1993-04-30

[Stage Direction]
Prayers

Mr. Charles A. Langlois (Parliamentary Secretary to Leader of the Government in the House of Commons and to Minister of National Defence):: Madam Speaker, I think that you will find consent for the following motion:

That notwithstanding any Standing Order, at the completion of the debate on second reading of Bill C-117, but no later than 3 p.m. today, the Speaker shall put all questions necessary to dispose of the remaining stages of Bill C-117, including Committee of the Whole, without further debate or amendment, to complete consideration of this bill today provided that if a recorded division is requested, it shall stand deferred until Monday, May 3, 1993 at 6 p.m. pursuant to Standing Order 45(6), at which time the remaining proceedings on the bill shall be completed.
That, one additional opposition day shall be allotted for the Business of Supply for the period ending June 23, 1993.


Mr. Gagliano:: Madam Speaker, in a spirit of co-operation and for the sake of the smooth operation of this place we give our consent to this motion.


Mr. Blaikie:: Madam Speaker, in trying to put it more eloquently than the member for Thunder Bay-Atiko-kan, we agree.


Madam Deputy Speaker:: I understand there is unanimous consent for the motion.


[Stage Direction]
Motion agreed to.

[Stage Direction]
The House resumed from Friday, March 26, 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, by unanimous consent, referred to Committee of the Whole.
Mr. Rod Laporte (Moose Jaw-Lake Centre):: Madam Speaker, I want to use the remaining minutes I have in this debate in a general way to talk about my home province, Saskatchewan.
The New Democratic Party is often getting hit with the label of not knowing how to manage an economy; that it cannot take care of business. In fact I remember back in 1982 when there was the Allan Blakeney New Democratic government in Saskatchewan. At that time the Tory leader, Grant Devine, said that we could afford to totally mismanage Saskatchewan and still break even.
After 10 years we find that the province is some $15 billion in the hole with something like 400,000 taxpayers. It is a monumental problem. This is by a Tory government that knows how to manage an economy. It has put Saskatchewan so far in the hole that it is going to take many decades for us to recover. It has been left to a New Democratic government to correct that error.
I think that the people of Saskatchewan, if you look at the history, are in good hands. I believe it was Diane Francis or one of the right wing columnists who wrote that back in 1981 the Allan Blakeney government was the best-managed government not just in Canada but in North America. That was from a right wing journalist. The record shows that.

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Back in 1944 when Tommy Douglas took over Saskatchewan, the province could not borrow money. Tommy Douglas came in and built Saskatchewan to where we were in 1982. Talking about fiscal responsibility, Tommy Douglas wanted to introduce medicare but waited some 17 years until the province could afford to do it. In those days the province did it on its own but it was not done until it could afford to do it.
The New Democratic governments in Saskatchewan certainly come from a background of being sound managers of the economy, very conscious of the economy. It actually galls me that people on the other side of the House and elsewhere say that New Democrats cannot manage an economy.
The Romanow government, faced with a huge debt which makes the national debt pale in comparison on a per capita basis, came in with a budget. In the last year of the Devine regime there was something like a $1 billion deficit. In the first year the Romanow government cut that deficit in half to $500 million. It is cutting the deficit in half this year to $300 million. It will have a balanced budget within three years.
That is already a better record than the federal Tory government has had. I have been in the House for the last five years. Every year I hear the same budget speech that this year our deficit is $32 billion, $34 billion, or $35 billion but next year it is going to be $29 billion and the year after it is going to be $15 billion. I think it was the former Minister of Finance, the hon. member for Etobicoke Centre, who said three or four years ago in the House that this year we were going to have a deficit of $8 billion. What do we have? We have what I believe is the largest deficit in the history of the country, $35.5 billion.


Mr. McDermid:: Check back to 1984. It's not the largest.


Rodney Edward Laporte: It was not $35.5 billion? The minister announced $35.5 billion. The $35.5 billion deficit, whether it is the largest or the second largest, is not something to be proud of.
Saskatchewan has a government that is cutting the debt not on the backs of ordinary Canadians but with a mind to keeping existing social programs. It is cutting that deficit with a view to causing the least harm to those who can least afford to have harm inflicted upon them.
The approach taken by the Saskatchewan government is different from the one this government has taken. This government has used blackmail. It has used blackmail in the area of the Western Grain Transportation Act, the Crow benefit. What has it done? In 1983 the Liberals took away the Crow rate and put in the Crow benefit. That payment was going to be in perpetuity. To me, perpetuity means a long time and not 10 years.
Last December we lost 10 per cent of the Crow benefit for two years. This year in the budget the finance minister said that we are going to take away in two years 15 per cent of the Crow benefit and after that we are going to take away 20 per cent of the Crow benefit and it is going to remain that way.
However, and this is where the blackmail comes in, the finance minister said if they agree to pay the producer the government will give them back that 10 per cent. That is negotiating with a gun to one's head. The Crow benefit and the Canadian Wheat Board are two of the most fundamental mainstays of agriculture in western Canada today, and this government is tearing them apart.
At the agriculture committee yesterday we were discussing the removal of barley from the Canadian Wheat Board under a continental market dual system. Government members refused to allow representatives of the Canadian Wheat Board to appear in front of the committee. I cannot believe it. They were scheduled to appear, they were on the list but the government said no.
If we were going to dismantle Air Canada we would surely have the chairman of Air Canada in front of the appropriate committee, but the government said no to the Canadian Wheat Board.
What is even more outrageous is that the advisory committee to the Canadian Wheat Board is not going to be allowed to appear in front of the committee either. The advisory committee is a committee made up of farmers who are elected by farmers to advise the Canadian Wheat Board. It is the only elected body in the country that represents farmers with respect to Canadian Wheat Board issues. It is being denied access to appear before the committee.
We are going to have one more committee meeting on this issue. Who are we going to have? They took away the Canadian Wheat Board and they are going to bring
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in UGG, United Grain Growers. This is a company that agrees whole-heartedly with the government's position.
Who else have we had in front of the committee? We had the Western Barley Growers Association. It is an association that has 214 members and receives 90 per cent of its funding from the government. That is a really unbiased group to bring before the committee. At the same time we are disallowing the Canadian Wheat Board and the advisory committee to the Canadian Wheat Board from appearing before us.
The other thing on this issue is that there have been a number of studies come out but the government has ignored them except for the ones that agree with its position. This is the kind of government that has been inflicted upon us in this country.
If that is called co-operation, if that is called trying to find a consensus, then it is looking at a different dictionary than I look at because nothing is further from the truth. They are heavy-handed tactics.
They are exactly what the finance minister used in his budget address a few days ago by telling people in western Canada that they are going to lose 10 per cent of their Crow benefit, that $72 million is going to be gone unless they do things the government's way, unless they play ball with it.
That is not going to go down very well in Saskatchewan. I can tell the government right now it is going to have an issue on its hands, certainly in the province of Saskatchewan, because I do not think the producers of Saskatchewan are going to buy that.
There was a poll commissioned by the Government of Saskatchewan that showed 88 per cent of the producers in Saskatchewan want to at least have a vote. That has been our position.
Talk about openness, talk about a consensus. Surely to goodness allowing the producers, the members of the Canadian Wheat Board, to have a vote on what should happen to their Wheat Board is only fair.
It is unbelievable that a government can talk about consensus and openness and at the same time come down with the heavy fist and iron glove on the people in the prairies. That is exactly what this government is doing.
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The government side is saying we are having a plebiscite because the producer will decide whether he wants to deliver to the Canadian Wheat Board or to the open market.
That is nonsense. What we have under the Canadian Wheat Board is a pooling system so that when people deliver to the Wheat Board they get the average price that was received by the Canadian Wheat Board during the whole year. Studies done in areas where they tried dual marketing systems show that the pooling system will fade away, it will fail. That is because during times when prices are higher, if the spot price is higher in the U.S., the Canadian Wheat Board will not receive any grain. If the price is low the grain will come to the Canadian Wheat Board. The only time the Wheat Board will have grain is when the price is very low.
To say that is a plebiscite is nonsense. The other factor is that in the government's so-called thorough study of this issue it has not done any study of the effects of the Canadian Wheat Board in a dual marketing system and the impact on the Canadian Wheat Board. That has not been studied.
The same holds true for the Western Grain Transportation Act. For the finance minister to stand up in this House and blackmail producers in western Canada is outrageous.
The other point is that the grain transportation system in this country is responsible for thousands of jobs, probably tens of thousands of jobs, and hundreds of millions of dollars to the Canadian economy. If we do not produce a strong Canadian transportation system we are going to lose those jobs in the ports and rail crews and in rural Saskatchewan.


Hon. Charles Mayer (Minister of Agriculture):: Madam Speaker, I listened with great interest to my hon. friend pontificate on the wonderful job the Saskatchewan government has done in cutting spending. I would like to ask him a question directly. Since he is so impressed with the spending cuts of the Saskatchewan government, including closing hospitals and so on, doing what it feels must be done, why have he and his party voted against every single spending cut proposed by the federal government in trying to get its deficit under control?

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Rodney Edward Laporte: Madam Speaker, the answer lies in the way that governments are cutting. It is true that these days as a social democratic party it is very difficult to implement many of the things that we as social democrats would like to see implemented and maintained. It has been very difficult. Certainly when the government in Saskatchewan is having to cut back in the areas of social welfare, health care and so on it is hard to do. However that is the reality we face.
The minister will know better than I that there is a big difference between a province managing its economy and the federal government doing so. The federal government has many more economic levers than a provincial government. The interest rate is controlled by the federal government. There are a number of levers the federal government has at its disposal which a provincial government does not.
The Saskatchewan government and many other provincial governments find themselves on a precipice. We have had transfer payments to the provinces cut back at an unprecedented rate. Thank goodness there were no transfer cuts this time. That is very much appreciated. However the minister will know that Saskatchewan does not have the economic levers the federal government does. We also do not have the room to manoeuvre in Saskatchewan that this government does. We have something like a $15 billion debt. We have interest rates in Saskatchewan of over $800 million a year and there are something like 400,000 taxpayers. The province only has 950,000 people in it.
It is a very tight situation. What the finance minister, Janice MacKinnon, has done in Saskatchewan, and I know the minister agrees, is to say that if we do not make cuts now we are going to lose our social programs. It is also true on the federal side. We have to get the deficit down federally. This government has been tinkering at the edges. We have had a deficit of over $30 billion every year since this government has been in place. I agree we have to make cuts. We have to lower the deficit, but we have to do it in a way that will benefit all of us and not hurt those who can least afford it. [DOT]
That is the attitude the Saskatchewan government is taking. That is the attitude this government should be taking. There are other areas where this government could be cutting: the $6 billion helicopter purchase that will take place.


John Horton McDermid: Is it $6 billion? It keeps going up.


Rodney Edward Laporte: I believe with inflation it is going to be $6 billion or $5.8 billion. The government is saying that it can either repair the helicopters or buy new ones. It has that choice. The government is buying 50 helicopters. It is not saying that it could buy those helicopters without the anti-submarine equipment on them. I do not know the exact figures but that alone would save billions of dollars. Some 35 of those helicopters are going to be able to chase submarines attacking this continent. The old Soviet subs are rusting in port. It should send over a tourist to take a photograph of them so that it would know where they all are instead of spending that kind of money on anti-submarine equipment.
That is an area where the government could cut. That is an area where it would get support from this caucus. If it came in with a plan showing that it would keep helicopters for search and rescue, that would be great. However I do not think we need the extra equipment, the sophisticate computers and so on that are designed to attack submarines. There is a whole host of added equipment on them. I have seen the figures. I forget exactly what they are but the cost of the helicopters could be cut considerably. If something like that was brought in the government would certainly get the support of this caucus and of this member.


John Horton McDermid: Madam Speaker, I would love to get into a debate on the helicopter situation with my friend. We are talking of an expenditure over 13 years. We are talking about job creation in Canada in a high-tech industry.
That particular party, the New Democratic Party, wants us to take money and throw it at short-term jobs, at three-month and six-month make work projects, not the meaningful employment, not the high-tech employment the helicopter purchase will provide. That has to be taken into consideration. If we cut there then the member can tell the aeronautic workers who are union members.
I believe their leadership supports his party. I do not believe the workers do but the leadership does. He can tell them that this is going to be cancelled and we will not have these helicopters. He can tell fishermen that we will not have helicopters that are able to go out in storms when they are needed out there. The helicopters we now
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have cannot do that. The new helicopters will have a longer flying time: five hours compared to three hours now. They can fly in all kinds of weather. He can tell them that the sophisticated tracking equipment will not be put on them so they can find lost fishermen or people in trouble off our coast. He should tell them all these things and then we will see where the New Democratic Party stands.
Right now its members are saying: spend here, spend here and spend here on short-term work; not meaningful jobs, not full-time jobs, but in fact make work projects. At the same time they want us to cancel a project that will provide 48,000 person-years of work in the high-tech industry.


Rodney Edward Laporte: Madam Speaker, the minister has skewed my remarks. I have said very clearly we need a search and rescue factor in our armed forces. That is for sure. I have not denied that.
I am talking about the anti-submarine equipment. I do not think we need that unless we plan to shoot down American fishing boats. I do not think it is required.
The minister asks who is going to protect fishermen. There will be no fishermen out there because this government has allowed the fish to be removed from the sea. Newfoundland has 5 per cent of the fish it used to have. The cod fishery has been destroyed by this government, a government that is supposed to manage the economy.
Since being elected I have received representations from the maritimes, from Newfoundland, saying that the way they are fishing will destroy the fishery. That is a fact.


John Horton McDermid: Here is one of the prairie boys from Saskatchewan who thinks he knows all about fishing.


Rodney Edward Laporte: I do not know an awful lot about fishing but I have had my ears opened since I have been here. The fishermen have been telling this government that it is going to destroy the fishery. By God, it has destroyed the fishery. That came true. We do not need helicopters off the coast of Newfoundland to protect fishermen because the government has already solved that prob-
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lem. No fishermen will be fishing out there because there is nothing to fish, unless they want to sightsee and maybe look at the icebergs.
That is what this government has done. That is called economic management by the Tory government.


Mr. Stan Darling (Parry Sound-Muskoka):: Madam Speaker, I am pleased to speak briefly on the responsible and far-sighted budget tabled this past Monday by the hon. Minister of Finance. Regardless of what those on the opposition benches say or would have the Canadian people believe, this budget aims to build on efforts outlined in the 1992 budget and the December 1992 economic statement. In the case of all three the objective is to position the Canadian economy for more growth in job creation by steadily reducing the burden of deficits and debt.
Since the budget was tabled many media critics have gone into high gear, producing a stream of so-called in-depth analyses of why the budget has failed the Canadian people. I figure this is fair game, for that is how the scribes earn their living.
However I find it galling to hear criticisms from the back benches of the Liberal Party. To me those in the Liberal caucus are unwittingly admitting that their memories are as lacking in substance as their alternative economic policies for dealing with Canada's fiscal problems.
To refresh those blocked memories let me say that it was the shortsighted, irresponsible policies of successive Liberal governments from 1968 to 1984 that provided fuel for the present fiscal crisis which threatens to bum away Canada's tomorrows.
Beyond a doubt it has not been an easy road for our government to travel in an effort to grapple with an inherited deficit that stood at more than $38 billion in 1984, the year we took office. Dealing with the problem has been far more difficult and complex than any of us could have imagined.
Many Canadians have not been particularly receptive to the brand of medicine we have been prescribing since 1984. However we have persevered and taken the slings and arrows of adverse public opinion in stride.

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I believe some comparisons or results speak well of our approach to date. For example, during the recession of 1981-82 under a Liberal government the national debt increased by a phenomenal 160 per cent. During the recession we are now coming out of, the debt increased by only 19 per cent under our government.
In 1984 the deficit was 8 per cent of our Gross Domestic Product. Today the deficit has been cut to 4 per cent of the GDP. The increase in the national debt presently is not because of unbridled spending but rather the result of a significant decrease in federal revenues due to the recession.
When the election is called later this year and the people of Canada have the opportunity to really consider our medicine and compare it to the voodoo remedies of the opposition, I am confident they will make the right choice.
Let us face facts. There is no magic elixir. The debt crisis did not happen overnight and it most certainly will not be solved overnight. The reality of the situation is that there is no quick fix and there is certainly no magician who can wave a wand and proclaim, presto the debt is gone.
Although I admit the budget was not warmly received initially by the international economic community, the budget lays a solid base for a Canadian solution to a Canadian problem. Some of the high priced experts criticizing the budget were advocating an increase of 2 per cent in the GST and raising other federal taxes.
Yes, Canadians want to see an end to the deficit but they want to see it achieved through spending cuts and not higher taxes. We acceded to the wishes of the Canadian people and there are no new taxes or tax increases in this budget.
The budget cuts more than $30 billion from federal spending over the next five years. It builds upon the restraint measures introduced in the December 1992 economic statement. These measures will yield savings of $3.8 billion in 1993-94, rising to $7.9 billion in 1997-98 for a total savings of $30.7 billion.
These measures will also see the number of jobs in the federal Public Service reduced by 16,500 over five years. With further cuts in the federal departmental operating
budgets, together with the December economic statement wage freeze, the total savings over five years in this area alone will be $7.5 billion. By holding defence spending to zero real growth starting in 1994-95 combined with the 1992 restraint measures there will be a total savings of $5.9 billion over the next five years.
These measures are only the tip of the iceberg as far as the significant savings this budget will see accumulated over the next five years. This budget will see the deficit reduced to $32 billion this year, which is the target set out in December despite lower than expected revenues. It also aims to end new borrowing and begins the process of reducing publicly-held debt over five years.
Drastic cuts in spending are not the only budget measures. Building on the streamlining actions contained in the 1992 budget, 12 federal organizations will be eliminated, merged or restructured. For example the taxation and customs and excise departments will be amalgamated. In addition our government will be pursuing the privatization and commercialisation of a number of federal organizations and services to reduce the over-all size of government while improving the delivery of services.
There are areas left untouched by the budget. Although this is a tough budget it is also a fair one. Two major areas of public policy are exempt from the budgetary measures. Benefits for the elderly and veterans are again excluded from spending cuts. So are programs specifically geared to the disabled, certain native programs, the Canadian Jobs Strategy and famine relief.
In recognition of Canada's common fiscal problems, no additional restraint is being imposed on major federal transfers to the provinces. These will grow by almost 4 per cent a year, more than twice the rate of other federal program spending.
While we are speaking of the provinces, if it has not been abundantly clear in the past it certainly is now that the deficit and the debt are not the federal government's problems alone. All governments share responsibility for their creation and an equal responsibility for their reduction and eventual elimination. Frankly, the taxpayers of Canada want all governments to work together to find solutions to the national debt problem. That is why I
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believe the most important aspect of the budget was the invitation extended by the Minister of Finance to all provincial and territorial finance ministers to attend a special meeting on May 30 and May 31 in Ottawa to begin the process of developing practical, co-operative solutions to our common fiscal problems.
I believe the planned meeting at the end of May is a significant step in the right direction. The federal government can slash spending from now until the cows come home, but unless all legislative jurisdictions in Canada pull together this problem will not be solved. Something concrete must be done to reduce the debt so succeeding generations will not continue to have a mortgage hanging over their futures. I do not believe for one moment that anyone wants to leave behind such a dismal legacy.
In conclusion, there are many who believe our government did not go far enough with the measures outlined in the budget. I disagree. To my way of thinking the budget provides a realistic approach to Canada's current fiscal problems, although the approach is gradual rather than radical. I believe it is both sensible and responsible. Yes, we could have made immediate cuts instead of phasing them in over five years and we could have raised taxes. However, in light of the fact that our economy is still recovering from one of the deepest recessions in recent memory the medicine is strong enough to do the job without killing off the patient.
The bottom line is simple and clear. Governments do not create jobs or enhance economic performance; the private sector does. I believe that the budget builds on the 1992 budget and the December economic statement by realistically attacking the number one dampener of economic activity, the deficit. In the final analysis less borrowing, lower interest rates and lower taxes are the best possible ways to stimulate economic activity and job creation at this time.
The previous speaker mentioned that one of the all-important reasons for our present financial situation is the proposed acquisition of the new helicopter program, the EH-101. I am aware that a great many in the opposition are giving the impression, probably not saying it so specifically, that the Government of Canada will be writing a cheque this year for $4.8 billion for the helicopter program. I happen to be a member of the Standing Committee on National Defence.
We had a very interesting and important meeting yesterday with the senior officials, the deputy minister and Admiral John Anderson, the chief of staff. I had the opportunity to question officials about this and of course listen to questions from my colleagues on the opposite side. In my remarks I stated that where we fell down badly was in getting the message across to the Canadian people. Even one of my distinguished colleagues on the Liberal side agreed with that.
The EH-101 program will do a job that is necessary. Sure there are no submarines lurking in our waters at the present time. I believe there are about 800 submarines owned by all the countries in the world. We know they are not a danger at the present time. It has not been emphasized enough that the EH-101 is a much superior aircraft and one of its most important jobs will be search and rescue.
It was mentioned in news reports that the new frigates coming on stream are not built to take the new EH-101-there are three frigates in the water now and there will be 12 within a very few years-and this was denied in no uncertain terms. They are built for that. The chief of staff and one of the other officials did mention that three of the Tribal class destroyers were not built to accommodate these new helicopters. There will be modifications made on those three quite old destroyers.
There was quite an article in the Times Colonist paper of Thursday, April 22. This is some information I would like to read into the record:
The mythical-cum-political version appears to have the following qualifications. Its selection was kept secret and was not debated until after the decision to buy it last summer.
It is an attack helicopter. Its sole purpose is to combat a non-existent cold war Soviet submarine threat.
Its other capabilities are far beyond our needs. It is the world's most expensive helicopter and costs $80-$ 90 million a copy. The project cost ballooned from $4.4 billion total to $5.8 billion and is unaffordable.
Moreover, Canadians will receive no significant benefits from this expenditure.
Listen to this:
It is too large to operate from a ship or to be maintained on board. Its limited range and fierce downwash make it unsuitable for search and rescue.

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I could go on and on and on. Yet in answer to those negative remarks let us look into this:
Its selection in 1987 was highly publicized. In November 1990 the all-party Commons standing committee on national defence called the EH-101 the only contender for the Sea King replacement and recommended the replacement be done as soon as possible to avoid costly stopgap measures. It is a multi-role helicopter with three variants: naval, commercial heliliner and tactical/logistic transport.
The naval variant is designed for the surveillance and control operations against ships, submarines and aircraft and to provide early warning of anti-ship missiles or attacking aircraft. It also will enable its mother ship to conduct SAR, search and rescue, medical evacuation,evaluation, relief airlifts-
The EH-101 has the range, endurance, survivability and all-weather capabilities essential to cope with Canada's extremes of weather and large ocean areas of responsibility and to handle United Nations commitments in foreign seas.
Madam Speaker, I could go on but I just want to emphasize again that this new helicopter which will be purchased will be proven and will be accepted by the Canadian people. It is getting all the adverse publicity now because of a leadership convention which is taking place and also an election which may take place some time this year, if not a little later.


Mr. Rex Crawford (Kent):: Madam Speaker, I would like to ask the hon. gentleman two questions. I have had the opportunity to sit on the environment committee with this gentleman for a couple of years and I respect him deeply.
I have a private member's bill C-301 which is an amendment to the financial act that is before the committee at the present time before it goes to third reading. I do not know if he is familiar with it but it is a bill on government accountability. I think it is a good bill and knowing the member and his common sense I was wondering if he could give me his views on that bill to help out on such situations as the budget.
My second question concerns the EH-101 helicopter. A close friend of mine in the city of Chatham is a helicopter pilot and owner who was with the United States Air Force and also flew for Jacques Cousteau in South America. He stated just Tuesday evening that the
Sea King can be refitted electronically to do everything the EH-101 will do. He explained that the EH-101 is only 20 miles an hour faster than the Sea King or the Bell helicopter. He said when you have a rocket coming at you at 700 miles an hour, 20 miles an hour means very little. It is the electronic system that is the important part of a helicopter. The frame can be replaced, the motor can be replaced, but the electronics is the most important part of a helicopter.
Now, we are getting 27 per cent of the work on this helicopter in Canada. Could we not get 100 per cent work in Canada by refitting our Sea Kings electronically?
I wonder if the hon. member would give his views on refitting our present helicopters as the United States has already done with theirs.


Mr. Dick:: We have done ours twice already.


Rex Crawford: Well, let us refit them again at a very minimal cost. You can refit them indefinitely.


Paul Wyatt Dick: No, you cannot; the frame will fall apart.


Rex Crawford: Are you a pilot?


Paul Wyatt Dick: I happen to be the guy on the committee who chose them.


Rex Crawford: Well, I think you made an awful mistake. But I am asking the hon. member over there for his view.


Stan Darling: Madam Speaker, I have the greatest respect for my colleague and as he said we have both had the privilege of being vitally interested in the environment and sitting on the environment committee.
With respect to that private member's bill, I must admit I am not familiar with it. But let me tell you that I am in favour of anything that is going to make the government more accountable and I will say amen to that. With respect to the purchase of the EH-101 because of the expenditure to refit the Sea Kings, I am not sure what the Minister of Supply and Service said.


Rex Crawford: Don't worry about him Stan, he doesn't matter a bit.


Stan Darling: Well all right. In any event, I am aware that there has been retrofitting of these helicopters in the United States. However the aircraft that are being refitted in the United States are much younger than
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ours. Therefore, if we spend this money there is still a deadline of seven or eight years, and it would be an expenditure of $2.5 billion.
I think my colleague will agree that the majority of the Canadian people are against it. They are of the opinion that it may be the Minister of Supply and Services who will be writing the cheques and that the cheques will be written for $4.8 billion this year.
As I mentioned earlier in my remarks, when Admiral Anderson and his officials were before the Standing Committee on National Defence I brought up that very question. He pointed out to me that the EH-101 program this year will require a total expenditure of $200 million, rising gradually to a maximum of $700 million a few years from now and then reducing after that. In other words, there will not be a great savings this year whether the program is discontinued or not. Two hundred million dollars is not too much and that is what the program is costing Canadian taxpayers this year.


Alfonso Gagliano: Madam Speaker, I am pleased to take part in this debate on Bill C-117 to authorize the government to borrow the huge amount of $31 billion.
The previous speaker mentioned the helicopters. Without getting into the specifics of this project, it should be noted that we are buying a Cadillac and at this rate we will not even be able to afford to put gas in it. That is where we are at. I think we should reconsider this deal.
The deal was approved in 1990 and my hon. colleague referred to the unanimous report from the Standing Committee on National Defence. But the global situation has changed considerably since then and I do not think we need helicopters powerful enough to chase nuclear submarines which are no longer in service, seeing that the nations whose nuclear submarines were threatening us no longer exist as such. So, we should reconsider this whole thing.
Moreover, with respect to the helicopters, when you talk about 45,000 jobs being created, all that is based on getting contracts from foreign countries. But we know that the economy is in a critical state not only in Canada but world-wide. The chances of getting foreign contracts are minimal. So, why take such a risk? Instead of
investing $5.8 billion in a project which ultimately will not create that many jobs- actually few jobs will be created-the cost of this project is so high that we should really reconsider.
I notice that it is eleven o'clock, Madam Speaker. With your permission, I would like to conclude my comments on this bill after question period.


Madam Deputy Speaker:: Very well. We will now proceed to Statements by Members pursuant to Standing Order 31.


STATEMENTS PURSUANT TO S. O. 31
[Stage Direction]


Mr. Marcel R. TVemblay (Quebec-Est):: Madam Speaker, last Thursday evening, I had the honour and the privilege to highlight the exceptional work done by 43 volunteers in my riding at a ceremony where they received the commemorative medal of the 125th anniversary of the Canadian Confederation.
The riding of Quebec-Est is packed with exceptional people and it was very difficult indeed to make a choice.
I want to pay a special tribute to these people who have contributed to improving the well-being of the population while strengthening community spirit.
I applaud these people who have given freely of their time, talen and energy for the education and cultural development of our society.


THE ECONOMY
Mr. Mark Assad (Gatineau-La Lievre):: Madam Speaker, Monday's budget clearly proved that this government has no answer to the economic problems which have been with us for several years.
The deficit, unemployment, high and numerous taxes have hit Canadians hard, especially the middle class which pays more than its share of taxes in Canada.
They should have planned a complete overhaul of our tax system to ensure fairness for all Canadians without any special favours for the wealthy, as well as a national

April 30, 1993
technical training service so that our young people can take up their rightful place in our society.
Canadians are looking for a government with unshakable political will, to deal with the crisis we are now facing.


THE BUDGET
Mr. Willie Littlechild (Wetaskiwin):: Madam Speaker, people in my riding want to see an end to the deficit. I recall the many times this was expressed to me over the past five years. They also want to see it achieved through spending cuts and not higher taxes. Although there are some who would like to see us spend more money on jobs, most agree that the government does not create jobs, the private sector does.
On behalf of my constituents in Wetaskiwin I ask all of our colleagues to commend the Minister of Finance for his persistent and consistent attack on the deficit. This budget cuts more than $30 billion over the next five years. It builds upon expenditure restraint measures introduced in the December 1992 economic statement. That will mean less borrowing, lower interest rates and lower taxes. My constituents agree that is the best way to stimulate economic activity and job creation.
I am particularly satisfied that the Minister of Finance has been able to begin national co-operation on all government debt. This is fundamental to ensuring continued economic recovery. We have to do it jointly with the provinces, and we encourage him and thank him for his continued efforts.


CORNWALL, ONTARIO
Mr. Bob Kilger (Stormont-Dundas):: Madam Speaker, Monday's budget will do nothing to help bring about an economic recovery for the people of Cornwall. With unemployment at over 20 per cent and 37 per cent of the population relying upon some form of social assistance, Cornwall has received nothing from this budget to stimulate an economic recovery.
Since 1989 more than 20 factories and numerous businesses have ceased operations. In the last two and a half years 3,000 jobs have been lost through plant closures and lay-offs. This is the harsh reality of nine
years of Conservative government. This is its economic legacy.
With 1.5 million Canadians out of work, the economic mismanagement of the government has exacted an enormous human deficit which rivals the country's financial deficit. Fortunately Canadians will soon have an opportunity to put this government out of business. This will be one closure that will offer hope to the people of Cornwall for a brighter future.


THE BUDGET
Mr. Larry Schneider (Regina-Wascana):: Madam Speaker, the recent budget continues along the path of economic self-determination. Since my election the philosophy of this government has been to guide us gently back toward economic sanity after successive years of Liberal lavishness.
It would be heroic to be spenders. Spending more than the credit card allows, by the Liberals, robbed this past decade and maybe the next of this privilege.
Perhaps the best testimony for this budget has come from what we call an ordinary Canadian, my Ottawa landlady. A lifelong Liberal she concluded a discussion on the budget by pounding her fist on the kitchen table and saying it is a good budget. She said that we have the lowest interest rates in a lifetime and the lowest inflation in a lifetime. There are no new taxes, no tax increases and $30 billion in federal spending cuts.
The budget is everything we asked for. Compare that to what the now disappearing party has done to us. This is a good budget.


CHILD CARE
Mr. Rod Murphy (Churchill):: Madam Speaker, I had the opportunity to talk with a number of child care operators in my riding in Thompson, The Pas, and also with people from the Indian reserve in The Pas area.
They are very concerned about the fact that there is no national child care program. They are also concerned that the provincial government in Manitoba has cut the actual number of subsidized child care spots throughout the province. That means that women, quite often single parents, who need child care in order to take training to get off welfare and better themselves are not able to do so.
April 30, 1993

This government promised a child care program in 1984 and in 1988, but it is not following through. If we do not have a national child care program we only encourage more and more people to stay on welfare. That only increases the national deficit.
It is time for a national child care program to help those people who want to better themselves.


Mr. Jean-Guy Guilbault (Drummond):: Madam Speaker, in my opinion, Canadians should applaud this government's efforts to attract investment that generates jobs, whether we are talking about the Canada-U.S. Free Trade Agreement or the North American free trade agreement.
A convincing example of what can be achieved was the announcement on March 1 this year that $160 million will be invested by a Spanish company, Petresa, in a petrochemical plant in Becancour.
The plant will produce additives for biodegradable detergents that will be sold throughout North America. Five hundred workers will be involved in construction of the plant, while another 75 will be employed in the plant on a permanent basis. The plant will make Canada a net exporter of this type of "green" product.
According to the president of the Spanish company, now that the North American free trade agreement was signed, the location on the St. Lawrence in Quebec will be ideal for shipping their products in Canada and to the United States and Mexico. Now that is free trade!


FISHERIES
Mrs. Coline Campbell (South West Nova):: Madam Speaker, section 35(1) of the Fisheries Act states:
No person shall carry on any work or undertaking that results in the
harmful alteration, disruption or destruction of fish habitat.
Section 35(2) allows a person to contravene this subsection.
I call on the minister of fisheries to put a hold on the leases given in the Annapolis Basin by the provincial minister of fisheries in light of the people in the area having so many questions. The municipality of Annapolis wants to see the scientific studies before aquaculture begins. More important, the traditional fishermen want to see and question the studies. They want to meet with the elusive provincial minister of fisheries to ask him why he allowed aquaculture in an area so highly utilized when there are so many other areas around the coast.
There are many unanswered questions. I call on the federal minister of fisheries to make public the studies that were made in order for him to go against subsection (1) of section 35.


ORGAN DONORS
Mr. David Bjornson (Selkirk-Red River):: Madam Speaker, I would today like to call upon all members of this House, as well as all Canadians, to consider becoming an organ donor.
In Canada there are approximately 1,700 people waiting for an organ transplant at any one time. For some of these people a transplant will not come in time and they will die while waiting. Everyone has the potential to become an organ and tissue donor. The health of the donor, not the age, is the most important thing to consider.
Signing an organ donor card, whether separately or on the back of a driver's licence, is one way of indicating one's wishes to be an organ or tissue donor.
In closing, once again I ask all Canadians to consider becoming an organ or tissue donor. Let us all remember that if we are prepared to receive we must be prepared to give.


TREE SPIKING
Mr. Lyle Kristiansen (Kootenay West-Revelstoke):: Madam Speaker, two weeks ago, Paul Watson, who is the

April 30, 1993
head of the Sea Shepherd Conservation Society, claimed his group had already spiked 20,000 trees in the Clayo-quot Sound region of B.C. and intend to spike a lot more. As well, he said he intends to teach a course in tree spiking in Tofino, which is in that region, at the end of this month.
Hidden spikes hit by saws send shrapnel flying indiscriminately and can tear through metal roofs and bodies like a machine gun. Mainstream environmental groups, the forest industry and the provincial government have all condemned Watson's statement. These threats are serious. As of November 27 of last year more than 40 spiked trees were found in one site of the disputed area. As of this time only the province of B.C. has legislation specifically outlawing tree spiking.
It is reported that the federal justice department has been preparing related amendments to the Criminal Code and I urge the government to immediately introduce such amendments, possibly in line with my own Motion M-767. My message to the government is: Nail the spikers now and incarcerate those who deliberately threaten the lives of loggers and woodworkers.


THE BUDGET
Mr. Eugene Bellemare (Carleton - Gloucester):: Madam Speaker, the 1993 budget is a mess. The Conservatives tell us that if they are re-elected they will add over $100 billion dollars to the debt. They also tell us that the deficit in the coming year will be $32.6 billion.
In reality the deficit would have been $33.25 billion but thanks to a shell game they managed to postpone $625 million in GST credit cheque refunds to low-income Canadians to next year's budget.
When the Tories talk about getting the country's finances back in order after nine years in government they really mean they are going to worsen the situation. When they talk about jobs they mean lay-offs.
What we need to get us out of this economic mess is a Liberal government that would not only look at the
balance sheet but also give its attention to stimulating the economy and job creation.


DUTY FREE SHOPS
Mr. Ken James (Sarnia-Lambton):: Madam Speaker, I rise today in support of the representations made by the Frontier Duty Free Association to the Ministers of Finance and National Revenue.
On behalf of the land border duty free shops, the association has sought an exemption from any possible potential reinstatement of the export tax on cigarettes.
Members of this House will know that no study has linked the sales by duty free shops to the tobacco smuggling problem. Departmental officials also have publicly acknowledged that these shops are not part of the problem.
In addition, to remove any doubt the duty free shops have worked co-operatively with our federal officials to ensure that they do not contribute to the tobacco smuggling problem.
Make no mistake about it. I continue to fully support our efforts to combat the problem of tobacco smuggling. However I would insist that the rather unique situation of these land border duty free shops, which employ over 700 Canadians, be given appropriate consideration.


RACIAL DISCRIMINATION
Mr. Mac Harb (Ottawa Centre):: Madam Speaker, I would like to publicly deplore the actions of an extremist right wing organization, the Heritage Front, along with others that are spreading hate propaganda, anti-Semitism and white supremacy in our community. The people of this city do not support this type of action.
We must protect the cultural mosaic of Canada. Our community requires a proactive approach. I am calling on the government to amend the Criminal Code to ensure effective means are implemented to deter hate propaganda.
Furthermore, I am calling on the government to facilitate the establishment of a working group in order to examine ways to ensure that racist organizations do not continue to flourish in our community.
April 30, 1993


NATIONAL DEFENCE
Mr. Robert E. Skelly (Comox-Albemi):: Madam Speaker, the commanding officer of the Canadian Forces Marine Testing Range at Nanoose, B.C. recently announced that Canadian and U.S. Armed Forces have jointly committed to extending the agreement on the base for another 10 years. This fait accompli comes despite the fact that the base agreement does not even come up for renewal until 1996.
The base receives regular visits from nuclear powered and nuclear capable vessels. Documented accidents, including the disintegration of a Soviet nuclear submarine in Norwegian waters last fall, attest to the health and environment risks posed by these vessels.
There have been repeated calls for environmental impact studies to assess the dangers and for conversion of the base. A year ago the B.C. government declared the province a nuclear weapon free zone and earlier this month the city of Nanaimo voted to support conversion of the base to peacetime use.
The cold war is over yet the Canadian military has apparently entered into an agreement to continue cold war operations into the next centuiy.
When is the minister of defence going to take command of the Canadian Armed Forces and follow Canadian priorities rather than-
{Translation]


Madam Deputy Speaker:: I am sorry but the hon. member's time is up.


CONSUMER CREDIT
Mr. Barry Moore (Pontiac-Gatineau-Labelle):: Madam Speaker, this year the federal government is highlighting the importance of consumer credit during National Consumer Week in order that consumers can act with full knowledge when they use the credit options that are available to them.
It seems clear that marketplace conditions affecting the use of credit have undergone fundamental changes and that these conditions are likely to persist.
Oral Questions
For example, while some types of consumer debts have declined from their recent peak level the use of consumer credit is still more common than it was a decade ago. Another change involves the misuse of credit, particularly credit cards.
To address this the Minister of Consumer and Corporate Affairs is communicating his concerns to the provinces and to credit grantors and asking them to provide their ideas on how problems of excessive indebtedness can be prevented and how the importance of the wise use of credit can be communicated effectively to consumers.
In addition to co-operative action with provincial governments and credit grantors, the Department of Consumer and Corporate Affairs will continue to make information on the wise use of credit available. This will help consumers better understand how to manage their credit responsibilities.



ORAL QUESTION PERIOD

[Stage Direction]


Mr. John Manley (Ottawa South):: Madam Speaker, perhaps there is a minister who could answer a question on transport today.
Yesterday Hollis Harris, president of Air Canada, announced that there were more job losses in the works at Air Canada. The deterioration of the airline industry in Canada is a symbol of the government's incompetence.
On the one hand, the Minister of National Defence does not believe there is enough traffic in the industry for two airline companies, as she stated recently on the program aujourd'hui dimanche. On the other hand, the Minister of Transport has said, and I quote: "It is in the best interests of consumers and the travelling public to have two airline companies".
What is the government's policy on the future of the airline industry in Canada? Does the government have any idea what it wants for the future of that important industry?

April 30, 1993
Oral Questions


Mr. Lee Richardson (Parliamentary Secretary to Minister of Transport):: Madam Speaker, it must be Friday. We get this question every Friday and the answer remains the same whether the Minister of Transport replies or I reply.
The answer simply is of course that the government is very concerned about the state of the airline industry as we are about the state of the airline industry around the world. Obviously in a recession and as a result of the gulf war airline industries around the world are in a difficult situation.
We are awaiting results of the NTA review of the current application of Canadian for an arrangement with American airlines. The government has got itself out of the airline business. We are waiting for a private sector solution. We are encouraged that one will soon be found.


John Paul Manley: Madam Speaker, I do not think the parliamentary secretary heard the drift of the question which raised new information that has come out recently.
He knows very well that in light of the decision of the competition tribunal last week, Canadian Airlines International is struggling to survive by seeking the co-operation of its employees and, most important, its creditors.
In the midst of all this the Minister of National Defence, a senior minister in government, decides to announce her learned opinion that Canada does not have enough traffic for two airlines. What message is she seeking to send to the creditors of Canadian Airlines? Is it that it is time to smash and grab? What message does the government have for those creditors?


Lee Richardson: Madam Speaker, as I said in my initial response, the position of the government has not changed in this regard at all.


John Paul Manley: The position has not changed. It does not have one, Madam Speaker.

As I said before, Air Canada president Hollis Harris announced yesterday there would be another substantial loss of jobs at Air Canada. Meanwhile, the government is
not charging Air Canada's competitors full landing fees and other taxes payable to the Government of Canada.
Why does the government maintain this double standard for air carriers? Why is the government just waiting for our airlines to go under?


Lee Richardson: Madam Speaker, I think everyone in the House is aware of the difficult situation of Canadian Airlines and of all airlines in Canada at the present time. This kind of rhetoric does not help the situation at all.
We have been working very closely with all airlines in the country to ensure an ongoing competitive airline situation in Canada. The hon. member knows very well about our efforts, and again I do not think this kind of rhetoric helps the situation at all.


Hon. Andre Ouellet (Papineau-Saint-Michel):: Madam Speaker, my question is not directed to the parliamentary secretary because his answers are entirely unsatisfactory. Air Canada has just announced that 2,200 employees will lose their jobs. This is not rhetoric. This is grim reality. We can blame the Conservative government for failing to act in the transportation sector.
I therefore want to ask one of the ministers from Quebec-not many are here today, but I would like to ask one of them-what this government intends to do to help Air Canada deal with its current economic problems, a company that under the Liberals was one of the seven best companies in the world and provided 24,000 jobs. I may remind the minister that today, Air Canada has only 6,000 employees in Montreal.
When will the Conservative government wake up and help this company remain viable, a Canadian company that creates jobs and keeps jobs in Montreal?


Lee Richardson: Madam Speaker, I think I should respond by first mentioning that the Minister of Transport is a Quebec minister. The minister is very aware of the situation with regard to Air Canada.
April 30, 1993

However I go back to my response to the member for Ottawa South. World airlines are in a difficult situation as a result of (a) the gulf war and (b) the world recession.
This is not a situation unique to Canada. There is clearly overcapacity in Canada and these matters are being worked out.


André Ouellet: Madam Speaker, the parliamentary secretary says this is a global problem. We are not talking about problems caused by the gulf war but about Tory policies, including deregulation, which created this problem facing Canadian companies today.
Earlier, my colleague asked some specific questions about Canadian airlines. I am now asking specific questions about Air Canada, and the parliamentary secretary tells us that the minister is from Montreal and he is keeping a close watch on the situation. The present minister may be from Montreal, but four of his predecessors were also from Quebec or the Montreal region and nobody has done anything whatsoever to help Air Canada.
Again, I want to ask when this government is going to get a consistent policy for the air transportation sector in order to save Canada's air transportation industry.


Lee Richardson: Madam Speaker, again I can appreciate the member's concern, coming late into this discussion.
On the other hand we have recently received the NTA report. One of the recommendations of the NTA report is on deregulation and how in fact it is working and working well across the country.


THE BUDGET
William Alexander (Bill) Blaikie: Madam Speaker, I share the concern of the hon. member of the Official Opposition who just spoke, but I would remind him the Liberals were the first to worship at the idol of
Oral Questions
deregulation under the Liberal Minister of Transport prior to their defeat in 1984.
My question is for the Minister of State for Finance and it has to do with the budget. It concerns the contrast between the rhetoric of the budget with respect to deficit reduction and the fact that no effort was made to close tax loopholes that had been identified previous to the budget and had been discussed in this House.
At least on one occasion the Minister of Finance indicated to me that he might have been considering reducing or eliminating the business and entertainment tax deduction that costs Canadians $1 billion a year. Could the minister say why no step was taken to address that particular tax measure?


John Horton McDermid: Madam Speaker, is that a question written by the hon. member from Windsor or is it one from the hon. member from Saskatchewan?
I will answer the question this way directly. The hon. member knows full well, because I saw him wining and dining with the Canadian Restaurant Association at the Chateau Laurier Hotel, that the Canadian Restaurant Association and the Canadian Small Business Association rely on those deductions for business purposes to help them with tourism, the restaurant business and small business.
New Democratic Party members stand and say that they are the great champions of small businesses but they certainly are not supporting them on this particular issue.


William Alexander (Bill) Blaikie: Madam Speaker, I do not know what the minister was consuming at that event but I certainly was not present.
In any event, the minister has given an argument in defence of that particular deduction, but the argument the Minister of Finance has given me in the past has had to do with staying competitive with the United States of America. This is the first time we have heard this particular angle.
Why was no effort made to close some of the tax loopholes that were identified by the Auditor General in his report? Surely, if deficit reduction is important, these

April 30, 1993
Oral Questions
kinds of loopholes should be addressed, particularly the ones which have been identified by the Auditor General. Why was no action taken on those particular loopholes?


John Horton McDermid: Madam Speaker, I am not sure exactly what the hon. member is referring to when he talks about the Auditor General and loopholes.
Recently the Auditor General came out with a report saying that foreign companies were given an unfair advantage, but once the figures were compared with the Department of Finance and the situation examined there was a meeting of minds that maybe that was not entirely accurate.
I am not sure to what the hon. member is referring specifically. Let me say this. This government over the last nine years, the Government of Canada, has reduced or eliminated more tax loopholes, as they are commonly referred to, than any previous government.
The hon. member knows that. We have brought in minimum corporation taxes, large business taxes. We have brought in minimum taxes for banks and financial institutions. The hon. member knows we have gone a very long way. For him to stand here today and talk about tax loopholes and so on is really misleading the House.


William Alexander (Bill) Blaikie: Madam Speaker, I would agree that there were many tax loopholes to close, thanks to previous Liberal governments, but there are many tax loopholes yet to be closed by this particular Conservative government. Many of them have been identified over the last few years, and particularly over the last little while.
In a budget that was allegedly devoted to deficit reduction we saw absolutely none of these tax loopholes closed. I think it gives the lie to what the government is really up to.
Therefore could the minister explain, again with respect to tax loopholes, why the government refused to have anything to do with the proposed draft of the multilateral mutual assistance agreement by the 28 members of the OECD and the Council of Europe, a draft designed to take on the world's largest tax loopholes, preventing both evasion and avoidance of all taxes other than customs duties?
This treaty, more commonly known as Interfirpol, equips national governments to effectively deal with the formidable obstacles that global companies are constantly throwing at our national economies and at our national fiscal systems.
Why is it that the Canadian government has refused to try to create an international context in which one country cannot be played off against the other and on which ministers of finance do not have to constantly rise in this House and say they cannot close particular tax loopholes because it would make them uncompetitive?


John Horton McDermid: Madam Speaker, I find it interesting that the New Democratic Party and its spokesman today talk about the finance ministers from the IMF, the OECD and the G-7 playing off against one another, when it is just exactly the opposite.
The G-7 finance ministers are in the process of meeting in Washington before the IMF and World Bank meetings this weekend. I thought my hon. friend might be prepared to use some of the quotes such as that of Michel Camdessus, the managing director of the International Monetary Fund, who said: "My impression is that there is a very significant effort to take care of the public debt in Canada. The last developments are positive including the budget which was announced two or three days ago".


Mr. McCurdy:: Answer the question.


John Horton McDermid: Co-operation between countries and between finance ministers is ongoing. Thank goodness the NDP is not in there. There would be no co-operation at all.


William Alexander (Bill) Blaikie: What about the question I asked?


NATIONAL DEFENCE
Hon. William Rompkey (Labrador):: Madam Speaker, my question is for the Acting Prime Minister.
The minister of defence claims she did not know that the beating death in Somalia on March 16 involved criminal intent until March 31. Yet statements by the chief of defence staff show clearly that she knew on March 19.
Yesterday the Minister of National Defence called the statement of the chief of defence staff ridiculous.
April 30, 1993

My question for the Acting Prime Minister is this: Does he agree with the Minister of National Defence or does he, as we do, believe the chief of the defence staff? If he does, would he agree to open up the Somali inquiry to include a thorough examination of the role of the minister?


Hon. Harvie Andre (Minister of State and Leader of the Government in the House of Commons):: To begin with the hon. member has not represented the situation factually in terms of what actually was said by either the Minister of National Defence or the chief of the defence staff.
The chief of the defence staff in his briefing indicated that the unit reported evidence indicating that criminal intent might be linked. He indicated that it might be linked. The hon. member said that the Minister of National Defence therefore knew there was criminal intent. She knew no such thing, nor did the chief of the defence staff say so. He said there might be.
What happens when there is an indication that there might be? An investigation is appointed and it is investigated by the appropriate authorities. That is precisely what the Minister of National Defence indicated was happening. It was being investigated. It is up to the investigation to make that determination.
The hon. member knows, if he attended the briefing of the Judge Advocate General, that the Minister of National Defence has a role in the defence legal system not dissimilar to that of a judge. If in fact the Minister of National Defence had stated explicitly on the 7th: "Yes, criminal intent," the hon. member quite rightly could have stood in this House demanding her resignation immediately for acting irresponsibly.
She said all she could say. She did not misrepresent the situation, nor in fact is there any conflict between what she said and what the chief of the defence staff said.


Bill Rompkey: Madam Speaker, there clearly is a conflict. If the minister is in fact correct then she has nothing to hide from a public inquiry then surely a public inquiry would exonerate her.
Oral Questions
If, as Canadians believe and we believe, there is a contradiction between what the chief of the defence staff said and what the minister said, they cannot both be right. In order to arrive at the truth why does the government not open up the inquiry to include a thorough examination of the role of the minister? If she is right she has nothing to hide.


Harvie Andre: To begin with, what particular accusation is the hon. member making in terms of the Minister of National Defence? Is he suggesting that as Minister of National Defence she should have come out and stated explicitly all the details?
Let me repeat my first answer because obviously he did not hear it: Indicating criminal intent might. Indicating might. Think about those two words, "indicating might". That was concluded.


Bill Rompkey: She did not say that.


Harvie Andre: Now the hon. member is shouting at me and will not listen to my answer even though he asked the question. Supposedly he treats this issue seriously. If he did he would close his jaw and listen to my answer.
The reality is that the inquiry was set up to establish the truth in respect of the operations of the Canadian Armed Forces units in their peacekeeping role. They are not dealing with a criminal investigation which is gomg on by the appropriate authorities under the jurisdiction of the Judge Advocate General.
The reality is in order that there be full and frank discussion by the witnesses it is being held in camera. The hon. member is suggesting that unless it is being held under the full light of TV cameras and so on we will not know the truth. Therefore, he s suggesting that the commissioners on this commission cannot be trusted to establish the truth. I would like him to name the commissioners he thinks are untrustworthy.


THE BUDGET
Mrs. Marlene Catterall (Ottawa West):: My question is for the Acting Prime Minister. Today is tax day for Canadians. Since it was elected this government has spent $1 trillion of their money. That is a one followed by 12 zeros. The deficit has grown to $34 billion. The debt is

April 30, 1993
Oral Questions
approaching $500 billion. We have been through a three-year recession and 1.5 million Canadians are out of work.
As Canadians write their cheques to the government they want to know this: Just what is going on here? What does this government think it is doing to this country?


John Horton McDermid: I hope I have the time to answer this.
First of all, some very good news came out this morning. The real gross domestic product rose four-tenths of 1 per cent in February. Over the last three months real domestic product growth has grown at an average annual rate of 4 per cent. I might point out that goods production increased 5 per cent. All those are good signs. Those are signs that the economy is coming back.
rhis government has placed Canada in a position to take advantage of recovery. We have the lowest interest rates in 30 years, lowest mortgage rates in 30 years and the lowest inflation rate in probably 20 years. As late as yesterday we were being credited by the IMF, by the treasury secretary of the United States and others that Canada is going to have the best job growth and the best gross domestic product growth over the next two years.
That speaks well for the very tough decisions this government, the finance minister and the Prime Minister have had to take over the last few years to bring us to this point. We said this is what would happen. It is happening and we are very pleased to see it.


Marlene Catterall: Madam Speaker, when we have hit the depths this government has taken us to there is no place to go but up, is there?
If the minister wants opinions on the budget I will give him opinions on it: "From a tired government a budget without inspiration; a bloodless budget; a phoney budget; and more razzmatazz".
This government that promised Canadians no tax increases has given them 38 new taxes or tax increases. What does this budget promise them? It promises them more tax increases. For the next five years personal income taxes will increase by over 7 per cent. That is 36
per cent in this budget. Just what is this government doing with their money? Canadians want to know why they should trust it with one more cent.


John Horton McDermid: Madam Speaker, I find that passing strange. We were criticized by the business community and some of the financial thinkers in this country for not raising taxes. Now my hon. friend is coming out and saying that we are raising taxes. The first statement by the Minister of Finance in the budget was that there were no new taxes and no increase in taxes. We are standing by that because we think that will help recovery.
The hon. member should get her facts straight. She made a series of quotes about the attack on the budget and, as my hon. friend said, it was probably the hon. member for Windsor West who said that.
Let me do some quoting from the people who should be listened to because I think it is very, very important. The secretary of the U.S. treasury said: "I am very pleased to see Canada with a strong budget where they are also pushing for growth". I could go on and on with the number of people who are supporting the budget.
Here is another one. The hon. member will be interested in this one because the Liberal Party was gloating about a credit rating decrease by one of the bond rating agencies. "I think Mazankowski was very successful in deflecting the CBRS downgrade by downgrading the CBRS". Well it was not only the Minister of Finance who did that but it was all the other bond rating agencies as well.
We are on the right track. We are heading in the right direction.


ABORIGINAL AFFAIRS
Robert Evans Skelly: Madam Speaker, my question is for the minister responsible for housing.
Off-reserve native housing organizations have learned from the minister's office that as a result of last Monday's budget no new funds will be available after January 1, 1994 for urban and rural native housing programs, for the RRAP program, or for rent subsidies.
April 30, 1993

Oral Questions
Not only will no new off-reserve housing be built to reduce the long waiting lists and overcrowded conditions, but the lack of maintenance funds through the RRAP program will mean that the quality of current housing stock will quickly deteriorate. The additional social costs related to inadequate housing conditions as well as the higher replacement costs which future governments will face as a result of the cutback to RRAP mean that in future Canadians will face even higher deficits than if the government had continued to borrow to finance off-reserve housing for native people.
Will the minister confirm to this House what his office has been saying to native off-reserve housing agencies, that no new funding will be available after January 1, 1994? Will he advise the House whether any studies were done to determine the impact on the deficit in allowing current CMHC housing stocks to deteriorate, as well as the added social costs which result from overcrowded and inadequate housing conditions?


Mr. Dave Worthy (Parliamentary Secretary to Minister of Public Works):: Madam Speaker, social housing has been impacted by the recent budget. I think the hon. member knows, but it should be pointed out, that the on-reserve native housing is not affected by that budget change.
The natives off reserve as well as all other people involved in social housing have been impacted by the cuts made to social housing. The implication of the member that housing would deteriorate and reach unacceptable standards is wrong. The program will continue to maintain in good shape the housing that does exist.


Robert Evans Skelly: Madam Speaker, many aboriginal people leave reserve communities because of the lack of economic and educational opportunities.
With this change in the program they will now be forced back on to reserves where even the department admits that half the housing stock is unliveable and where they are going to face lack of education and economic opportunities. This is as a result of a 30 per cent roll back in economic development money for reserves last year.
Is the minister aware that his cuts to housing programs will force native people to stop seeking employment and education opportunities off reserve, will force them back into the welfare system and overcrowded conditions on reserve where there are serious social problems?
Is he not concerned that the cost to this and future generations in human as well as financial terms will far exceed the short-term savings that he hoped to accomplish by cutting off-reserve housing programs?


Dave Worthy: Madam Speaker, the situation for the native people on and off reserve has been improving steadily over the past two years. There is no other government that has done more to assist the native people of Canada.
Obviously there is more that could be done and more that we would like to do. The situation regarding all the people of Canada, and there is such a thing as dealing fairly with all the people of Canada, is that we are in very tough times. We will continue to be for a short period. We have to take measures that may not be desirable but are necessary.


SMALL BUSINESSES LOANS ACT
Mrs. Beryl Gaffney (Nepean):: My question is for the Minister of Finance. Small business in Nepean and elsewhere is telling me that government and banks are choking economic growth and job creation. They say that banks are uncaring, are calling loans, and cutting back on lines of credit.
We know 80 per cent of jobs in this country are created by small business. Yet government and banks, which are the country's two most powerful organizations, have demonstrated their failure to understand what must be done.
What hope will this minister give today in this House in spite of a do-nothing budget to small business in Canada?


Hon. Tom Hockin (Minister for Science and Minister of State (Small Businesses and Tourism)):: Madam Speaker, obviously the hon. member is not aware of the Small Businesses Loans Act changes which are tremendously important. In fact the changes were applauded by her party when they were introduced and they were

April 30, 1993
Oral Questions
passed through the House in very quick fashion because of the tremendous hope given to small business.
Here are the changes: We are now guaranteeing 90 per cent of the losses instead of 85 per cent. We are now limiting the personal guarantee that banks can take when we do an SBLA loan. This is a very big step forward. Even John Bulloch who does not usually say nice things about any government applauded that.
What we are also doing under the SBLA is making sure that the banks know about it, that they put it in the window and that they train their staff on it. This has been done. I have already received reports from the six major banks. They are training their branches as I speak and most of them now are ready to use this act.
It is predicted that close to $1 billion worth of loans will occur in addition to what would ordinarily have occurred because of these changes.
I hope the hon. member will applaud us for this program because members of her party already have.


Beryl Gaffney: Madam Speaker, I am well aware of the new Small Businesses Loans Act. We on this side of the House do applaud it but it would be interesting if he would sit down with the heads of financial institutions and have them advise the heads of their banks that this is actually in effect because banks are turning away business left, right and centre. When is the minister going to sit down and talk this over with the banks?
The biggest impediment is the lack of available funds from the lending institutions. These small businesses are not the Olympia & Yorks of the world. The banks and the government are not even aware that small business exists in this country.
Why has this government ignored small business? Why is it not creating jobs? It has not even addressed it in this budget.


Thomas Hockin: Madam Speaker, no government has helped small business more thoroughly than our government.
First of all we have maintained the income tax level for small business at the lowest level of the OECD, 12 per cent. Second, we reformed the SBLA. When her party was in government it did not reform the SBLA in the positive ways we have done it.
More important, all the regional programs we have are essentially for small business. Of course they have been creating jobs. On reserve, for example, the aboriginal economic development program created over 3,000 small businesses in the last five years alone.
I cannot in answer to one question tell the hon. member the litany of things that we have been able to accomplish for small business, but the most important of all is to make sure interest rates are low. The interest rates are now at the lowest level they have been in 30 years and that is important to every small business person across Canada.
I agree with her though that we should talk to the banks and make sure that the banks use these programs. They know about them and we are doing it. I would be grateful if she would assist us in so doing.


PUBLIC WORKS
Mr. Don Boudria (Glengarry-Prescott-Russell):: Madam Speaker, my question is for the Minister of Public Works and it concerns the ICAO lease in Montreal.
In May 1991 Public Works Canada attempted to purchase the existing building in Montreal where ICAO is located. Less than 20 months later the government said that the building was so inadequate that it would not even rent it from the present owner.
I ask the minister: What changed in that 20 month period? Why is the government spending $175 million more than necessary?


Dave Worthy: Madam Speaker, I am glad to follow up on the minister's statement yesterday. He took the question and I was quite pleased with his response.
With regard to the situation in Public Works, the way we have opened the process up it is transparent, and in his words, the process is squeaky clean. The situation is transparent. I am glad to know the hon. member is going to take advantage of the briefing the minister offered yesterday.
I would like to quote what one of the other tenderers had to say. The Westcliffe group and other rival developers seeking the ICAO lease said yesterday that the bidding process had been followed strictly. It goes on to verily that it was. The rules of the game were followed
April 30, 1993

all the way through. The member should be satisfied that there was no problem dealing with the ICAO situation.


Don Boudria: Madam Speaker, the member across the way wants to quote other bidders. I will quote him another one. The Canderel Corporation said: "The dice were loaded".

I would like to ask the minister's representative on the other side to answer the following questions. For one, I want to know why the government, that wanted to buy the building, immediately said that it was unsuitable and did not even want to rent it. Secondly, what will he and his government do to restore confidence in the contract awarding system at the Department of Public Works?


Dave Worthy: Madam Speaker, I think the public and all members of this House should have absolute confidence in the system. It has never been better. In all of the years that member's party was running the government it was, I would say, less than squeaky clean.
The situation for ICAO for its requirements is this: Public Works in fact deals with customers. The customer was ICAO. It has new demands. It had a 20 year lease on the existing building. Its demands have changed. Its request of Public Works was that we enter a tendering process with those new demands. We have done so. The process is not yet complete. It will be shortly and we will be in a position to provide the customer ICAO with the facilities that it has asked for.


AIRCRAFT SERVICES
David Bjornson: Madam Speaker, my question is for the Minister of Transport.
I have risen in the House before on this issue of Aircraft Services in the Winnipeg area. The result of these interventions is that a study was undertaken and completed to determine the most cost effective location for this transport department.
Oral Questions
First, can the minister tell the House the results of the study?
Second, can the minister tell the House if it is true that Aircraft Services, before the study is released, is seeking a new location which may or may not fall within the recommendations of the report?


Lee Richardson: Madam Speaker, this matter has certainly been ongoing longer than either the member or I would have cared.
The situation arose when the Aircraft Services central region aircraft which were originally based at Winnipeg International Airport in an old World War II hangar that was condemned by Labour Canada was abandoned and found temporary accommodation at St. Andrews of which the hon. member speaks.
There is a study ongoing. We have asked Peat Marwick to consider the best location for the permanent hangar situation. The member knows we have been studying the St. Andrews airport as well as Winnipeg and Portage la Prairie. There has been no lease signed. The department has not yet negotiated a new lease. We are waiting for the results of the Peat Marwick study which I expect will be available shortly.


EMPLOYMENT
Mr. Ian Waddell (Port Moody-Coquitlam):: Madam Speaker, my question is for the Acting Prime Minister in the absence of the minister of energy. I ask him to bear with me. I have a touch of laryngitis which is probably not a bad thing for an NDP MP to have this week.


Some hon. members:: Oh, oh.


An hon. member:: Wrong MP.


Ian Gardiner Waddell: We will not go into that.
Imperial Oil proposes to close its IOCO refinery in Port Moody, British Columbia and a number of workers will lose their jobs. These same workers received a zero per cent pay increase last year. These same workers developed ways in co-operation with local management to cut costs and improve efficiency. The refinery is actually making money.

April 30, 1993
Oral Questions
My question is this. What is the government going to do to aid these workers and others who have done everything that the government has been telling Canadian workers to do but still lose their jobs?


Mr. Michel Champagne (Parliamentary Secretary to Minister of Energy, Mines and Resources):: Madam Speaker, I would like to remind my hon. colleague that the government, together with the Minister of Energy, Mines and Resources, is doing a great deal to help the energy sector, and particularly the oil sector. I will remind him of a very important program, Hibernia.
I hear the Bloc Quebecois member laughing at the Hibernia program. Maybe he should not laugh, because a great many Quebec companies benefit from it. It means jobs for Quebec. Maybe that does not interest him, but I would simply say that there are tremendous spin-offs for Quebec.
Getting back to my colleague from British Columbia- and I know it is unfortunate that jobs have been lost-I would remind him that programs for workers have been set up with the Minister of Employment and Immigration. Our funding has increased substantially to redirect them to other work or to upgrade their skills. Our department's main goal is not to try to maintain a company that is more or less in difficulty but to give it the best chance of acquiring expertise and good jobs in a field of activity where we perform well internationally.


Ian Gardiner Waddell: Madam Speaker, I wish to thank the hon. member for his answer. We have the same situation in east-end Montreal.

On the west coast we had four refineries in the greater Vancouver area and now three of them have closed; Shell, Petro-Canada and now Imperial. The refined product is coming from Edmonton by pipeline instead of being refined in Vancouver.
I want to ask the parliamentary secretary this.
Given the possibility of an interruption of supply or a cutback by the company, what is the government going to do to protect the security of supply of gasoline for the lower mainland of British Columbia, to keep the prices
from rising and to prevent independent gas retailers from being squeezed out?
Will the ministry, the department of energy, conduct an inquiry into the implications for the west coast of the closure of this very important refinery?


Michel Champagne: Madam Speaker, I would repeat that the Minister of Energy is extremely concerned about this issue.
Rest assured that he will do all that is necessary for every part of the country-the west coast, the Atlantic region, Quebec or Ontario-to receive its fair share from our programs. We will continue to do so equally, as we have in the past when we helped the west by eliminating the extremely disastrous National Energy Program.
Our government did that, in the interest of companies in western Canada and all Canadian consumers. We will continue to act in that way. Rest assured that we will consider the problem raised by the hon. member and that the minister will give an answer as soon as possible.


MUNICIPAL TAXATION
Larry Schneider: Madam Speaker, my question concerns the matter of grants in lieu of taxes to municipalities.
I believe it is unconscionable for any government not to pay for services rendered by any other order of government regardless of where it thinks it may be in the hierarchy of life.
The NDP government in Saskatchewan pays zero, naught, nothing for the services it receives from municipalities in Saskatchewan. This is the ultimate form of unfairness.
I fear that the the federal government may be inclined to be lured into this morass. It is my understanding that the minister has twice met with FCM to discuss the 77 per cent increase in cost.
In my city over the last five years we have illustrated some responsibility in that there has been a mere 8 per cent increase during that five-year period of time.
April 30, 1993

Can the minister tell me if it is the government's intent to approach this as a problem nationally or will it focus its efforts at abuse of municipalities, which I believe should be its thrust?


Dave Worthy: Madam Speaker, we are aware of course that there are provinces that do not deal with grants in lieu of taxes in the same way we do federally.
There have been, and the member rightly points it out, unacceptable increases in the grants in lieu of taxes over the past number of years. In fact, it has nearly doubled over the last five years.
It is for that reason that the government took the responsible action of freezing grants in lieu of taxes. The objective of the department and the government is to be fair with not only the taxpayers of the country but with all municipalities across the country.
It is for that reason that we have met and continue to meet with the Federation of Municipalities. We will be working out a fairer way of dealing with grants in lieu of taxes. I can assure the member we are not planning to stop paying grants in lieu of taxes.


HEALTH CARE
Mr. Rey Pagtakhan (Winnipeg North):: Madam Speaker, I direct my question in the absence of the Prime Minister to the Acting Prime Minister.
Two ministers of cabinet, now Tory leadership candidates including the minister of defence, say they will end universal medicare and impose user fees if they become Prime Minister.
Why does the Prime Minister not tell the minister of defence to defend medicare instead of defending the $5 billion helicopter program?


John Horton McDermid: Madam Speaker, I think you will find that all members of this government defend medicare and want to assure that medicare is provided to every Canadian no matter what their status in life.
Ideas are being discussed now in the leadership race. This happens at leadership convention times. People
Oral Questions
want to know what individuals are looking at and considering for the future.
If the hon. member was fair to the minister of defence, he would have quoted her a little more accurately in what she was talking about. I think the record will show that the minister actually said that she would discuss this issue with the provincial governments.
I think that is what I saw on television. I believe that is what she said. I think the hon. member should be fair.


Rey D. Pagtakhan: Madam Speaker, I direct my supplementary to the same minister.
The present minister of health defends medicare but the minister of defence and the Minister of the Environment are stabbing the minister of health in the back.
Can the Prime Minister tell the House once and for all whether the Tories believe in the Canada Health Act, in medicare, or is he like the minister of defence who believes that hospitals should check people's wallets before they check their pulse?
Why does the Prime Minister not fire the minister of defence and the Minister of the Environment from his cabinet or does he equally believe in killing medicare?


John Horton McDermid: Madam Speaker, that is such a foolish statement by the hon. member.
Let me just read for the record the exact quote of the Minister of National Defence: "There are disagreements over user fees. You know I am of the school, so for medical programs I am of the school of Benoit Bouchard". That is the current minister of health whom the hon. member just praised.
"I have talked to a lot of economists who specialize in this area and who do not think it is the most effective way." This is referring to user fees. "On the other hand it may be that provincial governments who administer the programs would have some latitude to decide how they are going to cover their costs. I want to sit down with the provinces and talk about it."
That is a far cry from what the hon. member who stood in this House said.

Routine Proceedings


PARLIAMENTARY EMPLOYMENT AND STAFF RELATIONS ACT
[Stage Direction]
April 30, 1993
Lyle Stuart Kristiansen: Madam Speaker, my question is for the President of the Privy Council. If I may, I would like to take the opportunity to wish him well in his announced impending retirement, unless of course he pulls a Trudeau in which case all bets are off. It is some 30 years since we first met and I sincerely wish him well.
In June 1986, six and three-quarter years ago, the 33rd Parliament with all-party support passed the government's Bill C-45 and enacted the Parliamentary Employment and Staff Relations Act which, very simply, extended to workers on Parliament Hill the same basic rights to decent working conditions and health and safety laws enjoyed by all other federal employees.
Almost seven years and one election has passed since Royal Assent was given to part I. Still the cabinet has not proclaimed the operative sections part II and part III into law.
Will the government proclaim this important basic legislation before the end of this Parliament and just when will it act to end this obvious and continuing injustice to those who serve us in this place?


Right Hon. Joe Clark (President of the Queen's Privy Council for Canada and Minister Responsible for Constitutional Affairs):: Madam Speaker, let me thank the hon. member for his compliments. Let me return them and let me take his question as notice.



ROUTINE PROCEEDINGS


Charles A. Langlois: Madam Speaker, pursuant to Standing Order 36(8), I have the honour to table, in both official languages, the Government's response to 44 petitions.
[Editor's Note: See today's Votes and Proceedings.]



WAYS AND MEANS


John Horton McDermid: Madam Speaker, pursuant to Standing Order 83(1), I wish to table a notice of Ways and Means motion to amend the Excise Thx Act, and I ask that an order of the day be designated for the consideration of the motion.



PUBLIC SERVICE SUPERANNUATION ACT


Eugène Bellemare: for leave to introduce Bill C-428, an act to amend the Public Service Superannuation Act (annuity following job loss).


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


Eugène Bellemare: Madam Speaker, I have the pleasure of submitting the following bill for first reading, entitled an act to amend the Public Service Superannuation Act.
The purpose of this bill is to amend the Public Service Superannuation Act in order to address the plight of federal public servants who lost their jobs since 1988 due to downsizing.
Currently a public servant who has reached the age of 55 and has at least 10 years of service and chooses a pension because he or she is a victim of downsizing is entitled to a full pension. However the same is not true for public servants between the ages of 50 years and 54 years. If pensioned they are penalized by 5 per cent a year until age 60 which means a 50 per cent reduction of their already minuscule pension. My bill would correct the situation by decreasing the 5 per cent a year reduction from age 60 to age 55. These public servants, many of whom cannot find employment, would then be able to receive 75 per cent of their minuscule pension instead of the present 50 per cent in face of the 1993 budget which calls for a further 16,500 public servant positions to be cut.
April 30, 1993

I hope that I will have the opportunity to debate this bill in the near future.


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


PETITIONS
Larry Schneider: Madam Speaker, pursuant to Standing Order 36, I rise today to present two petitions signed by constituents of mine. They humbly pray and hope that by way of this petition they can bring to light their concern regarding the Ukrainian redress on internment.
I present this petition on behalf of my constituents.


Larry Schneider: Madam Speaker, I have a second petition containing hundreds of signatures of my constituents dealing with the absolute insanity of the war that currently is occurring in Bosnia-Hercegovina.
They hope, following five recommendations, that we can address this matter to rid society of this insanity.


Mac Harb: Madam Speaker, I have a petition signed by many of my constituents in the national capital region.
These people would like to draw to the attention of the House that the goods and services tax credit is not available to independent, tax paying Canadians who are under the age of 19. Those constituents, as well as myself, believe that such exclusion is discriminatory.
Therefore, these petitioners call upon Parliament to urge the government to correct this injustice.


Rex Crawford: Madam Speaker, pursuant to Standing Order 36, I am proud to rise in the House and present a petition on behalf of the members of St. James Presbyterian Church, Chatham, Ontario who cannot stand the violence against women and children.
Routine Proceedings
They humbly pray and call upon Parliament to accept legislation designed to eliminate violence against women and children, encourage and support women to report incidents of assault or abuse, provide assistance and support for women reporting assault or abuse, provide relief and support to women as mothers to protect their children, emphasize the need for abuser rehabilitation, concentrate special efforts on training of police, lawyers, court workers and judges to become knowledgeable about women and child abuse, and to focus public attention on this very important and long ignored problem.


Robert Evans Skelly: Madam Speaker, I have a number of petitions. The first petition relates to the designation of a day recognizing Canada's aboriginal inhabitants and to honour their native cultures. The date proposed is the 21st as the most appropriate day to recognize our First Nations.
The petitioners therefore call on the Parliament of Canada to enact Bill C-268, an act respecting a national solidarity day for the First Nations of Canada.


Robert Evans Skelly: Madam Speaker, my second petition relates to the problem of violence and sexual assaults against children. The petition was submitted in memory of Dawn Shaw, a little girl who was sexually assaulted and murdered in my riding some time ago.
The petitioners call on Parliament to recognize the following: That the present system of justice fails to protect our children in our communities who are becoming increasingly victims of sexual assault; that judges should not be allowed to drop sexual assault charges because of delays in bringing these cases to trial; that jail sentences for sexual assault offenders be lengthened for persons convicted; that the community interest should be protected by permitting police to take DNA samples from persons suspected of sexual assault and that DNA imprints of paedophiles and sex offenders be kept in a national police data base.
There are number of suggestions that are being made by the people both in the Comox valley and throughout Canada. Therefore residents of Canada, in memory of Dawn Shaw, request that Parliament enact legislation to change the justice system to provide greater protection

April 30, 1993
Routine Proceedings
for children from sexual assault and to ensure conviction of offenders.


Eugène Bellemare: Madam Speaker, I have the pleasure of submitting a petition concerning the price of gas in the national capital region. As you are well aware, the price of gas in the Ottawa-Hull region is much higher than in Southern of Ontario, Toronto or Windsor.
Local residents find it unfair to be the victims of such a difference in the price of gas within a province and a region. The petitioners call upon the government to hold an inquiry in order to correct the situation.


Mr. Stan J. Hovdebo (Saskatoon -Humboldt):: Madam Speaker, it is my honour and duty to present a petition on behalf of the citizens of Saskatoon, mostly university students, who have suggested that the GST being the first federal tax ever applied to books, magazines and newspapers, is affecting the reading at their level, and particularly university students.
Since the Prime Minister promised in October 1990 to review the effects of the GST on reading materials after one year, they call upon this Parliament to immediately eliminate tax on reading material.


Ian Gardiner Waddell: Madam Speaker, I have a petition signed by many residents of Langley and Surrey, B.C. and also from some residents in my own riding in Coquitlam and Port Coquitlam, British Columbia.
It points out that two Canadians, Christine Lamont and David Spencer, are now virtually rotting in a Brazilian jail and that there is a real threat to their health and safety in prison. The only relief available is for Canada to request expulsion in accordance with Brazilian law. For some reason Canada has failed to do that.
Therefore the petitioners call upon Parliament to urge the Prime Minister to request the Government of Brazil to expel Christine Lamont and David Spencer and return them to Canada in accordance with Brazilian law.


QUESTIONS ON THE ORDER PAPER
[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
Charles A. Langlois: Madam Speaker, questions 421 and 485 will be answered today.


Mr. Simmons: With respect to the Atlantic Canada Opportunities Agency, what action has the government taken to resolve the problems as outlined in the 1991 Auditor General's report which cites "significant instances where officials have failed to adhere to the authorities governing the action program", concerning the (a) appropriation of funds (b) treatment of documents (c) evaluations of projects prior to their approval (d) terms and conditions under which the agency was created?


Hon. John C. Crosbie (Minister of Fisheries and Oceans and Minister for the Atlantic Canada Opportunities Agency):: With respect to the Atlantic Canada Opportunities Agency the government has taken the following action to resolve the problems outlined in the 1991 Auditor General's report:
(a)	Appropriation of funds
The primary concern of the office of the Auditor General (OAG) was that the agency was advancing funds before commercial production was achieved. In this regard, the agency reviewed the policies relating to commercial production. It was found that the definition of the date of the commencement of commercial production requires 30 continuous days of production of marketable goods in commercial volume. This left no room for discretion and caused difficulties for seasonal operators and some small entrepreneurs. All references to this milestone date have been removed from the terms and conditions, but retained in the guidelines where the agency has sufficient authority to reasonably deal with problem situations. This amendment to the terms and
April 30, 1993

conditions of the action program was approved by Treasury Board on April 30, 1992 (TB 818236).
(b)	Treatment of documents
The concern of the OAG related to two points:
1.	Treatment of sector department advice.
The agency has reaffirmed the need for ACOA officers to document all correspondence with sector departments and to ensure that all concerns are addressed and resolved before further processing of an application. Verification of adherence to this procedure will be established as part of the quality assurance audit regime.
2.	Treatment of substantive amendments
The agency's practice has been to define as substantive amendents those which increase the financial exposure of the federal government or could adversely affect the commercial viability of the project.
Using these criteria as a guide, a review of substantive and non-substantive amendments, as defined in section 400-1 delegation of authorities, policy and procedures manual, was conducted.
After careful consideration it has been determined that the listing of substantive amendments is appropriate and that no changes are warranted.
It is agreed that in the case identified by the OAG, the amendments to the project should have been considered as significant and therefore should have been approved by the minister. This is a case where the procedures were not applied properly and not a case where a policy change is warranted.
(c)	Evaluations of projects prior to their approval
The primary concern of the OAG was that the agency did not conduct adequate evaluation of commercial viability before the project was approved.
In this regard the agency has initiated two steps:
1.	The agency is in the process of implementing an automated financial analysis package. Financial and other indicators directly assessing the commercial viability of a project are an inherent part of this package. This will ensure quality and consistency in the evaluation of the applicant's financial situation.
2.	A comprehensive training package for account managers has been designed and will be applied to 70
Routine Proceedings
ACOA officers before fiscal year end. Among the topics covered will be the various evaluation criteria which have to be addressed before a project is approved.
(d)	Terms and conditions under which the agency was created
The terms and conditions of the action program are under constant internal review and challenge, to ensure they reflect the best practice of combining protection of the public purse while promoting regional development.
As part of this effort, the agency recently completed a full evaluation of the action program. This evaluation included a detailed review of the impacts and effects of the terms and conditions and offered recommendations for improvements. The agency will be announcing the results of the evaluation in the near future and subsequently formulating an action plan to deal with the recommendations.
Related actions
The agency has improved systems, processes, and policies to address the OAG findings. However, the coverage by the OAG indicated cases where, although policy and prescribed procedure is satisfactory, there was non-compliance with the terms and conditions of the action program. To minimize the potential of such cases, the agency has taken the following two measures:
-Project monitoring
The agency has formed a project monitoring committee. This committee is developing the processes and policies for enhanced monitoring of agency projects. The committee will be submitting suggested improvements for subsequent inclusion in the monitoring practices within agency operations.
-Quality assurance audit regime
Audit branch is developing a quality assurance audit regime. By the 1992-93 year end, and annually thereafter, all regions will have been subjected to quality control audits. Adherence to the terms and conditions of agency programs will be the fundamental audit criteria. More specifically, the audits will ensure high quality in the account management. It should be noted that commercial viability, significant changes, commercial production and project monitoring will be an integral part of the quality assurance audits.

April 30, 1993
Routine Proceedings
Further, this audit criteria will include the testing of project documents to ensure that projects are sufficiently evaluated prior to their approval.


Mr. Bellemare: With respect to the lease agreement regarding the Chambers buildings in Ottawa between the National Capital Commission and the firm chosen to upgrade and preserve the architectural heritage of the said buildings, (a) what tendering process was followed for that agreement (b) are there other kinds of tendering process that could have been used in this case and, if so, why were they not considered?


Hon. Elmer M. MacKay (Minister of Public Works):: There are in fact two lease agreements between the National Capital Commission and Chambers Ottawa (1992) Inc. relating to the Chambers site. The first is a 66 year ground lease between the National Capital Commission as landlord, and its tenant Chambers Ottawa Inc., a corporation controlled by Pemik Enterprises Inc. and Le Groupe L.G.L. Ltee. The commission awarded the lease in 1987 on the basis of a two-stage proposal call process: a publicly advertised prequalification call, followed by a proposal call.
The tenant subsequently assigned its leasehold interest under the ground lease to Chambers Ottawa (1990) Inc., a corporation controlled by another of the original tenderers, Perez Bramalea Limited. The new tenant made a further assignment of its leasehold interest to Chambers Ottawa (1992) Inc., a corporation controlled by Perez Corporation and The Standard Life Assurance Company. These subsequent assignment were done in accordance with the terms of the ground lease. As indicated in NCC chairman's letters to the hon. member for Carleton-Gloucester dated November 2, 1992 and December 2, 1992, Chambers Ottawa (1992) Inc. approached the National Capital Commission in November 1991 with a proposal to provide head office accommodation to the commission at the Chambers site. While the commission was considering issuing a proposal call for its head office accommodation in the national capital region, it agreed to review the proposal submitted by Chambers Ottawa (1992) Inc.
The commission's consideration of the proposal was compatible with its mandate, given its responsibility for safeguarding federally designated heritage buildings. The commission was concerned about the possible ramifications to the project from the stagnation of the commercial leasing market, both in terms of the risk of
delays and hence damage to the structures in question and the potential delay in receiving participation ground rent under the terms of the ground lease.
The Chambers site was found to be a desirable and justifiable head office location. However it became impossible to proceed by way of a public tender for the site's development due to the existing ground lease. After reviewing the proposal submitted and performing the necessary due diligence, the commission proceeded to enter into negotiations for a building lease with Chambers Ottawa (1992) Inc. on a sole source basis. The decision to proceed in this manner was taken only after a comparative analysis showed that the terms of the lease being proposed were competitive, given the heritage nature of the project and the terms of the ground lease in effect. This decision was endorsed by Treasury Board and received the approval of the Governor General in Council on July 23, 1992.


Charles A. Langlois: Madam Speaker, if question No. 454 could be made an order for return, that return would be tabled immediately.


Madam Deputy Speaker:: The questions listed by the hon. parliamentary secretary have been answered. Is it the pleasure of the House that question No. 454 be deemed to have been made an order for return?


Some hon. members:: Agreed.


Mr. MacWilliam: For each year since November 1988, have any departments or agencies spent money or provided grants in the constituency of Okanagan-Shuswap and, if so, (a) by which department or agency (b) in what amounts (c) under which categories and programs was the money spent?
Return tabled.


Charles A. Langlois: Madam Speaker, I would ask that the remaining questions be allowed to stand.
April 30, 1993


Madam Deputy Speaker:: 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 of the Economics envelope.
Alfonso Gagliano: Madam Speaker, as I was saying before being interrupted at 11 a.m., I am pleased to participe in this debate on Bill C-117, an act to provide borrowing authority for the fiscal year beginning on April 1, 1993.
The Conservative government is asking Canadians through Parliament for authorization to borrow over $31 billion in order to meet certain expenditures. The Conservative government is responsible for the management of public funds. It wants our trust and the power to borrow over $31 billion, which is an enormous amount of money. Given the sad economic performance of this government during the past decade and its empty budget of this week, we have no other alternative but to say no.
The government claims to be borrowing the amount indicated in Bill C-117 to complete public works and for general purposes. This could mean just about anything. This amount is also roughly equivalent to the anticipated deficit of $32.6 billion for the 1993-94 fiscal year, in last Monday's budget. You can rest assured that if the Conservative government could it would ask us for even more money later to fill the void created by a deficit which is even greater than expected.
That has already happened in the past, that the government comes back for additional borrowing. We know very well that all the budget predictions which this government made in eight and a half years, nearly nine years, and even those in the last budget never came true. Fortunately that party has only a few months left in
Government Orders
power, because in the next election the people will change the government.
I would like to take a closer look at the problem of the deficit and the debt. On May 23,1985 when he presented his first budget, the then Minister of Finance said that if he did not attack the debt problem the Government of Canada would end up paralyzed. At that time the public debt was a little under $200 billion. To solve the debt problem, the Conservative minister proposed tough measures needed to reduce the deficit and thus reduce the growth in the debt.
Let us look at the result of nine years of "tough measures", as the minister called them. The public debt has risen from $200 billion to over $450 billion in just nine years. In other words, the government's measures more than doubled the national debt; that is, the Conservatives are responsible for creating more debt in nine years than all the debt created in the previous 117 years of Canada's history.
The then Minister of Finance said in 1984 that if the debt problem was not dealt with Canada would be paralyzed. Well, the minister was right because today, thanks to his unsound economic policies, the country is in an unparalleled economic slump. Instead of solving the problem of the deficit and the debt, the Conservatives only made it worse. The figures are there and we could talk for hours, days and even months and go over all the budgets the two Conservative ministers presented since 1984.
The government's economic policies were as ineffective in dealing with the problem of high unemployment as they were with the deficit and the debt. In 1984 the Minister of Finance told this House that his policies were meant to "break the vicious circle of unemployment and public debt".
Let us now look at the problem of high unemployment and its harmful effects. Today, Canada has about 1.6 million jobless, and that is just the official figure. I say official because those who have given up looking for a job are not counted as unemployed by Statistics Canada.
The Canadian Conference of Catholic Bishops believes that there are now nearly four million unemployed people, welfare recipients and others without work in Canada. According to the Conference, the fact that a quarter of the country's labour force is thus excluded from the labour market undermines society's moral

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fibre. The bishops blame the economic policies of the last decade for this situation. High unemployment costs us dearly, also in terms of actual dollars and lost production, which is hard to estimate.
Let us take an example. Canada's Unemployment Insurance Plan costs employees and employers about $18 billion. If the unemployment rate were cut in half with job creation programs, $9 billion would be saved. Can you imagine what could be done with such an amount? To these $9 billion add another $6 billion that could be obtained if the government had the courage to cancel the purchase of 50 EH-101 helicopters.
It is an insult to our intelligence when candidates for the leadership of the Conservative Party tell us that they are concerned about the deficit. To solve the problem they say that all spending is on the table, even the universality of our social programs. We must be clear when we talk about social programs. Only one of them is still universal: health insurance. These people talk about abolishing the universality of medicare, a program which is the envy of the whole world.
Instead, why not put the purchase of these helicopters on hold? They are ready to eliminate the universality of Medicare, but they are not willing to give up the helicopter program. It is like buying a Cadillac without having the money to put gas in it.
There would be no limit to the problems which could be solved with a simple readjustment of priorities. Unfortunately, the priorities of this government are totally absurd. This government overlooks the human side of the situation. The first priority of a government should be the people. It may well be that such a priority would help alleviate the suffering in this country. If you want to see people suffering, come to Montreal. The poverty level is simply tragic!
According to Statistics Canada, Montreal breaks every record in terms of poverty for a metropolitan area. Indeed, 22 per cent of Montrealers live below poverty level. Twenty tons of food are now distributed each day in Montreal. What is even sadder is the fact that street children in Montreal know the same fate as those in Rio, according to a report from the World Health Organization. And then yesterday evening we learned that Air Canada intends to lay off 2,200 employees, bringing the total to 7,000 since 1990.
Will the Minister of Transport, who is also responsible for the Montreal region, examine the effects of his laissez-faire policy in Montreal? It used to be said that Montreal was a city with pride. Today, we say that it is the capital of poverty. Such is the sad reality of the Montreal region.
In my area, namely the east end of Montreal, the unemployment rate exceeds 25 per cent. Do you wonder why we refuse to support the government's decision to borrow over $31 billion? Its priorities are totally off. The government did not unveil any job creation program in last Monday's budget. It continues to make helicopters a priority instead of people.
This government showed nothing but economic inertia over the last decade. It has failed miserably. That is why we will vote against Bill C-117. We will vote against this government's budget policy and the people of Canada will vote against this inhuman and incompetent party in the next election.
The budget tabled last Monday is a disgrace. It brings nothing new and, what is worse, the Minister of Finance has given in to the prospect of a jobless recovery. If a small business had handed the same kind of budget to its bank manager he would have cut its credit and rejected any loan application.
There is nothing in this budget. Worst of all, this creative bookkeeping has been going on for years. It started with source deductions. They increased the frequency of source deductions to twice a month so that they could show a lower deficit at the end of the fiscal year. They used the same system for the federal sales tax rebate.
I clearly recall that when questioned on its GST policy and its impact on the poor and the old, the government answered: "We have a program whereby we will send them a cheque every three months." This was meant to compensate them for an unfair regressive tax they would have to pay on consumer goods.
And now, the government announced in Monday's budget that they will no longer get four cheques a year but just two, starting in January 1994. Why not immediately? If these programs save as much money as the government claims, why not apply this measure to the next two payments? First, because with an election coming they are afraid that the people will speak their minds about this government and send it off to collect UI benefits. Also, the first payment will be due in January
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1994, and the second would be due in April under the old quarterly payment system but its fiscal year ends March 31. So, what does this government do? It starts by eliminating one payment of the GST tax refund to the needy and uses an accounting trick. This way it can predict that by March 31, 1994 the deficit will have been reduced. There will be no real reduction because the same cheques for the same total amount will have to be sent out during the first week of April, but it will be a new fiscal year by then.
That is how this government has always got around the debt and deficit problem, by increasing our taxes. This needs to be said. A report published this week says that Canadians have seen their taxes increase by 25 per cent since this government took office. That is a 25 per cent tax increase. That is where we are at. That is the present situation. We had a projected annual deficit of about $32 or $33 billion, with a national debt of about $180 billion. But even with a 25 per cent increase in taxes the debt has now grown to more than $450 billion, while the deficit remained at the same level. That is what the Tories' economic policies have done.
I remember in 1983 when the present Minister of Trade who was finance critic at the time said that tax increases would completely stop economic growth. But this Finance Minister has increased taxes more than any other in the history of our country. This is where the Tories have led us after nine years in power.
One other thing. There is nothing in this budget for our young people. What does this government do for our youth? What hope does it give them to find a job after graduating? No jobs are created, thus there are none for young Canadians. Each time we bring up the issue of drop-outs we are told this is in provincial jurisdiction. Why would they pursue their education to be better equipped for the future when they see their brothers, sisters, cousins and neighbours make sacrifices to get an education but find no job when they graduate? That is the situation this government has created over the past nine years. It has doubled, almost tripled the debt. The deficit has remained unchanged. Taxes have been increased on 32 occasions. It has implemented the GST which not only slowed down the economy, but forced a
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big part of it underground. That is why our young people are discouraged and the future is uncertain.
I have not spoken of the famous free trade deal yet. During the 1988 election campaign, we were told it would bring prosperity. Canada would be open to the whole world, which would bring prosperity to all Canadians. Today we see plants closing and companies moving south where they will continue to sell us their products, maintaining their sales while we are losing jobs in Canada.
Unfortunately, this government cannot be given carte blanche to go out and borrow $31 billion without some reckoning as any good manager would be called on to give. The forecasts the Minister of Finance provided us on Monday are neither realistic nor logical and they continue to lead the country in the wrong direction. Unless we change course, we will have the Cadillac of helicopters but no money to buy fuel to run them.


John Horton McDermid: Madam Speaker, I have a brief question for my hon. friend.
I could debate with him, as some in the House would say, ad nauseam about some of the facts and figures he brought out. In his statement today he said to the Minister of Finance that the projections in his budget are wrong.
They are very conservative projections compared to those coming from all the economic organizations both within Canada and outside Canada, including the International Monetary Fund and the OECD. My hon. friend knows his government previously and our government now adhere to those projections.
He says they are wrong. Would he stand up in the House and tell the Canadian people what the Liberal Party's projections are and lay them on the table? If he is accusing the projections of the Minister of Finance of being wrong, and they are conservative compared to the International Monetary Fund, the OECD, the financial

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institutions and think tanks in Canada, then what are his projections?
If the Liberal Party is going to accuse a person of being wrong, it had better come up with its own figures.


Alfonso Gagliano: Madam Speaker, the minister is giving me a golden opportunity to say what I did not have the time to say during my allowed time in debate. I thank him.
Do I have any proof? I have nine years and nine budgets. In 1989 the government projected that we would have a deficit of $15 billion today and we have a deficit of $36 billion. The projections on the deficit were wrong in every budget. The projections on the national debt were wrong. The projections on job creation were wrong. In nine years we have never had one projection that was right. Why?
He wants to know what the projections of the Official Opposition, the Liberal Party of Canada, would be. I would be glad to tell the hon. minister if he would open the books to me.


John Horton McDermid: All the books are open.


Alfonso Gagliano: What books? How can he expect the opposition party to make projections when everything is closed?
I think my leader stated clearly how we would reduce the deficit and the debt. We would do it with a comprehensive policy, not just with simple cuts but by having a monetary policy, a fiscal policy and a growth policy so when Canadians work they earn money and pay tax.
This government had only one policy. It wanted to reduce inflation to zero. It froze all the economy's activity and with the little bit left from the GST it is on the ground. The government is bankrupt because it is not collecting taxes any more.


Mark Joseph Assad: Madam Speaker, before I begin my comments on Bill C-117, an act to provide borrowing authority, I would like to congratulate my colleague from Saint-Leonard who was able to outline the real problems both during his speech and in response to the minister thanks to his thorough knowledge of this issue.
Bill C-117 has to do with the Financial Administration Act.


Madam Deputy Speaker:: Is the hon. member rising on questions and comments or on debate?


Mark Joseph Assad: On debate, Madam Speaker.


Madam Deputy Speaker:: I wanted to make sure no other member was rising on questions and comments. Debate. The hon. member for Gatineau-La Lievre has the floor.


Mark Joseph Assad: Madam Speaker, Bill C-117 is an act to provide borrowing authority for the fiscal year beginning on April 1, 1993 and it deals with the Financial Administration Act.
Over the last few months we heard a lot about the deficit and the damage it spells for our economy.
I certainly do not want to trivialize the fact. Of course the deficit must be kept under control. Common sense tells us we cannot let the deficit get out of control. However, the way this government has been managing the deficit leaves much to be desired.
Some time ago, I was listening to CBC radio, and a professor of economics at Saint John's University in Manitoba was talking about the deficit. After hearing some very interesting comments by Professor Reuben Carl Bellan, I managed to get his home telephone number and we talked for about fifteen minutes about what he said on the radio. Later, I read an article in the paper.
Professor Bellan made it clear that the deficit must be properly managed. He argued that today Canada issues bonds to finance the deficit. It borrows money on the bond market. In recent years, many bonds were purchased by Germany, Japan, the United States, Sweden and other countries. I don't know the exact figures, but we are talking about billions of dollars coming in to be used to cover Canada's deficit.
According to Professor Bellan, that was a mistake, because in Japan, for instance, the government does not allow financing of domestic debt with foreign funds. Japan has an enormous deficit, but it is financed only by the Japanese. No American, Canadian or German funds are being used to finance Japan's deficit.
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Professor Bellan argued as follows: Why does Canada allow non-Canadians to buy Government of Canada bonds? It should keep transactions in Government of Canada bonds in Canada, to be made by Canadians, because Canadians buy Canadian products and pay taxes in Canada. The Japanese, Germans, British or Americans who buy Government of Canada bonds do not pay taxes in Canada. Elis point was that when these funds come from outside the country, we have a real debt.
Let me explain. It would be fine if foreign funds were used to finance infrastructures or were invested in our industry, to make it more productive and more efficient. But that is not the case. This foreign money is largely used to finance our deficit.
Professor Bellan went on to talk about the time between 1939 and 1945, when we were at war. Obviously we had to defeat the Nazis. Canada had to mobilize vast numbers of people across the country. Considering Canada's population that was a formidable undertaking. In 1944 and early 1945 Canada's cumulative deficit was $18 billion. Not impressive, compared with today's figures. However, w'hen we consider the value of the current dollar, our gross domestic product and our ability to pay, $18 billion was just as bad as today's cumulative deficit of $460 billion. In fact, we were in worse shape as far as our ability to pay was concerned. In other words, at the time it was harder to pay back $18 billion than it is to pay back the federal government's $460 billion deficit today. How did we do it?
According to Professor Bellan, in 1944-45 economists were very pessimistic about the post-war period. Canada would be debt-ridden. We would all be dressed in rags and live in shacks. They painted a horrific picture. However, we went on to a period of unprecedented prosperity. Their predictions were all wrong. However, economists have always been better at explaining their own mistakes than predicting the future. We have to remember that.
Professor Bellan made another interesting point. From 1939 to 1945 when Canada's deficit was even worse in real terms than it is today, who financed the deficit? Canadians did. Obviously it was not the Germans who financed Canada's debt during the war in
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1939-1945. Canadians financed the deficit by purchasing Victory Bonds.
I suppose we could ask this professor from Manitoba, and someone did: What if Canadians don't have enough money to finance the debt? Good question. We do have enough money. Today, Canadians have more than $300 billion in Canadian banks, ten times as much as this year's deficit.
Canadians have the money, and this government must start by financing its debt with money from within our money. When Canadian money is used to pay off the debt it does not have the same impact as when foreign money is used. I think this is just common sense and I think that perspective could be used for all our problems. It may be one of the alternatives we have today.
It is often said that the government creates jobs. Some people agree and others do not. I tend to disagree. Let me explain. Under our democratic system the government has the power to raise taxes and pass laws. Those are the two most important powers it has in a democratic society. It can raise taxes and adopt legislation through Parliament. If a government has these two fundamental instruments in a society like ours it does not have to intervene in any other sector.
Crown corporations may have been necessary in the past but I think they no longer are today. Personally I think the government's role and I know there are others who share my opinion, is to ensure that laws are just, that the tax system is fair and equitable-which is not the case here in Canada-and that programs and policies are sensible and necessary, which is not always the case either in Canada today.
We do not want any frills. We want the government to provide for programs that meet the needs of Canadians. Those programs are badly needed.
When we hear people say the government is going to create jobs we have every reason to be suspicious. However, the government can create a climate of confidence. It is absolutely necessary if we want Canadians to invest in their country. If we want to have foreign investment investors must be assured of a climate of confidence in Canada, that we have hope and are moving forward.

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How can the government achieve this? It is very easy. It must ensure that the tax system is fair and equitable- this is basic, especially in a democratic society like ours. At the present time, it must be said that the middle class is paying more than its share. I have said that many times and I repeat it again. When will we admit in this House that the middle class pays more than its share and that this cannot continue? We need a thorough reform to change this state of affairs.
I just spoke about our accumulated deficit and I added that Canadians alone should pay for the deficit. When I look at what other countries do, I ask myself some questions. When I see that other countries can reform their tax system, like New Zealand, and when I see the tax rate on big multinationals in Germany and Japan, I wonder whether Canada could not do the same. Are we more stupid than they? Can we not find ways to assure all Canadians that we are making a very sincere attempt to correct this shortcoming, that other countries have been able to get back on track by making reforms and that they have gained others' confidence? I think that is basic and we must use common sense. That is all Canadians ask and that is what we must work on.
Let us talk about social programs now. Oh, I have read many times that our social programs are too costly; the big multinationals are always saying that. However, the figures show the contrary. I called the Auditor General, who sent representatives to my office because I wanted to study what has happened to the federal government's budget and deficit since 1972. Yes, social programs are important, but they did not contribute as much to the deficit as some would have us believe.
The accumulated deficit is $460 billion, but social programs account for barely 6 per cent of that. They are not what hurt our economy the most. Social programs as such are not responsible for the deficit.
I believe that I speak for the great majority of Canadians when I say that health insurance is one of the most important assets in our society. Medicare started in Saskatchewan and those responsible for this plan are to be congratulated.
Even for me, a citizen of Canada from Quebec, health insurance is one of the programs that I am the most proud of and it should never be attacked. It can be modified and user fees can be charged. We must not be afraid of change, but it must continue to provide all
Canadians with the medical care they need. This program is absolutely necessary and it must never be called into question.
Other social programs, like the old age pension, are a source of pride for our country. I wonder if many Canadians realize that the United States, the richest country in the world-or one of the richest, because we must not forget Japan and Germany-has no old age pension.
This shows that our priorities are different from the Americans'. We are not criticizing them, far from it, but when we look at what we have built together here in Canada, what is our basic philosophy? We are our brother's (and our sister's) keeper. That is healthy and right and good for our country. If my neighbour needs help or medical care, he is entitled to receive it. Is there anything more wonderful in our country than that? Is there anything more wonderful than an unemployed person being able to collect unemployment insurance, when you think about it? Yes, there is abuse, but that is human behaviour. We know that, you and I. Perhaps over time, with more civic mindedness, people will realize that social programs should never be abused. We may not be at that point yet but it is coming, I am convinced.
We hear a lot about the deficit as though it were a bogeyman. I do not want to trivialize the deficit; it is serious. But as I said, corrective action can be taken, funding to begin with, and perhaps also an analysis of present programs. Certainly some programs and policies are out of date and need to be changed. We must not be afraid of change; we need political will. A government with political will can work miracles, I am not exaggerating. But without this conviction and this political will nothing is possible. We waste our effort by finding all sorts of excuses and rationalizing the errors and disadvantages of the various options.
Unfortunately my time is nearly up, but in the few minutes available to me, I would like to talk about youth. All my colleagues in this House are aware that there is a deep unease among our youth. I am convinced that there are answers to it, and I did not invent them, far from it. What we need is a national training service. I am not talking about a military service at all; there is no military connotation. I am talking about a national training service in co-operation with the provinces. This kind of program has been very successful in Germany, a tremen-
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dous success. I have documentation in my office and I have gone over it.
Here in Canada, occupational training may be one of the solutions for our youth. Personally, I know that if young people were given training for up to two years in a trade school and given technical knowledge we could greatly reduce youth unemployment and give young people hope. That is fundamental. Think of these young Canadians, be they 16, 26 or 27 years old, whatever, who are no longer in high school, who did not finish secondary school, who have no trade and no technical skill, who are on unemployment insurance or not working. You know as well as I do that they have no future. A national training service would be a solution for them.
At the present time more than 300,000 jobs in Canada are unfilled because these jobs need technical knowledge, basic knowledge of the industry or high technology. University diplomas are not at all required but rather technical schools, apprenticeships, trade schools that will help our young people overcome their difficulties.
In conclusion, Mr. Speaker, I thank you for your patience. I repeat, there are solutions. Above all, it takes courage to face the real problems and then to have the political will to go ahead and make the required changes, whatever the cost. It is for the good of our country and of every province and community, for the good of our neighbours on the right and on the left and across the way.


Stanley J. Hovdebo: Mr. Speaker, I cannot find much in my colleague's remarks to disagree with. I particularly appreciate the tone he is putting on his remarks.
I want to ask a question with a little variation from those remarks. After nine budgets, a series of nine projections about what was going to happen and nine projections which were proved wrong, does my colleague feel comfortable with the projections being made in this
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particular budget in relation to where we are going and what has to be done or what is going to be done?
We have had nine budgets where the deficit was going to be cut. We were going to deal with the debt back in 1984. We were going to solve it in four years back in 1988. We were going to solve it in a couple of years. It is nine years later and we still have not solved it.
Does this member feel comfortable with the projections that were put into this last budget?


Mark Joseph Assad: Mr. Speaker, regarding the projections in last Monday's budget the member asked if I were confident that we were heading in the right direction. I have the feeling that we are going nowhere. As I said even before it was brought down, I see in that budget a stand-pat budget. Because of the coming leadership convention the budget contains of course a lot of wishful thinking to the effect that the future is rosy and that things will get better. I am not convinced, because what we need as I mentioned before are actions and a political will. There is none of that in the budget.
They may have tried to introduce a few restrictions, but above all they are waiting for the new leader to be chosen because the new leader, male or female, will need some latitude to make decisions. Projections were wrong in the last eight or nine budgets. To err is human, but when it comes from a national government that is entrusted with the population's well-being, to be wrong eight times out of nine or nine out of nine is not a very inspiring record.
In answer to his question I would say people have lost confidence, and I think that polls do reflect how Canadians are feeling. They do not trust the government anymore. The member is right; how could you have confidence? That is the reason I am saying that as long as you have no political will, no courage to face up to the real problems, you are going nowhere.


John Horton McDermid: Mr. Speaker, the hon. member delivered

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a very thought-provoking speech today and I it. I do not necessarily agree with everything he said but I enjoyed it.
I want to ask him about projections because that is exactly what they are. They are projections. They are made by economic organizations; institutions such as banks and trust companies; think tanks such as the C. D. Howe Institute and so on. In discussing the projections that have been made he is condemning the government for being way off in nine years, which is not accurate.
If the hon. member took time to take a look at the projections and the results I think he would find that the Minister of Finance was fairly accurate with his projections up until the recession. As a matter of fact he projected a deficit in a couple of years which was less than he had projected.
In the February 1992 budget the projections that were made by the Government of Canada were again less than what was made by the economic think tanks and the organizations within and outside Canada. The growth did not happen in the world as all those who consider this had projected, including the Government of Canada.
The Government of Canada's projections have been far more conservative than was a compilation of all the projections by other organizations.
I want to ask the hon. member if it is really fair for him to make that judgment when everyone made the same miscalculation at the time? It really has nothing to do with the Department of Finance or the Minister of Finance. He no more than the hon. member, his leader, or the IMF has a crystal ball, and things happen.
The hon. member knows full well that the budget deficit projections, which have been off, took place during the recessionary period. They were based on those projections where everybody was wrong.
In fairness, would the hon. member agree that it was not only the Government of Canada that had projections which did not become factual but everyone else as well throughout the world that made those projections? Every' government throughout the world faces the same problems this government has faced because of the lack of growth in the world community.


Mark Joseph Assad: Mr. Speaker, let us assume that I go along with the argument the hon. member made concerning projections.
I realize that the government needs the help of the business community, economists and all the rest of them. Nevertheless I feel that when the deficits were growing through the years and some of the projections were off it did not mean he had to fire the economists in his department.
I know the whims of international prosperity. It is not a cut and dried situation. I think some measures could have been taken by the Minister of Finance such as I gave in my speech about Professor Bellan from Manitoba.
I thought that financing our deficit from within Canada would have been a tremendous measure.


John Horton McDermid: Do you agree with that?


Mark Joseph Assad: I agree partly with what you gave.


John Horton McDermid: With what the professor says?


Mark Joseph Assad: That the debt should be financed within Canada? Yes, I am convinced that is what it is about.


John Horton McDermid: So there is no money left for mortgages.


Mark Joseph Assad: I know the minister's line of thought. He gave examples from the past, such as the period of 1939-45. I have mentioned that there are tremendous amounts of money in deposits. I am convinced we can finance it within our own country.
If we are going to have money from outside it should be invested in capital expenditures to make our industry more productive. Neither he nor I have the complete monopoly on the truth. Admire everybody who is seeking the truth but beware he who says he has it.


John Horton McDermid: Mr. Speaker, I am not professing that at all. The hon. member knows that. What I am saying is just to be fair when we are making these criticisms and when we talk about other things.
I am interested in the professor's comments because that was a part of the speech I found rather fascinating. He talks about $300 billion in savings accounts throughout Canada.
By the way, that money is not just sitting in savings accounts not doing anything. That money is being loaned
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out by the financial institutions for mortgages. It is being loaned out for businesses. It is being loaned out to create employment and so on. If all the money that was borrowed by the provincial and federal governments was funded from within Canada then that would take away from mortgages and from business investment and so on. It would leave less for that.
1939 to 1945 was a war period when a great number of the countries of the world who are now our allies were our enemies. Then we were talking about far less cost, a far less complicated society and a far less technical society than we have today.
His comparisons are a little unfair. I would challenge the professor to a debate on that. I would find that very interesting. The ideal would be that we finance all our debts but all levels of government do this. For example the Ontario government's last issue was an entirely foreign one. That goes on today not only with our governments but with other governments around the world.
Does the member not agree that if we took those savings, which are being used for other things, it could be detrimental to our economy?


Mark Joseph Assad: Mr. Speaker, the member mentioned that maybe he would like to debate Professor Bellan on the subject. We would all probably welcome the debate going outside this House on this subject. However I remain convinced, and he has convinced me, that Canadians have the capability to finance the deficit along with other needs in our country.
Do not forget that we have tremendous pension funds in this country. The banks have tremendous lending power. Some banks, I will not say they can create money, but they can lend tremendous amounts of money. I am not saying it is an artificial means but they sometimes lend more than what they have in deposits.
I am convinced that we can finance our government operations completely from within our own country.


Lyle Stuart Kristiansen: Mr. Speaker, in addressing the borrowing authority matter before us there are a number of comments I want
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to make concerning four specific areas of government activity or the lack of government activity. I want to preface those with a few general comments about the economic direction, or lack of it, which this government has imposed on Parliament and the people of Canada.
The government is very fond of referring to these times as recessionary times. It is my opinion and that of many others across Canada that this has not been a recession like the others. In fact it is open to some question as to whether the term recession has been appropriate at all.
What we have been experiencing for the last number of years, particularly since 1988, is more like a major structural implosion which has been exacerbated by the fall-out of the free trade agreement between Canada and the United States and some of its implications, and looking ahead to the psychology taking root because of the impending North American free trade agreement.
These and other actions have caused a major "restructuring" which has destroyed much of our manufacturing industry base, particularly in the provinces of Quebec and Ontario, but also in areas of the lower mainland of British Columbia, those areas that were in the lead in terms of a Canadian manufacturing industry and a resource-based processing industry.
To term that kind of basic restructuring, which has seen not just large-scale lay-offs but large-scale terminations and the creation of rust belts in Quebec and Ontario and other manufacturing and industrial areas, a recession is false. Many of those jobs will not come back.
We recognize that the world is changing and that the global marketplace has different dynamics than it had at one time. However those have been added to by the very kinds of actions that this government in Canada has taken.
Moving from that very general statement, when we look at the so-called economic planning of this government since it was first elected in 1984, and its constant hyping and high-frequency alarms about debt and deficits, some of them justified, that have been constantly forthcoming from the government, particularly from its finance ministers, what have we found?

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The over-all debt picture of Canada has been getting worse and worse despite the efforts of this government. While it says with some braggadocio that the percentage of debt as related to the GDP is somehow better or our annual deficit positions are better its projections have constantly been way out. It has been deficit and debt reduction on the never-never plan.
We see almost exactly the same annual deficits now that we saw when this government was first elected in 1984, even with the rather profligate spending versus revenue generation policies of the Trudeau government that preceded it. It has been totally out of whack but it keeps saying things are looking up.
When one is flat on one's back even the bottom rung of the ladder looks high. That is about the only way that one can put any optimism into the economic scenario and the debt and deficit scenario that surrounds all of us, not only the federal government but those provincial governments who have been further encumbered by the cutbacks and the offloading that this federal government has participated in.
I am not going to suggest that it has done that with glee for it has certainly gone to great pains to disclaim its share of the responsibility for the difficulties that many provinces are having.
I would suggest that one of the irresponsible results of that action has been the drastic increase in our foreign debt, which is much more harmful to our long-term planning in this country than the domestic debt. The debts and deficits we had prior to this government taking office in 1984 were largely domestic.
Almost every economist would agree that we are in a much more serious situation as a result of a far higher percentage of our national and provincial debts being owed on the foreign market rather than within Canada's borders.
I said when I began that I specifically wanted to refer to four particular items that both my region and my industry, the forest industry, views with some alarm.
First of all, I want to go back to 1983 and then to 1984 and examine what at that point was the thrust of the former federal government and this federal government with regard to the forest industry, intensive silviculture
and paving the way for what we hoped would be a healthier and more dynamic forestry sector. After all it is the major contributor to our balance of payments situation on the plus side and has its roots in every part of Canada in some 300 communities.
I think Mr. Roberts was the minister in the Trudeau government in 1983 when we had the first federal-provincial agreement on funding of intensive forestry and silviculture between the forestry provinces and the federal government.
In the case of British Columbia that worked out to $55 million a year from the federal government, for that one year, and $55 million from the province of British Columbia. It was a good start but it was short term and the government changed.
It was one of the best things this government had done, even though on an annual basis there was a slightly smaller commitment. It dropped from $55 million a year to $50 million a year in the case of British Columbia.
With extensive negotiations they established three-year and five-year forestry agreements between the federal government and the provinces that allowed for some long-term planning and some good co-ordination. It was far more cost effective, there was far more bang for the buck, and it did far more for the forest industry across this country in restocking some of the areas that had been left lying dormant for far too long and beginning to use some of the new technologies in terms of intensive silviculture and practices such as thinning, pruning, fertilization, and many other areas that had long been missing from what had been one of our most vital industries. Starting in 1983 for the first time but especially after this government took office in 1984, we saw some rational planning and significant commitment to that sector in a way that counted. All of us with emotional and financial roots in that industry were very happy to see that take place.
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My party and I certainly recognize that forestry falls essentially within provincial jurisdiction, but federal governments for decades have derived large revenues from that industry. Many of us, including the government, I suspect, but certainly the Minister of Forestry when that ministry was established during the years of this government felt that it was long past the time that

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some of those revenues the federal government had been receiving for decades ought to be ploughed back into that sector. I give him full credit for the part he and his colleagues played in that.
Having that in mind, I was particularly saddened just the other day to hear the federal government, using the excuse of provincial jurisdiction, say that it was getting out. A great deal still has to be done, particularly at a time when we finally have some provincial governments trying to resolve with a great deal of difficulty some of the very emotional and hard nut cases of conflict over resource versus environment and other types of priorities for our forest lands.
The federal government is withdrawing from an area which everybody on both sides of those controversies and anybody connected with forestry agrees is a vital priority. One way we can try to get some of the heat of these arguments subdued is by renewing our commitment to a healthy and vital industry in which we can expect those resources to renew themselves with our assistance. Therefore, I regret that very much and hope the next government of whatever stripe will review that decision and renew what has been our commitment for the last few years to the health of that industry.
Related to that is another item which I raised briefly this morning. It has to do with the issue of tree spiking and the reluctance so far of the federal government to move in a serious way to impose penalties on those eco-terrorists. They threaten the lives of woodworkers whose job it is, whether they are in saw mills or loggers in the bush mainly on public lands and public property, to harvest our forest resource.
In saying that I recognize there are serious and in many cases valid differences of opinion as to what lands ought to be used industrially and what lands ought to be used for wildlife or other preservation or recreational opportunities. However, tree spiking is dangerous to life and is totally irresponsible. Everybody from the forest industry, the mainstream environmental organizations, government, labour and industry, agrees. For example, there is the kind of eco-terrorism Paul Watson was preaching by suggesting that some 20,000 trees in the Clayoquot Sound area had been spiked. We found
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evidence as early as last November that many of them had been and he can get away with it.
One province, British Columbia, has legislation that tries to come to grips with that and has named it as a serious offence. Reports were emanating from the B.C. Forestry Alliance and the Council of Forest Industries that the former Minister of Justice in this House had a team working on drafting amendments to the Criminal Code to specify tree spiking as a serious criminal offence. I currently have a private member's motion on the Order Paper dealing with that same issue in that same way and asking for minimum two-year sentences for those who counsel, incite or engage in tree spiking.
It is important. We have to send a clear message that that kind of terrorism, whether it is the spiking of trees or putting bombs in mailboxes, whatever kind of terrorism we are dealing with will not be tolerated and that is the will of this place.
I urge Department of Justice officials and the new justice minister to so act as soon as possible. At least declare that is the intention of the government. Hopefully we can find the time to do it before this Parliament is ended, but at least declare we are moving in that direction.
I briefly want to mention, another area in the economic and fiscal statement of last December it was stated:
Funding of up to $90 million will be made available for projects to relieve critical bottlenecks and improve safety on highly travelled federal highways in national parks in British Columbia and Alberta. These highways are essential components of major east-west transportation corridors which are key to commerce, industry, tourism and personal travel in western Canada.
That is also a public safety issue. For years the city of Revelstoke, many others from that region and I have been urging the federal government to do some widening of the Trans-Canada Highway particularly in and around Glacier National Park with the amount of extra freight and long supertrucks on our highways. Tourist traffic has also increased by the fact that they cannot travel on VIA Rail anymore and this has only added to the congestion on those highways. It is a danger to public safety. I urge the government to ensure that there is not a political bias in terms of which national parks get that funding. Whether we are New Democrats or Tories or

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whatever, if we die on a crowded highway that is burdened with heavy freight traffic we are dead.
I urge the government to move in that direction and to make that program fair. We are happy to see it. Let us make it fair; let us save lives. While that is being done some of the park maintenance budgets should be increased. Then other park services would not have to be robbed to provide minimum safety and equipment to the Parks Canada highway crews whose job it is to keep what highways we do have safe for public travel.


Mrs. Shirley Maheu (Saint-Laurent - Cartierville):: Mr. Speaker, it is a pleasure for me to rise today on Bill C-117. It is curious that at the start of a brand new fiscal year the government is seeking permission to borrow $31 billion.

Once again the Minister of Finance measured up to the standards of his government by bringing in a budget that does nothing to boost the economy or wipe out poverty by introducing a job creation policy.
The number of food banks in this country has increased from one in 1981 to 126 in 1988 and 292 in 1991. In the past two years, food banks have become common on campuses across Canada. Statistics Canada reported a 53 per cent increase in requests for help from food banks. In 1990, two million Canadians, including 700,000 children, had to receive assistance from food banks at least once.
What a coincidence! The Tory government has been in power since 1984.

This time the government prepared everyone for major cuts. We were expecting the axe to fall. Canadians were ready to swallow the pill but at the last moment the finance minister backed out.
What is bleak in Canada is that our ability to respond appears quite timid. We do not seem to have the will to build the kind of support framework that will be required. In the 1970s we led a government that cared
about the people, a government that cared about the future and about the lives of individual Canadians.
In 1993 there are voices suggesting that Canada be dropped from the G-7. Do you know why? Under the direction of this government our economy has shrunk to a level lower than Spain's. We are gradually losing economic clout in this world, all under the direction of the Conservatives.
The early statistics paint a very grim picture indeed. Every year this government seems to forget what is important. This is a budget of despair and nowhere does the Minister of Finance offer Canadians a light at the end of the tunnel. Nowhere in this budget does the government address the issue of jobs. Nowhere do the Conservatives even mention the need to get Canadians back to work, to get the economy going so that fewer people will rely on government hand-outs.
To quote the Leader of the Liberal party, the Minister of Finance has brought down a budget that reflects the state of the Conservative party. It has no strength, no design and no plan. The Conservative government is on its last leg and is more concerned with being re-elected then looking after the well-being of Canadians.
Once again, Canadians are being forced to make way for the political interests of a privileged few. This budget does absolutely nothing to reduce the deficit: a few minor cuts, when everyone was prepared to make sacrifices, to get rid of an increasingly crushing debt. Now we are asked to consider a bill that will let them borrow even more.
The government did not have the guts to face facts and act accordingly. Its credit card is worthless and may be withdrawn pretty soon. There is nothing in the budget to get the economy back on track and put Canadians back to work. Unemployment is up to 11 per cent, which does not include Canadians who are no longer looking for work. This is the worst performance of any G-7 country.
To make us feel better, the Minister of Finance said that in 1994 unemployment would be only 10 per cent. That's great. I am sure university graduates, young professionals and others who either cannot find jobs or have been told their jobs have been cut were impressed.
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Where is the country headed with this government? So far, it has been headed straight for disaster. It is high time changes were made.

This government continues to neglect the policies that would help Canada compete. We need long-term investment in our human resources. This budget has no plans to increase investments in education, training, retraining, numeracy or literacy. The Conservatives do not even reaffirm their commitment to their centres of excellence.
One has to wonder if they care about Canadians' welfare or if they are simply letting the country fall apart while the Prime Minister is spending millions of taxpayers' dollars to travel around Europe, beating the bush for a high-paying job. I am sure the Prime Minister will not have any Canadians listed as references on his resume. I doubt anyone would give him one after what he and the Conservative Party have done to this country.
We in the Liberal Party called for programs to boost our manufacturing and natural resources sectors, a manufacturing productivity centre which would assist small and medium sized Canadian firms get more value added and more high-paying jobs out of our natural resource sector. Of course these practical programs aimed at giving Canadian firms an edge over their competitors were not addressed in this budget. Could it be because Conservatives do not know how to deal with the Liberal Party's positive suggestions?
The Minister of Finance kept repeating the phrase that there is only one taxpayer. We know this. For those of us who served on city councils we know very well the reaction of taxpayers when we are forced to increase the rates because of cuts in transfers.
Since the Conservatives have been in power they have shirked their responsibility. They have passed the buck to the provinces to pick up the slack to finance programs such as health care, education and housing. When the Conservatives cut transfers they are forcing other levels of government to do their dirty work for them.

What about the government's housing initiative? Some initiative. The federal government will not in-
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crease its support for social housing through Canada Mortgage and Housing Corporation and will no longer fund housing through 35-year subsidy commitments.
It also expects to save $600 million over five years.
Fortunately, funding for shelters, native housing on reserves and the integration of persons with disabilities will continue. Unfortunately, that is not enough.
The fact is that before the cuts in CMHC's social housing budget these projects reached only 6 per cent of the population. Today 15 per cent of Canadians need this kind of housing-one million Canadians-and the demand for this kind of housing is growing steadily. Is this government aware of the real needs of Canadians? Sometimes it seems so oblivious to the social and economic situation in this country that you wonder whether it is living on the same planet.

The government is also cutting back on the frequency it sends out the GST rebate cheques. So far seniors and other people with low incomes look forward to receiving their rebate cheques in order to help make ends meet. Seniors benefit from the cheques as they put them in the bank and any interest they gain helps offset the cost of the GST.
By cutting back from four cheques to two a year the Conservatives are simply picking the pockets of seniors for the spare change they will get from interest on the GST rebate cheques. It is just another example of how the government fails to understand the true needs of seniors across this country.
Since last fall I have been collecting signatures on a petition urging the government to re-examine the mechanism it uses to calculate the cost of living index for seniors.
Thousands of people in Saint-Laurent, Cartierville and Montreal signed this petition. The response from the minister of health has been a joke. The government simply does not get it. It refuses to look at this issue because it knows that an index specifically designed to look at the cost of living for seniors would show that it increases at a rate far higher than inflation.

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Seniors want real answers from this government in terms of their problems. They want the federal government to take them seriously and not give them simple platitudes before election time.

Interestingly, at a time when the number of senior citizens is increasing and will continue to increase over the years, the Tory government has decided to reduce their chances of being heard. Is it a coincidence that the same thing is happening to the voice of the neediest in this country? Is the government afraid to face people who have some very serious demands? Is it afraid to face its failure to wipe out poverty and meet its commitment to enhancing the well-being of all Canadians?
By merging the National Advisory Council on Aging and the National Council of Welfare, the government is trying to give the impression it will save a lot of money.
We seriously question the government's judgment especially since savings will be negligible. In its 1991-92 annual report the National Advisory Council on Aging reported a budget of $396,200 and a staff of nine person-years, which represents only half the cost of the Prime Minister's farewell trip.
Both councils have always admirably represented their respective constituencies. Is that perhaps the real reason why the government insisted on this merger? Do the Conservatives really believe that the facts and the problems will go away because they gagged the poor and the elderly? This is one more example of poor judgment on the part of a government that is grinding slowly to a halt.
It is high time we had a new government that knows how to listen and how to act, after as well as before an election.

The government tries to sell a message of fiscal responsibility but with this budget and the additional borrowing we learn the deficit is absolutely out of control. In 1992-93 the deficit was supposed to have been $8 billion less than it actually was. It is over $1 billion more than he predicted it would be in last year's budget.
The minister's predictions confirm that the candidates for the leadership of the Conservative Party are completely out of touch with reality when they say they can eliminate the deficit within four or five years. If this is the case why are they not telling Canadians exactly how they are going to get rid of the deficit? Will they cancel old age security pensions? Will they cut back on UI? Will they cancel medicare? How about cutting transfer payments to the provinces even more?
The government has to be honest with Canadians. We are not buying this time. It did not tell Canadians about the GST and we are stuck with it. Canadians demand to know from the Conservative Party what it is going to do, otherwise it should call an election and give us Liberals a chance to govern. We know where we want to take this country. We know that we must get Canadians and Canada working again.

Our leader, the future hon. member for Saint-Mau-rice, is committed to controlling public spending, to suspending programs that do not directly create jobs and contributing to the economic development of this country as well as to reducing our debt in proportion of the GDP.
A Liberal government will not try to reduce inflation to zero percent by maintaining high interest rates that stifle our economy. It will find a fair balance between inflation control and economic growth by maintaining the Canadian inflation rate at a level comparable to the American rate.
We on this side of the House are committed to budgetary responsibility and to strict spending control.

Here is a suggestion of where to cut. It can eliminate the Canadian Multiculturalism Advisory Committee in the Department of Multiculturalism and Citizenship. It can roll back the totally ridiculous wage increases for citizenship judges and political appointees of this government.
The Conservative government loves talking about fiscal restraint and budget control but it is clear from its inability to act that it is simply not serious about cutting back in non-essential areas. Liberals understand that the only way to cut the debt is to get rid of the deficit and get
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Canadians back to work. We must get them off government assistance and UI. We must put the 11 per cent of Canadians who are unemployed and the millions more who are underemployed in situations where they can maximize their contributions to Canada's economy.
Without the two-directional Liberal approach of fiscal responsibility and economic growth, any attempt to tackle Canada's economic problems will be futile.

The Conservative government has been in office for more than eight years now. For more than eight years it has been promising the moon but has reneged on its promises, budget after budget. It has been more than eight years that Canadians, who are generous by nature, have been giving it a chance. Now it is over. The country can no longer afford to be run by a wishy-washy government. Canada needs an economic plan that will stimulate growth, not promises without any concrete implications.
The Liberal Party has proposals to put on the table. It has achievable measures in the short, medium and long term to propose. The most important thing is to rebuild our national industrial base and to restore public confidence.
Our party is committed to stimulating job creation by supporting the development of an economy focused on technological progress by controlling the budget deficit and by reducing the debt. Our party is committed to working in consultation with the provinces in order to convince them to remove trade barriers.
The Liberal Party has the tools that it needs. It has the resource persons. It is ready to work with and for all Canadians. Our party is on course and will steer the country to prosperity after the next election.


Robert Evans Skelly: Mr. Speaker, I would like to thank the previous contributors to this debate for the information they have imparted to the House.
We are here to debate a borrowing bill which will allow the government to borrow the money to meet its requirements over the current fiscal year. I understand that if the bill is not passed rather expeditiously the government will be forced into some short-term borrow-
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ing that will result in higher borrowing costs. We do not want to delay passage of this legislation any longer than necessary and force the government into the position I talked about.
There is no question in the minds of members of Parliament in this House and in the minds of Canadians that what has happened with the public debt over the last years of Tory government has been absolutely dramatic and very difficult for Canadians to understand. They know this government came to office talking in grand terms about dealing with the deficit and the debt problem that was created by the Liberals. However since it began its term of office the debt has more than doubled and this Conservative government has failed dismally in its attempts to deal with the problem of the deficit.
Its policies with respect to the debt and the deficit simply have not worked. It reminds me of a previous legislature where I sat for approximately 16 years. It had a little different approach to the way debates and discussions took place. In fact we had a sort of parting of the ways in British Columbia in the early 1980s when the Bennett government of the day decided it was going to embark on what he called the restraint program. One of his advisers was Bud Smith who may be remembered from another situation and one of his major advisers was Kim Campbell. She was one of the backroom people in Bennett's office when the restraint program was being rammed down the throats of the people of British Columbia.
When Mr. Bennett brought in this so-called restraint program he said it was absolutely necessary to cut down government expenditures and the debt. It would make sure we did not pass the debt and deficit problems on to our children so they would not be able to enjoy the kinds of programs we enjoy today at their expense.
In fact the Bennett government in British Columbia and succeeding premiers in British Columbia created more deficit and greater debt than any previous government in the history of the province largely as a result of the so-called restraint program. The restraint program was actually a cover for an ideological program that the Socreds had in mind for the government of British Columbia.

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Essentially it was designed to diminish the ability of the government to be a large player in terms of negotiations with labour, citizens groups and corporations. Bennett systematically dismantled the power of the province and created huge debts and deficits which limited the decision-making options of British Columbia. The province ended up being a very weak force in terms of its ability to aid its people, create new programs and develop new employment and opportunities for people.
The goal of the Social Credit Party, which was essentially a coalition of Liberals and Conservatives, was essentially to weaken the government to the point where it did not pose any kind of countervailing threat to the private sector. It was very successful in doing that.
What Mike Harcourt's government is dealing with today in British Columbia is precisely the problem of trying to restore the finances of the province to health so it can deliver the kind of existing programs it is obliged to deliver as well as create new programs that voters in that province are demanding.
I see the same kind of thing happening here in Ottawa where far from setting out to reduce the debt and the deficit of this country in my view the Conservatives have actually increased the debt dramatically based on their spending history. They have increased the deficit dramatically and brought about fiscal and monetary programs that have made this government much weaker in terms of its ability to assist Canadians and play a role in the development of this country for the benefit of all Canadians. In fact this government is now obsessed with the issue of debt and deficit because of the political plan of the Conservative Party on coming to office.
Statistics Canada has provided a great learning aid for the people in this House of Commons. It did a study some time back. First of all the government tried to suppress the study. The study actually analysed the cause of the debt here in Canada.
It found that roughly 55 per cent of that debt was due to concessions to the wealthy and large corporations. These are tax concessions we are talking about and those tax concessions were made to the wealthiest of Canadians, not to the middle class and not to the lower income Canadians. These tax concessions were made, according to the Statistics Canada study, to the wealthiest people in Canada, the people who should be paying their fair share of the tax burden.
In addition the tax concessions were made to large and profitable corporations which should have been contributing positively to the revenues of the people of Canada. In fact those concessions according to Statistics Canada resulted for many years in well over 100,000 profitable corporations paying no tax at all as a result of those policies of successive Liberal and Conservative governments.
According to Statistics Canada that is where 55 per cent of the blame lies for the current debt structure that we face in this country.
Now it says about 40 per cent is due to the high interest policy which was also pursued by the two parties because they are interchangeable it seems when they get into office. The Liberals sound like New Democrats when they are in opposition. They act like Tories when they are in office. The Tories sound like Tories in opposition. They act like Tories when they get into office.
In any case what we end up with in this country, regardless of whether they wear the label Liberal or Conservative, is essentially the same political ideology in office from those two corporate sponsored political parties.
About 40 per cent of the problem with the debt we have in this country according to the Statistics Canada study is due to the high interest rate policy pursued by both Liberals and Tories in office.
It always amazes me to hear the Prime Minister talk about the interest rate levels at the time the Liberals left office, the unemployment rates when the Liberals left office and all of those problems that we were experiencing when the Liberals left office. He is responding to the criticism made by the Liberals that his government is doing precisely the same thing.
The policy pursued by both of them with respect to interest rates has caused roughly 40 per cent of the accumulated debt that we now have to deal with in Canada and that this Parliament is charged with dealing with.
Statistics Canada also pointed out that 6 per cent of the debt problem is due to program over-runs. What does this government do? Does it attack the 50 per cent
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that is the problem, which is the concessions to the wealthy and the powerful and the corporations? Does it attack that which has been determined by Statistics Canada to cause 55 per cent of our debt problems? No. It increases the number of tax concessions going to corporations. It increases the problem.
Does it attack the problem of high interest rate policies? There is no question about the fact that interest rates have come down but the spreads in interest rates between ourselves and the United States and some other countries are still relatively high and are still a major cause of the problem. I do not think they are 40 per cent because of the reduction in the interest rates but they are still a major cause of the problem.
Fifty-five per cent of the problem is due to concessions to wealthy individuals, high income earners and wealthy corporations which do not pay any tax at all. Why does the government not deal with the major problems? Instead of dealing with those problems, why does the government not turn around and take a look at that 6 per cent of the responsibility and try to attack that 6 per cent which is program funding and over-runs on programming? We cannot solve the deficit problems and the debt problems in this country by dealing with the cause of 6 per cent of it. It simply does not work that way. It is an ideological problem, a blinker problem that this Conservative government has. It is unwilling to challenge the people who supported the Tories and paid their way into office. That is the rich, the powerful and the profitable corporations. They cannot deal with that 55 per cent of the problem because that is where their meal ticket is to get into this Chamber and that is why we are not dealing with the problem.
The gentleman across the way is saying:"Well, what about labour?" Labour does donate to the New Democratic Party and we are pleased to receive its donations. It supports us in large measure all across the country. I think that is because we are understood to be the party that does the most for individual Canadians and are most concerned about the problems being faced by individual Canadians, including individual workers.
The minister does bring up a problem and that is that there is a lack of national consensus in this country. Canadians from every walk of life do not agree with the
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direction in which the government is going. There is no forum developed in order to bring those people together, in order to get them to agree and to go in the right direction.
It is interesting that just a few months ago the Canadian Centre for Labour Market Productivity looked at some countries to find out why some economies were so successful in economic good times and also in times of economic recession. It identified a number of countries. For example, it pointed to Switzerland. Switzerland has a very strong business oriented national consensus which makes it a very successful country in terms of pursuing its economic goals. It is pointed out that these are business oriented economic goals but labour, the general public, government and business all have the same view of the world and it helps them to be successful.
Australia has a different way of looking at it. When the labour government entered into an agreement with the Australian Council of Trade Unions many years ago, it set up a national consensus based on the labour accords in Australia. Because this accord turned out to be relatively successful, business, while not a signatory, went along with the agreement. As a result a government of national consensus was established in Australia which made it a relatively successful economy compared to the kind of conflicts it it had before. What is lacking in Canada is that national consensus among groups in Canada which need to be onside in order to make this economy successful. The consensus is lacking.
This government has done very little to bring it together. It is a government that has directly attacked labour. In fact, I can recall when there was a grain handlers strike in Vancouver and our members were standing up in the House asking for government assistance to resolve the grain handlers strike. Essentially the Prime Minister said to our speakers on this side of the House:"Well, you go talk to your friends in labour and get them to back off the grain handlers strike".
What struck me is not that we had friends in labour or in the grain handlers union. I do not think we would have been as successful or any more successful than anyone else in dealing with those people at that particular time. What struck me is that the government felt that it had no friends in labour and as a result there was no network upon which to develop a consensus on economic issues. I

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think it is important that this Parliament consider that need.
When this Prime Minister first came to power in 1984 he convened a meeting representing all sectors of the Canadian economy. I recall that a number of union leaders across the country went to the meeting. I recall he even brought Bob Hawke, the Prime Minister of Australia, who had managed labour accord in Australia. I understand that he brought business people and other sectors of the economy together in the hopes of finding out if there was the basis for a national consensus in Canada. Unfortunately that conference withered on the vine. The idea seemed to flit away from the Prime Minister's mind right after the conference ended so he did not pursue this issue. The problem here is that this country, this government, this Parliament lacks a national consensus as to where we should be going as a country. A country that does not have that ends up wallowing.
What we see with this government in the last budget and in the borrowing bill is that the government has essentially given up the fight on the debt and the fight against the deficit. The government talks about the net public debt in 1997-98 being another $100 billion more than it is today, half a trillion dollars in debt. That is quite a legacy to leave for future governments and this bill is a part of the problem.
What we need is a new way of looking at these issues, of getting all parties together, getting all sectors of the economy together and addressing these issues so that the government is listening to everybody and setting up a plan that represents a consensus of the people of Canada. It has not happened to date. It is unlikely to happen under the current government. I cannot see it happening under future leaders of that party. I am just hoping that at some point in the future somebody will take the advice that has been given to us by some of the more successful economies on earth and take a look at the idea of the need for a government of national consensus around economic issues.


John Paul Manley: Very simply, Mr. Speaker, the member has given us a good explanation of why in the face of the crisis that we have in Canada, or a virtual crisis or perceived crisis with respect to debt and deficit, there is a need to build a national consensus on how to deal with it. As a member of the New Democratic
Party I am sure he is aware of the difficulties being confronted by an NDP government in Ontario in building just that very kind of consensus.
In the last few days we have had really a very direct rebuff of the NDP government by the trade union movement, particularly Public Service trade unions in saying they are not prepared to deal with a government that wants to roll back wages or reduce employment among their particular membership and that they are on that basis not willing to engage in the discussion of what the government has called a social contract.
I wonder in the face of that kind of rebuff of an NDP government by the very people with whom it ought to be best able to build that kind of consensus, how does the member see us building a national consensus in a situation in which the divisions are so acute and so difficult?


Robert Evans Skelly: I would like to thank the member for his very worth-while question.
In British Columbia with the accord that was signed with health care workers over the closure of a number of hospitals in Vancouver, the government was able in that case to sit down with health care workers and to hammer out an accord which now may run into a bit of difficulty with the management of the hospitals. I think that in spite of the public expressions of disgust about the whole process that people now are willing to sit down and are willing to see the accord develop.
I think there is a general feeling among labour, government and the hospital managers in British Columbia that there has to be some kind of an agreement that is going to allow us to continue on with the health care system and to make sure that there is no interruption in service. In the face of a crisis that Bob Rae is dealing with here in Ontario where the government has already announced its stated position as requested by the unions, I think the unions have publicly reacted in a very negative way to the material put forward on the table by the Bob Rae government.
What I see in terms of a silver lining in the cloud is the unions saying they are going to prepare their own proposals to submit back to the Bob Rae government. While negotiations as they appear in the media look like they have broken down or look like they are in a very difficult situation, in fact the unions are looking at their future, the need to sit down with government and the
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need to come to an agreement. I think they are developing their own proposals.
At this time I am still very optimistic about the fact that a social contract can be reached with the workers of the Ontario government. It is not going to be everything that either side wants. It is not going to be everything that Bob Rae wants. Perhaps he will have to give up on some of his non-negotiable items. It is not going to be everything that the trade unions demand and they will have to give up on some of their demands.
I am very optimistic, and I think the good faith is fundamentally there. Those people will sit down and at some point reach an accord. I am hopeful, for the benefit of Canadians and for the benefit of people in Ontario, that will be the case.


John Paul Manley: Mr. Speaker, I simply want to make a few comments on the bill debated this afternoon, and also on the budget tabled by the Minister of Finance on Monday.
First, I want to say that I am quite aware of the fact that the Minister of Finance was faced with a difficult task when he started working on this budget. The projections on the deficit in the last budgets, not only those of the minister in 1992 but also those of his predecessor in 1991, have really been inaccurate. An enormous mistake was made in predicting the deficit for the year which just ended and also for the year which started on April 1, 1993.

The fact that it was a difficult budget to prepare in these times, however, does not excuse what I believe has been a display of incompetence and, to put it mildly, a lack of frankness in the presentation of the budget. Let me begin with the question of whether this budget was competently presented and the circumstances that have followed its presentation.
In recent weeks, amid the rhetoric of Conservative leadership candidates talking about their ability to bring down the deficit, concurrently we had the Minister of Finance talking about the great problem the deficit and the debt had created. We had the acceptance of the enormity of the fiscal calamity by governments of all political colours in Canada. We had the premier of
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Newfoundland, Mr. Wells, having brought in a very tight fiscal budget, going to the people of Newfoundland in an election campaign and asking for their support to fight the deficit. At the same time we had the NDP governments of Ontario, Saskatchewan and British Columbia talking about the problem the deficit and the debt creates.
In this political environment the minister came forward a couple of weeks back with a document talking about the fact he was going to bring in a tough budget and there was a political acceptance of the need for such a budget. That was the climate created by the minister into which he brought the 1993 budget. He had managed to create expectations among the public, among the investment community and among international bond markets that the budget was going to be one signal that showed Canada was finally going to get its debt and deficit under control. That is what he promised.
The previous speaker or I or others of us may or may not have disagreed or agreed with whether what he was signalling to the markets was the right things to do. That is not my point here.
My point is that when a minister of finance speaks the world listens. The world, not just within Canada, has invested heavily in Canadian debt and the Canadian dollar as security. The Minister of Finance sent a signal. The signal was clear: this budget was going to bring down the deficit. That in itself accounts for what happened to the dollar following the presentation of the budget. It accounts for what happened when the Canadian Bond Rating Service downgraded the debt on Thesday. It accounts for the crisis of confidence in the government and the minister that followed the presentation of this budget. We have not had a fiasco like this since the budget leak of 1989.
The result is not neutral to Canadian taxpayers. The result has been an increase in the Bank of Canada rate on Tuesday in order to support the dollar and undisclosed spending out of the foreign exchange accounts in order to defend the dollar by the Bank of Canada or its agents. Those we will not know about until some months from now when we know what the level of foreign exchange really is. Those transactions and the rise in the bank rate are not neutral to Canadian taxpayers. The Treasury bills that turned over on Canadian government debt this week and had to be turned over at higher

April 30, 1993
Government Orders
interest rates are costing Canadian taxpayers money. The Minister of Finance is accountable for that and he should be answering for it.
I said that the budget had a lack of frankness. Some might say it was downright dishonest. I am quoting from the minister's speech, the opening lines of his budget
speech:
Today I am presenting a budget that will deliver: no new taxes; no
tax increases;
When we go through this document, for the benefit of those who do not often look at these, it is fundamental that we deal with the accounts of the government on an annual basis. We use a fiscal year that starts on April 1 and ends on March 31. It is not that complicated. We need to have some basis for comparing year to year, period to period. All the revenue projections, all the spending projections and all the deficit numbers are all done on a 12-month fiscal year basis.
When the minister says "no tax increases", does he not mean on a fiscal year basis? Would we not think when everything else in the document is based on the fiscal year that he is talking about a fiscal year when he says "no tax increases"? Apparently not. He decided to save money, save administrative costs, by taking the four GST tax rebates and combining them into two rebates. That is going to save costs a little bit, granted, because of the fact the cheques have to be printed, calculated and so on. Guess what? He is combining them so that the January cheque is combined with the April cheque and paid in April.
Let us think about that for a minute. The fiscal year end is March 31. If we take a January payment out of one fiscal year and we combine it with the April payment in the next fiscal year, what have we done? We have taken $625 million of reduced revenue-because it really nets out against the GST-and put it into the next fiscal year.
What effect does that have on the statement of accounts? It works its way through in a couple of items. It works its way into the net revenue from the GST which goes up for the fiscal year by $625 million. It works its
way into the debt financing and reduction account-that is another sham account we can talk about in a minute if we have time-for this year because it reduces the debt financing costs by $625 million.
Guess what? The minister said there were no tax increases. What has he done? He has raised the GST revenue by $625 million. How? By effectively reducing the amount paid to the poorest Canadians in the current fiscal year. If it is such a good idea to combine two quarterly payments, I have an idea for him. Why do we not move the October payment to January so that low income Canadians get their cheques in January, just after Christmas when a lot of them need it? It works the same way. The administrative costs are just as much a savings.
That whole $625 million would still be in the current fiscal year. The minister would not be able to play his little game of shifting it into next year. If I have anything to say about it, when this government is tossed out we will give that $625 million back to Canadians. If it is no tax increase what does it matter? It is all neutral, right? That is the way this government has dealt with the numbers on the books of this country since day one.
Going back to November 1984, the government came into office and delivered a financial statement. The former Minister of Finance, the hon. member for Etobicoke Centre, rose in the House and said: "Here is what we are going to cut. We are going to cut all kinds of things that those wasteful Liberals were doing. If we do not cut them, do you know what? By the end of the fiscal year the deficit will reach $34 billion, if we do not make all these cuts".
By the end of that fiscal year he had managed to run the deficit up to $38 billion with his cuts. He managed to cram every last expenditure he could get into that year. Even this week, those members were arguing that in the last year of Liberal government the deficit was $38 billion. It spent a whole portion of that in the months between September and March when it was in office. This is a budget, like so many other financial statements that have been presented by this government, that is fundamentally dishonest.
April 30, 1993

I want to raise another question. I do not know the answer to this one. I have looked at how much the government wants to borrow in this borrowing bill and it is a large amount of money. We are looking at a bill which asks for the authority to borrow $31.5 billion.
Last year we had a bill for borrowing too. In that one the government requested $24.7 billion. That is quite a large difference. What did the government have to do? Last year it had to bring in another bill which passed on February 15 for an additional $8 billion. I smell a rat here.
The House cannot sit beyond November 21, 1993. After that an election will have to be called. At least it would have to be called in order for the House to resume sitting some time within the year following. There is a lot of leeway. The House of Commons fundamentally exists to vote supply for the government, to give it the money to operate. If the government had not borrowed enough money in this bill and began to run out, it would have had to call the election early enough. We all hope the government will call it soon, but the possibility with a borrowing bill of $31.5 billion is that the House could continue until some time in 1994 with the government burning up the money it is borrowing today.
It is unfortunate that this government has not borrowed just enough money to get it through a summer election so the people of Canada can make up their minds. Then we will deal with who should be making the decisions that have to do with managing the finances of this country.
A lot of the rhetoric and discussion about debt and deficit somehow misses the point. The fact that we have a debt-deficit problem is analogous to having a high fever when suffering from a disease or illness. During a bad case of the flu one gets a fever. If the fever gets out of control the fever itself can kill. But treating the fever alone is not enough to deal with the underlying disease. The disease is what we have to try to find a cure for. It is true that when we have a high fever maybe a cold bath or drinking fluids or whatever the doctor prescribes is useful. They reduce the fever but we still need to address the illness.
I believe that the deficit we have been suffering in Canada is like a fever. A cutting of expenditures is like a cool bath. It reduces the fever and tries to address that
Government Orders
part of the problem, but the fundamental underlying disease that we are suffering from in the Canadian economy is the fact that we have been going through the last number of years of recession and low economic growth.
When we look at the government's records in terms of its spending, revenue and borrowing it is clear that we ran into problems when the revenue dropped off significantly. The revenue dropped off more rapidly than any government could have rectified by cutting expenditures.
We really had a problem of low revenue, not because tax rates where not high enough, but because the economy was not generating enough wealth. The government's share began to decline as did the private sector's share. The fundamental underlying disease we are dealing with is not the debt or the deficit but the weakness that exists in the Canadian economy itself.
That is why to look to the budget for some plan for economic growth is a search that must be performed. If we do not see a plan for where we are going to grow and where we can build the jobs that are going to generate the income that will be taxed tomorrow, then the deficit today which we know is going generate tax increases tomorrow is going to become an insurmountable problem.
Perhaps the greatest failure of this budget, even though it may be an interim budget until the government chooses a new leader, is that it lacks the plan and direction. It gives us no indication of where economic growth and prosperity is going to come from in order to address that fundamental problem which underlies the economy.
I cannot help but take the opportunity to look at that bottom line deficit projection for the five-year forecast contained in the budget and see that after five years we will continue to run a deficit of $8 billion for the year 1997-98 under this minister's plan.
It baffles me how two of his cabinet colleagues can go out on the hustings. The Minister of National Defence can claim that she can eliminate the deficit in five years and the Minister of the Environment can claim that he can eliminate the deficit in four years. The man in charge of it all, the Minister of Finance, brings in a budget that says: "Sorry, folks. After five years we still are going to be $8 billion in the hole".

April 30, 1993
Private Members' Business
Why does the Prime Minister not just stop right now and turn the whole thing over perhaps to the Minister of the Environment? I see that the four-year forecast is $14 billion. He is $14 billion better than the Minister of Finance. Why not give him that job today and let him get started at it?


The Acting Speaker (Mr. Paproski):: Is the House
ready for the question?


Some hon. members:: Question.


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


Some hon. members:: Agreed.


Some hon. members:: On division.


[Stage Direction]
Motion agreed to, bill read the second time and, by unanimous consent, the House went into committee thereon, Mr. Paproski in the chair.
Steve Eugene Paproski: Order. House in Committee of the Whole on Bill C-117, an act to provide borrowing authority for the fiscal year beginning April 1, 1993.
Clause 2 agreed to.
On Clause 3-Adjustment of Maximum Amount The Deputy Chairman: Shall clause 3 carry?


Some hon. members:: On division.
Clause 3 agreed to.
Clauses 4 to 6 inclusive agreed to.
Clause 1 agreed to.


[Stage Direction]
Title agreed to.
Bill reported.
John Horton McDermid: that the bill be concurred in.


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


Some hon. members:: Agreed.


An hon. member:: On division.


[Stage Direction]
Motion agreed to.
John Horton McDermid: that the bill be read the third time and passed.


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


Some hon. members:: Agreed.


Some hon. members:: On division.


[Stage Direction]
Motion agreed to, bill read the third time and passed. SUSPENSION OF SITTING
The Acting Speaker (Mr. Paproski):: Is it the wish of the House to suspend the sitting to the call of the Chair for the consideration of Private Members' Business?


Some hon. members:: Agreed.
The sitting of the House was suspended at 2.26 p.m.


SITTING RESUMED
[Stage Direction]
The House resumed at 2.37 p.m.
The Acting Speaker (Mr. Paproski):: Is there consent to call it three o'clock?


Some hon. members:: Agreed.


The Acting Speaker (Mr. Paproski):: 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


Mr. Derek Lee (Scarborough-Rouge River) moved: that Bill C-389, an act to amend the Criminal Code (invasion of privacy), be read the second time and referred to a legislative committee in the Departmental envelope.
He said: Mr. Speaker, I am pleased to have an opportunity to bring before Parliament a bill dealing with a matter of public concern over the last two or three years. It has been brought about by an increasing awareness on the part of the public of intrusions into their privacy and a sequence of lower court decisions that have made it apparent that section 183 of the Criminal Code, which purports to protect the telephone privacy of Canadians is no longer effective in protecting that privacy.
April 30, 1993

The bill which I present to the House would broaden the definition of a private communication as it is now defined in the Criminal Code. It will be broadened to state, and I will just quote the subsection I am dealing with here: "shall be deemed to include any oral communication or telecommunication transmitted through the facilities of a telecommunications carrier, irrespective of whether or not the transmission is both originated and received solely within Canada".
That adds to the definition of private communication and deems that every telephone conversation that takes place in Canada, whether or not it originates here, is protected by the privacy provisions of the code under the sections that prohibit wire-tapping.
This particular section of the code was enacted approximately 20 years ago because of increasing incursions into the privacy of Canadians and at that time it was simply called wire-tapping. At that time all of the normal telephone traffic in Canada and in the western world was carried by wires. At a certain point in time the telephone companies resorted to microwave transmissions to convey telephone transmissions in bulk.
Then at a later point in time we began using cellular telephones, which was radio technology. Those radio telephones, those cellular phones, use particular assigned frequencies in the frequency spectrum that is available to us in here in Canada. They are assigned in various countries around the world just as radio stations are assigned frequencies.
That is an explanation of what this bill does. The difficulty is obviously one of increasing technology. As a result of new and improved technology people who want to eavesdrop are more easily able to intercept private communications of Canadians on their cellular telephones.
This technology goes a little further. I am sure that as I speak there is another technology which we have not heard of yet. It is being used in the security and intelligence field and one day soon we will have an opportunity to read about it in Popular Science or Popular Mechanics magazine. As soon as it has become public the security and intelligence people will move on to a new technology.
Private Members' Business
I know that the technology is capable of picking up computer-stored data from outside of the building in which the computer exists. A personal computer emits rays and signals on different frequencies as it just sits there. Like a sponge we are now able to simply extract the data from the computer as it sits inside a building from a van or a car outside the building. We are playing catch-up football in this procedure in which we are trying to continue to protect the privacy of Canadians.
There were a number of Canadian cases that dealt with this right across the whole country. It was interesting to look at these cases because of the range they represented. The courts began some years ago, approximately in the late seventies, to indicate that a telephone conversation transmitted on a radio frequency might not be private as defined by the code. The code says: "In order for it to be a private communication there must be on the part of the person making the telephone call a reasonable expectation of privacy".
I would have thought that anybody making a telephone call through a telephone telecommunications carrier would have assumed that his or her phone call would have been private. The courts began back in the late seventies and into the eighties strictly interpreting the provisions of the code and saying that when people use a radio telephone there is not the reasonable expectation of privacy.
Consequently there is a big gap in the privacy protections as a result of those cases. American cases had to deal with the same issues. They came out to approximately the same meanings.
I took a different view in reading the code. I interpreted the section to cover every telephone communication so that if the person believed his or her conversation was private then it was, but the courts ruled differently.
Just shortly after I presented this bill, the government presented Bill C-109 in an attempt to redress that area of concern and other areas of concern, all of which are important. The bill has not yet completely gone through the parliamentary process but it has moved through the House process. In dealing with telephone privacy that bill deals with only two types of interception of telephone conversations.

April 30, 1993
Private Members' Business
The first type of phone call the government's bill would protect is a phone call that the interceptor intercepts for malice or for gain. The focus there is on the interceptor, on the wire-tapper.
The second kind of phone call that would be protected under the government bill is an encrypted telephone conservation. That is an encoded telephone conversation in which the signal is scrambled and then transmitted and then descrambled for the receiver of the telephone conversation.
That is all it does. All of the other cellular telephone calls that we make are certainly not encrypted. They remain unprotected.
This causes a problem for Canadians. That is the problem my bill is intended to redress. We accept now that they are not protected. The government accepts that people making or receiving telephone calls on cellular phones are not protected. Simple eavesdropping is not covered under this new government bill. It is apparently okay to eavesdrop on somebody making a phone call on a cellular phone but it is not okay to wire-tap from a wire transmission.
Apparently the only people around here these days who are protected under the new bill by means of the encrypted phone call are the ministers of the government, all of whom have encrypted conversation facilities. Government ministers are protected under the bill but ordinary Canadians are not.
The second problem is that the government says that there are too many scanners out there, too many pieces of equipment that can pick up telephone conversations. There are some 900,000 in the country. What is not being pointed out is that almost every one of them, or the vast majority, are dedicated scanners for ordinary radios, ordinary televisions and other electronic devices. They are dedicated and they are not being used for wire-tapping.
The third problem, and it is one that was pointed out just today in the lead editorial of The Toronto Star, is the inconsistency of the government's position. In its editorial The Toronto Star asks the rhetorical question: "People could be prosecuted for intercepting cellular phone conversations maliciously or for gain even though it would still be perfectly legal to eavesdrop. Does that
make any sense?" It has tapped right into part of the problem.
Another problem that evolves out of this is reflected by the U.S. response. The United States government sees the same problem but it has approached it differently. It has banned at a date in the future, some time in 1994, the import and manufacture in the United States of all radio scanners capable of picking up telephone frequencies.
Until 1994 everybody can continue to manufacture, import and use scanners, but after 1994 in theory there should be no more equipment of that nature. People cannot import it and they cannot manufacture it. All of the existing equipment will ultimately, as technology changes, become outmoded. Eventually the easy scanning will die. That is the approach that is being taken in the United States.
There is the Government of Canada's approach, which only deals with malicious and gainful interceptions or encrypted phone calls, there is the U.S. position, and then there is the simple solution offered by my bill.
I want to point out another problem at the same time. The new government bill does not address the apparent problem of an agency of the Canadian government that is currently freely intercepting all of this radio wave telephone conversation. That is the Communications Security Establishment. That agency is now doing it.
Based on the interpretation of the Criminal Code the agency would appear not to be doing anything illegal. It does not get warrants. In fact it does not even tell us what it is doing. I am making certain inferences here from information that is available to parliamentarians and to people who read the media across Canada. Under the new government bill that agency will continue to be free to intercept because it is not doing it maliciously or for gain. I do not know how it is dealing with the encrypting problem but if there is any agency in this country capable of encrypting and de-encrypting it is the Communications Security Establishment. That is its job for the Government of Canada on behalf of Canada's security agencies.
I submit to the House, that my bill addresses this problem of agencies of the government. The problem has also been addressed by the Supreme Court of Canada which says government may not wire-tap. It may not intrude on the privacy of Canadians. There are

April 30, 1993

special rules for the Government of Canada as I understand it and I am always subject to correction. The Communications Security Establishment should come forward to Parliament and explain what it is doing. It is carrying on unchecked and unregulated now by the Criminal Code and apparently even by the government's new BUI C-109.
I submit to the House that what is needed is a bUl of the nature I have proposed. The government's current proposals simply do not go far enough.
As I said earlier there is a kind of inconsistency of logic here. One of the reasons the government says it does not want to ban eavesdropping now on ordinary cellular phone calls is because there are too many people out there capable of scanning. There are too many people able to eavesdrop. I think that is what the government is saying and I quote an editorial from The Montreal Gazette which says: "It would be wrong and probably futUe to try to ban the scanners because there are so many".
If the government's logic is that it does not want to ban it because there are so many people eavesdropping already then why the heck would we bother to prohibit theft? Why would we bother to prohibit smoking marijuana? I am sure there are a lot more people committing theft in this country than there are intercepting telephone conversations. I am certain of it, although I cannot prove it. I do not know anybody who is a telephone wire-tapper. I know the odd person who has stolen and if I am correct there are people even in this House who have smoked marijuana. Admit it.
The fact that there are many people capable of scanning phone conversations and intercepting them is not a reason for not prohibiting the scanning of phone calls. The privacy of Canadians is at stake. We either have it, are entitled to it and there are laws protecting it, or we do not have it. Right now the government admits that cellular telephone users do not have the protection from ordinary public eavesdroppers or from the Communications Security Establishment, or any other outfit that wants to eavesdrop on cellular telephone conversations.
The government has said that some day in the future- and this sounds like an advertisement for a well-known electronics manufacturer whose name I will not men-
Private Members' Business
tion-and that day is not now, all or most of our telephone conversations will be encrypted. It will not be an option as it is now; it will simply be there. However it is a bit of an illusion that all telephone conversations will be encrypted and therefore protected because just as the technology of encrypting has advanced, so will the technology of eavesdropping advance.
As the parliamentary secretary for the Minister of Justice pointed out in the debate on Bill C-109, we are always playing catch-up football in this field of technology. I do not really care where the technology is. I submit to this House that the principal concern is not the technology but the privacy of Canadian telephone users.
We all remember the Wilhelmy eavesdropping incident in the province of Quebec during the Constitution negotiations. That was eavesdropping with a cellular telephone. There were others. There was a very prominent one on the west coast. Even Her Royal Highness, the Princess of Wales, was apparently eavesdropped on by means of a cellular phone interception. These all make us painfully aware that our privacy is not protected.
I want to close by highlighting that the assertions of the government that it has moved to protect telephone privacy is only partly true because it has only moved to ban the interceptors who do it maliciously or for gain. It has only been done for its ministers' encrypted telephone conversations.
I submit that does not go far enough. The government could have kept it simple. It could have kept it clean. It could have had this problem rectified with one amendment to one section of the Criminal Code. It chose not to do that. We will see where the future takes us.
This is an opportunity for the government to reconsider that. I submit that my proposal can augment and will not be inconsistent with the half-protections proposed by the government. This bill will simply augment the principle of protection of privacy as it is now in the Criminal Code.
We will close the gap. We will seal it up tight the way Canadians want it and the way they think they have it. I hope the House will look upon my bill in that way.

April 30, 1993
Private Members' Business


Wilton (Willie) Littlechild: Mr. Speaker, I welcome the opportunity to say a few words about Bill C-389, legislation aimed at protecting the privacy of telephone conversations made using the facilities of telecommunications carriers.
This is a very short bill, so short that its purpose is not patently obvious. It consists of a single clause making two changes to the definition section of part 6 of the Criminal Code.
The substantive change is to extend the definition of private communication found in the Criminal Code to include oral and telecommunications transmitted through the facilities of a telecommunications carrier. It would also make it irrelevant that the oral or telecommunication did not both originate and end in Canada. The other change would be to add a new definition. The Criminal Code would now define a telecommunication carrier as a person who provides telecommunications services to the public.
The explanatory note indicates the purpose of the bill is to protect all telephone conversations to ensure that no telephone conversation is excluded by what is somewhat inaccurately termed as the reasonable expectation of privacy, the criterion found in the current definition of private communication. As I have already indicated, that expression is to be modified by Bill C-389.
There appears to be a misunderstanding as to what the current Criminal Code definition of private communication does. I would suggest that we need to be clear on that before we even try to consider Bill C-389.
It should be noted that it is not a reasonable expectation of privacy that is relevant in the Criminal Code definition of private communication. It is whether given the circumstances in which a communication is made, it is reasonable for the speaker to expect that the communication will not be intercepted by someone other than the intended recipient.
The notion of reasonable expectation of privacy is relevant when one considers constitutional requirements under our Charter of Rights and Freedoms. It is important that both be kept separate and apart.
Be that as it may, if the purpose of this bill is to protect all telephone conversations as it appears that is what the
sponsor of this bill seeks to do, I would have trouble supporting the approach he has chosen, even if I agreed with the premise that all telephone conversations should be protected.
The reason is that the method chosen to achieve that purpose in Bill C-389 on the one hand goes well beyond ensuring that all telephone conversations are to be protected. On the other hand it may be that some telephone conversations which should be protected and which presently are protected would be excluded.
On the first point, that this bill overshoots the mark, I would like to read the definition of telecommunication found in section 35 of the Interpretation Act. It is directly applicable to the new definition that would be created in part VI of the Criminal Code. We will note it is a very broad concept. It means:
Any transmission, emission or reception of signs, signals, writing,
images, sounds or intelligence of any nature by wire, radio, visual or
other electromagnetic system.
While we might be hard pressed to discover just what this covers, we can all readily agree that it goes beyond telephone conversations which to my mind implies two or more persons speaking to each other over the telephone. For example, in ordinary commercial radio or television transmissions, if the station was broadcasting a paid for or even a public service announcement or info program it would be captured by this overly broad concept.
Many more examples could be imagined. I suspect this was not intended. Nonetheless it would be unwise and dangerous to support this bill as presently drafted.
What would be the effect of Bill C-389 on conversations over telephone systems owned completely by nontelecommunications carriers? In-house communications are becoming more and more frequent. It may be that courts might be inclined to the view that Parliament intended only to protect calls carried by public communications companies. I would not want that result because those conversations made over systems not used to provide telecommunication services to the public are deserving of the protection of the law. I would not want new uncertainties introduced in what is already a difficult area of law.
April 30, 1993

Another undesirable result may occur. Courts might interpret the provision to restrict it to interceptions of communications while carried over the telecommunications carriers facilities. By that I mean while transmitted over the land lines or equipment belonging to the carrier and not while travelling over the air. This would create a larger loophole even if it is an unintended loophole.
I understand that just such an interpretation occurred in the United States. Its comparable legislation had to be changed to ensure that where appropriate protected communications included the radio portion of a telecommunication, that is if carried in whole or in part over the facility it would be protected even while travelling over the air.
In my view this is what we must aim for. It should not make a difference that a portion of a conversation is being carried over the airwaves. How is someone to know that the conversation is taking place over land lines only and therefore the law applies to that conversation but not if the carrier transmits parts of the conversation over the air?
Private Members' Business
I suspect the sponsor is interested in protecting the over the airwaves link, that is when using cordless phones, cellular phones or the satellite link. This is obviously a very difficult field because of changing technology among other things. This is something that would have to be carefully considered. As I have been trying to show, Bill C-389 does not appear to deal adequately with the issue.
Thus while I applaud the sentiment of this bill I cannot support it. Indeed I think a more balanced and accurate solution can be found in Bill C-109, an act to amend the Criminal Code, the Crown Liability and Proceedings Act and the Radiocommunications Act. As mentioned by our colleague, Bill C-109 is still before this House.


The Acting Speaker (Mr. Paproski):: There being no further members rising for debate, the time provided for the consideration of Private Members' Business is now expired. Pursuant to Standing Order 96(1), the order is dropped from the Order Paper.
It being 3.05 p.m., this House stands adjourned until next Monday at 11 a.m. pursuant to Standing Order 24(1).


[Stage Direction]
The House adjourned at 3.05 p.m.
[Stage Direction]
Monday, May 3,1993