Mr. Alexander:

I insist on hearing Joe.

Mr. Perrault:

I will not prolong my remarks.

Mr. Alexander:

Good.

Mr. Perrault:

There is much more I could tell about the record, but time does not permit. This is an important debate.

Mr. Knowles (Winnipeg North Centre):

It was.

Mr. Perrault:

As members of all parties we must act to ensure continuing Canadian ownership of this company. If this means government ownership of the company or government participation in the company-and there are no other alternatives-then I favour consideration being given to these measures and I believe many other members of the House support such action. But let us not cloud the basic issue with the type of spurious comments advanced by some on the other side who suggest that somehow the rumoured sale is linked with the white paper on tax reform or that it is a "sell-out" to United States "interests" and that there is a "plot afoot". Canadians from coast to coast are becoming increasingly concerned about the degree of outside involvement in and ownership of some of our basic industries. This is an important question before us. Let us not cloud it with other spurious considerations.

Hon. Marcel Lambert (Edmonton West):

Mr. Speaker, we would certainly have liked to have heard the minister, particularly since I am now informed he has already spoken on television about this problem. He has, in fact, acted in complete contempt of your opinion, Mr. Speaker.

Mr. Orange:

Nonsense.

Mr. Lambert (Edmonton West):

I would like to see the

hon. member for Northwest Territories (Mr. Orange) speak from his seat and bring some light on this subject, rather than stand behind the curtain and say "nonsense".

Standing Order 26 reads:

.. .for the purpose of discussing a specific and important matter requiring urgent consideration...

On examination of the proposal put forward by the hon. member for Nanaimo-Cowichan-The Islands (Mr. Douglas), Your Honour decided this matter to be important and urgent, and that it should be brought on for immediate consideration. Yes, members on all sides of the House have demonstrated so far that they would like to see a solution, but the man who has the most information on hand, the man who has all the knowledge of the

dealings, who has been in contact and perhaps acting on behalf of the government, has chosen to remain silent. He can remain silent and sphinx like until six o'clock in the morning.

Mr. Green:

Like Solomon.

Mr. Lambert (Edmonton West):

No, sphinx-like. Solomon spoke and acted. The minister decided to let this debate go forward. We have heard scholarly exercises in economic nationalism, try-outs for a debate next week on the CDC when some people will essay their wings of economic nationalism. A number of proposals have been put forward that the government should act and buy Home Oil. I would simply ask the hon. gentlemen who made that proposal, under what statutory authority would the government do so? What act would allow them to put forward the first dollar to purchase the company as a buyer of last resort? Even if they did suggest that some of the Crown corporations could buy Home Oil, have any of those Crown corporations the legal power to so act?

Second, if any of those Crown corporations have the personnel who know anything and who could act in a managerial capacity, is there authority for those companies to borrow money from the federal government if that were deemed to be the avenue of approach? These are just wild guesses. I would have thought that when the parliamentary secretaries were making this proposal they would have verified whether or not that course would be possible before bringing it forward for serious consideration. This is why perhaps the minister should have been the second person to speak tonight, when he could have given the information and we could have discussed the matter perhaps a little more intelligently than we are doing now.

I must confess that in many instances I am relying on newspaper reports, conjectures, and information that I can gather here and there. But the minister is the man who knows, and I place the full responsibility on him for this continuing debate which has gone far beyond the time that it should because he has refused to say anything Yet, I am told that he has spilled his heart and waxed eloquent before the television cameras. Sure, he had to make the eleven o'clock news; that is why we had these disappearances from the House.

Now, I want to deal with a few of the proposals that have been put forward. The hon. member for Don Valley (Mr. Kaplan) spoke about purchase by the government. I ask, where, how, and by whom? Then, the CDC was mentioned. I presume that the hon. members who have referred to CDC tonight have not read the press release and the remarks in print and on television made by the Minister of Finance (Mr. Benson) in which he said that in no way was this company to be a buyer of last resort. Are they going to tell the Minister of Finance that he was talking through his hat? The minister will surely tell them on Monday that CDC is not established to bail out any organizations that are in some difficulty or under pressure. These are purchases under duress.

February 18, 1971

As a matter of fact, there is a question as to whether there is a binding agreement in existence at present. Only the minister could tell us that. A veil of secrecy has descended to the point where, in fact, Mr. Brown had to commit a technical breach of the SEC regulations by withholding filing for insider trading in buying additional shares of Home Oil. According to the press, he tells us that he was under instructions of the government of Canada, not of the United States, not to make the disclosures and not to speak about his dealings and negotiations. That is something that we want to be cleared up.

Next, I should like to come to the questions which I wish to examine in this particular matter. First, we want to know whether there is a binding contract or a projected sale. If there is a binding contract, then the remarks of the hon. member for Scarborough East (Mr. O'Connell) in which he deprecated the action of the government with regard to Denison Mines would have full application in this instance. If there were a binding agreement,-was it last week or a month ago that Mr. Brown entered into an option agreement to sell-then there would have been that degree of retroactivity which the parliamentary secretary deprecated and he would have to level the same criticism on the head of the government that he levelled against the Denison deal.

Mr. Horner:

Mr. Speaker, I rise on a question of privilege which affects all members of the House. We have now gone through three hours and ten minutes of debate on this question during which everyone urged the minister to rise and speak. He has remained silent in the House. However, he went on national television and said that a deal is being made and that he is confident that within two weeks an announcement will be made that Home Oil will remain Canadian. He said that there is no fear and no need to worry. Why did he not say so in the House? By appearing on the national network and by ignoring the concern of members of his own party and of every member of the House which has been expressed during the three hours and ten minutes of debate, he has attempted to destroy Parliament. He has sat there like a sphinx, like a mummy. I could use a lot of other words in the Prime Minister's (Mr. Trudeau) vocabulary, but I am not so well acquainted with them.

Oh, oh!

Mr. Horner:

This is one more step in downgrading Parliament.

Mr. Speaker:

Order, please. The hon. member for Edmonton West.

Mr. Lambert (Edmonton West):

I welcome the intervention of the hon. member for Crowfoot (Mr. Horner) because it points out precisely the complaint which I expressed at the beginning. The action of the minister is in contempt of the House and in contempt of you, Sir, because when the matter was put to you this afternoon you judged it to be a matter coming fully within Standing Order 26. Those words were not weighed lightly. Certainly, Your Honour never weighs them lightly. You consider them very carefully, as you should, and today you have done so. Yet, this minister has the ultimate gall

Possible Takeover of Home Oil Company to have this House debate the question while he appears on television and spills the beans, tells everyone but this House. Sir, I do not know if there is any purpose in continuing the debate here because of this type of behavior.

Mr. Horner:

Arrogant! Arrogant!

Mr. Lambert (Edmonton West):

I cannot express in terms that are strong enough my contempt for the minister's action. What is the purpose of such a debate if we get this sort of treatment? I do not know how much the Minister has said. According to the hon. member for Crowfoot, and presumably he has an accurate report, the minister said that the deal is going to take another two weeks and that he is satisfied there is going to be a preservation of some sort of Canadianization, or Canadian quality, or what have you with respect to this company.

We want to know is it actual ownership that is going to be maintained in Canada, or is the operational control going to move to others? Is it the deal that there will be a new board for Cygnus, with four nominees for Mr. Brown and three for Ashland, but the three real operatives being Ashland nominees? Is there a secondary agreement between Mr. Brown and Ashland that he will guarantee delivery at some future time, or within a set period after his death, such shares of Home Oil as will give absolute ownership control to Ashland?

Can the minister tell us what are the obligations of Home Oil under TAPS, the syndicate that is to put a pipeline across Alaska, in which Home Oil has a participating interest? What further obligations has Home Oil got? What is its real interest in Atlantic Richfield? Are the shareholdings of Home Oil in Atlantic Richfield the pot at the end of the rainbow for which Ashland is reaching? What about the remaining 10 per cent that Home Oil has in Trans-Canada Pipe?

I quote from the brief Mr. Brown submitted last June to the Finance Committee examining the white paper, from appendix A-3 to volume 50 of the transcript of evidence, page 198, as follows:

Home is one of the largest shareholders of Trans-Canada Pipe Lines Limited. Dividends are now received by Home from Trans-Canada tax free.

Home's investment in Trans-Canada Pipe dates back to 1957 when several large blocks of common shares were bought from non-residents bringing Home's interests to 15.7 per cent of the voting shares of Trans-Canada Pipe. One can readily see that Home's interest was that of a major shareholder. What happens to that interest in this deal? Is that protected in any way? What are the special circumstances surrounding the sale? I am not trying to delve into Mr. Brown's personal matters. It is the tax laws of this country which are at the root of most of the sales of Canadian enterprise to foreigners. We heard a litany of other oil companies apparently recited with glee by hon. members opposite who had forgotten the dates of their acquisition by American companies. But all hon. members know that North Star and Canada Oils were

February 18, 1971

Possible Takeover of Home Oil Company sold as the result of the incidence of estate tax and succession duty taxes.

It is unfortunate that the hon. member for Lotbiniere (Mr. Fortin) is not in the chamber because I could tell him that the government of his province, through punitive succession duty laws, has driven Canadians to dispose of their companies before death or, in the event that they were caught unexpectedly, caused their executors to put up their shares at fire sale prices. The same applies to the level of succession duties in Ontario, and then there is the federal government taxation on top of that. One has only to recall North Star which was absorbed by Shell. The same thing happened to Canadian Oils. I suppose one could say to the provinces that they should not levy succession duties, but they do. They have that right. This is where we, as Canadians, have the wrong end of the stick. We think we can live like the prodigal son off the fat of our endeavours, but far beyond our capacity to produce. We want all sorts of frills, but the economic core of this country must do the producing, and we always seem to bleed that core. My hon. friends to my left would not even want it to live. They would kill it.

This economic core is what provides the money for all the things they ask. Of course, the NDP have a shelf full, a nest full, or a bag full of people who are expert in running all these industries that they want to take over. But we can point to certain examples in Saskatchewan.

What sort of government have you got in Ontario?

Mr. Lambert (Edmonton West):

They do not have a great number of Crown corporations, but Crown corporations are not a good example when it comes to dealing with labour, or anything like that. I am not going to make myself an apologist for Crown corporations.

Just compare the high incidence of taxation on Canadian corporate earnings as compared with the situation in the United States, the high taxation on dividends in Canada as compared with the situation in the United States, and the unequal tax treatment given investment in resource development programs in Canada as compared with the United States. An American, not even engaged in the oil business, can invest money here in Canada and get full allowance for it, regardless of whether it is his major source of income. But to Canadians we say that it must be their principal business. The result is that Americans have run circles around us.

Let us look at what Mr. Brown had to say about the activities of Home Oil as recorded at page 50:58 of the committee hearings:

During the past ten years we have raised $170 million. I submit this is a real achievement for a company the size of Home, and especially so when one realizes that at the same time it has been possible to retain over 90 per cent of our voting shares in Canada. It is also noteworthy to point out that only 19 per cent of these funds were obtained in Canada under relatively favourable tax rules.

Our ability to raise capital in the future, particularly in Canada, will depend to a great extent on the tax incentives provided both to the industry and to individual investors. The white paper proposals would reduce these important tax incentives to the industry. The proposed investment incentives fail to encourage

high risk investments by Canadians. Preference is given to investment in low risk, well established companies. Resource investments are further penalized by the proposed tax on capital gains, which will have a relatively greater effect on this form of investment. The high rates of tax proposed for the transitional period would drastically reduce investment in the industry at a most critical time. As you know, exploration in Canada is becoming more costly and more risky as we move to the more remote northern regions of Canada.

I know that my time is limited, Mr. Speaker. I hope the House will extend to me the courtesy it extended to other hon. members and allow me to finish. We can see the background to this transaction. I trust that after I sit down the minister will stand up and give us the details of what has happened. Since he was satisfied to go on television and say that he is hopeful about the situation, I trust he will tell the House what the situation is. Then we shall be able to judge whether it is possible, in this particular instance, to salvage a company of this nature. I will not cry about economic nationalism at this time. This is neither the time nor the place to do that. But we must have information if we are to embark upon an intelligent debate, and I think the information has been withheld from the House.