1993-03-26

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[English\

Hon. Don Mazankowski (Deputy Prime Minister and Minister of Finance) moved: that Bill C-117, an act to provide borrowing authority for the fiscal year beginning on April 1,1993, be read the second time and referred to a legislative committee in the Economics envelope.
He said: Madam Speaker, I very much appreciate the opportunity to speak at second reading of Bill C-117, the 1993-94 borrowing authority act.
Bill C-117 gives the government the authority to carry out its regular borrowing program for the fiscal year 1993-94. Under normal circumstances the bill requesting this authority would be tabled at the time of the tabling of the federal budget, usually in February, and the fiscal framework in the budget serves as the basis for the new borrowing authority.
However this year circumstances are not the same as in the past, as I did present an economic statement to the House in December with an update of the 1993-94 financial situation. As I indicated earlier, I will be introducing a budget shortly after we return from our Easter break.
Given that fact, it is important to have the new borrowing authority bill before Parliament before the new fiscal year begins, otherwise we run the risk of the bill not being passed before the borrowing authority runs out.
The fiscal framework set out in the economic statement in December provides the basis for both the 1993-94 borrowing authority and the 1993-94 Main Estimates.
With the December statement and the Main Estimates Parliament has all the information it needs to deal with the borrowing bill. I will discuss the main contents of the bill shortly, but first of all I would like to comment on the government's general economic and fiscal situation.
Since coming to office the government has pursued a clearly defined strategy to bring federal finances under control, improve Canada's international competitiveness and strengthen the private sector as the main engine of growth and job creation.
Our economic priority is to build confidence, enhance growth, create jobs and help Canadians adjust to the current economic changes and take advantage of new opportunities.
All our efforts have been directed at investing in growth through sound monetary and fiscal policies, opening up new markets through trade liberalization, streamlining government, reducing government intervention, the privatization of Crown corporations, the building of skills of Canadians and the encouragement of the private sector as the main basis for economic progress.
Despite the severe impact of a world-wide recession these efforts are beginning to yield positive effects. Canada's economy grew last year at a rate of about 1 per cent, however fourth quarter growth showed a strong upward trend of 3.5 per cent at an annual rate, with exports being the driving force. However, domestic demand has remained hesitant.
On the other hand there are encouraging signs, particularly with the growing competitive strength based on low inflation, the lowest in 30 years; reduced interest rates, the lowest prime rate in 20 years; and some mortgage rates at 5.75 per cent, the lowest in 35 years along with enhanced national productivity. These all augur very well.

March 26, 1993
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This new Canadian strength is reflected in our export performance. Canadian businesses last year sold $157.5 billion in merchandise to foreign markets. That is an increase of almost 21 per cent since the Canada-U.S. Free Trade Agreement was put in place. It also represents an increase of 11 per cent over 1991, the largest year-over-year increase since 1984.
I should indicate as well there are some rather interesting statistics I feel must be put on the record.
For example, in dealing with exports to the United States, Ontario's exports to the United States have increased by 29 per cent, from $56.4 billion in 1988 to $72.6 billion in 1992. Quebec's exports have increased by 27 per cent, from $16.5 billion in 1988 to $21 billion in 1992.
To go to my own home province of Alberta, again there has been an increase in exports to the United States since the free trade agreement came into effect. Alberta's exports to the United States have surged since the free trade agreement was put in place by rising 52 per cent, from $9.1 billion in 1988 to $13.8 billion in 1992.
In British Columbia, exports to the U.S. have increased by almost 14 per cent, from $7.4 billion in 1988 to $8.4 billion in 1992. Saskatchewan's exports have increased 44 per cent, from $2 billion in 1988 to $2.8 billion in 1992. Manitoba's exports are up 30 per cent, from $1.7 billion in 1988 to $2.3 billion in 1992. Nova Scotia's exports to the U.S. have increased by 29 per cent, from $1.4 billion in 1988 to $1.8 billion in 1992.
These are very impressive increases.
To look at some other sectors, transportation, electrical and electronic and chemical industries accounted for most of the gains of over 70 per cent recorded by Canada and the U.S. since the free trade agreement came into effect. Other sectors such as the Canadian high-tech exports to the United States grew from $6.6 billion to $10.7 billion, a gain of 63 per cent. The office, telecommunications and precision equipment component of that grew by 74 per cent. The electronics component went from $893 million in 1988 to $2.9 billion in 1991, a gain of 225 per cent.
These figures do not include the dramatic gains in exports to the U.S. which we have seen in the first 11 months of 1992. We really have chalked up an impressive increase in our exports to the United States since the free trade agreement was put in place.
We hear so often across the way that the free trade agreement has caused the so-called deindustrialization of Ontario. This is what the Canadian Manufacturers' Association has to say about that:
When the president of the CMA, Mr. Stephen Van Houten, was asked in a CBC interview how the free trade agreement had helped or hindered its members, he replied: "Oh, it has helped considerably. In fact, exports of manufactured goods from Canada to the United States have gone up 60 per cent since the free trade agreement came into force. So those who blame the free trade agreement for all of our ills and job losses frankly do not know what they are talking about. Without that business we would be in real trouble". The interviewer asked this question: "And you are looking forward to NAFTA?" Van Houten replied: "Very much so indeed. Our members are behind it; they tell us so in a 10:1 ratio".
That was right from the president of the Canadian Manufacturers' Association. I happen to know as well that if he were asked what his opinion was of the GST, he would clearly say that without the GST there would not have been that kind of increase and that kind of penetration. The changing of the manufacturers' sales tax, the removal of the archaic, destructive manufacturers' sales tax has increased the competitive position of the Canadian manufacturing industry by something in the order of $3.5 billion to $4 billion.
Those are very impressive statistics. They clearly demonstrate that some of the policies we have been following are indeed working, making Canada more competitive, exporting more, generating more wealth, generating more jobs and improving the economic fortunes of all Canadians.
For the economy this year, these trends all support the view that we can meet the growth rate as forecast in the December economic statement of 2.5 per cent. As a matter of fact I am quite confident that can be exceeded.

March 26, 1993

The OECD, for example, in its forecast in mid-December predicted Canada's growth of 3.2 per cent this year and 4.2 per cent in 1994. Those are the levels that would lead the G-7 major economies.
I should say as well that Canada and the United States are clearly the leaders in terms of world growth. France is looking like its growth will be flat. The United Kingdom is still in a negative growth position, after seven or eight successive quarters of negative growth. Italy is going into a decline. Germany is expected to have negative growth. Japan is expected to have growth something in the order of 1.5 per cent to 2 per cent. Really, the promise is clearly focused on the North American situation and Canada is very much a part of it.
Still we notice that this means the over-all pace of growth will not be that encouraging, but it will be veiy competitive. It will require us to continue to improve our productivity and our competitiveness and to build upon the progress that has already been made.
Clearly an essential component of maintaining growth and economic progress, the single most critical issue that we face today in terms of determining our national potential for growth and job creation is to get a better handle on the deficit and the debt. I speak in terms of not only the federal deficit, but indeed the provincial deficits as well.
Since 1984-85 this government has taken firm action to improve Canada's fiscal framework and real progress has been made in reducing the deficit. As a matter of fact, I have said and I say so again, the deficit as a percentage of GDP has been reduced by almost 50 per cent, from about 8.7 per cent to 5.1 per cent. That is real progress and much of that progress was made notwithstanding the fact that we have been in the recession.
Much of this improvement results from the consistent spending restraint we have put in place. For example, from 1985-86 to 1992-93, the government has implemented a variety of restraint measures that have saved about $120 billion. About $120 billion have been shaved off the expenditure plans of the government. With these restraint measures in place, program spending growth averaged 4.1 per cent from 1984-85 to 1991-92 which is well under the rate of inflation.
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By comparison, in the years 1969-70 to 1984-85 program spending grew at an annual rate of 13.8 per cent. In that period of time, the national debt increased elevenfold from about $18.5 billion to $206 billion. There was an elevenfold increase in the national debt during that period of time. That is what happens when program expenditures grow at the rate of almost 14 per cent over a period of 15 years. That is what happens when $1.33 is spent for every dollar's worth of revenue taken in. It simply cannot be sustained and we stopped that and turned it around.
As a result of this spending restraint, this year the government again will run an operating surplus in total revenues, that is, total revenues minus program spending. We have run an operational surplus every year since 1987-88 and it has accumulated. It has amounted to some $33 billion of accumulated surpluses since 1987-88.
Bear in mind when we assumed office, the operational deficit in 1984-85 was $16 billion. When that is contrasted with the previous administration, since 1987-88 we have generated a cumulative operational surplus of $33 billion. Contrast that with the period prior to 1984-85 when the administration previously chalked up a cumulative operational deficit during that period of time. The 10-year period before 1984-85 chalked up an operational deficit of $66.3 billion. If we had continued to spend along the lines of the previous administration and followed the Liberal pattern, we would have had a deficit of $82.5 billion today. We took action. To reinforce that commitment to restraint we brought in legislation, the Spending Control Act, which sets out firm ceilings on federal program spending for the period 1991-92 to 1995-96. The tough restraint measures we have put in place have held spending limits under the Spending Control Act.
Notwithstanding these efforts, the weakness of the economy in 1992 had a major effect upon government revenues and put upward pressure on the deficit. Confronted by this economic sluggishness we took strong action in December to reduce spending levels by an additional $8 billion over the balance of this fiscal year and the two years to come.

March 26, 1993
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As hon. members know we took action to freeze the salaries of cabinet ministers, members of Parliament and those in the Public Service. I should point out that this is the sixth time since 1985 that cabinet ministers' and members' salaries have been cut or frozen.
We advanced a 5 per cent reduction in departmental operating budgets over the next two-year period. As for defence alone the combination of wage freezing and operating cuts will mean savings of $1.3 billion to the taxpayers of Canada.
We took targeted action on the unemployment insurance program. We cut 10 per cent in federal grants and contributions. We are prepared to take additional action as needed to ensure that our deficits as pledged in the December statement will hold true to form and to secure a firm, committed and credible track to get the government out of the pattern of public and international borrowing.
The December economic statement included a number of initiatives to bolster public and private investment and to encourage economic growth. As one will recall we announced support for small business, research and development and training and adjustment. I must say I am very pleased with the fact that the changes to the Small Businesses Loans Act, a very important piece of legislation, have been passed by the Senate and proclaimed into law. This will certainly help in a very tangible way our small business sector. I am very pleased to see that the banks, the Bank of Nova Scotia for example, announced they will be making loans under the provisions of the Small Businesses Loans Act at the prime rate of 6 per cent. I think this will be a real boon to the small business sector and provide additional stimulus to the small business sector for the creation of jobs.
We also undertook initiatives to improve the construction and resource sectors. We provided incentives for job creation through the UI premium holiday. We extended the successful home buyers plan that was introduced in last year's budget. We extended a number of improvements to encourage infrastructure and provide for some public expenditure to create jobs and to improve the competitiveness and productivity of our major industrial sectors. All of these measures will help the recovery and at the same time will ensure responsible action to reduce deficits.
We all know that all governments face similar fiscal pressures. I think it is important for all members and all people in Canada to recognize that deficits and growing debt are not just federal problems but are problems that are facing all administrations. For example provincial deficits have tripled over the last six years from $7.6 billion in 1987-88 to an estimated $23.4 billion this year. These deficits are being fuelled by spending increases that carry an onerous price. We only have to look at what happened when the federal government in the 1970s and early 1980s let program spending grow at a rate that eclipsed economic growth.
There is no way that the federal government could sustain program spending increases that averaged about 14 per cent a year for the 15 years prior to 1984-85. It created a debt and interest load that is punishing us today even though our government cut the average rate of program growth dramatically.
We all know that the current cost of servicing the debt is 32 cents out of every revenue dollar we take in. In other words for every revenue dollar that is taken in, 32 cents is lopped off the top to pay the interest on the cost of servicing the debt. Obviously that leaves that much less money to be spent on economic and social programs. If we do not deal with that and if we do not redress it then it will become progressively worse.
Likewise there is no way the provinces could sustain an average annual growth and program spending of 7.5 per cent. That is the level of spending their growth was increasing at. In some cases it was as high as 10 per cent. They are becoming trapped in the same vicious circle. We now see that provinces are running operational deficits as well. They obviously cannot sustain that.
However, in this regard we should all be encouraged that provinces are indeed taking action to contain spending. It is also encouraging to hear provinces indicating a renewed interest in working with each other and with the federal government to join in a national plan for restoring Canada's fiscal health.
We have been recommending this for some time. I certainly want to assure all members of the House and all the provinces that we will provide leadership action in dealing with this issue. We certainly have laid out a plan. We certainly would like to see a strategy outline with certain goals and objectives that can be achieved in a co-operative and co-ordinated fashion.
March 26, 1993

That puts this bill into context. I would now like to turn to the main elements of the bill. Bill C-117 contains three standard elements of previous borrowing bills. They are: first, the financial authority to cover financial requirements for 1993-94; second, the exchange fund account profits; and third, a contingency reserve.
The first element provides the government with the authority to cover its anticipated requirement for borrowing in order to meet the net financial requirements set out in the economic statement.
The second element of the bill provides for an amount of money to cover exchange fund account profits. These are the earnings which give rise to additional Canadian dollar borrowing requirements. Exchange fund account earnings are retained in the account and their main purpose is to provide the government with the capacity to intervene in foreign exchange markets.
The third element provides for a $3 billion non-lapsing reserve to cover contingencies. The reserve is there to cover unexpected contingencies such as foreign exchange and intervention requirements. This amount is the same as requested in borrowing authority bills over the last six years.
Bill C-117 is requesting $31.5 billion of regular borrowing authority for the 1993-94 fiscal year. This includes estimated financial requirements of $26.5 billion, projected exchange fund account earnings of $2 billion and a non-lapsing contingency reserve of $3 billion.
In line with the measure introduced in last year's legislation, Bill C-117 ensures that the 1993-94 borrowing authority may only be used after the 1993-94 fiscal year begins. This provision links the borrowing authority to the 1993-94 financial requirements even if Bill C-117 receives Royal Assent before the beginning of 1993-94.
The bill contains a standard clause stating that any unused borrowing authority granted by this bill over $3 billion will be cancelled on March 31, 1994. This clause allows the $3 billion non-lapsing contingency reserve to be carried forward into 1994-95 in case new borrowing authority is not in place by then.
There are also a couple of technical clauses that ensure the use of the borrowing authority matches the financial requirements for the year for which it was granted.
In addition, the bill provides for any unused borrowing authority for 1992-93 to be cancelled once Bill C-117
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comes into force. Prior to this bill coming into force, the $3 billion contingency from the previous year's authority can be used between March 31 and the date the new borrowing authority takes effect.
Furthermore any portion of the $3 billion contingency reserve carried forward from 1992-93 and used during 1993-94 will be deducted from the 1993-94 borrowing authority.
I know that hon. members recognize the importance of passing this bill before borrowing authority runs out early in the 1993-94 fiscal year. We have announced the borrowing program for the first fiscal quarter to provide information to our investors and orderly marketing conditions for the large debt program.
This borrowing authority is a normal part of the operations of the government so I ask my colleagues to consider it and give it expeditious passage.


Hon. Herb Gray (Windsor West):: Madam Speaker, only a month and a half ago the Minister of Finance through the parliamentary secretary asked this House to pass a bill authorizing the government to borrow a further $8.2 billion. This was supposedly to deal with the additional requirements of the government for the fiscal year beginning April 1, 1992.
Now, only a month and a half later, we see the Minister of Finance himself here again on behalf of the government asking for the authority to borrow $31.5 billion for the fiscal year beginning April 1, 1993. This is another request for substantial borrowing authority only a few weeks after a similar bill was presented to this House by the government.
I do not think the government has made a more convincing case for its financial record today any more than it did a month and a half ago when the earlier bill was presented by the parliamentary secretary.
The minister himself today has talked about the purposes of the government's financial policy. He talked about creating jobs and growth and helping Canadians to adjust. What has been the result of this government's policies? Since 1989 Canada has lost 325,000 manufacturing jobs. Unemployment has been at double-digit levels for two consecutive years and in spite of some slight improvement there are no prospects of this changing for the rest of this year and well into next year according to the government itself.

March 26, 1993
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More than 200,000 people and firms have gone bankrupt since 1990 and 40 per cent of service sector jobs pay wages below the poverty level. Adjusted for inflation, average family incomes are no higher today than they were in 1983.
This situation did not happen by accident. I think this Conservative government has made some very basic policy errors such as fighting inflation at all costs, supporting high real interest rates and a high Canadian dollar and, in spite of what the Minister of Finance has said-I will talk more about this in a few minutes-a free trade agreement without a subsidies code or adjustment programs that contributed to the decline in manufacturing jobs and the deterioration of our industrial base in this country.
The minister has been talking about the benefits of his policies, his Conservative government's policies. But there are some other disturbing numbers in addition to those I have just put on the record which help to confirm that these policies have hurt rather than helped Canadians and their families in the last several years as well as at present and with respect to their prospects for the future.
Yesterday in The Globe and Mail Robert Sheppard wrote a very interesting but troubling column in which he said:
By now, most Canadians are probably aware that once wealthy Ontario has finally overtaken New Brunswick-in a big jump last year-to become the province with the largest share of welfare recipients among its general population.
As of last June, 17 per cent of Ontarians under 60 were receiving some form of provincial or municipal welfare. This is nearly three times the prevailing level throughout most of the 1980s, and four times what it was in the decade before.
Imagine that. In the province of Ontario 17 per cent of the population under 60 is now receiving some form of provincial or municipal welfare. What an indictment of this Conservative government's policies.
Mr. Sheppard goes on to say:
Neither Ontario nor the country can afford to let their new bases be set at the 10 per cent national range, let alone Ontario's 17 per
cent, only to be augmented by the "jobless recovery" of the next few years.
We have to note that to the extent there is recovery in this country it is tragically a "jobless recovery". No matter how much Canadian workers increase their skills there are still not enough jobs to meet the needs of those already unemployed, much less those entering the labour market.
The Minister of Finance went on at some length about his government's tax policies. He did not make clear that since this Conservative government came into office taxes for ordinary Canadians have been increased some 36 times. Today in The Globe and Mail Jeffrey Simpson wrote that:
Among the world's seven leading industrialized countries, only in Italy did tax revenues rise faster as a share of the economy in the 1980s than in Canada. In 1991, tax revenues in Canada accounted for 39.4 per cent of gross domestic product, compared with 31.6 per cent in 1980.
In 1980, Canadian taxes as a percentage of GDP were 6.5 points below Germany's and 3.5 points below Britain's. By 1991, the Canadian percentage exceeded that of both Germany and Britain by 3 points. In the same period, the gap between the Canadian and U.S. rates soared to 10 percentage points from 2, a striking difference between the world's largest trading partners.
Mr. Simpson made one of the most important points of all with respect to how this Conservative government has increased the tax burden on ordinary Canadians when he said:
What's arresting in the figures, compiled from the Organization for Economic Co-operation and Development, is how fast Canadian taxes have jumped in recent years. The tax to GDP ratio increased by 4 percentage points from 1989 to 1991 whereas it remained steady in France and the United States and actually dropped in Germany and Great Britain.
I do not think I have to remind Canadians that the present Conservative government has been in office for almost nine years, that is, over most of the period we have been talking about and certainly during the period between 1989 and 1991 when the tax to GDP ratio increased by 4 percentage points in only some two years. This is another indictment of this Conservative government and its record and the way it has mishandled the finances of this country, in spite of the protestations today by the Minister of Finance.
March 26, 1993

The Minister of Finance talked about the very good record of this government in handling these finances. What does the record actually say? It says that the accumulated public debt is in the area of $450 billion, more than twice as much as it was when this Conservative government took office. Is that good management of the country's affairs? No matter what the Conservatives say, the record is clear. The public debt is more than double today what it was when this Conservative government took office.
The Minister of Finance talks about the deficit. He admitted in his December economic statement that the budget deficit for the fiscal year 1992-93 would be $34.4 billion, some $6.9 billion more than had been forecast only a few months earlier in his February 1992 budget. The deficit is really not much different than when his government took office. As I said in this House in the borrowing bill debate only a month and a half ago, this government has put the Canadian economy and the Canadian people through a very high degree of pain for no real gain.
Another measure of this government's mishandling of the financial affairs of this country is the ratio of debt to our gross domestic product. When this government took office the ratio of debt to Gross Domestic Product was only 42 per cent. It is now in the area of about 65 per cent. That is a tremendous increase in the period since this Conservative government took office. It is a real deterioration from what it was when this government took office claiming that it had the answer when it came to our debt and deficit problems. Yes, it had the answer. That answer was to make things worse.
In the minister's speech today he talked about what the borrowing requirements would be used for, but he did not make clear that since this Conservative government has been in office its debt, which was once held almost entirely by Canadians, is now to an increasing and troubling extent held by borrowers outside this country. More than 20 per cent is held by borrowers outside this country, making us vulnerable to pressures that did not exist before this Conservative government took office.
These are the realities of our debt and deficit situation which the Minister of Finance conveniently ignored in his speech a few minutes ago. I can understand why he
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ignored these figures. I can understand why he ignored these realities. It is because they paint a very different picture, a more realistic and accurate picture about this government's handling of this country's financial affairs than anything he said in his speech. We can understand why he would prefer to sweep these facts under the rug and try to pretend they do not exist. They do exist and they cannot be forgotten and they will not be forgotten by Canadians when they pass judgment on this government in the next election.
The minister went on to speak about improvements in exports which we welcome. He talked about linking this improvement with the free trade deal. What he did not mention was that 80 per cent of the exports of this country to the United States were duty-free before the free trade deal went into existence. They were already duty-free, 80 per cent of them. How can he say with a straight face that this improvement in exports was in fact linked with the existence of the free trade deal with the United States? Common sense would say that simply does not hold up if the reality is that 80 per cent of our exports to that country went there duty-free before the free trade deal was in existence.
He did not talk about how our exports improved because the dollar went down after this government for months and years supported a high dollar policy which undermined our export sector, whether we are talking about exports of resources or exports of manufactured goods. He did not talk about how our exports were helped finally by lower interest rates although they are still quite high in real terms compared to the interest rates in the United States. So there are other factors there which can account for the improvement in our exports.
Thank goodness for an improvement in our exports because according to the government's own statistical agency, Statistics Canada, if it was not for this improvement, even the weak and slow and vacillating growth we have seen would not be there because we have in this country a very weak domestic demand according to Statistics Canada in its publication the Canadian Economic Observer. That is important because domestic demand accounts for 60 per cent of the activity in our economy.

March 26, 1993
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According to Statistics Canada if there is to be continued growth in the economy it will have to depend on a further pick-up in exports rather than an improvement in domestic demand. Statistics Canada in its current publication of the Canadian Economic Observer made clear that Canadian job growth slowed in January and February and household demands for cars and housing remained sluggish. Here I am making use of a summary of this publication in a story from Dow Jones in today's Financial Post: "Statistics Canada said that the reasons for the slump in household demand are unclear because they occurred at a time of rising unemployment and falling interest rates".
It seems pretty clear to me. I suggest that it seems pretty clear to most Canadians that household demand would not be very strong and consumers would not have much confidence about whether they should spend their money if unemployment was rising. They would not have that confidence if unemployment remains high and shows little prospect of change because of the policies of this Conservative government over the next year and the year afterward.
Yes, Statistics Canada, the government's own statistical agency, confirmed a weakness in household demand. That means the intention of individual consumers, individual families, working people, working men and women and small business people to buy. Statistics Canada confirmed weak consumer confidence and little prospect of change. The public is passing judgment through that lack of confidence and through that lack of household demand in this Conservative government's policies. That judgment is that the government has been a failure and has caused destruction and damage to the lives of hundreds of thousands of Canadians.
Just a few months ago, looking at the policies of this Conservative government, our distinguished Whip said to me: "If the medicine is so good then why is the patient still so sick?" That I thought was a statement of essential truth. If the Conservative medicine is so good then why is the patient still so sick? The fact is that the patient is still so sick because the Conservative medicine has not been good. It has made the patient sick. It has created the sickness rather than curing that sickness when it comes to the health of the Canadian economy.
This is confirmed by what Statistics Canada says about our unemployment figures. We know that fortunately they improved slightly in the past month but they are still well above double-digit levels at 10.8 per cent.
Statistics Canada said the main reason it improved was not because there have been a substantial number of new jobs but because a large number of Canadians gave up. They lost hope. They left the labour force. The total size of the labour force dropped.
If that were not the case we would not have seen any improvement in the unemployment figures at all. They are still shamefully high across this country, in my own city of Windsor and in many cities like it in every part of Canada.
The Minister of Finance has talked about how well his policies have been working as a way of justifying the continued request for borrowing by his government.
As I have said before, as with a business in the private sector, the government's revenues do not come in at the same time as its required needs for expenditures and borrowing. In using this debate on the government's borrowing bill as a way of putting on the record and justifying this government's economic policies, the Minister of Finance, while certainly a good debater and a good speaker, really has not made a convincing case at all as to why these policies deserve to be further supported by the Canadian people.
What is missing in the government's talk about its economic policies now and in the future is any commitment to economic growth. There is no real commitment as a priority to helping the economy grow, as part of the answer to its problems whether they are problems of unemployment, the yearly deficit or the accumulated public debt.
Yes, we need to have a sound basis of fiscal management. Yes, we need to have control of government expenditures. At the same time if government revenues are weak-the minister admitted that today-then they are weak because of the lack of economic growth. Without policies of government aimed at encouraging economic growth we are not going to get a handle on problems of the debt and the deficit. We are certainly not going to get a handle on the problem of high and chronic unemployment.
March 26, 1993

What we need is something that this government has not only refused to make a commitment to, in fact it has gone in the opposite direction. It is a commitment to economic growth as a priority of government policy for the purpose of dealing with the problems of the debt and the deficit. It is equally important for the need to deal with the lack of jobs for Canadians and all that means in terms of their hopes and confidence for the future.
This is an essential difference between the Conservatives and the Liberals. This is an essential difference between the government and my party because we are committed to operating in a framework of fiscal responsibility, but we want to use it for the purpose of growing the economy to provide better lives for Canadians now and in the future.
As I said earlier, Canadians, especially in the coming months, have to ask themselves: "If the Conservative medicine has been so good then why is the patient still so sick?" I know their common sense and good judgment will tell them that the Conservative medicine has been wrong for Canada because no matter what changes may come in the leadership of the Conservative Party, nothing else will have changed. The content of the package is the same bad medicine that brings sickness rather than health. It brings sickness in an economic and social sense rather than hope and confidence.
Therefore I say this minister has not made a case for the economic policies of his government and they must be rejected along with his government. I am confident that will happen in the next election. It will soon be replaced by a new, effective Liberal government working now and in the future in the interests of all Canadians.


Madam Deputy Speaker:: Would I be wrong to assume that the hon. member for Essex-Windsor would rather wait until after Question Period to start instead of starting now for one minute? Let us call it eleven o'clock a.m. and proceed with statements by members pursuant to Standing Order 31.


STATEMENTS PURSUANT TO S. O. 31
Mr. Jean-Robert Gauthier (Ottawa-Vanier):: Madam Speaker, one-third of all the taxes the city of Ottawa received last year came from the Government of Canada.
In their December economic statement the Tories announced that they were freezing these grants in lieu of taxes at 1992 levels. In effect, the Conservative government has unilaterally reduced its own taxes and imposed upon the rest of taxpayers in Ottawa a 5 per cent increase. The Ottawa city council estimates the freeze will cost it about $4.5 million dollars in 1993. Without this money other taxpayers will have to pick up the tab.
This unacceptable decision goes against years of cooperation between municipalities and the federal government. Yesterday we heard that the government might, and I underline might, be able to pay some of the increase it owes municipalities by renegotiating the base.
I urge the government to act like a responsible taxpayer as the rest of us do and-


Madam Deputy Speaker:: I am sorry, but the hon. member's time has expired.


CANADA CUSTOMS
Mr. Ken James (Sarnia-Lambton):: Madam Speaker, I rise today in support of reports that Canada Customs is planning to institute a new business relationship initiative, or NBR. I applaud the effort to streamline procedures and reduce costs.
I also hope that NBR will bring a new and more practical approach to customs operations at the border. The so-called no hassle policy seems to have suffered a quick and easy death in my riding of Sarnia-Lambton.

March 26, 1993
A number of our small businesses have been banging on my door to complain that customs seems to take some pleasure in making it more difficult and more costly for them to do business.
This comes at a time when our government is trying to rekindle, support and enhance a small business community that is the life-blood of our economy.
I hope that the department's new business relationship initiative can be revisited. I can assure Revenue Canada of my full co-operation and a little to boot if it stops putting the boots to small business.


TRANSFER PAYMENTS
Mr. A. H. Harry Brightwell (Perth-Wellington-Waterloo):: Madam Speaker, in recent months various letters to the editor and comments from Premier Rae of Ontario and other provincial authorities have all suggested that the federal government has drastically cut transfers to the provinces.
The term drastically cut is very wrong as there have been no cuts, so I wish to place the facts on the table. Since 1984 transfers from the federal government to the provinces have increased at an average of 5.4 per cent, and the average growth of Ontario transfers since 1984 has been 6.2 per cent.
Very rapid growth in transfers occurred in the Canada Assistance Plan area, which includes contributions to social measures such as welfare and community benefits. During Ontario's boom time, Ontario's social needs grew at an average rate of 20 per cent per year. One wonders what policies caused social costs to increase 20 per cent during a boom period.
Of course, during the same period Ontario's spending more than doubled, increasing from $22.5 billion to a budgeted expenditure of $50.9 billion for 1993. Transfer payments to Ontario grew with no restraint from 1984 until 1990 at an average rate of nearly 12 per cent per year-


Madam Deputy Speaker:: I am sorry, but the hon. member's time has expired.


SAINT-LAURENT
Mrs. Shirley Maheu (Saint-Laurent-Cartierville):: Madam Speaker, Saint-Laurent is celebrating its hundredth anniversary this year. Starting September 26, the centennial committee will offer a souvenir pocket calendar to residents, businesses and industries and sell a passport for the festivities.
In its 100 years the city of Saint-Laurent has become one of the most beautiful in the province and its second-largest industrial city. We have become a culturally rich city, with local theatre, painting and music.
This year the city of Saint-Laurent invites everyone to come and discover us. I wish all the citizens of Saint-Laurent a happy centenary.
The people of St-Laurent have a great deal to celebrate in this our centennial year. I invite everyone to come and discover what I have known about St-Laurent for many years. It is a great place to live and do business. Happy Birthday, St-Laurent.


CREDIT CARD INTEREST RATES
Mr. Walter Van  De Walle@St. Albert: Madam Speaker, while the announcement by the banks of Canada that they will cut their credit card rates by a single percentage point to 15.75 per cent is encouraging, the total dollar value of credit purchases in Canada continues to rise from one year to another, this in a time of restraint.
As a result of the fact that only 50 per cent of Canadian credit card holders pay off their balances each month the accumulated outstanding debt is almost $11 billion and rising.
This is an unacceptable situation. Surely when the prime lending rate rests at 6 per cent the credit card industry should not be patting itself on the back for lowering its rate. There is still a spread of nearly 10 per cent above prime.
It is still ripping off the Canadian public with these excessive rates. I call upon the Department of Consumer and Corporate Affairs to investigate these high credit card interest rates and start protecting the Canadian public from the credit sharks.
March 26, 1993


NORTH AMERICAN FREE TRADE AGREEMENT
Mr. Ray Funk (Prince Albert-Churchill River):: Madam Speaker, the total arrogance and contempt for democracy of this government is on display again.
By limiting debate on the substance of North American free trade to only two days the Conservative government is denying the people of northern Canada, and all Canadians, their fundamental right to have their concerns debated in this Parliament.
Northerners want to know how NAFTA will affect them on issues like telecommunications, water exports and local benefits from their resources.
Eighty per cent of my constituents do not have telephones, so who is going to pay to have them installed when U.S. companies cream off all the profit in the telecommunications industry? Water is the life-blood of northern Canada. Yet this agreement leaves our waters as unprotected as a baby in a snowstorm.
NAFTA also restricts the ability of governments to guarantee local benefits from resource development like employment, secondary processing, revenue sharing and preference for local northern business.
NAFTA is bad news for northern Canada and this government will pay a high price for muzzling this debate.


ENTREPRENEURSHIP
Mr. Yvon Cote (Richmond-Wolfe):: Madam Speaker, I am extremely pleased to tell you about a wonderful initiative of a labour union in my lovely riding of Richmond-Wolfe, in Asbestos to be precise, where the workers have decided to invest $5 million in their own company. This initiative was taken by a union which has set up an investment co-operative.
We can already imagine the fantastic advantages that can flow from such entrepreneurial co-operation. For example, think of the better labour relations between management and the unions, who were usually at odds and now will be co-investors. Also think of the pride and
feeling of belonging in the company, where both partners, traditionally on opposite sides, will now work together to produce a better product thanks to the improved relations and identification with the company. Of course we can also mention the effect of all this on the region's economy. What an example they set!
I would like to point out this important contribution from a union and I congratulate my fellow citizens on their investment.


Madam Deputy Speaker:: The hon. member's time has expired.


INTERPROVINCIAL TRADE
Mrs. Marlene Catterall (Ottawa West):: Madam Speaker, last week when the Minister for International Trade met with provincial ministers one of the items on the agenda was the removal of interprovincial trade barriers. Yet right here in the nation's capital there exists one of the most blatant examples of an interprovincial trade barrier, and it is stifling economic development in this region.
The municipalities on both sides of the river have taken this in hand. They have already agreed not to discriminate in hiring on the basis of place of residence and are taking further measures to eliminate trade barriers with respect to the construction industry. However they need the co-operation of the federal government and both provincial governments to achieve a level playing-field.
I urge the Minister of Finance, if he really wants to remove barriers, to make sure that work on the construction of the new archives in Gatineau is equally available to workers on both sides of the river.


PUBLIC WORKS
Mr. Bill Casey (Cumberland-Colchester):: Madam Speaker, supporters of the fixed link are again asking the federal government to comply with the court decision calling for a section 12 determination and proceed with the project.

March 26, 1993
Supporters not only include business groups but a cross-section of people and organizations such as the labourers union, the federation of agriculture, the carpenters union, and the federation of labour, as well as the Chambers of Commerce of Charlottetown, Summer-side and Kensington, the road builders association, the tourism association, the manufacturers association, the construction association, the hotel association, the convention bureau, the restaurant association, the engineers association, the real estate association and on and on.
It is clear that the majority of people on Prince Edward Island want and need the fixed link. I urge the government to forge ahead, meet the conditions of the court decision and proceed with construction.


HUMAN RIGHTS
Mr. Stan J. Hovdebo (Saskatoon-Humboldt):: Madam Speaker, Canada can make a difference in the progress of human rights throughout the world. Canada should be taking the lead in ensuring that the World Conference on Human Rights in Vienna this summer is a success. That success can be measured in terms of new concrete action to strengthen the accountability of member states for their commitment to human rights and by expanding United Nations mechanisms which would work to protect women, indigenous peoples, refugees, disabled persons, democracy activists and development workers.
It has been too easy in the past to deny the universality of the human rights charter on the basis of cultural and economic differences. Canada would do well to include a broad cross-section of Canadians, including representatives of non-government human rights organizations, in its delegation to Vienna.
These NGOs have a deep sense of the need for progress in global human rights. Canada can use that kind of wisdom at the table.


THE DEFICIT
Mr. David Berger (Saint-Henri-Westmount):: Madam Speaker, recently the Minister for National Defence, who is a leadership candidate for her party, said that not only would she cut the federal deficit but she would
balance the books by the end of a first term. The Minister of the Environment weighed in by saying that he would cut the deficit without raising taxes or cutting social programs.
Canadians should be a teeny bit sceptical about the simplistic Tory approach to deficit cutting. The Conservative record speaks for itself. In his first budget the then Minister of Finance, the current Minister for International Trade, said he would reduce the deficit to $18 billion by the end of the decade. Yet in 1990 the deficit was $30.5 billion. He missed the mark by the small sum of $12.5 billion. Of course, the deficit has increased since then.
The Minister of National Defence should not assume that Canadians cannot add. One does not cut the deficit by spending $5.8 billion on attack helicopters.
If Canadians want a realistic approach to deficit reduction they would be well advised to vote Liberal.


OIL AND GAS INDUSTRY
Mr. Brian O'Kurley (Elk Island):: Madam Speaker, during the past six months western Canadian oil and gas exploration and development activities have been showing signs of improvement. There have been increases in land sales, in the number of well licences issued, and in the level of drilling activity.
There are a number of reasons for these increases, including the industry's cost reduction initiatives, technology improvements, higher natural gas prices, the governments' efforts to provide a market-oriented environment and a stable, non-discriminatory framework for private sector decision making.
An example of this co-operative approach is the recent announcement made in Devon to support the development of Alberta's oil sands and the heavy oil resources of Alberta and Saskatchewan.
The Canadian industry is benefiting from federal government initiatives such as the flow-through share provisions, the elimination of the restrictions on foreign ownership and the Alberta government royalty change. These initiatives contribute to western Canada's economic growth and job creation and will result in spin-offs for the Canadian manufacturing and service industries.

March 26, 1993


SEXUAL ABUSE
Ms. Joy Langan (Mission -Coquitlam):: Madam Speaker, members of the government from the Prime Minister on down have made much of their policy of zero tolerance for sexual abuse and sexual assault. Far too often, however, their words do not match their actions.
In an article in today's Ottawa Citizen Transport Canada is reported to be considering granting one year's leave so that a convicted child molester can serve his sentence and then return to his job. What kind of zero tolerance message is that?
Zero tolerance means that those convicted of violence against women, no matter if the woman is 13 or 30, must not be allowed to take advantage of work place policies such as leave of absence. That a convicted abuser could see his job held open for him is unacceptable. What is needed from this government is action, not more pious rhetoric.


EMPLOYMENT
Mr. Bob Corbett (Fundy-Royal):: Madam Speaker, in 1988 the government approved an expenditure of up to $40 million of Canadian Jobs Strategy funds for youth strategy pilot projects in New Brunswick and Newfoundland, where youth unemployment is the highest.
This morning in Fredericton the Minister of Employment and Immigration and the New Brunswick minister of advanced education and labour jointly announced a one-year $25.45 million extension to the Canada-New Brunswick youth strategy. To date, this strategy has assisted over 17,700 young people in New Brunswick.
I was pleased to learn that this program has been extended for another year. The federal government will provide $16 million, with the province contributing $9.45 million.
The purpose of the strategy is to help at-risk youth integrate into the labour market. It is important that we give young people the opportunity to acquire the education, training and experience needed to find their own place in today's competitive work place.
This Tory government has again put its money where its mouth is.


TAXATION
Mr. Eugene Bellemare (Carleton-Gloucester):: Madam Speaker, following this week's meeting between the Minister of Public Works and representatives from the Federation of Canadian Municipalities regarding payments of grants in lieu of taxes, the government should accept two important principles. First, the federal government should pay its fair share of municipal taxes as established for its properties.
Second, the government should accept all of the municipalities' reassessment levels for all properties, be they residential, business or government. In doing so the government will not prove to be a burden on other municipal taxpayers.
One of the mayors, Claudette Cain of the city of Gloucester in my riding, pointed out to the minister that her municipality stands to lose nearly $2 million in revenues from federal properties, creating an unfair burden on other taxpayers.
The Conservative government should accept fair market value assessment and pay its fair share of taxes on its properties.


NEW DEMOCRATIC PARTY
Mr. Howard Crosby (Halifax West):: Madam Speaker, there are hard times ahead for the New Democratic Party and their friends in the trade union movement. Where are Bob White and Daryl Bean when you need them?
What is happening? Bob Rae is going to roll back Public Service wages. He is not talking about Maurice Strong and $250,000. He is talking about hospital workers, domestics and the like.
Whatever happened to that great socialist philosophy? Where are those people who paraded against central wage freezes? Let us hear them holler: "No rollbacks for Ontario workers".

Oral Questions



ORAL QUESTION PERIOD

[Stage Direction]
March 26, 1993

Hon. Lloyd Axworthy (Winnipeg South Centre):: Madam Speaker, in the absence of the minister of trade I will put my question to the Deputy Prime Minister.
The government has a major dilemma on its hands. Today the Mexican ambassador to Canada has said that Mexico will not accept any side deal that imposes environmental or labour standards upon Mexico.
At the same time, the trade representative in the United States says on the other hand there will be no NAFTA unless there are safeguards on the environment and on labour standards. These are two totally opposite, contradictory positions.
I want to ask this question: Where does the Government of Canada stand? Is it on the Mexican side or the American side? Does it have any position at all? Why does it not stop the legislation until it resolves this dilemma?


Hon. Tom Hockin (Minister for Science and Minister of State (Small Businesses and Tourism)):: Madam Speaker, the hon. member asks where Canada stands on this. Canada stands on the side of sovereignty. We stand on the side of commissions that work and commissions that reach co-operation among the three sides.
What the ambassador said was really quite reasonable. Both ambassadors are essentially saying the same thing. The Mexican ambassador is saying that they do not want commissions that violate sovereignty. The American ambassador agrees with that and so do we.
What we would like to see is progress on the environmental side and progress on the labour standard side without violating sovereignty.


Lloyd Axworthy: Madam Speaker, I can understand why this minister decided not to run for the leadership. That was the most foolish answer I have heard in the House of Commons in the last 14 years. He says that on the one hand we have a commission, but on the other hand the commission will do absolutely nothing. You either have a commission that has safeguards which the Americans want or you
have a commission with no teeth which is what the Mexicans want.
Where does Canada stand? When is this minister going to smarten up and give Canadians the right and honest answer?


Thomas Hockin: Madam Speaker, every year I have been in the House, my hon. friend, stands up and expresses great concern for Canadian sovereignty. This is what he does all the time. Now he is calling for a commission to be established which would not protect Canadian sovereignty.


An hon. member:: It would violate it.


Thomas Hockin: It would violate Canadian sovereignty. What we believe in is to find a way, which we have done in many, many other international contexts. The hon. member is very well informed on international contexts. You can have commissions, you can have supemational bodies that do not violate sovereignty and that is what we are after. We are after co-operation and we are after progress.


Lloyd Axworthy: Madam Speaker, this answer comes from a representative of the government that has had a fundamental policy of giving up Canadian sovereignty day in and day out for the last eight and a half years.
I want to ask the minister again, what is the Canadian position? Are we asking for a commission that will have the ability to enforce some real safeguards on the environment and labour so Canadian industry will not run out of this country and seek an arena where it does not have to live up to basic fundamental laws, or are we going to side with the Americans and say we need decent safeguards?
I ask the minister, for goodness sake, for the sake of some basics fundamentals of parliamentary democracy will the government stop this legislation, hold it up until this fundamental impasse can be resolved?


Thomas Hockin: Madam Speaker, the hon. member is trying to create an image of fundamental impasse. In fact there is no fundamental impasse. What we have is all three countries with their own laws on these subjects, environmental protection, labour codes, and so on.
March 26, 1993

We are trying to encourage all countries when they trade with each other in the new NAFTA-I am glad the hon. member likes the over-all content of the NAFTA; that is an impressive step forward from his point of view-to move forward together without violating sovereignty.


Mr. Jim Peterson (Willowdale):: Madam Speaker, over the past few years we have seen an unprecedented level of U.S. trade harassment of Canadian producers; automobiles, steel, pork, softwood, magnesium, and the list goes on.
This is poisoning the investment climate in Canada. The problem is this. The United States is not going to sign a new trade deal without having side agreements on the environment and labour standards. Why will Canada not stand up for its workers and industries and insist on a side agreement dealing with the definition of subsidies?


Thomas Hockin: Madam Speaker, my hon. friend expresses concern in the premise to his question about investment in Canada and about trade disputes.
First of all investment in Canada is running at a record pace. In 1988 with a $2.5 billion deficit in investment in Canada more Canadians were investing outside Canada than people were here. We had a surplus at the end of 1991 of over $4.3 billion, a tremendous turnaround in investment, a $7 billion turnaround.
When it comes to harassment all we read in the newspapers is the tip of the iceberg, only when we have disputes with the United States. Before we had dispute settlement mechanisms with the United States we were left to the whim of the U.S. protectionist operations in Washington. We would spend millions of dollars and get nowhere. Now we have binational panels that settle within 315 days and we have won more often than we have lost.


James Scott (Jim) Peterson: Madam Speaker, the facts are very clear. Over the last four years Canada has lost 16 per cent of its manufacturing jobs. The United States has lost only 6 per cent of its manufacturing jobs. Where are our jobs going?
Oral Questions
If this minister thinks his dispute settlement mechanisms are working so well why did Robert Milboume, the president and chief executive officer of Stelco, just say that Canada's steel industry is toast unless this government can end U.S. trade harassment of our steel industry.
Why will this government not use its power to sit down with the Americans and Mexicans and insist on a side deal that will end the trade harassment of Canada's steel industry?


Thomas Hockin: Madam Speaker, the facts are these on the steel side. Both countries have had tremendous decreases in steel production, Canada as well as the United States. Canada's share of the U.S. market since the trade agreement has grown.
Even with that we have argued we would like to see if we could have a separate binational agreement on steel.
I would like to thank my hon. friend for asking this question because the Minister for International Trade will be meeting with the U.S. trade representative, Mickey Kantor, on April 1 and the steel issue will be raised at that meeting because we are working to obtain a steel pact with the United States.


Mr. David Barrett (Esquimalt-Juan de Fuca):: Madam Speaker, coincidentally my question is on the same line of questioning vis-a-vis the United States and subsidies disputes. The United States has just confirmed it is allocating $1 billion this year to its export enhancement program that permits the government of the United States to pay subsidies to grain sales offshore by the United States. Not once has the Canadian government raised this and demanded a panel under the much vaunted FTA.
I ask the minister concerned: When will this government which boasts about this trade turnaround stand up and demand that the Americans stop their program of export enhancement, unfair competition and offshore sales of wheat and other grain products here from Canada?

March 26, 1993
Oral Questions


Thomas Hockin: Madam Speaker, the hon. member knows because he is informed on trade matters that disciplines in agriculture have not been put in place appropriately under GATT. We have made some progress under the FTA but nobody believes that total discipline is in place on all ranges of agriculture, especially grain export subsidization.
What he is now saying, which is really news, is he wants us to use the dispute settlement mechanism panels for this. Now he likes the free trade agreement and likes the dispute settlement mechanism panels.


David Barrett: Madam Speaker, as the hon. minister knows he is mixing oranges with wheat, not apples.
The minister wants to retreat to GATT when he tries to defend the fact that there are no teeth in the agreement between Canada and the United States known as the FTA to protect the farmers from massive American subsidies. There is no protection there whatsoever.
I want to address the minister directly. He knows that under NAFTA they will be dismantling the minimal protection this government boasts about provided to the farmers under section 701(4) of the free trade agreement. As a matter of fact it will weaken what they boast about, those so much vaunted panels.
Why is this government not standing up for Canadian farmers? Why is it accepting a weakened article 701 in NAFTA and not saying a word in defence of those grain farmers in the Canadian west?


Thomas Hockin: Madam Speaker, I have to ask my hon. friend, why are our exports in the wheat area up 30 per cent to the United States? I have to ask my hon. friend, has he read the results of the durum wheat panel that was dealt with by a binational panel with the United States? Is my hon. friend aware of what this government has done for agriculture in the last eight years, billions and billions of dollars a year?


Mr. Steven W. Langdon (Essex-Windsor):: Madam Speaker, my supplementary question to the minister
deals with another area of agriculture production, the asparagus industry in Ontario which has been almost destroyed by free trade according to this letter it wrote to the Minister of Agriculture just this month. In fact the chairman of the industry also told me today that he cannot see why we are pressing ahead with NAFTA when the problems like theirs with free trade have been ignored.
Will this government meet urgently with the asparagus industry to work out solid answers to these farmers' problems, especially since asparagus has been one of the substitute crops for tobacco which is considered to be such a dangerous crop to produce in this country? Help the asparagus farmers in southern Ontario. They come from your district.


Mr. Murray Cardiff (Parliamentary Secretary to Minister of Agriculture):: Madam Speaker, to the hon. member, the federal government has always worked with producers of all of the various commodities and special crops such as asparagus. We will continue to do that and consultation will take place with the producers of asparagus and other crops, as I have said before.
Everybody seems to think that the North American free trade agreement is the answer to everything. A GATT agreement is very important as well. One piece of legislation cannot deal with all problems.


Some hon. members:: Oh, oh.


Murray Cardiff: We have been very successful with many of our trade disputes with the United States through the panel. We solved the pork issue. We have won most of the assessments that have been put against us. I think we should take credit for that and be very proud of all the negotiations that have taken place and how this government has responded to the needs of farmers.


HELICOPTER PROGRAM
Hon. William Rompkey (Labrador):: My question, Madam Speaker, is for the Minister of Finance. Circumstances have changed dramatically in the world, both in terms of finances and in terms of security since the decision was taken to purchase the EH-101 helicopter.
March 26, 1993

In view of the dramatic change in circumstances, is the Minister of Finance now personally committed to the continuation of that decision? Is he now personally committed to the purchase of the EH-101 helicopter?


Donald Frank Mazankowski: Yes, Madam Speaker.


Bill Rompkey: Madam Speaker, I want to ask the minister a question in view of that answer and in view of the fact that he wants to send a signal to the world that Canada's finances are sound and that international investments are secure. In view of the ballooning federal deficit, how does he justify the signal that is sent to the international community by the purchase of EH-101 helicopters at a cost of $5.8 billion?


Donald Frank Mazankowski: Madam Speaker, first, the cost is $4.4 billion over 13 years or 14 years. We want to send a signal to the world that we are prepared to patrol our coastal waters, to enforce the laws of Canada, to protect our sovereignty, to engage in effective search and rescue, and to engage in peacekeeping missions.
Yes, there is a price we have to pay to be a part of it. We have to pay to defend our own security. If we are to have an armed forces of capable and reliable men and women we need capable and reliable equipment for these men and women to use.


Mr. Fred J. Mifflin (Bonavista-THnity-Conception):: Madam Speaker, my question is for the Deputy Prime Minister.
Yesterday the Minister of National Defence said there were ways of cutting defence expenditures other than cancelling the EH-101 helicopter program. Would the minister share with the House where these cuts will be made?


Donald Frank Mazankowski: Madam Speaker, I certainly will when I bring down my budget. I obviously will not get any advice from the members opposite.
They want to put our men and women out servicing Canada's needs in 35-year old helicopters. I think that is a disgrace, particularly coming from that hon. member. He should know better. I am sure we will not see him driving around in a 35-year old automobile.


Fred J. Mifflin: Madam Speaker, my supplementary question is for the
Oral Questions
same minister who talks about advice. If we are going to talk about advice I think we should be balanced on it.
As early as three years ago the same committee that the government quotes in support of the EH-101 program had problems specifically with that program. I am going to quote from the same area that the government uses in support: "The committee views with concern the delays in the new shipboard aircraft project caused by technical problems during the development phase in Europe and difficulties in assembling the consortium".
These problems still exist; in fact they have been exacerbated. In view of that does the minister still consider that government priorities are in this area?


Mr. Harvie Andre (Minister of State and Leader of the Government in the House of Commons):: Madam Speaker, as the hon. member pointed out the committee was concerned, as was the government, in bringing it together but as he knows the consortium did come together and we agree with the unanimous recommendation of that committee to proceed with the EH-101.
I thought the hon. member would take some comfort from the fact that the Dutch have just announced they are looking at the EH-101 for their frigates.


Mr. Lyle Dean MacWilliam (Okanagan-Shuswap):: Madam Speaker, on March 12 the minister for privatization and Tory rhetoric in reply to my question on water exports and free trade confirmed that article 401 of the North American free trade agreement applied to water. I could not believe my ears.
I had to go back and read Hansard, and this is what it said: "In this section water means natural surface water and ground water and liquid in gaseous and solid state".
I would like to ask whoever is going to answer for the minister whether the minister would agree that the inclusion of water under article 401 as a good or a commodity of trade, as was confirmed by the minister for privatization, places the export of Canada's fresh waters under the remaining provisions of the North American free trade agreement, and the FTA for that matter, even though water may not be explicitly mentioned in these other provisions?

March 26, 1993
Oral Questions


Hon. Bill McKnight (Minister of Energy, Mines and Resources):: Madam Speaker, I believe the hon. member is mistaken in quoting what a colleague on this side had said. I will be very slow and very cautious so that he cannot do that again.
Water in its natural state is not a product or a good capable of being traded. Any more than the trees in the ground or the oil in the sub-surface, water in its natural state is not covered under international trade agreements such as NAFTA. It cannot be covered under international trade agreements because it is not a good and cannot therefore be traded.


Lyle Dean MacWilliam: Madam Speaker, the minister has just refuted his colleague's comments of March 12.
This government continues to hide behind the argument that Canada's water policy and the implementing legislation for free trade in fact excludes water. That is what this minister is referring to.
This government knows full well, first, that the water policy is a paper tiger and, second, that international agreements such as the FTA and NAFTA supersede domestic legislation.
I want to ask this government: When are you guys going to come clean and stop lying to the Canadian people?


William Hunter (Bill) McKnight: Madam Speaker, the hon. member uses words that would not be accepted in most cases but I understand why. It is because his argument is so weak. Water is not a good. Water cannot be traded and just article 7 would maybe give the member some comfort. It says: "For greater certainty nothing in this act or agreement, except article 302 of this agreement, applies to water".


Some hon. members:: Oh, oh.


William Hunter (Bill) McKnight: Let my tell the hon. member what article 302 is.


Lyle Dean MacWilliam: You said article 401.


William Hunter (Bill) McKnight: Let the record show that I said 302. Now the member knows that water in that article is
bottled water. In my riding and in my province the member for Yorkton-Melville supports the export of bottled water because there is an active, very viable commercial opportunity throughout Canada in bottled water sales.


Lyle Dean MacWilliam: You are lying.


William Hunter (Bill) McKnight: Madam Speaker, privilege. The hon. member said that I was lying. That is not acceptable language.


Some hon. members:: Withdraw.


Harvie Andre: Nystrom, get him to withdraw.


Mr. Benjamin:: After Question Period.


Madam Deputy Speaker:: Such accusations have no place in the House of Commons.


Some hon. members:: Hear, hear.


Madam Deputy Speaker:: I would like the hon. member to withdraw now, please.


Lyle Dean MacWilliam: Madam Speaker, the comment I just made in reference to this government will be withdrawn.


Jean-Robert Gauthier: Just withdraw it.


Lyle Dean MacWilliam: I understand that this government, in fact most members of this government, may not have read those very provisions. If one is not-


Madam Deputy Speaker:: The hon. member will please withdraw his comment unconditionally and now.


Lyle Dean MacWilliam: Madam Speaker, I just did withdraw the comments. I said that it may be simply a misunderstanding.


Madam Deputy Speaker:: Thank you. Withdrawn.


STUDENT LOANS
Mr. Ronald J. Duhamel (St. Boniface):: Madam Speaker, my question is for the Minister of Finance.
Young men and women with no jobs and therefore unable to pay their student loans are being harassed at this very time by collection agencies that are trying to renew their contracts. They are being harassed at home, in the work place, at social events, at all times of the day. Why is the government refusing to step in and help these young Canadians in their time of need?
March 26, 1993


Donald Frank Mazankowski: Madam Speaker, that is precisely what we are tiying to do and that is precisely what the Secretary of State is trying to do in working out a new arrangement with the lending institutions.
The hon. member is quite right. There have been abnormally high levels of student loans that have been in arrears. In large part it is caused by the arrangements currently in place with the financial institutions.
It is with that in mind that we are trying to change the system. There have been proposals that have been presented to the minister. She is currently examining those. I can assure the hon. member that we will take his representation into consideration.


Ron J. Duhamel: Madam Speaker, my supplementary question is for the same minister. Part of the problem is that there are no jobs. They cannot pay them back when they have no money.

One constituent in my riding, a young mother with three children, can't pay back her student loan because she couldn't get a job. She might lose her child tax credit, because she was told she could lose it as well as her income tax refund. Meanwhile, she is being harassed by a collection agency. Why does the government allow this unfair harassment of a woman and her family?


Donald Frank Mazankowski: Madam Speaker, I genuinely appreciate the hon. member's emotion attached to this question. It is a serious question and I want to treat it in a serious fashion.
He should realize there is a provision under the current arrangement and there will be a provision under the future arrangement. Where there are difficulties experienced by a student there are provisions for that to be taken into account. The necessary flexibility and accommodation to help students in that regard are clearly defined there.
I would ask the hon. member to look at that to see whether those provisions would be helpful.
Oral Questions


Mr. Mac Harb (Ottawa Centre):: Madam Speaker, my question is for the Minister of Finance.
Members of the post-secondary education community, in particular the National Advisory Group on Student Financial Assistance, were kept in the dark regarding the government proposals outlined in the request for financing the Canada Student Loans Program.
Why has the minister not consulted with them? As well, will the minister give his assurance in the House today that he will call on, consult with, listen to and implement the recommendations of the student representatives on this issue?


Donald Frank Mazankowski: Madam Speaker, as I indicated in the House yesterday, the former minister did consult with not only the Canadian Federation of Students but also the Association of Universities and Colleges of Canada and outlined in a general way what was being proposed.
I am sure the hon. member recognizes, because of the commercial nature of these particular negotiations, one has to take that into consideration but I have been assured by the current minister that she will take representations into consideration.
What we are trying to do is improve the system. His colleague just indicated there were some deficiencies in the system. What we are trying to do is improve the system so that students will have access at reasonable cost and at reasonable cost to the taxpayer.


Mac Harb: Madam Speaker, I would like to know what steps the minister intends to take to ensure that the banks do not reject physically handicaped people or who, because of their age, would be less likely to find a job. What does the minister intend to do to ensure that Canadian students are treated fairly?


Donald Frank Mazankowski: Madam Speaker, I think I answered that question. That is currently what the minister is trying to do.

March 26, 1993
Oral Questions
She has asked for proposals. The proposals are in. They are currently being re-evaluated. Our goal is to try to ensure there is adequate access for student loans to the students at a reasonable cost, fair and equitable access at a reasonable return, a fair return to the financial leading institutions with a certain amount of necessary accountability for service in those accounts, and at reasonable cost to the taxpayer.
I assure the hon. member that we take this issue as seriously as he poses the question.


PUBLIC WORKS
William D. (Bill) Casey: Madam Speaker, my question is for the Deputy Prime Minister.
An essential part of the transportation network in Atlantic Canada is the fixed link, not only as a transportation link, but as a competitiveness tool for Atlantic Canada. The federal government has always consistently supported the fixed link project.
Is the federal government still totally committed to the project and will it take the appropriate measures to meet the two requirements outlined in the recent court case and proceed with the project?


Donald Frank Mazankowski: Madam Speaker, yes, the government has been committed to this project and is committed to the project. I so indicated in the December statement. Nothing has changed, except the fact that we do have a decision of the Federal Court which has to be taken into consideration.
That is what the Minister of Public Works is currently doing, to see if there is a way in which this project can go ahead. However, I remind the hon. member that the Federal Court decision has to clearly be taken into consideration and dealt with in an appropriate fashion.


OIL AND GAS INDUSTRY
Herb Breau: Madam Speaker, my question is for the minister of energy.
Recent statements have alluded to the economic viability of the oil and gas industry in western Canada. The recent signing of the Hibernia agreements with Murphy Oil and the federal government will prove vital to the Atlantic provinces' state of economic stability in the energy sector.
Can the minister advise this House of the current situation in western Canada and what the government's expectations are for the future prosperity of this industry?


William Hunter (Bill) McKnight: Madam Speaker, the hon. member recognizes the importance of the industry in western Canada and in Canada and he is accurate in his assumptions on Hibernia.
I can inform the hon. member that activity, including bids for leases, has increased in the sedimentary basin in western Canada. I should also inform him the number of licensed wells has doubled, I believe, to 1,780 from 780 last year. I should also inform him that the increase in activity by rigs has increased 60 per cent this year over last year.
The reinvestment from cash flow will be over $5 billion this year. That is almost a 5 per cent increase in reinvestment over last year, but it is in the historic trend. Therefore, there is increased economic activity.
It is a good sign for the oil-producing part of western Canada. It is a good sign for Canada. The provincial governments and the Government of Canada should be complimented, along with the industry for the faith they have shown and the actions they have taken together to cause this increased activity.


WESTERN GRAIN TRANSPORTATION
Mr. Rod Laporte (Moose Jaw-Lake Centre):: Madam Speaker, recently the Deputy Prime Minister made an announcement that his government was going to introduce enabling legislation to allow it to make any changes it wanted to the Crow benefit without further consultation with this House.
I would like to ask the Deputy Prime Minister when such legislation is going to be introduced. More important, why is he introducing enabling legislation? Why not a bill, a more substantive bill, that outlines exactly what his government plans to do with the Crow benefit?
March 26, 1993

It would be nice to have an opportunity to have a real discussion on an issue for a change around here.


Donald Frank Mazankowski: Madam Speaker, the hon. member's assertion is totally inaccurate and grossly misrepresented.
The Minister of Agriculture responded to those questions and he is attempting to seek out a national solution involving all parties having an interest in this subject. That consultation process is ongoing and will continue.


Rodney Edward Laporte: Madam Speaker, it was this minister who indicated in a news release that the government was going to introduce enabling legislation to make changes to the Crow benefit. As far as complication is concerned, the Crow is already in an unhealthy state. It has been made that way by the wounds inflicted upon it by a lame duck government in its death throes. Now the government wants members of this House to give it the right to declare open season on what is left of the Crow benefit and all that without any real consultation with the producers in western Canada or with this House.
Why does the minister not show some real courage, show some real guts and have some real consultation with the people of western Canada? Make it an issue in the election and let the people decide then.


Donald Frank Mazankowski: Madam Speaker, in order to set the record straight, this is exactly what was said in the backgrounder on the Western Grain Transportation Act:
"With respect to the method of payment of the Crow benefit under the Western Grain Transportation Act, ministers agreed to continue the present process aimed at finding a national solution through a whole farm income approach of the Net Income Stabilization Act type. That involves all producers in all regions of the country and will involve all governments".
That process has been ongoing, headed by the Minister of Agriculture, and that will continue.
Oral Questions


GOVERNMENT APPOINTMENTS
Mr. Don Boudria (Glengarry-Prescott-Russell):: Madam Speaker, my question is for the Deputy Prime Minister.
In 1984 the present Prime Minister said that political appointments by a Prime Minister who was on the verge of leaving public office were wrong and that "Canadians should not be made to pay the price".
How then can the Deputy Prime Minister on behalf of the government in good conscience have appointed the Tory election chair of Alberta and the vice-president of the Conservative Party for the prairies a full month after the Prime Minister announced his resignation? Why did the government change its mind and betray the confidence of the people of Canada?


Harvie Andre: Is it not
strange, Madam Speaker, that the hon. member for Glengarry-Prescott- Russell did not get up last week and complain about Mr. Jean-Claude Rivest, a Liberal who was appointed to the Senate last week. I did not hear the hon. member get up and complain.
The Senate exists. He knows that the Prime Minister and indeed everybody in this House campaigned vigorously for an elected Senate. That, in fact, did not come about. The Senate is there, it exists.
The hon. member should show his appreciation of the fact that these last four appointments in particular, but all of those previous to that as well, are outstanding Canadians. They will do an outstanding job.


Don Boudria: Madam Speaker, the minister just does not get it. The Minister of National Defence yesterday was reported as saying that the Prime Minister should not fill Senate seats before the next election. For once we agree with the Minister of National Defence, not with the minister across the way.
Why then, does the Deputy Prime Minister not take the advice of the Minister of National Defence? Why does he not stand in this place now and announce that there will be no further appointments?

March 26, 1993
Oral Questions
You, sir, have the option.


Harvie Andre: Madam Speaker, just to set the record straight, which one often has to do after that member speaks, the Minister of National Defence said yesterday and I quote: "The Senate is a reality; you have to deal with it". That is what the Prime Minister did. He appointed two outstanding Canadians.
I can assure you that none of his appointments will be running around with kazoos and cowbells and generally behaving the way some of the hon. member's friends in the other chamber have behaved.


VIETNAM
Mr. Jim Karygiannis (Scarborough-Agincourt):: Madam Speaker, in light of well-documented cases of human rights abuses that have been perpetrated by the communist government in Vietnam, I would like to ask the minister of external affairs if she is aware of the fact that two Canadians and 14 American citizens are being held incommunicado by the Vietnamese government on what may or may not be legitimate charges.
I would like to know what steps the minister has taken with the Vietnamese government to assure the security of the two Canadians held there.


Hon. Barbara McDougall (Secretary of State for External Affairs):: Madam Speaker, I am aware of the case involving the two Canadians and the others. They are allegedly being detained in Vietnam. We do not have the details. Our consular officials have approached the Vietnamese government to say that we expect that their human rights will be looked after, that we will have full access to them as consular assistance is required, and that they will have full human rights in terms of what is to follow.


Jim Karygiannis: Madam Speaker, the families of these individuals in Canada must know what is happening to their loved ones. I am asking the minister what immediate steps she will take to ensure the safe return of these Canadian citizens.


Barbara Jean McDougall: Madam Speaker, we do no yet know what charges have been laid against these Canadians. We
have been in touch with the Vietnamese authorities. We are doing everything we can and we will be in touch with the families.


PEACEKEEPING
Ms. Margaret Mitchell (Vancouver East):: Madam Speaker, my question is for the Secretary of State for External Affairs.
On Wednesday two peacekeepers were wounded in Bosnia and yesterday a second Canadian peacekeeper was killed. I would like to express on behalf of all members our deep sympathy to the family of Master Corporal John Temapolski.
I would like to ask the minister if she can explain the circumstances of Corporal Ternapolski's death.


Barbara Jean McDougall: Madam Speaker, I want to, on behalf of our government also join with the hon. member in expressing our sympathy to the family.
An investigation is underway in the department of defence. We do not have a great many details yet, but it looks as though it was a simple case of an accident with the vehicle. There were three people in the vehicle; two were unharmed and unfortunately, the corporal was killed. There did not appear to be hostilities in the region. The Department of National Defence will do a full investigation. I have asked for a complete report as soon as possible.


Margaret Anne Mitchell: Madam Speaker, a supplementary to the same minister.
The UN commission to investigate war crimes in Bosnia and Croatia cannot operate with "absolute peanuts", according to Canadian Commissioner Commander William Fenrick.
What efforts is Canada making and what is the minister doing to assure that this commission has adequate funds to do its important job?


Barbara Jean McDougall: Madam Speaker, first of all, we did offer the services of Commander Fenrick, so we are already providing some of the human resources that are required for the war crimes tribunal. We will be urging other countries to make resources available. We will also look at what will be required as this idea moves forward.
March 26, 1993

This was essentially a Canadian initiative as we raised it in London and then again in Stockholm in December. I am very pleased that the United Nations has now taken up the cause of this war crimes prosecution that I think we should follow in the future.
We will be urging the United Nations to adopt the kind of rules that are required and we will urge member nations and the UN to put the resources that are necessary into this. We are already putting our own resources into it by providing some of the people required and by helping to sponsor the conference in Vancouver.


EXTERNAL AID
Mr. Pat Nowlan (Annapolis Valley-Hants):: Madam Speaker, my question is for the Secretary of State for External Affairs. Some time ago the minister stated publicly that there would be an opportunity for Canadians to get involved in the debate on a shift in foreign aid from humanitarian aid to Third World countries to a more economic aid package to the emerging countries in eastern Europe and Russia.
In view of the pending budget which might freeze things in stone and not give an opportunity for that debate, what forum is the minister going to provide for a lot of interested Canadians to have their views made known?


Barbara Jean McDougall: Madam Speaker, there are a couple of levels of discussion going on.
At the moment, we are looking at our over-all aid package from a number of points of view. First of all there is more aid today than there was in 1984. On balance, aid has increased. There have been some cuts as a result of earlier budgets. We are looking specifically within the framework we have today, "Sharing Our Future", on how that aid will be dispersed. We are also examining not just the changes in central and eastern Europe, but whether our aid to Third World countries should have some changes made to it.
The fundamental issue is that there are some success stories in aid. Some Latin American countries, for
Oral Questions
example, that used to be aid recipients now are more trading partners. We are looking at that kind of issue in terms of how to focus our aid program a little better in current times.
My colleague, the Minister for External Relations, and I are working closely on all aspects of our aid program. We will be appearing before committee. There will be the normal consultations with the NGO community and others once we have approved the document.


Mr. David Dingwall (Cape Breton-East Richmond):: Madam Speaker, my question is for the Deputy Prime Minister.
Earlier in Question Period the Deputy Prime Minister will recall his colleague made reference to the fact that the Minister for International Trade, on April 1, will be making arrangements with U.S. officials with regard to a steel pact.
The Deputy Prime Minister and Minister of Finance comes from a region of the country where he understands or ought to understand the importance of subsidies and the role they play in the Canadian economy.
I want to ask the Deputy Prime Minister on behalf of the Government of Canada: Why is the government, and in particular the Minister for International Trade, so grossly negligent in not negotiating a comprehensive plan or package with regard to a subsidies code? Why are they not pursuing that track in their negotiations with the U.S. counterparts?


Thomas Hockin: Madam Speaker, this is one of the oldest questions that can possibly be asked in the House. This has been asked for six months and the answer is the same.
A very good subsidies code has been negotiated through GATT. We support what has been put together there. We are hopeful that the Americans and the Mexicans will support it.

March 26, 1993
Routine Proceedings MULTICULTURALISM


Hon. Alan Redway (Don Valley East):: Madam Speaker, my question is for the Minister of Multiculturalism and Citizenship who knows that in November 1990 the Prime Minister announced that he would be making a formal apology in the House of Commons to Canadians of Chinese origin in connection with the head tax and the Exclusion Act, and to Canadians of Ukrainian origin and of Italian origin in connection with their wartime internment. At the same time he asked the Minister of Multiculturalism and Citizenship to finalize the details.
Can the minister assure the House that he will have finalized all the details in connection with that apology well before the Prime Minister leaves office on July 1?


Hon. Gerry Weiner (Minister of Multiculturalism and Citizenship):: Madam Speaker, indeed I can assure the member that after a very intensive and thorough consultation which I carried on with individuals and community representatives of the affected communities I did issue a report. I provided a full report which the government is now considering. I hope too that the matter can be resolved at a very early date.
One of the people I met who does not always support this political formation told me he thought it was essential that something happen now, in this current mandate. A result was the very positive response we were able to give, and justly so, to Canadians of Japanese origin. I know the Prime Minister has been very clear on what he would like to do. I am certainly looking forward to being able to participate in that.



ROUTINE PROCEEDINGS


Mr. Charles A. Langlois (Parliamentary Secretary to the Leader of the Government in the House of Commons and to Minister of National Defence):: Madam Speaker, pursuant to Standing Order 36(8), I have the honour to table, in both official languages, the government's response to 10 petitions.
[Editor's Note: See today's Votes and Proceedings.]


PETITIONS
Don Boudria: Madam Speaker, I wish to present a petition signed by a number of residents of Pembroke and Petawawa, areas that have much in common, who humbly pray and call upon Parliament to pass legislation to protect the unborn child.


Margaret Anne Mitchell: Madam Speaker, I have three petitions to present on different subjects. One is a petition from a number of Chinese Canadians in my riding of Vancouver East.
It concerns the impact of the Immigration Act, Bill C-86, and particularly the provisions that allow decisions to be made retroactively. The petitioners urge the government to withdraw these amendments.


Margaret Anne Mitchell: Madam Speaker, my second petition concerns NAFTA. The petitioners say that the proposed NAFTA has resulted in even greater trade concessions being demanded of Canada. They say that more jobs will be lost and there will be further restrictions on our government's ability to be effective. Also the North American trade deal cannot be remedied through renegotiation.
The petitioners call on the House to reject the NAFTA.


Margaret Anne Mitchell: My final petition, Madam Speaker, is a lengthy one so I will just refer to certain sections of it, if my colleagues will allow me to do so.
It is from a great number of Vancouver residents, particularly residents of the Chinese community. It concerns the very unjust and racist law that established the Chinese head tax and was followed by the exclusion act under which people had to pay $100 to come to Canada because they were Chinese. This had a tremendous impact, and to this day has an impact, on the Chinese community.
March 26, 1993

The petitioners call upon the Canadian government to support an all-party resolution that would acknowledge this injustice, including redress for the payers of the head tax and the community.


Mr. Dan Heap (TYinity-Spadina):: Madam Speaker, under Standing Order 36, it is my honour and pleasure to present a petition from a number of residents of Etobicoke, Burlington, Oakville, Hamilton, Milton, Stoney Creek, Woodbridge, Dundas and Scotland, Ontario.
All these people wish to draw to the attention of the House that the North American free trade agreement has brought about even greater trade concessions by Canada or demanded of Canada, to our disadvantage, which will cause more loss of good jobs and will hinder the Canadian government from protecting our environment and conserving Canadian natural resources.
The petitioners also point out that it cannot be remedied through renegotiation and that there is an election coming, due before January 1, on which date the North American free trade agreement is scheduled to come into force. Therefore they now call on this House to reject the North American free trade agreement and recommend to the government that it use the termination clause to end the Canada-U.S. Free Trade Agreement.


Steven W. Langdon: Madam Speaker, I too have a series of petitions from various parts of southern Ontario concerning the North American free trade agreement.
The people who have sent these petitions to us are all deeply concerned about the fact that this agreement will cause Canadians to lose more jobs and that it will result in further restrictions on the ability of our governments now and in the future to assist Canadian industry, conserve Canadian natural resources and advance needed social programs.
The people are convinced that this agreement cannot be remedied through renegotiation. They call upon the House to reject the proposed NAFTA accord and to recommend to the government that it use the termination clause to end the Canada-U.S. Free Trade Agreement.
Routine Proceedings


Rodney Edward Laporte: Madam Speaker, I rise with duty and with pleasure to present a petition to this House from a number of residents in southern Saskatchewan.
The petitioners say that the undersigned residents of Canada draw to the attention of the House the following. The proposed North American free trade agreement has resulted in even greater trade concessions being demanded of Canada. This agreement will cause Canadians to lose more jobs. If implemented this trade agreement will result in further restrictions being placed on the ability of Canada's federal, provincial and territorial governments now and in the future from assisting Canadian industry, conserving Canadian natural resources for Canadian benefit and advancing needed social programs. The North American free trade agreement cannot be remedied through renegotiation. Canada's Constitution requires a general election before January 1, 1994, the date on which the North American free trade agreement is scheduled to come into force.
Therefore they call upon this House to reject the proposed North American free trade agreement and to recommend to the government that it use the termination clause to end the U.S.-Canada Free Trade Agreement.


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Charles A. Langlois: Madam Speaker, question No. 451 will be answered today.


Mr. MacWilliam: With respect to the RCMP, (a) were any measures taken to promote altitudinal and behavioural change among male officers toward women, specifically with respect to issues of sexual harassment, gender inequities and violence against women and, if so, what are they (b) have any affirmative action programs been implemented and, if so, what are they?

March 26, 1993
Routine Proceedings


Hon. Doug Lewis (Solicitor General of Canada):: (a)
The community policing branch of the Royal Canadian Mounted Police (RCMP) recently published and distributed a family violence pamphlet relative to spousal assault. This pamphlet was designed to educate the general public as well as employees of the force to the issue of assaults against women in abusive relationships. It also provides a brief history of the problem and an outline of current laws designed to help and protect victims. It goes on to provide advice to victims as well as advice to anyone who might know a victim of spousal assault.
All contract divisions of the RCMP are at various stages of setting up police based victims services units usually staffed by a full time supervisor and volunteers from the community. These units provide assistance to all victims of crime, including women, and aid in the recovery from victimization related to criminal activity. These units also provide a listening ear and referrals to existing community services. After referral, a follow-up contact is made to ensure that sufficient and appropriate service has been provided. Where a community or court based victims' unit exists instead of a police based one, our detachments co-operate with these units by making referrals. Presently the force has approximately 100 police based units in existence with others coming on stream in the near future.
As part of its policing responsibilities, the RCMP has provided family violence training to its members since the early 1970s. Courses have been offered at the basic recruit level as well as at the regional in-service level.
Although no specific family violence course exists, many of the subjects related to family violence, such as sexual assaults, child abuse, and spousal assaults, have been taught as components of courses presented at both levels. In particular, the issue of sexual haraasment has been addressed in sessions of the Canadian Human Rights Act.
In addition, members of the force have participated in regional, inter-agency family violence workshops. Since 1988, 5,271 members have received training through this method.
The RCMP is participating in the federal family violence initiative, 91-95. Under this initiative our training programs have been reviewed in order to develop more comprehensive and innovative approaches to training in this area. Course development will address cultural and gender sensitivity issues.
As part of the interdepartmental response to incidents of family violence, the RCMP has promoted and conducted regional, inter-agency family violence workshops and will continue to do so throughout this initiative.
Upcoming activities include the development of scenarios for designing enhanced lecture materials, simulation training sessions and computer based, interactive training programs. These programs will reflect the force's commitment to providing policing services that are sensitive and responsive to the needs of victims and to Canada's diverse population generally.
In order to inform our membership of the RCMP's commitment toward cultural diversity and the law prohibiting discrimination on any ground, regardless of race, national or ethnic origin, colour, religion and gender, the RCMP has recently distributed a brochure to all members entitled "Policing in Canada, RCMP Principles and Commitments to Diversity". The booklet is also available to the general public.
An employment equity unit was established within the staffing and personnel branch of the RCMP in 1991. Two analyst positions were created for overseeing this function.
As a result of a joint review between the RCMP and the Canadian Human Rights Commission, the development of an employment equity policy, currently being edited for publication and ultimate distribution, states:
The RCMP shall strive to change attitudes and behavioural patterns that have an adverse effect on the employment, career progression and attrition of members of designated groups.
The RCMP shall implement special measures as outlined above to prevent, eliminate or redress disadvantages that hinder the representation of designated groups.
The RCMP shall attempt to change behaviour that adversely affects participation of members of designated groups.
Under our human resource management plan for strategic issues, the following projects are in the works:
Develop a strategy which will encourage or require force personnel at all levels to ensure that committees, working groups, specialized teams/sections, consultation groups, et cetera, have representative consideration for women and other target groups.
March 26, 1993

Develop communications to force membership which is conducive to the promotion of harmony and understanding of issues relative to managing the value of diversity within the force's membership.
Develop a strategy that will encourage appropriate and uniform discipline to founded complaints against force employees where prejudice, discrimination, racism or harassment is involved.
A sensitization video entitled "Strength in Diversity" was produced to help RCMP employees deal more effectively with designated group members, including women. The video illustrates physical and attitudinal barriers that may be experienced by these employees and suggests ways in which these obstacles may be eliminated. The video was distributed to over 700 RCMP detachments.
International Women's Week, which is held annually to reflect the progress made to advance women's equality, is promoted throughout the RCMP. Information is made available and presentations are given to employees on topics such as self-defense, sexual harassment and violence against women.
All senior managers were provided with copies of "Beneath the Veneer", the report of the task force on barriers to women in the Public Service. In addition the summary of the report was made available to line managers and employees through the RCMP newsletter. All levels of management have been encourged to take positive action to implement the task force recommendations.
Departmental harassment policies for both Public Service employees and RCMP members have recently been strengthened to better inform employees and investigative bodies of the guidelines that apply, should harassment occur in the work place. Both policies will be published in the very near future.
An employment equity program has been in place for the Public Service component of the RCMP since 1983. The recruitment, promotion and retention of women are monitored regularly. To ensure that women have opportunities to enhance their careers and broaden their experience, a number of initiatives and policies have been implemented, for example a career advancement course for women, an assignments for career enhancement program and a part-time employment policy.
(b) Over and above the aforementioned response to question (a) the RCMP is in the process of forming focus
Government Orders
groups in the divisions to set up a networking system for female members.
In a continuing attempt to reduce imbalances and the under-representation of women within the RCMP, two special programs were sanctioned in 1988 and 1992. Under these initiatives 17 females members will have been promoted to the rank of corporal for instructor positions at the RCMP training academy by the end of 1993: 8 were processed from 1988 to 1991 and an additional 9 will be processed in 1993.


Charles A. Langlois: I would ask that the remaining questions be allowed to stand.


Madam Deputy Speaker:: The question as enumerated by the hon. parliamentary secretary has been answered. Shall the remaining questions be allowed to stand?


Some hon. members:: Agreed.



GOVERNMENT ORDERS


[Stage Direction]
The House resumed consideration of the motion of Mr. Mazankowski that Bill C-117, an act to provide borrowing authority for the fiscal year beginning on April 1, 1993, be read the second time and referred to a legislative committee in the Economics envelope.
Steven W. Langdon: Madam Speaker, we have a situation in front of the House of Commons today which is shameful and unacceptable. We have a government asking this House for permission to borrow over $31 billion on behalf of the people of Canada despite the fact that this government has not presented to the House of Commons a budget for this fiscal year that is coming up.
The minister has suggested in his comments this morning that what he is asking for is permission to borrow based on his economic statement of December 1992. In fact he has already put through a borrowing authority bill based on that particular economic statement which passed in this House just a month and a half ago.

March 26, 1993
Government Orders
There is absolutely no justification that we can see for a government to come before the House of Commons and present a demand to the House of Commons that it be given carte blanche to go out and borrow over $31 billion without telling the people of Canada why that money is necessary, or without giving them any sense of the fiscal parameters within which that borrowing will take place. It has done so without giving to the people of Canada any sense of what kinds of policy directions the government will take to try to deal with the massive unemployment problems we have in this country, to try to deal with what some people have called a debt crisis in this country, or to try to deal with problems of poverty in this country that are getting seriously worse. We have no suggestion from the government as to how it will proceed to put in order the finances of this country.
Let me go back to the budget of February 1992. This is a budget that was presented by this same minister to the House of Commons, the same House of Commons, less than 14 months ago. It was presented on February 25, 1992, 13 months ago almost to the day.
Let me remind the House what was suggested within that budget from 1992. It suggested first that the deficit for 1993-94, that is this coming fiscal year for which this borrowing authority is put before us, would be a deficit, and I quote from page 71 of the budget from last year, of $22.5 billion. That would be the deficit. The financial requirements that this government would need according to this budget presented just 13 months ago were $13.3 billion. Yet today the minister is bringing before us a borrowing authority for over $31 billion.
How can any member of this House of Commons react with any sense of responsibility to an outlandish demand for authority to borrow $31 billion when just 13 months ago this same minister was telling us he was only going to need to borrow $13.3 billion? How is it possible for anybody in the country to believe what this minister is telling us today?
Clearly there have been things that have changed but we do not know what those things are. We do not know what the government's projections are for 1993-94 because we have not received a budget yet for 1993-94 despite the fact this government promised it faithfully.
Michael Wilson was the finance minister of this country. He was somebody who-whatever criticisms I have made of him-at least knew something about economics and the market in this country. At that point the government promised there would be a budget presented each February so that provincial governments, private businesses, households and all of us as members of Parliament would have some sense of where we were heading and what the government saw in the future.
However, now we have a Minister of Finance who does not understand economics, does not understand the needs of the marketplace, does not understand the concerns of Canadians across the country with respect to the debt problems we face and does not understand the concerns of provinces and we do not have a budget.
It is almost the end of March. April 1 is next week and there is no budget. We are told there will not be a budget until April 21. Yet the government asks us: "Despite the fact we have not given you a budget, write us a blank cheque for more than $31 billion and a month from now we will let you know what it is for. A month from now we will let you know what the situation will be financially in Canada during the year for which we will already have received the authority to borrow this more than $31 billion". It is absolutely and totally irresponsible.
This government talks about fiscal responsibility. It talks a good fight. Right from the day it was elected in 1984 it said it was going to deal with the deficit and the financial problems facing this country.
Well, those problems are worse in 1993 than they were in 1984 because we now face a situation where we have a government presenting demands for borrowing authorities without even presenting a budget to us.
I do not see how anybody in this House of Commons who believes in financial responsibility could vote for a borrowing authority under these circumstances. I say this to the backbenchers of the Conservative Party: If hon. members in the Conservative Party expect to go out into an election later this year and to run in their various constituencies on the fact that they have tried to get the finances of Canada in order, how can they possibly do it when they passed a borrowing authority for over $31 billion without even having a budget to go with that borrowing authority?
March 26, 1993

I warn those members that the people of Canada will not buy that kind of irresponsibility. The people of Canada are not prepared to give away blank cheques any more. They want to know what is happening. They want to know why it is happening and this government is not giving any answers at this stage whatsoever.
The minister talked in his comments about a number of other points. I want to deal with some of those points. As I say, I think the major problem with the minister's presentation was his failure to offer any satisfactory justification for getting the right to borrow more than $31 billion without a budget.
He also talked about the federal government being prepared to offer leadership in dealing with the debt problems of this country. The fact is that there have been requests from provincial governments across this country for a First Ministers' meeting on debt in Canada and this government has refused those requests. This government has refused requests coming from provinces that are hard pressed and hard hit financially and need to have a first ministers' meeting on debt. This government has said no.
Again, the people of Canada must not accept that this government really seriously cares about debt. It is willing to play politics with debt but it will not come out and try to deal with the problem seriously in a first ministers' meeting.
This government suggested that its record was superb on dealing with debt and the deficit. In that case how can it explain one of the conclusions from the C. D. Howe Institute this past February when it held its now famous workshop on avoiding a crisis? These were the proceedings of a workshop on Canada's fiscal outlook. The workshop brought together some of the foremost authorities on debt and fiscal management in this country. How can it explain that one of the strongest criticisms made in the report of the proceedings of that workshop indicated that the workshop was: "critical of the government's fiscal performance, in particular its loose stance during the late 1980s". I am quoting from page 3 of the workshop's conclusions.
The government likes to get up and blame everything on the Liberals. I admit that sometimes that is easy to do
Government Orders
or often easy to do because the Liberals left a sorry mess when they left office finally in 1984. However, the fact is that this government, the Conservative government, is being criticized by this C.D. Howe analysis. It is not the Liberal government of the time before 1984 because, let us face it, these guys may have done a bad job way back then but that is not the issue now. The issue now is what the Conservatives who have been in power for almost nine years have done.
The Conservatives have, according to this C.D. Howe analysis, clearly made a mess of things. They have created a fiscal situation by their irresponsibility in the late 1980s that has made the debt crisis in this country very much worse than it otherwise would have been.
There is no way the Minister of Finance, though he squirms and tries to cast the blame off onto somebody else, and this government can get out from under that criticism. There is no way it can escape from carrying the can for the fiscal problems we now face as a country.
The Conservatives try to blame the provinces. Listen to this government. In fact we heard it repeated today during Statements by Members. Somebody from the Conservative Party got up and said: "We have increased our transfers to the provinces". So when the provinces blame the federal government for transfers being cut back, somehow they are not being fair.
I want to quote from as neutral and disinterested a source as I could possibly find: the Dominion Bond Rating Service. This service has downgraded and put on alert the financial and debt situations of all our provinces in Canada. It outlines here the reasons why it has done that. It says one of the reasons is the effect of the recession. I am not surprised.
However, look at the second reason it cites. I quote it specifically again: B. "Federal caps or limits on the growth of all federal transfer payments". That is not the premier of Ontario. That is not the premier of New Brunswick. That is not the premier of British Columbia talking. That is the Dominion Bond Rating Service saying to the people of Canada that this federal government has created a big part of the problem that the provinces are now facing.

March 26, 1993
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There is no way, although he might squirm and wriggle, this Minister of Finance can get out from carrying that can. There have been serious mistakes made by this government. It has made mistakes by cutting taxes to those at the top and thereby worsening our deficit. It has made mistakes by fiscal irresponsibility in the late 1980s that have been identified by the C. D. Howe Institute. It has made mistakes by cutting back the amount of money going to the provinces as the Dominion Bond Rating Service has indicated. That has thrown our provinces right across Canada into crisis.
Yet this government comes before us today and says: "We are managing the economy magnificently. Give us a blank cheque for more than $31 billion to go out and borrow".
Undoubtedly the trained seals on the Conservative side will get up and support this. Undoubtedly it will not prove to be possible for voices of reason to stop this craziness on the part of the government benches.
We have a government that has been wrong on its budget projections it made just 13 months ago. It was so wrong when it said 13 months ago that it would need just $13.3 billion. It now says it needs over $31 billion.
This government has been so irresponsible that it has not brought a budget forward to justify this borrowing authority. This government has been so vicious to the provinces that even the Dominion Bond Rating Services has underlined that as a major problem for the provinces.
This is finally a government that has been recognized even by the C. D. Howe institute as being a major part of the problem in creating the debt crisis we face in this country.
There is no way our party could ever support giving this government with this record a blank cheque for more than $31 billion in borrowing authority. This government has been so irresponsible that it deserves to be thrown out and not thrown money.


Fred J. Mifflin: Madam Speaker, I would like to make a comment on the
speech made by the hon. member. I certainly appreciate the depth of the difference between what was anticipated 13 months ago and what in fact is the case right now.
If his figures are correct then we are looking at a fantastic increase in projections. Those figures show the inability of the government to make any reasonable projections at all. When making projections in financial areas, one may be out by 5 per cent, 10 per cent or even 15 per cent given the vicissitudes of financing and the uncertainty of the financial markets today, the state of the recession and those similar impinging matters. However, to be out by a factor of over 100 per cent is astounding.
To add insult to injury, even before a budget is released, the government expects this House to go in front of the Canadian people to say we have not produced a budget yet. In fact the Minister of Finance was not sure whether he was going to have a budget or not until he was cajoled by the opposition to do so.
Having decided there will be a budget, he now comes forward to ask for the borrowing of $31.5 billion given the dismal state of the economy in the country right now and before the budget. This is not only arrogant and presumptuous but unprecedented in recent parliamentary history.
Could the member elaborate on the borrowing authority the government is seeking and the bond market it plans to visit and does he have a breakdown of how much is foreign and how much is domestic?


Steven W. Langdon: Madam Speaker, again I thank my colleague for what is an interesting question. If we look at the total of the federal government debt we are talking at the moment of something over $420 billion. Approximately 23 per cent of that is foreign held. I would expect of this new borrowing authority we would likely be looking at a somewhat larger percentage than the 23 per cent simply because the government has been gradually increasing the degree to which it has gone to foreign markets to tiy to source some of its borrowing. We might be talking about 25 per cent but again there is nothing in the government's legislation which suggests the direction it will take.
March 26, 1993

The other point I might just comment on is that it is not entirely unprecedented for this approach to be taken and for a borrowing authority to be passed before a budget. I am told it was done by some previous governments before 1984.
However, one of the things that I think everybody in the House felt was a useful step forward, whichever party we were in, was the commitment on the part of the then finance minister Wilson that there would be a budget in February. There would be a set time and we would then be able to have a borrowing authority that followed from that that was important. We also had some greater certainty created for the various provincial budgets that had to be brought down subsequently. As it is at the moment, virtually every provincial budget will be presented before the federal budget is presented on April 21.


Rodney Edward Laporte: Madam Speaker, I would like to compliment the member for Essex-Windsor on his speech. His contribution certainly to this party with respect to job strategy and economic strategy in the New Democratic Party is paramount and instrumental in the direction this party is going.
I would like to ask the member for Essex-Windsor something. The fact is that oftentimes some say that as New Democrats we have no economic plan and cannot manage an economy and if we were in power things would be terrible. We have never been in power federally in this country and the debt of this nation is over $420 billion and is increasing at a dramatic rate. In provinces where the New Democrats have been in power, such as Saskatchewan in 1981, for example when the Blakeney government was in power, there were comments made that the Blakeney government was the best managed government in North America at that time.
I would like to ask the member if he could set the record straight a bit. What sort of process would he undertake as finance minister in the government next year to get this country on the right track? Could he give a general outline, for myself and for Canadians watching and for members of this House, of what directions a New Democratic government would take with respect to the economy in this country?


Steven W. Langdon: I thank my colleague for the question. It is a tough one to answer in a few minutes.
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I just want to refer people in the House and elsewhere to a very interesting article by Jeffrey Simpson which was published February 9, 1993 in The Globe and Mail, entitled: "It was not a socialist shopping binge that gave the country a hangover". He stresses in this article one of the important political realities in this country. It is that the massive national debt and the great bulk of provincial debt we have built up in this country do not come from New Democrat governments but from irresponsible governments whether they are Social Credit, Conservative or Liberal at the provincial and federal levels.
The jobs plan we have issued is characterized by-perhaps to the surprise of some across the country-commitment to reduce the level of expected deficit in this country over the next five budgets by $11 billion compared to what the Conservative approach would bring us. Therefore, we recognize the importance of sound fiscal management. We also recognize however that to reach that sound fiscal position requires getting people back to work and requires levels of interest rates in this country that would make the interest rate burden on our national debt less onerous than it presently is.


Yvon Côté: Madam Speaker, I listened with great interest to the speech by the hon. member for Essex-Windsor who, if my notes are correct, mentioned two problems. First, the hon. member expressed his surprise that the borrowing authority bill was tabled without any information on the government's objectives or intentions, which was unprecedented or at least not common practice. Perhaps I could explain.
We have the December 2 economic statement, which announced the government's intentions and the economic and financial outlook. In other words, today's bill comes after this economic statement. I think that is a very important point. Furthermore, the basis for this borrowing authority will be further explained in the next budget. This is a very important point, and there is no reason to call this unprecedented. In fact, the precedent is there, and the basis for this borrowing authority is there as well. That is the comment I wanted to make.

March 26, 1993
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Madam Deputy Speaker:: The hon. member may want to make a very short comment. The time has expired.


Steven W. Langdon: Madam Speaker, following last year's statement the government tabled a borrowing authority bill. Today it is tabling another bill. In my opinion, there should have been another statement or a budget. I am not particular about whether we have a statement or a budget, but we need one or the other to indicate the reasons and figures for next year so we can see how much money we need. There has been no statement or budget providing this information, and in my opinion that is what we need.


Yvon Côté: Madam Speaker, as I said before, I understand the hon. member's concerns, but I want to point out that in addition to describing the perilous state of the economy and proposing corrective action, the December 2 statement also announced the government's intentions for the coming year. I think it is important to realize that the borrowing authority is motivated by and based on the statement. And of course a few weeks from now, the budget will provide additional information.
I have a second point on which I did not have a chance to elaborate. The hon. member said the provinces were already bringing down their budgets, while we usually have our budget earlier, in February. I agree that is usually what happens. Speaking as a private member, I wonder if it would make more sense for the government to bring down its budget after the provinces bring down theirs. Traditionally the provinces never made much of an effort since their federal big brother had already announced his intentions and was the only player to make a reasonable effort, with or without budget cutbacks. Often the provinces would just tag along behind. However today for once, and I agree this is unusual, the provinces are taking the initiative, since big brother did not bring down his budget and they are now performing
better than ever before. I refer to the last two budgets that were announced by Newfoundland, if I am not mistaken, and Saskatchewan.
I realize the member is disappointed that the next budget will be postponed for a few weeks, but I think there is every indication this will be beneficial and give the provinces that extra motivation to take the initiative, since they will be first with their budgets this time around. I think the impact will be particularly effective this year.


Steven W. Langdon: Madam Speaker, I will answer the member's question in English because I can say it more quickly that way.
First on the question of a budget, the government cannot have it both ways. It is not possible to have it both ways. If there was a declaration, an economic statement, in December which covers next year, the government does not need a budget.
If it is going to have a budget, which the government has decided, then that budget presumably sets out new projections about what is expected and we must see those new projections in order to be able to make a responsible decision with respect to borrowing authority requests.
With respect to the second point that was raised, my problem is that the federal government budget is the budget that can have the greatest impact on the over-all economic situation in the country. It is the broad framework within which the provinces have to operate.
What we are getting at the moment is not the provinces presenting their budgets and then the federal government presenting a budget that somehow takes them into account because the timeframe would be far too short to make such changes. We are really getting at budgets being prepared and presented in parallel without any sense of interplay and inter-connection. That is really unfortunate when there are such serious economic problems within the country.
March 26, 1993


Fred J. Mifflin: Mr. Speaker, I will be splitting my time with the hon. member for Notre-Dame-de-Grace. I will go ten minutes and five and he will follow with ten minutes and five.
As much as I respect my hon. colleague and am delighted to share my time with him, I would like to have had more time to press home some of my points, but I am sure my hon. colleague will do equally well in pressing home the difficulties we have with this bill.
I am going to say at the outset that I have great difficulties with not only the details of this bill but with the principle involved.
Looking at it in its simplest, mundane, ordinary day-to-day terms, this is like me asking you, Mr. Speaker, to sign a blank cheque in any funds available to finance my record of financial mismanagement over the last eight and a half years. I want a blank cheque from you to continue financing the ways in which I have practised over a period of time, which have been unconscionable, and I am still not financially solvent.
If I went to a bank with the record of this government and asked for a loan, even with a guaranteed support and a demand loan where I had assets or promissory notes to cover what I was asking to borrow, I do not think it would let me get beyond the second question. It would look at my record and would boot me out on my behind.
This is a litany and it is becoming tiresome for people who watch this on channel 18, 19, 20 or whatever it is. The role of the opposition is to press home just how atrociously the government has managed the finances of the country, and I am not one who presses home with such direct and consistent criticism on a particular point.
When we have a government that over the past eight and a half years has been pressing home a pledge and a promise to put Canada's fiscal house in order, reduce the annual deficit, and retire the public debt, on a regular basis, in 1984, 1985, 1986, et cetera, the government management of the economy has been atrocious, maladroit and inept. Why? It is because over that period of time it has increased taxes 38 times including the hated
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and badly timed goods and services tax. It has nickel and dimed students. It has reduced unemployment insurance safety nets for those people who need them the most at this particular time. It has introduced temporary surcharges that are still in existence and it is at its wits' end.
It cannot tax any more because it is well beyond the break even point of taxing individuals, and it cannot find money anywhere else. Now it has to go and borrow money. There are a number of things that bother me about this.
Borrowing money is not unusual. I think we all from time to time have to borrow money. When people borrow money surely one of the things their bank manager, assistant bank manager or whoever is going to lend them the money will look at is their credit rating and how much money they make; in other words, what they are looking at is their ability to repay the loan. That is the concern.
In 1984 when this government first looked at borrowing money the relationship of how much the country owed to how much the country made, in other words the ratio of the debt to the gross domestic product, was 42 per cent. Those are the best figures I can get and they have been verified by other people. It might be 40 per cent or 45 per cent, but it was in the vicinity of 40 per cent. We owed 40 per cent of what we made.
Eight and a half years later a concerted effort was promised by this government in its annual statements in the budget. Normally it is in February, March or April, the spring of each year, as is common for any government. It certainly has been a precedent with the Canadian government and in Parliament for as long as I can go back in my history books. There were promises by the government that it would retire this debt. It now says that the annual deficit is the same as it was when we started the exercise back in 1984 and that has caused the national debt to be doubled.
What is more important in terms of the relationship of one to the other, how much we owe versus how much we make, is that we have now gone from 42 per cent to 64 per cent. In other words, looking at our ability to pay and our financial solvency, we now owe 64 per cent of what we make.

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Mr. Speaker, if you were running a business or were in a private situation in which you were borrowing on a regular basis 40, 45, 50, 55, 60, or 65 per cent of the money you made and you had a personal or financial debt for your business which in eight and a half years more than doubled then I do not think you would be a very good financial risk.
More important, and more scary to me and of more concern to the Canadian public, is the very question of where this is going to lead: Will the government have us in a position by the election, which has to happen by the end of this year, in which any party that assumes the custodianship of the country will never be able to take us out of the depth of financial despair we are now in?
We all know there was an attempt in 1990 to help retire the debt by changing the tax structure from essentially a manufacturers' sales tax on around 20,000 businesses in the manufacturing sector to a consumption tax on all individuals.
We all know a tax of that nature has a greater impact on those with less income because the amount they spend on necessities is much higher proportionately than for those in the higher income bracket. By having a consumption tax we attack those people who can least afford it.
The other aspect of this issue is, quite apart from the pros and cons and the advantages and disadvantages of a consumption tax not being harmonized with the 10 provinces, that the timing could not have been worse. I am sure the government's financial advisors in the country and our financial friends outside the country would have advised, and indeed had advised, against implementing a consumption tax when the government by its own admission and at its own hand was responsible for an impending made in Canada recession.
Mr. Speaker, would you expect me, with this background, knowledge and understanding, or anybody else with these concerns to be supportive of this bill? I think not.
In summary, we have a situation in which the government is asking to borrow $31.5 billion, and I wonder how
much of that is offshore contributing to our 30 per cent of foreign debt. The government is asking to borrow $31.5 billion before a budget has been put in place and further play into the promise and pledge that it is going to reduce the deficit and the federal debt.
I do not believe it for one moment. I certainly am not going to support it because I think it is wrong, and I think it is atrocious. I do not think the Canadian people will support it either.


Hon. Warren AUmand (Notre-Dame-de-Grace):: Mr. Speaker, this bill to give the government the authority to borrow certain moneys gives us the opportunity to discuss the economic situation in this country and the government's economic policy.
Whenever we in the opposition and groups outside this House, economic experts, business experts, and think-tanks, attempt to bring to the government's attention that the economic situation in this country is bad and that its economic policy is not working, the government gives us two standard replies:
First, it trots before us a whole set of statistics attempting to show us that everything is absolutely fine, that the situation is really great, it is really moving in the right direction and so on. The second answer we usually get from government members, particularly the Prime Minister and the Minister of Finance, is that things were worse in the recession of 1981-82.
Let me deal with that response first because it is continually thrown back at us. Whether or not the recession we have had for the last three years is better or not as bad as the one of 1981-82 is irrelevant to the many thousands of Canadians who are unemployed now. Those kinds of answers from the Prime Minister and the Minister of Finance give no comfort to those many people who are unemployed, to the many businesses that are going bankrupt, and to the many people who are living in poverty. It does not become a government of this country to use that kind of response when we seriously raise the plight of unemployed Canadians and the dire straits of our Canadian business situation.
March 26, 1993

Let me just for a minute compare the recession of 1981-82 with the present recession. Many experts, not members of this House, have pointed out that if the participation rate in our labour force stayed at what it was in 1981-82 the unemployment rates would be much higher. For example, I refer to the Ottawa based company Informetrica which in its monthly economic review in January said the following: "The disappearance of hundreds of thousands of workers is all that has kept the unemployment rate from exceeding the level reached a decade ago in what was the deepest downturn since the dirty thirties. Unemployment would have reached 13.7 per cent last year, slightly higher than during the 1981-82 slump, had 345,000 discouraged workers not given up looking for jobs".
You are only counted as being unemployed in the official unemployment statistics if you are actively looking for work. If you are not actively looking for work and have become disillusioned, frustrated, and continually turned away, and have not looked for work in the last few weeks, then you are not counted as unemployed. Because of the situation today the participation rate in our labour force is much lower than it was in 1981-82 and consequently the unemployment rates appear to be lower.
In addition those who are unemployed in this recession have been unemployed longer. In 1981-82 there were high rates of unemployment but those people found new work quicker than they are today.
The unemployment today, to a much greater extent, is based on structural changes in our economy and not cyclical types of unemployment. Consequently a structural problem in our economy, which means the closing down of factories that have existed for years and years, and replacement by automation or new trade patterns and so on, requires a different kind of solution from the cyclical type of unemployment we had for the greater part of 1981-82.
There was another major difference as well. In 1981-82, faced with high unemployment, the Liberal government of the day believed the government could and should do something. We did try to do things. We tried to kick-start the economy. We had public works programs. We had programs to build houses, infrastructure and so on, all to kick-start the economy.
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This government was influenced by the economic policies that were promoted in the United States under President Reagan and in Britain under Prime Minister Margaret Thatcher. Their belief was that the market economy would solve all our problems and the less government did the better.
We do not believe the entire solution or the basic solution can be found by government but we believe there is a role for government. We submit that the greatest areas of prosperity in this country have been where government, in a wise partnership with the public sector, has produced a lot of jobs and a lot of growth.
The new Government of the United States recognizes that as well. It campaigned on a rejection of Reagan-Bush type economic policies and won. Now it is trying to return to what can be more properly called a mixed economy approach.
Another response we get from the government is that everything is fine, that there is a glowing picture out there. It cites certain inflation figures and points out how low inflation is, how certain trade figures are up and so on.
Whenever statistics that deal with improvements or with things getting worse are cited, the distance of improvement depends on the starting point. I could take issue with the government on many occasions for picking starting points that were misleading and false in order to show that things had greatly improved. That aside, the fact of the matter is that things are not fine economically speaking. They are not. The government can try to paint as rosy a picture as it can, but that is simply not being bought by Canadian people throughout this country.
The unemployment rate is well over 10 per cent. There are still 1.5 million Canadians unemployed. Bankruptcies during the last year have been at record levels. There are record levels of Canadians going to food banks and soup kitchens. There is a greater number of people living under the poverty line. Things have been worse in the last 10 years than they have ever been in a continuous trend since the end of the Second World War.
When the government brought in some of these policies we warned it that those policies would result in exactly what has happened. They would exasperate what might otherwise be a shallow recession or downturn in the economy. But it went ahead with them anyway.

March 26, 1993
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We in the Liberal Party are in favour of freer trade. Our history shows that as a party we have always taken steps through GATT and otherwise to expand trading opportunities. Before the free trade agreement there was a movement between Canada and the United States to lower tariff barriers.
We opposed vigorously the so-called free trade agreement which was much more than a free trade agreement. It allowed us to be left open to all sorts of attacks on our economy from the United States. We said it would lead to high unemployment, and it did. We said it would lead to the closing of Canadian companies, and it did. It was the same with the GST. We opposed the GST. Even those economists who supported the GST said it was the wrong time, that we should not bring in a big tax increase when the country was moving into a recession.
I do not have enough time, but I could quote from article after article which back up what I have just been saying. Let me say what we have put forward time and again. The Federation of Canadian Municipalities was here this week asking the government once again to participate in a tripartite program to rebuild Canadian municipal infrastructure: roads, sewage systems, bridges, tunnels, ports and transportation systems, which would improve the economic climate of cities attract business and commerce to cities, and at the same time put thousands of people to work. Why will it not do that?


Daniel James Macdonnell Heap: Mr. Speaker, I was interested in the remarks of the member for Notre-Dame-de-Grace. As usual his remarks have made a lot of sense. Of course in the time available it is not possible to cover everything.
I would like to ask him a couple of questions. First, what does he think is the effect of the government's policy of reducing the taxes on rich people and increasing the taxes on middle income people? Has that policy had any effect on creating jobs or creating unemployment?
I will ask my second question at the same time. What does he think is the effect of the government spending billions upon billions of dollars for the arms industry? Is that having a good effect on employment or a bad effect?


Mr. Allmand:: Mr. Speaker, I will deal with the second question first. If I had the time I would deal with the
government's commitment to buy military helicopters at a cost of $5.6 billion, almost $6 billion.
We are in a period where we need money for all sorts of things: health care, education, retraining and so on, and the government is going to spend nearly $6 billion on helicopters designed to fight a cold war which has now come to an end. Talk about nonsense. The government is saying it wants to reduce the deficit and provide growth in the economy. Even from the point of view of creating jobs, the production of militaiy equipment such as helicopters is very low as a labour intensive industry.
If we want to create jobs there are many other things which would come before military production. Even from the point of that argument this is unwarranted expenditure. We must find a way since the cold war is over and there is not the major threat there was years ago. We still need armed forces for certain matters, such as peacekeeping and patrolling our oceans, shores and territories, but we do not need the same capacity we needed while the cold war was still going on.
With respect to taxation the member is absolutely correct. Tkxes are not liked by anybody. We pay them because we know they are essential. If there is to be a certain peace in this country there has to be a consensus among all classes that the taxation system is fair. If people in certain classes, whether it is low income classes or middle income classes, feel they are being inequitably dinged with the taxes of this country then there is going to be unrest and instability.
One of the reasons we so vigorously opposed the goods and services tax, which was put through without proper consultation, without the support of the provinces and at a time when we were moving in a recession, was that it bears more heavily on the poor and middle classes than it does on the rich.
A 7 per cent tax or a 15 per cent tax on goods and services does not make as much a dent in the incomes and lifestyles of the rich as it does in the lower incomes. That is why years ago we brought in a progressive income tax system where the rates of tax increased: higher percentages on the wealthier population and lower percentages on the middle class, with exemptions for the people who had very low incomes. That is a fair system in principle. Where there is a certain percentage of tax for a consumption tax that applies across the board, no matter what it is not fair.
March 26, 1993

It is true the government has a tax credit system for those with very low incomes, but it does not compensate them for the high taxes they are paying to the government, hidden in most respects by the goods and service tax. In answer to the hon. member we know we have to raise taxes, but the taxes have to be introduced in an equitable and fair way for all classes in society.


Margaret Anne Mitchell: Mr. Speaker, it is very difficult today to talk about this bill without talking about the national tragedy that we are faced with in Canada as we are being pressured into passing a North American free trade agreement. I would like to concentrate my remarks on that.
This Conservative government is bound and determined to sell Canadian interests to the U.S. and Mexico under the North American free trade agreement or NAFTA. Five years of the Canadian-U.S. deal, the FTA, has resulted in the loss of some 500,000 jobs, mostly in manufacturing. We know that company after company in Canada has gone broke or has moved to the United States.
In my riding of Vancouver East, for example, fish processing plants have been forced to close and some have moved south with hundreds of jobs being lost. This is a whole field of jobs, particularly for immigrant women.
Textile workers have been laid off or forced into exploitive home work and many, many small businesses have closed. Many have been affected by cross-border shopping.
However we look at it, five years of the FTA and now a NAFTA agreement on top of it will be devastating to Canada and to our sovereignty. Many young Canadians have given up hope because of the lack of job prospects.
Canadians already are hurting from continuing high unemployment, government cuts to our social programs and a battered economy. Much of this is really related to our locking ourselves into a continental agreement with
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the United States. Many more Canadians will suffer if this government passes the NAFTA.
Canadians do not want NAFTA because it is bad for Canadians and bad for Canada. NAFTA is much more than a trade deal. This is what I hope Canadians and viewers will understand. It is a continental economic agreement, an economic constitution that gives economic control not to governments but to transnational corporations whose sole interest is profits. It emasculates our national government which will have no say or control over Canada's destiny.
It is a triumvirate kind of agreement where Canada will provide unprocessed resources, Mexico will provide cheap labour and transnationals based mostly in the United States will make the products and get the trade benefits.
Our brain power will go south. Small businesses will not be able to compete. NAFTA threatens Canadian jobs and businesses in our auto industry, in textiles, agriculture, transportation, banking, insurance and data processing.
The Government of British Columbia is strongly opposed to NAFTA because it will erode the provincial government's ability to manage provincial resources and to control foreign investment in our economy in B.C. B.C. will be hurt in five very critical areas.
First of all, NAFTA will not stop the U.S. from setting up unfair trade barriers. We see how damaging this has been to the B.C. economy in relation to softwood lumber tariffs. It will prohibit Canadian incentives that are needed for processing our raw materials, our raw logs and our raw fish and to have value-added products for trading. This will be very difficult in our economy.
Second, this deal will not ensure that workers' rights and the environmental standards are protected. There will be tremendous pressure to undermine unions by lowering the working standards and wages for Canadian workers. Higher profits will be had in Mexico because of its poverty levels, its abysmal health and safety standards and lax environmental enforcement.

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We heard at a rally recently in Vancouver that Mexican workers earn $5 a day if they are lucky, are working in very polluted environments and their situation will be worse with NAFTA. Mexican workers also oppose this.
Third, this unfair deal will hurt B.C.'s processed vegetable producers and apparel industry. The Canadian Apparel Manufacturers Institute says that as many as 30,000 Canadian jobs in the apparel industry are at risk if NAFTA is signed.
Fourth, NAFTA offers absolutely no guarantee that B.C. will not be forced to export water to the United States. Earlier today we heard the minister refuting this, but I can tell you at the hearings which I attended in Vancouver, experts there had studied the documents very carefully and pointed out that water is not exempt. It can be considered as a good and therefore become a transcontinental resource.
Fifth, the Canadian government offers no assistance to help Canadian workers adjust. This has been promised to American workers. We know this was promised under the FTA. I certainly know many people in British Columbia who are unable to get any adjustment programs.
This Conservative government is setting Canadians up for a future where our health care and social programs are in jeopardy. Bill C-91 was a part of this NAFTA deal. It was part of this nefarious plan and, of course, this was the drug patent bill which gave a monopoly to multinational pharmaceutical companies and has a tremendous impact on the cost of drugs and the whole medicare system in Canada.
Tories have argued that this was necessary. It was necessary in their view. It was something that they had already promised to Mr. Bush.
NAFTA basically wipes out the sovereign right of the Canadian Parliament to allow generic drug companies to provide cheaper copies of brand name drugs to consumers.
Canadians have suffered more than enough under the U.S.-Canada Free Trade Agreement. Enough is enough. NAFTA must be rejected in favour of world-wide fair trade and I will ask my colleague to expand on some of these points in his remarks.


Daniel James Macdonnell Heap: I would ask the member for Vancouver East to comment further on the
effect of the free trade agreement and unemployment on the income levels of the people she knows of.
In my city, and I will go into this later, the rich have got richer and the poor have got poorer. This is the intended effect of the free trade agreement and other parts of the Tory agenda.
I am sure the hon. member can tell us something of the situation of the people, especially the large number of unemployed people, in the district that she represents.


Margaret Anne Mitchell: Mr. Speaker, it has had a devastating effect, as the member suggests. For example, I have met with a number of people who were in the fish processing industry and these plants have closed down entirely. Incidentally, they were not even given adequate unemployment insurance coverage. Many of them are immigrant women raising families on their own. Some are native women, and that is probably one of the worst effects.
Look at the garment industry. We know that if the industries are to survive at all and compete with the American and Mexican industries, they are going to have to force largely women into doing things at home in the cottage industries.
Some people think this is folksy and lovely, but it is a terrible situation because it is not controllable. It is not unionized and women who are looking after kids are going to be trying to do work on machines and so on in their homes at very low wages.
We know the impact it has had on the whole aspect of unionization. There is a move to do anything possible to undermine decent union wages and to force down wages by whatever means possible. There are many, many impacts.


Rodney Edward Laporte: Mr. Speaker, I know the hon. member has been very active in issues dealing with the multicultural areas and various cultures in Canada and the number of support groups over the years to help immigrant women and other people adjust and get ahead in this country. I would like to ask her, from her experience over the years, what impact has the effect of government budgets and government cutbacks had on various support groups that have been trying to help disadvantaged groups in her riding and perhaps right across the country. If she could make some comments on that, I think it would be quite enlightening.
March 26, 1993


Margaret Anne Mitchell: Of course, speaking more generally and not only from a NAFTA point of view, we know that the federal government has targeted advocacy groups, in particular immigrant and visible minority groups, the Canadian Ethnocultural Council and many groups and communities, and has cut back on their funding, just as it has cut back on native friendship centres, for example.
These groups are needed as advocates to work for improvement in the conditions for these people. The government has cut back and they are now having to close.
It is very interesting that the member for Vancouver Centre who is aspiring to be Prime Minister is talking about wonderful citizen involvement, grass roots citizen involvement when it was her government in its budgets year after year that cut out any funding that makes it possible for people to organize, to speak for themselves, to get involved in the whole process of speaking for themselves and developing programs affecting government.
There are those impacts. There are also great impacts on immigrant people coming in, immigrant women who are the last hired and first fired, and on small businesses. I know in my area, in Chinatown particularly, I have had merchants saying how difficult it is to survive and the impact the combination of FTA, the free trade agreement, plus GST has had on their businesses. It has just about made them go under.
Also it seems unfair that we are putting so much emphasis on north-south trade and ignoring the Pacific Rim where there is tremendous potential. That is certainly what we should be developing.


Daniel James Macdonnell Heap: Mr. Speaker, we have divided our time because we want to speak on this bill and we know that time is running out. We know that we will not get a fair chance to speak on the official debate on the North American free trade agreement because the government is cutting it to two half-day debates. It is not even two days.
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However, these two bills are closely related, though the NAFTA bill is more important. The government is asking us to agree to let it borrow $31.5 billion and it has not told us what it is for. It did put out an incomplete financial statement in December. Things have changed further since then, as the government itself admits. It is not giving us a real budget prediction for the coming year but is telling us: "Lend us this money to spend it on such and such". It is just asking for a blank cheque.
We in our party would not lend the government a nickel, considering its record of wasting money. The government has been wasting the taxpayers' money for eight and a half years. It has given tax breaks to rich people, which is the main source of the growth of the deficit in the last few years. The previous government started it and this government has continued it.
The government has been giving tax breaks to rich individuals and big corporations and grants to big corporations. It is giving grants and subsidies to the arms industry at a time when it does not need it. The cold war is over. Not only are the Russians not there, but the subs are not in the ocean. They do not have enough fuel or enough dollars to put their subs out to sea. If we want to watch where their subs are we just have to send somebody to the northern port at Murmansk and he can count them because they are all tied up at the docks, so we read.
This government is wasting money on armaments at a time when it should be investing in things Canadian people need. It is going to blow $5.5 billion on helicopters to hunt for submarines that are not coming.
It has changed the laws to sell automatic weapons to foreign powers. It has in fact decided to sell over a thousand troop carriers with automatic machine guns on them to Saudi Arabia, a country that is already too highly militarized with a notorious record for abusing its own citizens and denying freedom, particularly to women.
It has also agreed that Canada will sell frigates to Saudi Arabia, probably $1.5 billion worth.

March 26, 1993
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That kind of encouragement to the international arms race is going to promote more war. It promoted the gulf war because we had been arming Saddam and were then surprised that he used his arms. We are now hurrying to try to sell more weapons to more dictators and police states around the world.
The reason is that the Tories believe in the trickle down theory: If you give the money to the rich they will spend it and somehow the poor will get some too. What they always leave out of that nice theory is that they did not take the money in the first place from the rich; they took the money from the people at the bottom and in the middle and gave it to the rich. Then they tell the people at the middle and the bottom that if they live long enough some of that money will come back to them. That is their trickle down theory.
That is also why they signed this agreement with the United States, the free trade agreement, which has ruined hundreds of thousands of good jobs in Canada. The agreement gives control of our economy to the great transnational corporations which are mostly based in the United States. Tire North American free trade agreement will give further control even over the provincial governments.


Shirley Maheu: That's our socialist: Print the money.


Mr. O'Kurley:: Comrade.


Daniel James Macdonnell Heap: If the hon. member would come to order it would make it easier for the House to carry on its business, instead of carrying on her gossip across the floor.
The purpose of the free trade agreement, like the purpose of the whole Tory agenda, is to prevent the Canadian people from controlling their own economy, from controlling their own daily working lives to produce the things we need. The result after that, for example in metro Toronto according to a recent report of the Social Planning Council, is that more than 21 per cent of the people of Toronto-that is of 2.5 million people-are on social assistance. More than one in five is on social assistance. The reason for that is simply the unemployment that has resulted from the free trade agreement. The factories were being shut down even before the NDP government was elected. They had been shut down, dismantled, emptied of their machinery.
Unemployment is up across the country, although it is stronger in the manufacturing area because it is there that the American corporations made their attack, shutting down branch plants, buying up plants to shut them down so the production would be concentrated in the United States.
The government brags about increased export of goods which it has been able to do by at last devaluing the dollar, but it does not tell us about the drop in the export of services where most of the jobs are.
The Tory agenda has caused unemployment and extreme poverty so that one-fifth of the people of metro Toronto are now on social assistance.
There was a study done by the Social Planning Council of Metropolitan Toronto. It divided the incomes of people according to size into 10 groups-the highest, the middle and the smallest-about 350,000 families in each group, just the families. It found that 10 per cent of the families with the highest income during the last 20 years increased their income by 3 per cent, that is their share of their national income, to $124 million per family on average, while the bottom 10 per cent found their income dropping. It dropped by almost .5 per cent so that they are now only getting $3,400. In other words, the top ones are getting about 40 times as much as the bottom ones.
They have reckoned the top ones' increase in worth at about $5.4 billion. If it were divided evenly among the bottom ones with the same number of families, 350,000 at the top and 350,000 at the bottom, it would give an income to each bottom one of about $15,000 more.
How could that be done? It would not have to be done by handouts except in the short, emergency situations. We could close the food banks in Toronto in short order if we made certain changes, if we had fair taxation, taxation according to ability to pay instead of people earning $200,000 or $300,000 paying no taxes, corporations worth many millions of dollars paying no taxes and the taxes being loaded on to the people at the bottom and the middle, even people on unemployment insurance or pension paying taxes.
We could make fair employment and unemployment insurance rules. We could have proper investment in health, education and housing. We could have a day care system that people need. Those would all provide scores of thousands of new jobs. We could also rebuild the transportation and communication systems of Canada east and west instead of making Canadians depend on going south to the United States. All of that would create the jobs if we dumped the free trade agreement
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and dumped the whole Tory agenda with its unfair tax system.


Rodney Edward Laporte: Mr. Speaker, I commend the member on his speech. I have a question for him.
The member has been very active in helping the socially downtrodden in this country over the years as a minister, as a member of the New Democratic Party and as a member of Parliament. I also know he has been active on a great many committees. Being from the Toronto area he certainly has seen his share of hardships and suffering in that area of the country as there is in many other areas of the country.
I would like to ask the member to comment on exactly what the state of poverty is in this country and how it has changed even in the past 15 years since he has been involved. We have had Tory governments and Liberal governments all claiming to want to help the socially downtrodden and wanting to improve the lot of people. I wonder if he can make some comments on how he sees the kind of improvement that has been made in this country with respect to the poor. Are the numbers decreasing? Are they increasing? Is there hope there? Has the hope diminished? Have problems increased? Have problems changed?
This is a general question but I think it is very important that we start looking at a perspective and get a bit of a picture as to exactly what is the state of individuals in this country, those who are financially not as well off as many, those who are suffering socially and those who are suffering emotionally. How are we dealing with those people in Canada? How are we improving their situation? How are we improving their lot in this country?


Daniel James Macdonnell Heap: Mr. Speaker, I thank the hon. member for the question. It is a very broad one. I will just pick two or three points.
As to what has happened in the last 15 years, I will go a little bit farther back than 15 years. In 1975 the then government of Pierre Trudeau imposed a wage freeze. At one stroke, without the slightest consultation, even less consultation perhaps than the present government uses, he denied the legislated and hard won right of the working people of this country through their unions to bargain for higher wages.
He simply imposed a freeze. He claimed he was imposing a freeze on prices. Nobody ever noticed the price freeze. Certainly he did not even claim to impose a freeze on profits. Since then there have been many moves like that by Liberal and Tory governments to take away the strength that the working class in Canada has won through a century or two of struggle, almost an entirely peaceful struggle, on the part of the working class.
Second, there were the tax breaks for the rich initiated by the Liberal government in the early seventies and then much increased by the Tory government in the last eight and a half years by which they have simply taxed poorer and middle income people into a lower level of real income than they had in those years past.
Third, beginning again with the Liberal government in the early eighties and continuing at a greater pace under the Tory government, they have been dismantling the health system, the post-secondary education system and the transportation system of this country so as to make Canada more dependent on private enterprise, that is to say on the transnational corporations which are now moving in to take over health and moving in to take over education even in lower systems. Now they are even dismantling the telephone and other communications systems in this country to make us dependent on large American multinationals.
Basically it is a policy that the present Deputy Prime Minister enunciated before the last free trade agreement, before the last election. He explained to people in the oil patch this free trade agreement would protect the oil barons against a left wing Liberal government or an NDP government.
In other words, the free trade agreement is to protect the companies from the people of Canada in case the people of Canada should elect a government that did not support the companies in the style to which they aspire.

March 26, 1993
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Don Boudria: Mr. Speaker, I understood that an hon. member across the way had wanted to be recognized. He is not in his place so I will continue my remarks.
I just want to indicate to the Chair that first I would like to share my time with the hon. member for Ottawa West.

The government is asking this House today to grant it authority to borrow $31.5 billion. We are therefore discussing the government's fiscal and administrative policy.
Before going further, I would like to dissociate myself from the comments made by my colleague from Trinity- Spadina. I have a lot of esteem for him, but even though I do not much like the government opposite, I will not go so far as to say that the government intentionally or in bad faith acted against the interests of the Canadian people.
I do not agree with the Conservatives' policy, but I still recognize that most people in this House are doing their best for their constituents.
We must establish new policies in this country and restore the confidence of the Canadian people in government institutions. Barely two hours ago, we had an oral question period in this House during which the government was questioned on the Prime Minister's behaviour in appointing people to sit in the other place just as he himself is preparing to leave this House.
Moreover, in 1981 the Prime Minister had also promised not to proceed to any nomination when his turn came to step down. Today he is breaking his word and Canadians feel cheated. For some members, these nominations of two, three or four persons, this type of thing, may be of little importance.
Compared to $31.5 billion this is just peanuts but it has to do with trust, because when the Canadian people cannot trust their Prime Minister, who is making appointments despite his solemn commitment not to do so on Canadian television nine years ago, how can they trust the Conservative government in other matters? In my opinion, despite all the hoopla about a leadership
race, the Conservatives will not regain the confidence of the Canadian people.
This kind of cynicism leads people to wonder who they can trust. This is sad because it gives a bad name to this institution and to all of us. We should stop and think about that today.
At this very moment, the hon. Leader of the Opposition-I almost said the right honourable, but it will come soon-is making a speech before the Sainte-Foy Chamber of Commerce to annonce the research and development program of the Liberal Party of Canada. I want to take this opportunity on behalf of most, if not all members in this House to congratulate the Leader of the Opposition and member for Beausejour on the excellent program he announced in Sainte-Foy. This program is designed for the Canadian people and its goal is to update our way of looking at research and development not only in the decade already under way but for years to come.
The Leader of the Opposition said and I quote: "A wind of cynicism is now blowing over this country's institutions in which we used to take pride." He then added: "It is time to bring back that pride. But how can we speak of pride to an unemployed of 45 whose employer had to close his business under the combined pressure of a free trade agreement without a transition program and a GST that needs an army of accountants to administer". That is well said, Mr. Speaker.
It is not enough to criticize, and the intention of the Leader of the Opposition is in no way to limit himself to that. We must do it because we must make this government accountable for its actions and we do so with all the necessary vigilance. Moreover, my colleague and my leader, the hon. member for Beausejour, wants to propose a proactive program in the field of R&D, namely the Liberal Party program. He says, and I quote him again: "It is through this network of new links that a Liberal government will create a national apprenticeship program to help young people complete their studies and be better prepared to enter the work force".
Just a few days ago in this House, we debated a bill which would impose a 3 per cent tax on student loans. Moreover, the students would be subject to an additional six months of interest payments. Is this the way to help our young people complete their academic training? This is a backward approach.
March 26, 1993

Imposing additional charges will not encourage our young people to finish college or university. As the Leader of the Opposition rightly said, we must do everything to better prepare our youth for the labour market. Of course, a very good way to prepare them better is to have them stay in school long enough to acquire a better academic, technical or professional training, so that they are not condemned to low-paying jobs for the rest of their lives or, even worse, condemned to losing their jobs whenever the economy declines.
The Leader of the Opposition also said in his excellent speech: "I would call on the Canadian banks to be more flexible and understanding with them, so that they can obtain the financing they need". Of course, he was talking about small and medium sized businesses. He added: "In addition a Liberal government will continue the reform of the Small Businesses Loans Act, make access to risk capital easier, support our export potential and ease the regulatory burden on small and mediumsized businesses".
These are some of the things that the Leader of the Opposition is proposing to us and to Canadians. Representing a riding like Glengarry-Prescott-Russell, I can attest to this need for better academic and occupational training.
I would like to conclude by urging the government opposite to provide the necessary funds, with the Government of Ontario, for building the Cite collegiale here in Ottawa, as well as the satellite campuses in Hawkes-bury and Cornwall, so we can train the people of our region and encourage them to stay in school and upgrade their skills, as others already have, but which our people have not always had a chance to do.
The federal government has been negotiating with the province for a long time. I encourage both parties to conclude these negotiations and build this Cite collegiale, so long awaited by the people of my riding and other parts of eastern Ontario.


Rodney Edward Laporte: Mr. Speaker, I want to direct a question to the hon. member for Glengarry-Prescott-Russell who is a member I
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have respect for. He is a very hard working member and is certainly very sincere in his approach to handling matters with respect to the House and his riding.
As he will know there are many people in this country who have been critical of the federal Liberal Party with respect to the fact that it has not been clear on many issues. It has been vague. Having looked at the Leader of the Opposition's speech I must say that I have been unable to find the specifics.
I would like to ask the hon. member something specifically with respect to the future of the economy, which is going to be germane to any advances we are going to make on social and other issues in this country. What is his party's position with respect to the NAFTA agreement? Is his party opposed to the NAFTA agreement? Will his party, if elected, announce that the NAFTA agreement will not go ahead on January 1, 1994?
With respect to the GST his party has made comments that it was going to remove the GST. What is his plan to replace the GST? What will take its place? Will there be another tax? Will there be a different approach as to how Canadians are taxed? Finally, what is his position and his party's position with respect to an economic plan?
It would be interesting to hear some specifics because, with due respect, we are not getting an awful lot of specifics from the Liberal Party- We would like to hear some specifics now if the hon. member would oblige the House.
.(1355 )


Don Boudria: Mr. Speaker, I am being asked to explain the economic, fiscal, monetary and trade policies and skills training of the Liberal Party in the next three minutes. That is not going to be an easy job. I will attack some of these topics. I will gladly send him much of the material that the Liberal Party has put together so far.
The hon. member knows, in spite of what he says, that there have been several pronouncements in that regard. The Leader of the Opposition, for instance, gave an extensive speech at the University of Ottawa on the economic recovery in our country. He also gave another speech in Toronto. I have just quoted from the one in Ste. Foy, Quebec today with regard to trade. I will gladly forward him a copy of it.

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I want to address a couple of things specifically, however. The first is on trade. There is no doubt that the cornerstone of any trade policy has to be the General Agreement on Tariffs and Trade. In terms of the North American free trade agreement our position is that this agreement should only proceed once Canada is satisfied that through parallel accords we have corrected the shortcomings of the original deal. Our trade critic has expressed this many, many times in the House. He asks very responsible questions every day in expressing what we need.
What do we need specifically? First of all we need to improve the Canada-U.S. Free Trade Agreement in reference to the subsidy code. We need also to recover some of our losses in the energy area. We all know that. We have spoken on those extensively in the past. There is insufficient protection for the environment in the North American free trade agreement as it is. The Americans have recognized that and the new administration wants a parallel accord. The problem is that the government across the way says it does not need anything and the accord is fine as it is. We do not agree.
The member asked about the goods and services tax. Here is the position we have taken. We know as a government-which we hope to be very soon-we are going to need the funding necessary to function and to continue to provide for the social programs that we as a party invented a number of years ago. We know we will need the money from some place. It is not just swell to say we will abolish the GST and not replace it with anything. That is not very responsible or cute. Of course we do have to replace it with something.
The Leader of the Opposition has stated that he will appoint a committee of this House to travel right across the country to develop a program within 12 months after the government is sworn into office so we can replace this tax. Yes, there will be another tax but it will be one that works and does not take an army of accountants to figure out and does not provide the burden that this present taxation regime does on small and medium sized businesses in my riding and elsewhere in Canada.
I am also supposed to respond to economic policy but I think my time has run out.


Marlene Catterall: Madam Speaker, it is important to point out for people who are listening to our debate this Friday afternoon what it is we are debating.
We are debating a government that says it is interested in reducing the debt and the deficit that is borrowing a new $31.5 billion. That is adding to the debt instead of reducing it. I do not think anybody out there needs to be reminded that it also means adding to the deficit because we are going to have to pick up the interest on that $31.5 billion of new debt.
For a government that says it wants to stay the course on reducing the debt and the deficit this must seem to ordinary people out there watching us, and to those of us who like to think we have some common sense in here, just a little bit contradictory not to say hypocritical. However, sometimes we all borrow money because we have important purchases to make and important things to do. We want to invest in our children's education. The time has come to buy a new home and we know we are going to be building up our capacity to enjoy the future and to enjoy more security in the future. Let us have a look and see if that in fact is what the government is going to do with this $31.5 billion it is borrowing today.
First, where is it going to borrow the money? Is that borrowing going to help Canadians and Canada?
We know it has increased our foreign borrowing to the point where $22 billion in interest is going out of this country every year, outside Canada, out of the Canadian economy, away from where it can stimulate economic growth, job creation, research and development for Canada and for our economic future.
This government has us to the point where we are now sending $22 billion of that annual deficit outside Canada. That is bad enough, but another interesting point is that on the $22 billion nobody in Canada is paying tax. Not only are we sending $22 billion outside the country, but assuming a 50 per cent income tax rate we are also giving up $11 billion in income tax we could be earning on that $22 billion of interest. We have a further drain on the Canadian economy.
March 26, 1993

As I said sometimes it makes sense to borrow money. It depends on what is to be done with it. What is the government going to do with it? What is the biggest problem confronting Canada now? What is the biggest problem confronting Canadians? What is the biggest worry of our young people or of people in middle age who suddenly find themselves without jobs and not knowing how they are going to pay for their mortgages or rent or put food on the table?
A job, I think, is the biggest worry of most Canadians. Turning to unemployment in this country, 11.6 million Canadians are without jobs. There five million Canadians in total either on unemployment insurance, welfare, or living in a household where the income earner is on unemployment insurance or welfare. Where is the government's job creation program? Surely that is what it wants this $31.5 billion for.
It does not have a job creation program. It thinks this level of unemployment is just fine and that somehow Canadians will have to struggle through it and survive as best they can. It has just finished telling those same Canadians who are without jobs that the unemployment insurance they have paid into all their lives is not going to help them out much and is going to help out fewer people.
Is it going to help our young people who have never yet had jobs because they happened to come out of school at a time of high unemployment? Is this government going to be using this $31.5 billion to invest in more student loans and student grants to help young people get better education and better training so they have a future? No. In fact it is planning to give up all responsibility for the student loan program.
We all know that this past year the government started charging young people who are poor enough to qualify for student loans a fee for the loans. They do not have enough money to go to university so they qualify for the loans but now they have to pay a fee to get the loans.
Older people in our country are worried about the future of medicare and about the future of their pensions. Is this government planning to use this $31.5 billion to ensure the security of the old age security scheme or to ensure the future of medicare? No, that is not in its plans either.
Is the government planning to reduce taxes? Is it planning to do anything about those 37 different tax
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increases it has imposed on Canadians in the last nine years that have created a large part of the economic difficulty we have by taking purchasing power out of the hands of consumers? No, that is not what it is planning to use this $31.5 billion for either.
Is it planning to improve government services so that people are not waiting two, three or four years to have a family member join them from the country they emigrated from?
Is it planning to improve services to Canadians so seniors are not waiting six months? After spending weeks on the telephone unable to get through busy signals, they are forced to go down to visit an office because there are not enough staff and there is not enough equipment to give Canadian seniors the pensions they are entitled to. No, that is not how it is planning to spend it either. It is not planning to add more public servants to deliver the service seniors really want. It becomes pretty difficult to go downtown three or four times, since they cannot get through on the phone, just to try to qualify for pensions they are entitled to because they have contributed to them all their lives.
Is the government planning to put this money into solving the problems of the environment? No, it is not. It has just gone through cutting the green plan. In fact the green plan has been a better example of cutting than of curing. From the time it was introduced in 1991 it has been steadily drained and bled of funds to solve our environmental problems. The estimates tabled just a few weeks ago show further cuts to the green plan.
Is the government planning to invest in research and development? No. It has been a steady slice away at research and development, slice away at the opportunities for the future for this country and slice away at our ability to compete internationally because we are in the forefront of key sectors of new knowledge.
As I said at the beginning sometimes it makes sense to borrow. It makes sense when we have good, positive, important things we want to accomplish. In the four years I have been in this House I have yet to hear one good positive thing that the government wants to accomplish for Canada. I have seen the cut of this, the destruction of that, the ruination of the other, and I wait yet to see one positive thing.

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That is why I will say no to borrowing $31.5 billion. I do not think the government needs it because it does not have a plan to use it for the benefit of Canada.


Mr. Jean-Guy Hudon (Parliamentary Secretary to President of the Privy Council and Minister Responsible for Constitutional Affairs):: Madam Speaker, I would have a question for my hon. colleague. I have been listening to her for a while and have heard nothing but negative comments. She said since she was elected to this House four years ago she has found nothing positive. But would she not say that one of the biggest problems facing this country-I agree that unemployment is probably the biggest but this is a big problem too in our country-is this propensity to complain about just about anything.
From listening to her speech one would believe that no more R and D is being done. That is not true at all. The people watching us deserve better information than that. There are great things being done in R and D. Some things are happening through the green plan. There are things going on everywhere. But the best job creation plan may not be to hire more civil servants to answer the phone, but rather a plan to put the economy back on track again, an economic recovery plan to restore Canadians' confidence in the economy. That is what we are doing and I find it regrettable that she would have negative things to say about that. I am not expecting praise from the other side, but it will not be said that everything is going wrong in this country. All that the younger generation watching us on the Parliamentary Channel can hear is moaning, not unlike what I am doing right now as a matter of fact.


Marlene Catterall: I could not agree more, Madam Speaker, that there is a need to restore confidence in the economy and in the future of our country. That is not what I am blaming this government for, this government that has destroyed the confidence the people of Canada had in their country by failing to ensure proper prospects for the future. Confidence in the economy must be restored, but this cannot be done by borrowing an
additional $31 billion when the deficit already stands at $500 billion or so. Canadians would only feel more disperrate.


Herb Breau: Madam Speaker, I was interested in the comments of the hon. member opposite because she and I share responsibilities on one of the House of Commons standing committee.
Generally speaking I have a great regard for her comments. However some of the statements and innuendoes in her speech are worthy of a response. With regard to the money being borrowed, most fair-minded Canadians realize the money is being borrowed to pay the interest on the Liberal debt. Most people also realize the entire national debt of Canada is the original debt in 1984 the Liberals created in addition to the compound interest. Since 1984 the Government of Canada has accumulated an operating surplus of $33 billion. If it were not for that surplus our debt situation would be quite a bit worse.
With regard to the comments of the hon. member about interest rates and about foreign borrowing, would she recommend as a policy of the government that interest rates be increased to encourage domestic borrowing, increased to the rate the Liberals had during their term of government of something in the order of 22 per cent? Would it be her recommendation to encourage domestic borrowing to service the Liberal debt?


Marlene Catterall: Madam Speaker, the member knows perfectly well the debt of the early seventies and eighties was paid off many times over in the time he has been in Parliament. It has been reborrowing by the member's government that has more than doubled the debt.


Some hon. members:: No, no.


Marlene Catterall: Madam Speaker, would you like to bring order or perhaps I should do it. None of us in this Chamber has not been in debt. We know that when our income rises, as the income of the government rose dramatically-


Some hon. members:: Oh, oh.
March 26, 1993


Madam Deputy Speaker:: Fortunately the five minutes for questions and comments are up.


Mac Harb: Madam Speaker, I cannot believe my ears. It is Friday afternoon and we are shouting across the aisle actually trying to-


Madam Deputy Speaker:: If the hon. member will allow me I do not believe my eyes or my ears either. Shouting in the House, this week? No. The hon. member for Ottawa Centre.


Mac Harb: You said it, Madam Speaker. We get to a point where we have to start looking forward and stop crying over the past. We have to shift our cars into full gear so we can move toward the next century and have a positive outlook.
I could not help but try to get involved in this debate somehow, at least from our local perspective at the national level in the Ottawa-Carleton region. The government obviously is talking about debts and deficit reduction, economic growth and so on. All those are wonderful things but sometimes action speaks much better than words and is a true reflection of what is happening out there.
I would like to share from the perspective of the Ottawa labour market what is happening in terms of the record of this government and what it has done to the industry in this region alone. If the industries are doing fine they are selling, employing people and paying taxes. Then we have a lower unemployment rate and a high productivity level and everybody feels good.
Let us look at some of the figures from the local industry in this region. I am going to share a few of those figures with the House. In 1992 the construction industry, for instance, pretty well followed the national trend. We have seen a decrease in that by 2,600 people. In terms of the over-all industry it is a reduction of over 23.9 per cent.
In the trade and commerce industry for instance employment has decreased by 1.8 per cent. It was 45,200 in 1992 and that is down from 56,800 in 1990. As we see there has been a tremendous drop in this particular area and that represents a rate of approximately 8.5 per cent.
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The construction and trade sectors have taken a big hit over the past three years or so. In our region's finance, insurance and real estate industry, while employment in
1990	was 22,900, as a result of the worsening economy and the bad politics which have taken place at the federal level and the provincial level in Ontario we have seen a decline to 19,600 in 1991. That represents a decrease in terms of the over-all number of people in the work force.
The management and professional administration group has lost 1.3 per cent in terms of the number of people who were employed in 1992. Service occupations is another sector in our region which was extremely affected by what has taken place. The food and beverage sector lost 2,600 jobs in 1992 while the unemployment rate was at 8.1 per cent, fairly low when we compare that to 1984 figures.
In the processing occupations again we have seen a downward trend. This group has lost 2,200 jobs in our region. The construction sector, as I indicated a little earlier, also lost 2,400 jobs in 1992.
Obviously if these people are losing their jobs there is only one thing for them to do and that is to claim unemployment insurance. It is interesting to note that in
1991	there were 22,337 who claimed UI benefits on a monthly basis. That is something the government should have noticed a long time ago.
People go on UI for a few months and then it runs out. Then what do they do? They move on to the social welfare assistance rolls. It is interesting that there are on average in this region over 3,500 cases a month of people who are collecting social welfare assistance.
These are the figures. I have to ask my colleagues on the other side of the House what the government has really done to help the people get back on track and to encourage them to move forward.
To be quite frank, the combination of provincial and federal politics has been a recipe for disaster over the past three years. It has failed. I can only say it is because of the mismanagement of the economy, nothing more, nothing less.
One would ask how we deal with the question of the deficit. There are two areas and the government can take note of them One of them is investing effectively and efficiently in the area of education and combating illiteracy. The other one is crime prevention.

March 26, 1993
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Not too long ago we had a conference in Toronto. The public was informed that the cost of crime in our country was over $14 billion a year. Two years before that we were told that the cost of illiteracy in Canada, in terms of the cost to society as a whole, was over $10 billion a year. That is over $24 billion cut out of the economy annually. That is as a result of mishaps, lack of planning, and the fact that over the past few years we have been playing a reactive rather than proactive role when it comes to the economy and society as a whole.
Another extremely important factor is in our institutions, for example in our jails. I am informed that it costs us over $70,000 annually to keep somebody in jail. That is the kind of thing, as a government and as a society, we have to sit down and look at in terms of how we are doing things. We can no longer deal with the situation we are faced with today the same way we dealt with it 30 or 40 years ago. We have to change our ways and attitudes.
The government has had tremendous opportunities to get the economy back on track but has failed to do so. Month after month, year after year we have heard government ministers and the Prime Minister speaking out on the question of education and initiatives that will help the economy get back on track.
They have commissioned report after report. The latest report I am told cost over $20 million and deals with the question of prosperity in order to put Canada back on track. I have yet to see one single action plan coming out of this report that would put this country back on track.
We have been talking a lot but have not yet seen one single tangible action that the Canadian public can look at and say: "That does make sense. We should proceed with that proposal because it would help the economy".
We talk a lot about industry. What industry would want probably more than anything is to see the bureaucracy cleaned up and the red tape reduced. All industry would need is an understanding on the part of the government to help it just by eliminating or reducing the bureaucracy. But what do we see? We see a lack of
co-ordination and co-operation by different parts of government, both federal and provincial, but to a large extent the provincial government.
There is no way in this day and age that, for example, one is going to see business people coming to the province of Ontario to set up businesses. They are frightened because of the government's attitude. They see the government as being the enemy of business. Why do they do that? It is not because the government said it wanted to be the enemy of business, but because what the government has been doing has made it the enemy of business.
What is lacking here is a cohesive plan on the part of the government to address the questions of deficit and debt. We do not see that cohesive plan.


Ron J. Duhamel: Madam Speaker, I appreciated my colleague's comments and particularly those he made with respect to tackling increasing crime and how moneys might be saved in doing so. In the area of education, the member made some fairly insightful comments. I think they are extremely useful and we need to look at them.
I just wanted to make two points and then perhaps ask him to comment. Just a moment ago a colleague from the government side said we are always condemning government and never give it credit.

That is not quite true. We did admit they made some headway in controlling inflation, but we also had some questions. And the most important question is: at what price?

I just wanted to correct the record. When the government does have successes we are prepared to note them and we have done so.
I was wondering if my colleague might want to elaborate on the use of education, training, retraining, research and development in economic development. Perhaps as well he would like to comment on the following.
March 26, 1993

When this government came to power in 1984 the total debt accumulated since Confederation was almost $168 billion. Almost nine years later it is in excess of $450 billion, well over twice. I have that from a signed statement from the former Minister of Finance. That is in spite of almost 40 tax increases and a revenue increase from about $70 billion to $130 billion. The government has almost doubled its revenue so that makes it even worse. It has had this huge increase in revenues, and in fact it would have been greater if it had not caused the recession.
I wonder if my colleague would care to comment on any of those points, please.


Mac Harb: Madam Speaker, one of the reasons inflation is so low is that people do not have any money. The unemployment rate has hit the roof. It is well over 10 per cent to 11 per cent and in some regions it is over 25 per cent to 30 per cent.
I would have liked to have given the government credit for that. I am sorry but I just cannot because that was not as a result of a cohesive plan. It came by fluke.
Simply put because the value of the dollar is so high, there are so many people out of the work force. It is to the point that if stores close down there will be zero inflation. Nobody has money to spend and nobody is working. There is chaos everywhere. Bankruptcy has hit at an all-time high.
We talk about tough economic times. My gosh, we have seen what has happened in the past two and one-half years or so. Definitely, if anything, what should have happened is that the government should have moved forward with a proactive plan like our leader. He came up with a cohesive plan with investments in infrastructure and investments in capital projects. Every country in the western hemisphere and all of the G-7 have a cohesive plan that deals with the question of infrastructure, investing in roads, bridges, sewage treatment plants and so on.
What we have seen here is a new park and the government throwing a couple of million here and there and calling it an infrastructure plan, when the provinces have said they would participate in a national plan. We would create in a matter of three years over 100,000 jobs as a result of that. That is what would revitalize the
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economy. That is one way there can be a spin-off benefit. For every dollar that is spent we would get $5.
It does not take a genius to answer that part of the question. It has been proposed and suggested by our party and our leader.


Madam Deputy Speaker:: There are only 45 seconds left.


Douglas Grinslade Lewis: Madam Speaker, I believe my hon. friend was involved in municipal politics when the Hon. Paul Cosgrove, the Liberal minister of housing, shut down in the middle of the 1981-82 recession, any federal government involvement in municipal infrastructure.
Since that was done by a Liberal minister of the crown at the time and he has since gone to his great reward as a federal judge, I wonder if my hon. friend would explain to the House what representations he made as a municipal politician to the Liberal minister of the Crown at that time?


Mac Harb: Madam Speaker, I was not in municipal politics then. There is an act in the housing department for the minister to check. It is already on the books. We do not have to reintroduce a new act. We just have to do it through the existing act which is at CMHC right now.


Mr. George S. Baker (Gander-Grand Falls):: Madam Speaker, for the benefit of the Solicitor General, I was here in 1984. If he wants me to answer that question, I would be pleased to.
The situation was this. An agreement was signed with two provinces prior to the 1984 election to phase out what was called infrastructure funding under the Central Mortgage and Housing Corporation. When the Tories took over in 1984, the remaining provinces were then convinced because the Tory government said it could no longer afford the 75-25 formula. It was the one that cancelled that particular agreement.
If the Solicitor General had been listening to both of the members from Ottawa who were speaking a moment ago, he would have learned something. I quote the member correctly. One of the members said: "There is $22 billion interest that goes outside of Canada on this debt, this borrowing, and that $11 billion is given up in taxes on that because it is not being borrowed from Canadians". This a borrowing bill. The government wants to borrow $31.5 billion today.

March 26, 1993
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If the Solicitor General had been listening, he would have caught on to what these two members from Ottawa were saying. It is this: The difference between the Liberal government in 1984 and the Tories who took over in 1984 is quite simple. One borrowed from itself, the other borrowed from foreign nations.
In 1984 nine per cent of the total debt of Canada was owed to foreign investors. Today that figure has mushroomed to about 26 per cent of the total. The latest figures show 25.6 per cent and now I imagine it has gone up to 26 per cent. If one is going to borrow money it is better to borrow it from oneself than from Household Finance, is it not? If one is going to borrow money it is better to borrow it from one's mother than the Bank of Tokyo, is it not?
At least if one borrows from oneself through Canada Savings Bonds or the Canada Pension Plan, one is borrowing from Canadians who are willing to invest in Canada and one sets one's own interest rates. The Canadian government sets its own interest rates on the kind of money that is borrowed and it can also under certain circumstances decide on the repayment schedule.
What caused the Canadian government to create a situation in which at this very moment 38 per cent of all government bonds are held by people in Japan? In other words, when the Bank of Tokyo says jump the Minister of Finance says how high.
In this country the debt has more than doubled. The government has set up special teams of people to try to get money out of ordinary Canadian citizens. It set up a special team the other day with regard to the Canada student loans plan to try to collect what it said on the record were debts owed back to the sixties. It is a strange thing today for people to fill out their income tax returns and then be notified they cannot get the rebates, the Canadian government owes them, because it believes they owe Canada student loans from 1960. The people do not have any records from 1960. Neither does the law firm that perhaps acted on behalf of the government or the collection agency that probably bugged them to death at that time. That is what the Government of Canada is doing.
While it is cutting back on this, cutting back on that, and increasing taxes, what is it doing in the House of Commons? It is borrowing $31.5 billion today, this is
Friday, and what is it doing Monday? What is happening Monday in this House? Guess. No, it is not borrowing on Monday, it is bringing back Bill C-92. That is the bill that, if we can trust the words of the dean of law of Victoria university quoted in the paper, a tax expert here in Ottawa and the associate dean of Osgoode Hall who appeared before the committee last week and if we can believe the columnists who have written in the financial papers, it is supposed to be the biggest give-away, according to them not me, to the wealthiest people in Canada perhaps in Canadian history. Billions of dollars are being put off-


An hon. member:: Oh, oh.


George Baker: The hon. member is grumbling over there. Let him grumble with the deans of the law schools and the financial experts. Let him grumble with the people who appeared before the committee. Let him grumble with the finance department officials who came before that committee and said: "We do not know how much money is being affected here. We do not know how much money is in trusts in Canada". We do not know how much money, and we are passing a bill to again delay the paying of taxes for another 40 years? We are doing that while we borrow $31 billion, while we bring in the GST and tax everybody to death, and while we have 36 tax increases in the last eight years?
Then we turn around and, according to the experts not the politicians, give the biggest tax break ever to the billionaires in Canada in our history. Make no wonder that the one sentence that the Prime Minister repeated in his speech was about how healthy the finances of the Conservative Party are. He took off his glasses and he even repeated it before the cameras. He talked about how healthy the finances of the Conservative Party are and about how he was leaving it in a very healthy position. It is too bad he did not leave the Canadian country in a healthy financial situation today.
Make no wonder the big contributions are coming in to the Conservative Party of Canada today. Make no wonder it is the richest party on record in the history of this country. Of course it is. It is no wonder when we examine the legislation that is going through this House today, which is the legislation that the experts say is the biggest giveaway to the 20 or so billionaires we have in Canada, the biggest giveaway in our taxation history.
March 26, 1993

Govemement members ask where we are going to get money. How about some of those people, and the numbers have doubled, making over a quarter of a million dollars a year who pay zero income tax in this country? How about some of those? That is not from business losses.
How about some of those making over 200 grand a year who are getting the GST rebate? Figure that one out. There are about 100. I suppose they would need about 100 children under the age of 18 to do that.
As for the two standards, one is saying they do not have any money so they have to borrow it and increase our taxes. The other is bringing legislation before this Chamber to help out just a tiny group of people. That is according to the deans of law and the tax experts in this country, not according to the politicians.


Thomas Hockin: Madam Speaker, I am always entertained by the hon. member's comments. I am delighted that I was able to get into the House to hear what he had to say.
I was disturbed by the content of what he said and I want to say that as an economics lecture this presentation we just had was totally misleading, although it was a lot of fun.
As a matter of fact, in the American basketball championships we are apparently down to the final 16 and it reminded me a little bit of these basketball coaches we see on the sidelines waving their arms around and so on. It is a lot of fun watching them but I do not know whether there is any content to it. It is really the players out there who are scoring the baskets.
What disturbed me about his comments was that he was completely misleading when it came to the debt. I think he believes profoundly in what he just said so I want to turn him around and see if he will confess to not understanding, and after listening to me perhaps he will understand exactly what happened.
He said when the Liberals were the government they had a $220 billion debt and they were able to fund it internally through Canada Savings Bonds and Treasury Bills. Through Canadians more or less buying the debt
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we kept the money funnelling within Canada. That was his basic argument and he is quite right. About 90 per cent of our debt was funded internally, and about 10 per cent of it was denominated in foreign currencies: Tokyo, New York, Europe, wherever.
Then he argued that what has happened now with the debt, which has occurred since we have been the government, is that we have had to go outside home, outside the household and get other people to finance our debt. That was his argument.
I want to tell my hon. friend that the reality is that when we borrowed $220 billion at home until 1984 to finance the excesses of the Trudeau government during very good times we had reached the limit of our capacity to borrow at home from Aunt Nellie, Uncle Oscar, mom and dad, and brother and sister. We had reached the limit. That is what happened. The trouble was the previous government had put all sorts of people on the payroll, had all sorts of projects under way and left us with a $38 billion deficit in 1984 alone.
If we had come in and the next day decreased that to zero then hundreds, thousands of people would have been left without jobs, projects, and contracts. Therefore we could not turn that around all in one year, so we have tried to decrease the deficit steadily. In fact in 1993 it is now half the size of what it was in 1984 in relation to the size of the economy. It is very important to remember that $38 billion in 1984 was in a pie, called the Canadian economy, half the size of the pie we now have. Therefore a $30 billion deficit is half the size of what it was nine years ago.
Here is the point. We have had to borrow offshore in order just to pay the interest on this home debt that accumulated until 1984. As a matter of fact, that is all the deficit is. We have really been paying for interest on the debt we inherited, and that adds up to today's deficit. With our own operations we have run a surplus. By running a surplus on our own operations we are able to pay down the deficit even more than we would if we just broke even. The hon. member has to realize the reason we have had to go offshore to finance our debt is because we have reached the limits of financing it only internally.

March 26, 1993
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Then he mentioned interest rates and said when we are financing internally we can set our own interest rates. No economist believes that. We have always had to maintain interest rates internally, the same as they are internationally. My hon. friend knows that and I think he should go back to economics 100 and have the reality clarified for him. I am making this intervention so he can respond to it. I always look forward to his responses, but I hope he stands up and admits he made a fundamental error in understanding economics.


Madam Deputy Speaker:: I will allow the hon. member some time to answer.


George Baker: Madam Speaker, if I understand the hon. minister correctly he said, to use his words, that we had to go outside of the family. In other words, we had to go outside of Canada because Aunt Nellie does not have any more money. We have reached the extent of Canadian borrowing. Perhaps it is because Aunt Nellie does not trust the government anymore. Aunt Nellie and many more Canadians are investing in bonds in the United States. They are investing in all countries throughout the world and the minister claims there is no more money left in Canada.
One further thing, to clear up this business of credit. Standard and Poor's announced its most recent credit rating for Canada. That is on paper money. Granted, we do not borrow much in that form but we dropped. The province of Ontario with an NDP government now has a negative rating. The province of Newfoundland, supposed to be the poorest in Canada but now with a good Liberal government that knows where it is going, is now positive.


Ron J. Duhamel: Madam Speaker, I am delighted to have the opportunity to say a few words on this borrowing bill.
I wish we could get our statistics right. I have a written, signed statement from the former Minister of Finance, the Minister for International Trade, indicating that at the end of fiscal 1984 the total accumulated debt was less than $168 billion. I like that signed statement so much I have circulated it throughout my riding. Why did I circulate it throughout my riding? I did so because
government members have a tendency to inflate that figure in order to make themselves look better.
Either the minister did not tell the truth or he told the truth, and I believe he signed a true statement. It was less than $168 billion, the hon. minister said so. He signed it.
Let us look at the situation as it is today. We say the deficit is much better than what it was. It was predicted to be less than $30 billion. It is in excess of $30 billion. The debt now is over $450 billion.
Our colleagues from the government would like to make us believe that if we took that less than $168 billion debt in 1984 and factored in the interest, it would now account for the debt today. It is not true.
I have had three independent sources do that and it is absolutely totally false. It is only recently that the government has been spending in such a way that their program spending is less than what they take in so I think it is very important.
A point that is often forgotten is that there have been almost 40 tax increases and the revenues of government used to be approximately $70 billion. It is roughly $130 billion and that would have doubled if it had not made a major fiasco of its economic policy, if the recession had not set in and if the GST had yielded what it thought it would. However there has been almost a $60 billion increase. We have to look at that.
We have to look at how much more money is being made today and not just the increase in the debt. If we look at how much more it is making today and how much more that debt has in fact increased over time then how can it possibly stand up there and pretend and say without blinking an eye that it has managed well?

Let us ask Canadians whether they think this is good management. The Conservatives came to power with a debt of less than $168 billion and revenues of $70 billion and today they have a debt of $450 billion and have nearly doubled government revenues. Is that good management? Certainly not.
March 26, 1993



Their financial predictions have been off time and time again.

If they are fair, and some of them are, my hon. colleagues will admit.

The government boasts of the control of its expenditure levels, particularly of late. It tosses out these figures of 2.4 per cent and up. These figures are probably correct. I have no reason to doubt they are but one must ask how this came about. It was by cutting back transfer payments to provinces. That has been one major way. It was with the clawback and with the eradication of certain universal programs.
Let us look at the reductions and cuts to health and education. Between 1986 and 1995 there will be roughly $30 billion fewer dollars for health and education: $20 billion less for health and about $10 billion less for education. That was put on the backs of the provinces and the provinces put it on the backs of the universities, the colleges and the hospitals and the taxpayers.
It is the same as if I were to say: I have debts. [Translation]
I could go home this evening, and tell my wife and children: "We are going to divide these debts in two. You take half." Then I could start telling everyone: "I liquidated half my debts." Of course I did. I shifted the tax burden to my wife and children.
The government shifted the tax burden to the provinces, colleges, universities and hospitals. That is what happened. That is why it can say, with some measure of truth, it controlled costs.

I have a final point. I know that some other colleagues want to join in the debate and I am looking forward to the questions. In fact I would be delighted to receive the questions.
The government has undertaken cuts in a number of areas that I think are very serious: seniors' programs, official languages programs-les langues officielles, women's programs, programs for the handicapped and programs for aboriginal peoples. These are some of the
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groups that are the most powerless in society and I am offended by that kind of approach.

I will conclude my speech, because I think some of my colleagues would like to ask some questions and I would like to answer them.
I think there is an hon. member on my left who would appreciate the time to make some comments. Provided he does not pick on the Liberals, I would be glad to share my time with him.


Jean-Guy Hudon: Madam Speaker, I do not understand why the hon. member says we cut transfer payments to the provinces. If we look at the government's record from 1984 to the present day, transfer payments have increased annually. They may not have increased as fast as the provinces would have liked, but they did increase.
We must not forget one thing. I have been listening to the debate since we started this morning, and they say we need a job creation program based on public works, because it will generate jobs.
Where is the money supposed to come from? We must not forget, while we sit here as members of the House of Commons in our well appointed chamber, that the taxpayers are sitting in the gallery. If we do not tax them at the provincial level or the municipal level, is the federal government going to tax them? Come on. In the end it is still the same taxpayer who watches us on television. When we have financial problems, the federal government has to tighten its belt and the provinces have to do the same.
A few years ago the government of Ontario thought it could deal with its financial problems by running up a horrendous debt. In the process it created a demand for dollars on the international market because it had to borrow. The money came from countries like Switzerland and Japan. This put pressure on money markets and had a negative impact on the economy. And the same taxpayer is still paying the shot. If public works or students do not pay back their loans and we have to do it for them, the federal government gets the money from the taxpayers, who do not want to spend that money on their education or pay their municipal, school or provincial taxes. We will have to give them a break sometime.

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Ron J. Duhamel: Madam Speaker, I definitely want students who have a job and have the money to pay back their loans. I want to make that absolutely clear. I asked a question in the House today about what could be done for students who don't have a job and who are being harassed by collection agencies that are trying to recover this money.
An infrastructure program has been proposed by the leader of my party. If these people were working, if I am not mistaken, it would pay them about $17,000 or $20,000 per year. If these people on unemployment insurance or welfare were put to work, they would pay taxes, contribute to the economy and not be a drain on the federal Treasury and other resources.
I would like to refresh the memory of the hon. member who is very fair and explained more or less that what I call a cut is actually a reduction. I can live with his definition, but on this Friday afternoon when the sun is shining I would like to say, with all due respect for the spirit of friendship within these precincts, that the Prime Minister of the party in power today said several times that he would never tamper with the transfer formula. But he did. Yes, it is right there in his public speeches. Not only did he tamper with it, he reduced it by 2 per cent and again by another percentage point. He froze transfers, and this has been a real nightmare.


Rodney Edward Laporte: Madam Speaker, I am pleased to be able to join in this debate for the last seven or eight minutes of the time that is allotted to this debate. I have been listening to the debate for most of the day. I am always amazed to see the Liberals and Tories ram heads with one another over who is going to provide the best economy and who will be the best economic managers of the state.
The fact is that neither of them has done what anyone would call an admirable job. Certainly to be more realistic they have done a disastrous job of handling the economy.
It has not been the New Democratic Party in power that has run up a debt of some $420 billion, which is soon to be $451.5 billion as we pass this borrowing bill in the next few days. As I stated earlier in the day I am always surprised when I hear Tories and Liberals saying how the
New Democrats cannot manage or handle an economy. In fact we have not created the problem in this country at all.
I am from a province that has been one of the hardest hit during these economic times and certainly over the history of this country. Saskatchewan has suffered dearly. When the CCF government of Tommy Douglas came to power in 1944 it was a time when the province could not even borrow a dime. It was the CCF, the reigning socialists, that brought the economic situation in Saskatchewan under control and provided opportunities for farm families, small businesses and education. It was Tommy Douglas who modernized the province of Saskatchewan. It was not the Liberals. It certainly was not the Tories. The record is very strong.
We lost power in 1964 and the Thatcher government took over. Ross Thatcher's Liberal government was in for seven years. Although it did not do as much destruction as the Devine government did later, it still left a mess.
The Allan Blakeney government came into power in 1971 and was in power for some 11 years. During that period Saskatchewan saw some unprecedented growth in that province. In fact it was in 1981 when Diane Francis-I am not sure which columnist it was but it was certainly one of the columnists on the right wing of the political spectrum-made a comment that the New Democratic government in Saskatchewan was not only the best managed government in Canada but was the best managed government in North America. It was a well run government and it was done on social democratic principles. He did it with a surplus budget besides that.
What happened in 1982? The Tory government came in under Grant Devine. People made ridiculous comments: "There is nothing wrong with this economy. One can afford to totally mismanage the Saskatchewan economy and still break even". That is what Devine said. He ran a deficit budget every single year he was in power. In the meantime he sold off Crown corporations, sold off provincial assets and cut funding to all types of organizations that were trying to help the disadvantaged and the poor and so on in that province. That was the Devine record.
March 26, 1993

When the Roy Romanow government took over in 1991 it had a situation that was a disaster. The province was $15 billion in debt. There were 980,000 people to pay off a $15 billion debt that was created almost exclusively by the Devine government that was supposed to have managers and Tories who could manage the economy. He has a masters degree in economics. My God. What a disaster.
Now the Roy Romanow government in power is faced with some very difficult situations. It is this government that has faced up to the fact that if the deficit is not cut in the province of Saskatchewan then we simply will not be able to borrow money. In fact we are so close to the precipice that in fact the federal government has put in a contingency plan in case we cannot borrow money.
The Roy Romanow government has cut the deficit from $980 million from the last year of the Devine government to $590 million last year. It is going to cut it to $390 million this year. In three years it is going to have a balanced budget. This is being done by the socialist hordes and the people who cannot manage an economy.
One simply has to look at the Saskatchewan government for an example of how to manage an economy. Even the Deputy Prime Minister has given some credit to Roy Romanow.
We have not been doing it the same way that rightwing Liberals and Tories have managed it. We have still managed to put money aside for the socially disadvantaged. We have actually increased payments to social assistance in Saskatchewan. We increased funding for a child hunger program. It is not enough. I must say that I have been critical myself of some of the things the provincial government has done but it is certainly miles ahead of anything any Liberal or Tory government has done in this country. It provided increased funding for low income seniors and it increased home care funding by 20 per cent. It has increased foster care rates by $2 million.
It set out a situation where it had some modest tax increases this year. It was not income tax. It has said that
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there will be no more tax increases unless of course the government decides to do some more off-loading on to the provincial government.
I sit here in the House and hear Liberals and Tories banter back and forth about who can manage the economy better.
I would say that both of them have set really poor examples. Neither of them has a very good record on handling the economy. I think both these members on the government side and members on the opposition side would do well to take a look at Saskatchewan and its economy and take some lessons from the Saskatchewan government, which is not perfect but is certainly way ahead of anything I have seen on either side of this House or in any other province in Canada.


Madam Deputy Speaker:: It being three o'clock p.m., the House will now proceed to the consideration of Private Members' Business as listed on today's Order Paper.



PRIVATE MEMBERS' BUSINESS


Don Boudria: That Bill C-217, an act to provide for the review of postal rates and services and to amend certain acts in consequence thereof, be read the second time and referred to a legislative committee in the Departmental envelope.
He said: Madam Speaker, I am pleased to move Bill C-217 in the House of Commons this afternoon. I am happy to see the member for Manicouagan here in the House. He also represents a rural riding. I also see the member for Beauhamois-Salaberry. They will understand the need for such a bill.
Why do we need Bill C-217? Let me indicate what others said in the past.

Private Members' Business

I want to quote from a press release dated June 27, 1988 which says: "Setting up a system that gives Canadians a voice in the planning of postal rates and services is an idea whose time has come". I quote further from the same person: "Now that Canada Post is breaking even", as it was at the time, "and revenues are coming out of the pockets of postal users, customers have a right to a say in both national and local issues".
Do you want to know who said that, Madam Speaker? It was the government House leader of today. If the government House leader, for whom I have such respect, said this was right I know it has to be right because the member for Calgary Centre would certainly not lead us astray on an important matter such as providing this kind of a service to Canadians.
When the minister made this announcement on June 27, 1988 he did so with great fanfare, telling us how important it was for Canadians to have a postal services review committee.
On August 15, 1988 the then Minister of Consumer and Corporate Affairs, today the government House leader, introduced the Postal Services Review Board Act. I must confess something here. Bill C-217 that I have introduced today is plagiarized. Yes, I know that it is a sinful thing but it is, word for word, the bill that was introduced by the now government House leader, the then consumer and corporate affairs minister.
Therefore the government across the way cannot say this bill is unreasonable. The government cannot say this bill is undesirable or unworthy of support, not after the quotes from the government House leader that I read in the House earlier today.
Why do we need a structure like that, apart from the reasons just invoked, that the minister said was a good idea? We need the bill because Canadians need to have an agency to review the activities of Canada Post. The government across the way tells us Canada Post is a Crown corporation and it cannot interfere with its operation. On the other hand, Canada Post has by law of this Parliament a monopoly on many of its services. The government does not control it by its own admission. Canada Post has a monopoly on first class mail and has a monopoly on many of the services it offers.
We have in effect an unregulated monopoly in Canada right now. That is wrong. That is not the fault of the employees and many of the officials at Canada Post. That is an error in judgment on the part of the government. That is why we need an agency of the Government of Canada, an agency of the taxpayers of Canada to oversee the operations of the post office and to provide the post office with some direction.
Let me give an example of one of the things that I find wrong. I received a letter just today. I finished answering the correspondence at the back only moments ago. A female constituent from Maxville, a senior citizen, wrote to me saying roughly the following: "Mr. Boudria, I live in a rural area just outside the village of Maxville. I used to get the postal box for $6.10 a year. Now they charge me close to $60 for the rental of that postal box. It is wrong".
I had a conversation with her and explained to her that Canada Post looks at it this way: "You are given an opportunity to have mail free at your gate if you want to install a box there". The lady quite appropriately answered: "What good does that do me, as a person living alone, a woman and a senior citizen? Am I going to go out there and shovel snow or put the mailbox back on the post when the snow plough knocks it off in the middle of winter?" That is not a reasonable thing for that person. Yet those rates for the mailboxes are approved with the input of no one.
The price of stamps goes up every year. It is approved by Order in Council of the cabinet. Four ministers sign a stack of these every morning and then it is gazetted with no input from Canadians at all. That is not right.
Then there is the whole issue of cross-subsidization. I brought proof to a parliamentary committee some years ago that Canada Post was using some of its monopoly revenue to cross-subsidize other services that it offers in which it is in competition with the private sector. That surely is not right.
It is wrong for two reasons. First of all, why should someone who is paying for a postage stamp be subsidizing some bigwig at Canada Post who has it in his mind that he wants to start up a new business for whatever reason? Why should we do that? Second, it is not fair for the competitors of that service.
March 26, 1993

Here is the instance I discovered about a year and a half or two years ago. I found evidence that Canada Post was sending letters to its customers, large mail users, saying roughly the following: "Fill up your postage machines now. In filling up your postage machines we will give you credit vouchers to be used for Priority Post courier". The courier service of course runs in competition with private enterprise and it is unregulated. By encouraging people to buy large amounts of postage stamps to load up their postage machines in their offices, some of the revenue of that was used to cross-subsidize the other. That cannot be right. There is no agency to review this.
Canada Post needs a form of CRTC of the post office. Maybe the member across does not think that is necessary. That agency exists in the United States. There is a watchdog to review its postal service.
With the present unpopularity of our Canadian postal system in Canada, if there were no other reason, that alone would be sufficient reason why we would want to avail ourselves of the kind of agency I am suggesting.
More than anything else, the Marchment committee report some years ago recommended the creation of such an agency. The Marchment committee report recommended in 1985 the creation of an agency like this.
In 1988, as I said, the Department of Consumer and Corporate Affairs announced that there would be a third party review of Canada Post Corporation's rates and services.
I brought to your attention that on June 27, 1988 the minister responsible at the time indicated that this was "an idea whose time has come". Finally, on August 15, 1988 the minister actually introduced the bill, a bill which is identical to the one I am proposing to the House today.
This has been an idea heavily promoted by the Conservative government with the support of all parties in this House. Yes, some of us said we wanted the bill that the government proposed to be a little stronger and so on in order to ensure that it had all the strength possible, but we were in favour of the idea.
What this House may not know is that the postal services review board, as proposed in this act, actually was constituted and its first chairman was Mr. Alan
Private Members' Business
Marchment. It was called the Postal Services Review Committee as an interim step until the act was passed. It even reported to a committee of this House.
I have in hand the February 6, 1990 report of Alan Marchment, chairman of the Postal Services Review Committee, to the House of Commons Standing Committee on Consumer and Corporate Affairs and Government Operations. It is quite a lengthy report in which he recommended a number of improvements to Canada's postal service.
What did the government do? In the next budget after that report, it cancelled the Postal Services Review Committee. I have to ask the question, why? Could it be that the committee told the government what it did not want to hear? Could it be, I ask the parliamentary secretary who I see waving to me, that the government did not have the money to continue it? If it did not have the money, why did it create the thing to start with? It was in operation for only a year.
Postal users pay a lot of money for their postage stamps. Are they not entitled to have a say? Right now they do not have any.
Here is the recommendation of our committee in April 1990. The Consumer and Corporate Affairs and Government Operations Committee of the House of Commons in its report "Moving the Mail" said, and I quote here from our report: "The committee also believes that it is necessary to balance the interests of the regulator and the corporation by supporting both the review agency's need for information and the corporation's need for protection for commercially sensitive data. At the same time, we are of the view that as much information as possible about postal rates and services must remain in the public domain".
We even made recommendations about how much information Canada Post had to give to this committee. I continue: "The committee therefore recommends that anybody exercising review powers of Canada Post have legal authority to compel Canada Post to provide all information necessary for it to conduct an effective review in accordance with its mandate. Secondly, while ensuring that as much information as possible remain public, provision be made where necessary to allow the review agency to receive information from Canada Post in confidence".

March 26, 1993
Private Members' Business
This is a recommendation that received the unanimous approval of a committee of this House.
I say today to the government that it should speak in favour of the bill, provide its unanimous consent to allow the bill to go to a legislative committee for review and enactment as soon as possible.
I ask this of our colleagues across the way. They know it is the right thing to do. They know such a structure exists for other kinds of monopoly services in Canada. They know such a structure exists for postal services elsewhere in the world. They know the same bill and the same structure have even existed under the present government.
I ask them to do for once what Canadian consumers want, to stop this nonsense, stop their partisan way of looking at things, and think of the best interest of the Canadian consumer who is paying handsomely for postal services that are administered in an arbitrary and sometimes most unfair way.


A.H. Harry Brightwell: Madam Speaker, I come to the debate today with some different feelings. I have as much concern for the post office service in Canada as the member for Glengarry-Prescott-Russell, but I also see the other side.
I came here today with strong feelings about the bill. Yet the member's argument has been quite persuasive for me in terms of the many viewpoints. The history of the situation intrigued me. At one time the government proposed a board, had a board and ended that board's life. In fact the party the member represents today at one time created the new independent post office structure on purpose so that it could compete in the communications area freely and without government intervention.
In spite of the argument of the hon. member for Glengarry- Prescott-Russell I propose that we do not support the bill today. Canada Post is one of the major players in the communications field. If we put on more regulations that increase costs and create obstruction we
will simply curtail its ability to function in the interests of the Canadian economy and Canadian businesses.
Most members will recall that in 1981 the previous government, with the agreement of all parties, converted the old money losing post office department into a Crown corporation. At the time the minister of the Crown of the day, the member for Papineau-Saint-Mi-chel, emphasized that the independence of the management of the new Canada Post would be one of the most important elements of making the new organization successful. As reported in the Debates for April 9, 1981, almost 12 years ago, he said at third reading of Bill C-42:
The Canadian public will be getting a better service and, above all, management will have a chance to give a full measure of their ability knowing that they are in full control of the situation and that they do not depend on decisions in other departments in order to provide an efficient management of the Canadian postal service.
It interests me that the hon. member speaking for his party today, or perhaps it is just for himself in Private Members' Hour, has taken a contrary stand to that of people in his own party 12 years ago as much as perhaps we have done in the time since the board has been in place.
The former minister also dealt directly with the question of setting regulated rates for postal services. He appeared to be quite satisfied, and apparently members on all sides of the House on that day were as well, that the arrangements in the legislation for establishing rates would allow for an adequate public input. The legislation which still exists to this day provides for a six-month notification of proposed changes. New rates are published in The Canada Gazette for everyone to see. Interested Canadians can forward their comments directly to the minister responsible for Canada Post. They take advantage of that right to a great extent. It may be because they are not effective in overturning the rates that they do not feel their requests are heard but I know they are. Certainly I see them coming through my office. Cabinet must still approve the rates. It is not totally done by the post office. There is an elected group of people who make decisions and exercise final control over postal rates.

The level of review of Canada Post rates at this time is already extensive. The hon. member now believes it is necessary to remove Canada Post's independence. He said in his opening statement that Canada Post was unregulated. He wants to impose more regulations. He wants to make it more difficult for Canada Post to function. In present circumstances his idea is not warranted.
The result of removing the management of the post office from interference by government has been to generate positive benefits for Canadians. We do not want to go back to the time when every postmaster was appointed on the recommendation of a member of Parliament. I understand there was one small community in the east coast represented by a Liberal cabinet minister of many years ago which had five postmasters for one town of 1,500 people. We do not want to see that kind of thing happen again.
Let me say a bit about the positive accomplishments of Canada Post. Hon. members are aware, because they will have been mailing many letters back to their ridings and perhaps across Canada, of the quick turnaround right now in Canada Post. We have had episodes since 1984 when I was first elected of it taking 10 days to get a letter to my riding in the centre of Ontario and 10 days to come back. It was a 20-day turnaround. Now the turnaround is so quick I almost wonder if the first letter ever went out. I will write it on a Monday, mail it to my riding and have an answer back in my office on the Hill before the end of the week. That is a very common occurrence.
Once in a while one or two letters take off or a bag of mail gets hooked up and those hit the headlines. The service from Canada Post for first-class mail has been very good in the last few years.
Postal rates have gone up, when measured in absolute terms by hours of work. The cost of a stamp compared to relative costs in other parts of the world is among the lowest in the industrialized world. This is a definite competitive advantage for Canadians.
On the labour front we have had many occurrences of difficult labour-management negotiations. Canada Post and major unions representing all the employees have signed settlements which will run for the next several years. We are into a period of calm and quiet where delivery can be the main objective of Canada Post.
Private Members' Business
Following several decades of losses in places where we had to pump in money to keep it going and where the general taxpayers as a whole covered for the users, Canada Post is now in a positive cash flow. Some of the money put in to cover deficits in the past is now returning to the Government of Canada. While doing this Canada Post has found new and innovative ways to expand service and make postal service available and affordable to more and more Canadians.
The hon. member might, through this legislation, take us back to the days when Canada Post was a department of government and introduce again the level of political interference which I spoke about a little earlier. The deliberate arm's length relationship with management as envisioned by the former minister might be destroyed if this legislation is brought in. A return to the old ways of doing things is simply another reversal of policy and an attempt to establish another level of costly bureaucracy.
I do not think the hon. member recognizes that competition in the marketplace has also been very influential in the progress Canada Post has achieved. I am told by constituents that because of electronic communication the post office is dead. Despite that, the amount of products delivered by the post office seems to increase yearly. Direct competition for parcel, courier, faxes and other products has forced the post office ahead. Technological electronics and the communication field have had a positive impact in motivating Canada Post to improve in all areas.
Canada Post competes and competition forces improvements. It has a stronger effect on its service than any board that would delay decisions and bring in committee style management could ever hope to introduce.
The member is proposing through this legislation to burden in this competitive field the business of Canada Post with the cost of a new regulatory regime. In trying to do this I am sure the committee would want to know the plans of Canada Post and in consultation with the board would expose the plans of Canada Post to its competitors. This would make it very difficult for Canada Post to respond rapidly to a changing market environment. The effect in Canada Post would be to eliminate it from competitive markets and increase the cost of postal service. The proposition is unfair and not in the best interest of Canadians.

March 26, 1993
Private Members' Business
Finally Canada Post has already seen the wisdom of consultation and has had a forum of postal services users express their concerns. The value to both the corporation and its customers is obvious.
The corporation decided to establish postal service customer councils. In preparing for this speech I learned about the councils today. I had not realized they were there. Perhaps that says they should be more prominent or more evident. I know through these councils, through approaches to members of Parliament which occur regularly, and through letters to the minister there is already an effective scrutiny of the tariffs charged by Canada Post. It also has a customer service initiative. Together with the 10 regional customer councils these are now a model for other Canadians companies.
Implementing the bill would be a step backward. The proposition of the Ottawa member would add a burden to the current postal services. It would not be in the interest of Canadians. Political interference, second guessing management, distorting competitive balances while adding unnecessary cost and bureaucracy are not conducive to a healthy and viable postal service for all Canadians. For these reasons I cannot support the proposed bill.


Fred J. Mifflin: Madam Speaker, I rise to speak on the bill put forward by my colleague, the member for Glengarry-Prescott- Russell. I am the seconder of the bill.
Despite the comments of my worthy colleague from Perth-Wellington-Waterloo I am very much in support of the bill. I must say I have the greatest respect for that member. I listened very closely to his comments. I believe I detected in the thread of his presentation a certain willingness. If not to accept the major thrust of the bill, his preliminary comments indicated that he a certain sympathy. I do not know if these were exact words but certainly my impression from listening to him was that he understood where the member proposing the bill was coming from. He had certain affinities with the principle of the bill. Then he went on to say that because of government interference, political interference, and the possibility of regulatory agencies or review boards slowing down the service of Canada Post he could not support it.
I found that very difficult to understand. The organization is operating properly, professionally and with skill,
alacrity and efficiency. The member gave it good accolades. I agree we do have complaints from time to time with Canada Post, but by and large compared with the postal services of other countries and their per capita expenditure relative to ours we fare pretty well.
That is not the point today. I do not believe there is any system in the world that could not be improved on. I believe that Canada Post can be improved on. I am going to give the reasons for the main principles of why I believe in this and why I feel the way I do.
I have had occasion, as I am sure every single member of Parliament in this House has, to deal with Canada Post on several issues. The most frequent and recurring one is the corporate plan of Canada Post to shut down 5,221 post offices, not in urban Canada, but in rural Canada.
I understand this year it plans to close down over 250 post offices and the principle being used is when a natural opportunity occurs. This means when the postmaster or postmistress of a post office serving the smaller rural communities is about to retire, the Canada Post plan is to bring in a system that will change the post office. It will bring in either retail post offices or supermailboxes as they are called. I think it is a terrible misnomer. I do not think there is anything super about them at all.
It is a paradox when the hon. member who last spoke said he was not going to support my hon. colleague's bill because of the possibility and fear of political interference.
If there is any time for a review board to have some authority and watch what is called the efficiency of this organization, it is called into here and I will give the reason.
The member says he is afraid of political interference. Only three days ago I received a response from Canada Post, a three-page letter in turn, responding to a request that I had made regarding a rural post office in my riding. It was going to close because of a natural opportunity. The officials came down from Canada Post in January. It was right after Christmas. They listened to what everybody had to say, paid absolutely no attention and went back and said they were going to shut the post office down.

I wrote asking them to hang on. I was looking for fairness and balance. The thrust of my letter was that in the area of the Prime Minister's riding there were five rural post offices in which the natural opportunity had come up. One served a community of 121 people. It had to go out not once but twice and it is still looking for a postmaster or postmistress to operate that post office. The hon. member has the gall to say he does not want to support this bill because fear of political interference.
Everyone can draw their own conclusions from that. If that is the principle on why the hon. member is not supporting my hon. colleague's bill, then I think it is a pretty weak principle. I think he is dealing from a very, very distorted deck of cards and as a fiddler is playing very much out of tune.
I have citations here. My hon. colleague has given me tons of substantiations. I could stay here in the House as long as I would be permitted and give the testimony of those people. Who should know better than members in the House that there is a need and a necessity for such a board? I am going to quote one and I believe he is an authority.
On February 6, three years ago, Alan Marchment, the chairman of the then Postal Services Review Committee made a statement to the Standing Committee of Consumer and Corporate Affairs and Government Operations of which my hon. colleague is a member. He said: "It is in the interest of the Canadian public to have a forum where rate and service charges must be reviewed publicly. As the relationship between Canada Post and the government becomes more arm's length, the need for a public return process increases". I understand Mr. Marchment is saying that if this kind of a review committee is implemented, the possibility of political interference will be reduced, not increased.
What is the purpose of the CRTC? I do not have its mandate here, but the purpose of the CRTC is to look at how radio and TV stations are licensed and to make sure the government cannot politically interfere. I am a great believer in democracy like all of us, but I have witnessed in the last four and half years the closure and time-allocated debates on important issues. We had one recently
Private Members' Business
on the unemployment insurance bill. When we get the situation in our country with a majority like the present government has, it can use its ramrod and jackboot measures as long as it wants. Our political system allows it. There are no checks and balances that would prevent it from happening.
This is the perfect example of a Crown corporation that has been the subject of considerable, and I would say sometimes acrimonious, discussion in this House, in correspondence, in town hall meetings and in political rallies. It is an excellent opportunity for the government to show faith and to say: "Okay, we have nothing to hide. We are quite prepared to allow a review committee to be established to look into the rate and service charges". It should do this in order to dispel any rumours that perhaps the postal rates are subsidizing an aspect of Canada Post that by government order should be precluded because it is in fact in competition with industry. God knows, industry needs every break it can get today.
I am not going to quote what they said, but in addition to that man who has credibility and recognition in the area on which he commented, there was the Nielsen task force, a considerable task force in 1985, the second year of the mandate of this government and consumer and corporate affairs in 1988. They also made recommendations.
How did the government respond to some pretty authoritative people and authorities in making proposals which essentially formed the core of my hon. colleague's bill? In 1990 the government did away with the postal service review board. To top it all off, the minister responsible for Canada Post said: "Oh, I favour this hands-off approach regarding the closing of rural post offices and mail delivery standards and the like".
However, I want to say that because there is no review board or other watch-dog I am going back to Canada Post and saying: "In your very learned three-page response to my question you did not address the question as to why in the Prime Minister's riding the principle of natural opportunity has not been applied in the same way as it is being applied in my area and in others".

March 26, 1993
Private Members' Business
I want to conclude by saying that everything my hon. colleague says about this bill I like, but the defence of not doing it I did not like. It did not make any sense. In fact the remarks of the hon. member from the other side convinced me even more that we should all support this outstanding and very timely bill.


Jean-Guy Hudon: Madam Speaker, thank you for giving me the opportunity to address you and the Canadian people this afternoon on this bill presented by my hon. colleague from Glengarry-Prescott-Russell. I respect him a lot, although I cannot support such a motion for now.
I do not know what makes us politicians want to stick our noses into something that is going better all the time or going well, except to make political capital, even if it is only for as long as we speak in the House of Commons.
Canada Post had two important governmental decisions to make since it was created. When Andre Ouellet was the minister responsible for Canada Post, he made the first decision to privatize the postal system. It was a good decision.
Why did the government want to privatize the postal system then? It was to take from the House of Commons all sorts of decisions that were to be made about postal services and rates and other matters.
The other good decision about Canada Post was made after 1984-85, when the minister, Harvie Andre, told them: "Too bad, but starting now, you will have to cover your costs and come up with a corporate plan so that Canada Post will not depend on the government every year for the $200, $400 or $500 million you need to balance your budget".
One thing is clear, Madam Speaker. Why do we have postal services? To take a product and send it somewhere else at the lowest possible cost. Before, we would send the product somewhere else, but sometimes that was expensive and this was discussed in the House of Commons. Taxpayers watching us said there was no way they would pay 45 cents, so we told them we would charge 20 cents for sending the item and the government
would subsidize the remaining 25 cents. It still came out of the taxpayers pocket, but that didn't matter.
Basically providing postal services means taking a product and sending it somewhere else as quickly as possible and at the lowest possible cost. In 1985 the government told the Canada Post Corporation that the lowest possible cost of sending a product to Vancouver, for instance, was the real shipping cost. In other words, do not count on the government to subsidize potential deficits.
Of course there was a risk because Canada Post was practically in a monopoly position and people were afraid it would become a monopoly and would make decisions without regard for the interests of the general public. However that was not the case. It did not become a monopoly, on the contrary. Personally I think that soon we will have fewer and fewer post offices, unfortunately perhaps in terms of the federal presence. Why? Because it is not a monopoly. Look around Ottawa or Montreal or other major Canadian cities and see the services of priority post as well as those of other companies being used every day. I am thinking of Federal Express, Purolator and United Parcel Service, and they even have aeroplanes with their own logo to carry the mail. There is no longer a monopoly as there was before.
Second, we now have fax machines. Some post offices could close altogether and use fax machines to send the same letters, provided the addressee has a machine as well. We no longer have a government monopoly, but a Crown corporation competing with other companies with different prices and costs.
We are still sympathetic to consultation, but consultation is not necessarily what people will do because the decisions made concerning Canada Post always lead to emotional situations. Just look at what is happening right near Riviere-du-Loup, where the people are rising up against Canada Post because it wants to close the post office. Any platform is good. If there were an advisory board to review this decision, I am not sure the debate would be more elevated or more dignified because it would be in the House of Commons.
The place to do it is in the municipality concerned. That is an excellent forum for it. That is the only place for someone supposedly defending the rights of that community to seek a party's nomination and stand for election. Federal elections will be held very soon. All that is good for visibility.
March 26, 1993

Advisory boards lead to consultations, which often arouse appetites that cannot be satisfied. People do not want consultation but participation.
I must take my product and send it at the lowest possible cost in the least possible time. When Canada Post became a corporation and was told to cover its costs, it understood one thing. It realized that to cover its costs, it must provide better service. They now have a prestigious independent firm, Ernst and Young, that conducts surveys every two or three months, I believe, to find out how satisfied Canadians are with the postal service.
Madam Speaker, it is a good thing you are seated because what I am about to tell you could be quite staggering. This survey showed that 98 per cent of the mail is presently delivered on time. That is good. In fact, it is great. This means it takes two days within the same town, three between major cities of the same province and four to reach other centers across the country. That is excellent and cost is factored into it. There are people who complain about the cost of stamps these days. There are still people in this country who want to be able to mail a letter for five cents. That is just not possible any more.
If you examine the situation in industrialized countries that have faced up to their responsibilities regarding their postal systems, you realize that the price in Canada is among the lowest for a service which is fast in most cases. Granted, there will be problems and it is those we always hear about. Inevitably some time, some place a letter will get lost.
Last week I received at home a letter completely tom in two, probably by the machine. It happened to me once in the eight years I have lived at that address. It was an accident. I could have brought that letter to the House and said: "This is outrageous. Look at what happened to that letter". In a sense I was happy because it was the electrician's bill and the part that was tom was the one showing the amount payable. I called my electrical contractor, Paul Bouchard, and told him: "Mr. Bouchard, I received a nice apology from Canada Post but your bill has been tom to bits. You will have to send me a new one". I received the new bill as well.
Private Members' Business
I live in Beauhamois, a small town with a population of some 7,000. The letter carrier service was granted to Beauhamois at a time when the town was developing. It is simply marvellous to have someone bring your letters home five days a week. Beauhamois was promised a great development and its population grew to 10,000 before it fell back to 7,000. Saint-Timothee, a town located five or six miles from Beauhamois, experienced significant growth during the last five or six years. It is now bigger than Beauhamois and wants letter carrier service and cannot get it. My time is almost up? I could go on for at least two hours. They cannot get the service. Do you know why I have the privilege to have mail delivered at my doorstep five days a week, and the people in Saint-Timothee do not? It is often because of what is written in collective agreements. I would be happy to receive my mail only three or two times a week and share the service with other people. But that is not how it works.
Advisory committees or committees such as the one we will be creating to review services which are becoming more and more competitive and challenged could improve matters. Also, and I will conclude with this, when the project was developed, we had the money to pay for it. Nowadays we do not have that kind of money and we can only afford to increase the service. Quality is what we will be judged on and Canadians will support us on this.


Rodney Edward Laporte: Madam Speaker, I am very pleased to have the opportunity to participate in this debate. I want to say I am certainly in support of this bill put forth by the member for Glengarry-Prescott-Russell.
I have to take some issue with the member for Beauhamois-Salaberry who just spoke. I think that what he is saying clearly demonstrates his government's misguided view. Surely it is not going to be helpful to the people across this country, particularly in rural Canada. He talks about being from a small town of 7,000. In my riding I am talking about communities of 100, 200, 500, maybe 2,000. There was a time in this country when the post office was here to provide a service for Canadians.

March 26, 1993
Private Members' Business
That is no longer the case. It is here to make a profit. If the member thinks we should be having a-


Jean-Guy Hudon: That's not a bad idea.


Rodney Edward Laporte: He says it is not a bad but a good idea to run it at a profit. If we are going to have a progressive country that encourages competition and development there are some services that we need, certainly in places like Saskatchewan. Since this government has been involved with deregulation and transportation and with this attitude toward postal service, Saskatchewan has been suffering and businesses have been suffering in that province.
If we ran everything strictly on a profit basis there would not be anybody living in rural Saskatchewan because there would be nothing there to maintain them. It has been of economic benefit to this country to maintain a viable rural infrastructure in this country. One of the reasons this country has a problem now is because of the policies of his government that have caused much of the demise of rural Canada.
Just to make some comments. He says that it cannot afford the services. Canada Post is making a profit these days. Canada Post has come to communities in my riding and said it is going to give them better service. It is going to close their corporate post office and, although it says it will consult, they either get a retail postal outlet or green boxes.
Communities have told me that if Canada Post wanted to come into their communities and break even they would have been willing to work with it. Briercrest said it did not need service six days a week. It gets its post six days a week and would take it five days a week if it would then break even. The town of Simpson in my riding offered Canada Post a free building if it could keep its post office. Communities have offered the help of volunteers to assist the postmaster or postmistress. Canada Post has refused them all. That is because it is not interested in providing service for Canadians, but in selling Canada Post. That is what it is interested in doing.
If we are going to allow it to be taken over by a private corporation that is going to run it at a profit then it is not going to have post offices in many areas of rural Canada
pure and simple. That is because it is a business that is there to make a profit. I understand that is the hon. member's view. If that is his view, I submit if we are to have a healthy economy that is going to develop and allow businesses to establish and communities to maintain themselves and grow then we need some services. It should be the responsibility of this government to provide those services.
I want to speak more specifically to the bill itself. The idea of setting up a services review board was introduced by the then Minister for Consumer and Corporate Affairs, the government House leader, who said in a news release back in 1988: "Setting up a system that gives Canadians a voice in the planning of postal rates and services is an idea whose time has come. Now that Canada Post is breaking even and revenues are coming out of the pockets of postal users, customers have a right to a say in both national and local issues". I agree with that. That is a good approach. They should have a say in those issues.
The body was actually set up for a period of time under Alan Marchment, who actually made some reports. When these reports came out they were very critical of the government. Suddenly the whole atmosphere changed, the committee disappeared and was gone.
If we are going to maintain some service in this country we cannot simply allow a government to tell Canada Post that its bottom line is to get rid of as many rural post offices and urban post offices as it possibly can and to privatize as many post offices as it possibly can in order to sell the Canada Post business.
It may be okay for the city of Toronto, I do not know. It may be fine there because there will be a lot of competition. Purolator will go into Toronto. Purolator will work in the area of southern Ontario and certain areas in Quebec. I would like the hon. member to go up to northwestern Quebec, to Abitibi, Normetal, Dupuis and those places, and see what they would think about losing their post offices up there. Go into rural Saskatchewan, go into any part of rural Canada, go into rural Newfoundland. These are areas that need a service. As Canadians we should have a right to expect some basic services in this country. Certainly Canada Post is one of them.
March 26, 1993

If the attitude of this government had been adopted in the history of this country, certainly places like Saskatchewan would not have developed the way they have. It was because of a desire to provide transportation, for example, that the Saskatchewan transportation company was set up by an NDP government because Greyhound would not go to some small communities. Yet these small communities where there are businesses, and service stations needed that service.
I know as a lawyer working in small town Saskatchewan I certainly could not afford to run my practice having mail two days a week. It would not work.
I think the bill put forth by the member for Glengarry-Prescott-Russell is the right approach. I think the position put forth by the government some four or five years ago is a good approach. Everything in this country simply cannot run on free enterprise and bottom line competition. That is not how this country was built. It was John A. Macdonald with the national policy. If John A. Macdonald had believed in free enterprise we would never have settled the west because that was a program to encourage development in certain regions of the country, namely western Canada.
To have that sort of attitude simply is not going to work, especially when we live in a country that is the second largest in the world geographically. Thirty-three per cent of Canadians, one in three Canadians, live in three cities: Montreal, Toronto, Vancouver. Forty-seven per cent live in nine cities.
Private Members' Business
If we are going to maintain some kind of infrastructure, we have to be committed to providing services to rural Canadians through transportation, postal service, health care delivery, education, and a whole host of issues. That has to be the commitment.
Yes, we have to cut down our deficit. Yes, our debt is too high. Absolutely. We can do that and still provide some of the services. Certainly Canada Post does not have to be privatized. It is making a profit. It is providing a service. However, it is now taking an attitude that is ripping the heart out of rural Canada.
I want to say in closing that I support this bill. I think it is the right approach to proceed with. I just regret that we are only going to have one hour of debate on this bill. It will die on the Order Paper. That is a tragedy. It certainly deserves far more debate and far more interest than that.


Madam Deputy Speaker:: Since no other members wish to speak, the time provided for the consideration of Private Members' Business has now expired.
Pursuant to Standing Order 96(1), the item is dropped from the Order Paper. It being four o'clock, the House stands adjourned until next Monday at 11 a.m., pursuant to Standing Order 24(1).


[Stage Direction]
The House adjourned at 3.58 p.m.
[Stage Direction]
Monday, March 29, 1993