Mr. Speaker:

It is my duty to inform the house that five objections, signed by the hon. member for Kamloops (Mr. Fulton) and the hon. member for Vancouver-Burrard (Mr. Basford) and eight other hon. members in one [DOT]case; by the hon. member for York East (Mr. Otto) and ten other hon. members in another *case; by the hon. member for Nicolet-Yamaska (Mr. Vincent) and ten other hon. members in the third case; by the hon. member for Dorchester (Mr. Cote) and nine other hon. members in the fourth case, and finally by the hon. member for Lafontaine (Mr. Lachance) and ten other hon. members, have been filed with me pursuant to section 20 of the Electoral Boundaries Readjustment Act, with respect to the reports of the electoral boundaries commissions for the provinces of British Columbia, Ontario and Quebec respectively.

If the house will agree, I propose that the procedure followed on prior occasions in this session be again followed, so that the text of these five objections, together with the names of the members who signed in each case, will be printed as appendices to Votes and Proceedings for this day. Is it agreed?

Agreed.

Mr. Speaker:

May I add a word at this time concerning the notice of objection filed by the hon. member for Kamloops, the hon. member for Vancouver-Burrard and others. When the notice of objection was initially deposited "with me the first paragraph thereof included the words "and that this house do endorse the said objections". After consultation with the .hon. member for Kamloops he agreed to *delete these words from the notice.

Hon. Mitchell Sharp (Minister of Finance):

Mr. Speaker, I wish to make a statement on the Municipal Development and Loan Act.

Hon. members will recall that the purpose of this statute, which became law on September 5, 1963, was to provide an inducement to municipalities to accelerate the construction of municipal projects as rapidly as possible and thus to increase employment. The inducement took the form of an offer of $400 million of loan funds at a modest rate of interest and an undertaking that 25 per cent of the principal amount of each loan would be forgiven in respect of project costs incurred up to March 31, 1966, whether or not the project had been completed by that date.

Municipalities in all provinces have taken advantage of the borrowing facilities provided by this legislation. The municipal development and loan board expects that it will have committed about $390 million out of the $400 million made available in loans to municipalities by March 31, 1966. In short, virtually every province will have fully used up its quota; indeed most provincial quotas are already fully committed. Some 2,300 loans will have been made to about 1,300 municipalities.

The bulk of the municipal projects being constructed under this program have already been completed, or are well on the way to being completed. However, some 200 to 300 municipalities are unlikely to be able to complete their projects by March 31, and will not therefore be entitled to receive the maximum forgiveness payment.

In some cases the delay in completing their projects is explained by the fact that some municipalities took a longer time than they had anticipated in taking all the steps necessary to bring their projects to the point of commencing construction. In other cases, after the necessary borrowing had been authorized by the province, bad weather, strikes, shortages of materials and manpower delayed the actual construction schedules. Some municipalities applied too late to expect to be able to earn much if any forgiveness. As a

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Municipal Development and Loan Act result, construction work corresponding to perhaps $50 million and covering some 200 to 300 separate loans will not be completed until after March 31.

[DOT] (11:10 a.m.)

The act has fulfilled its main purpose, and it is not intended to propose any addition to the $400 million of funds made available or any extension beyond March 31, 1966 in the date by which projects must be approved.

As hon. members are aware, strong representations have been made to the government to extend the date for the calculation of forgiveness, most recently by a delegation of provincial ministers and their representatives. The suggestions ranged from extension for a few months to indefinite extension. The government has been giving careful study to these representations and has been impressed by the evidence of the difficult financial situation which some of these municipalities will encounter if, because of circumstances beyond their control, they are unable to earn the forgiveness they had expected to earn before March 31, 1966.

On the other hand, the government has also had to take into account that some municipalities decided not to apply or were prevented by their provincial boards from applying because they would not be able to earn full forgiveness before March 31, 1966. The government has also been aware, and I have no hesitation in saying this, that some municipalities have no expectation of earning forgiveness and are taking advantage of the act for its favourable financing facilities only.

Taking all these conflicting factors into account, the government has decided that it will ask parliament for authority, by means of a vote in the supplementary estimates for 1966-67, to pay to municipal borrowers under this legislation such additional amounts of forgiveness payments as may be necessary as a result of extending the relevant termination date by six months. That is, I am proposing that the 25 per cent forgiveness payment should be made with respect to all project costs incurred up to and including September 30, 1966. This extension will probably require additional payments amounting to about $12 million beyond those already contemplated.

Mr. Speaker:

Order, please. Perhaps this might be a good moment for the Chair to unburden itself of a very weighty opinion prepared following the discussion in the house on Tuesday, February 15, when hon. members were invited to argue the point of order raised by the hon. member for

DEBATES February 18, 1966

Cumberland (Mr. Coates). The Chair undertook to give a decision after considering the arguments submitted. I can assure hon. members that I have studied most carefully the several views expressed by those who participated in the discussion on the point of order.

As hon. members know, it has been the practice for some years that when a minister of the crown makes an announcement or a statement of government policy on motions, a spokesman for each of the parties in opposition to the government may comment briefly.

Beauchesne refers to this practice in citation 91 of his fourth edition. On February 1, 1954 Mr. Speaker Beaudoin stated that it was the practice of the house, when a minister makes a statement, to allow one spokesman for each opposition party to make observations, and he referred to a ruling in that regard made by his predecessor, Mr. Speaker Macdonald, on June 4, 1951.

Last year this practice was embodied in our rules and is now provisional standing order 15(2a), which reads as follows:

On motions, as listed in section (2) of this standing order, a minister of the crown may make an announcement or a statement of government policy. Any such announcement or statement should be limited to facts which it is deemed necessary to make known to the house and should not be designed to provoke debate at this stage. A spokesman for each of the parties in opposition to the government may comment briefly, subject to the same limitation.

In 1963 an amendment was brought to the Senate and House of Commons Act, which reads as follows:

There shall be paid to each member of the House of Commons, other than the Prime Minister or the member occupying the recognized position of Leader of the Opposition in the House of Commons, who is the leader of a party that has recognized membership of twelve or more persons in the House of Commons, an allowance at the rate of four thousand dollars per annum in addition to the sessional allowance payable to such member.

It has been suggested that provisional standing order 15 (2a) should be interpreted in the light of the amendment to the Senate and House of Commons Act in 1963 and that this amendment should be a guide to the Speaker as to the procedure to be followed in the matter of comments on ministerial statements.

There is obviously some merit to this proposition. However, one should bear in mind the following principle of parliamentary procedure laid down in subsection 3 of citation 8 of Beauchesne's fourth edition:

In the interpretation of the rules, or standing orders, the house is generally guided not so much

February 18, 1966 COMMONS

by the literal construction of the orders themselves as by the consideration of what has been the practice of the house with respect to them.

We must take into consideration that after the 1963 amendment to the Senate and House of Commons Act was enacted, standing order 15 (2a) was adopted by the house, and that in the same year such standing order was adopted the house accepted that the hon. member for Red Deer be permitted to make comments on ministerial statements, although at that time he had in his party fewer members than the number provided in the amendment to the Senate and House of Commons Act.

Following such precedents, I do not see how I could come to the conclusion that standing order 15 (2a) is to be interpreted in the light of the amendment to the above mentioned act. At the same time I do not think it would be reasonable to conclude that independent members fall under standing order 15(2a). I do not think, also, that the hon. member for Kenora-Rainy River who contributed to the discussion, comes under this category. But until such time as the house amends the standing order dealing with ministerial statements so as to define more precisely the right to comment thereon, I am of the opinion that I should follow the practice which prevailed during the last session and interpret the standing order as permitting comments on ministerial statements by the Leader of the Official Opposition and by spokesmen for the New Democratic Party, the Ralliement Creditistes and the Social Credit party.

Mr. H. Russell MacEwan (Piclou):

Mr. Speaker, we listened with interest to the statement by the Minister of Finance with regard to this matter of the municipal development loan fund. Let me say, first of all, that this six months extension is not, in our opinion, long enough. I would remind the minister that when his predecessor introduced this legislation in 1963 he promised that should the municipalities have used the $400 million before the March 1, 1966 deadline there would be no hesitation in asking parliament to make further funds available. Apparently hon. gentlemen opposite have now changed their minds, and after having kept the municipalities waiting for a long time to see what would happen the minister comes forward today, February 18, to make this disappointing statement. This is not good enough.

I would point out that in areas such as the Atlantic area this fund has been of great

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Municipal Development and Loan Act assistance. Its continuation for a further six months only will be a keen disappointment. During the last reported period of 1965, unemployment in the Atlantic area amounted to 6 per cent according to figures from the Dominion Bureau of Statistics. The development loan fund was doing good work in areas such as mine where four schools within a radius of five miles were undertaken under this scheme. I do not know whether they can be completed within the six months period now allowed.

I am glad the minister and the government have listened to the representations of the official opposition and allowed at least some extension of the terms of this act but, as I say, the intention was surely to assist in providing employment, especially in areas like my own.

Mr. T. C. Douglas (Burnaby-Coquillam):

Mr. Speaker, the announcement made by the Minister of Finance will cause considerable disappointment among the municipalities of Canada. The concession to extend the period for another six months will be of some help, but the minister has not made it clear whether this extension will enable all the municipalities which now have projects under way to qualify for the 25 per cent forgiveness.

[DOT] (11:20 a.m.)

It seems to me, in view of the very small sum of money involved, the very least the government might have done would be to agree that any projects commenced prior to this date would be allowed to qualify for the 25 per cent forgiveness because, as the minister has pointed out, there have been a great many delays due to causes beyond the control of the municipalities, which have accounted for the fact that they have not been able to complete their work. Some will certainly be unable to complete their programs by September, and it will be a very serious loss to them if they are denied the 25 per cent forgiveness provision.

The second announcement by the minister, that the government has no intention of extending the Municipal Development and Loan Act beyond March 31, is even more disappointing. I think the conference of mayors and municipalities felt fairly confident, when the former minister of finance introduced this measure, that we were taking the first step toward setting up in Canada a permanent municipal loan fund. The house has to remember that there are a great many

February 18, 196&

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Municipal Development and Loan Act municipalities, particularly smaller municipalities, which cannot borrow money at the same interest rates as can the larger urban centres. Many of these small municipalities must pay exorbitant rates of interest, if they can borrow money at all, and the absence of any federal municipal loan fund means that many of the more needy communities will be prevented from undertaking much needed municipal works.

We in this party had always hoped the government would establish a permanent municipal bank or municipal loan fund to allow the municipalities to borrow money at reasonable rates of interest. The federal government can borrow more cheaply than the municipalities, and without great cost it could save the municipalities a great deal of money. But even more important it could enable the poorer municipalities to undertake projects which otherwise would be impossible. This is one way in which the government could equalize opportunity as between the different municipalities and they will be disappointed, as are we, that the government has decided not to extend the Municipal Development and Loan Act so as to make this a permanent feature of our Canadian way of life.

[Translation1

Mr. Real Caoueiie (Villeneuve):

Mr. Speaker, the measures taken by the government to assist municipalities through the granting of loans seem to me completely inadequate.

As a matter of fact, if we consider the situation in which most of our municipalities find themselves, we readily realize that they need government assistance all year round and not only during a given period.

The minister has just said that 1,300 municipalities have benefited from such loans and advantages provided under the federal act. He told us also that some municipalities have not undertaken any municipal works because they were unable to complete them by March 31, 1966.

The minister does not say if these municipalities can undertake works now, tomorrow or next week, and benefit from the provisions of the act until September. The hon. minister's statement is not very clear.

In any event, I endorse what the hon. member for Burnaby-Coquitlam (Mr. Douglas) has just said about this municipal development and loan act. I feel this should be a permanent and not merely a temporary measure, because Canadian municipalities do not exist only until March 31, 1966 or September

30, 1966, but problems will still be facing them after that. Therefore, let us help the municipalities by making this act permanent, so that the municipalities may be treated equitably throughout the year.

Mr. Speaker, I am sure there are many municipalities across the country which will be grateful for the announcement the Minister of Finance has just made. I believe that in so far as the previous act is concerned this new policy will cover the majority of needs where municipalities have not been able to complete projects and claim benefits in accordance with the previous deadline.

However, the need for assistance in financing capital development across this country, particularly as it relates to municipal governments, is urgent. The minister has said that the purpose of this change is to assist in relieving the unemployment situation, but the real need in this country as far as local governments are concerned is not direct relief for unemployment, but money for capital development which cannot be obtained except at exorbitant interest rates. In this regard the tax rate imposed on local taxpayers by many municipalities is made up more in interest charges than for capital for the necessary projects for those communities.

Therefore, Mr. Speaker, I urge upon the Minister of Finance that what we need is a permanent set-up to provide this capital. It would seem much wiser for the government to bring in permanent extension, rather than a temporary provision, which would give the type of assistance the government has given under the municipal loans fund in the past years. The need goes beyond that, and that is why we in the Social Credit party down through the years have asked for a definite and complete municipal financing set-up which we believe could best be done through a municipal development bank as part of the Bank of Canada, where such money could be obtained at a reasonable cost which would give hope of meeting the development needs of the country with some relief to the taxpayers.

[Translation1

Hon. Jean-Luc Pepin (Minister of Mines and Technical Surveys):

Mr. Speaker, I wish

February 18, 1966

to table copies of correspondence between Mr. Roblin, Premier of Manitoba, and myself, concerning power development of the Nelson river. Mr. Roblin is doing likewise today in Winnipeg.

Right Hon. J. G. Diefenbaker (Leader of the Opposition):

Mr. Speaker, I should like to direct a question to the Minister of Industry asking whether the most unusual action taken by him and the Minister without Portfolio (Mr. Turner) yesterday in connection with the government of Quebec, as to what that government ought to do in the field of education, however justifiable the objectives were, was taken as members of the government or on their own?

Hon. C. M. Drury (Minister of Industry):

Mr. Speaker, if I may speak on behalf of myself and my colleague, a telegram was sent jointly by myself and the member of parliament for St. Lawrence-St. George as members of parliament for two ridings on the island of Montreal, to two members of the provincial legislature from the island of Montreal, to seek to obtain their assistance in finding out whether something can be done for the university of which I am a graduate.