June 20, 1972

PC

Harold Warren Danforth (Progressive Conservative Party Caucus Chair)

Progressive Conservative

Mr. Danforth:

Once we stop giving grants to induce factories and industries to move to submarginal areas, and once economic conditions return to normal, those factories and industries will not stay, because economic conditions will be against them. Every businessman in Canada knows this. I cannot understand why this fact has escaped the government.

My colleague showed that we are not creating new jobs, merely transferring jobs. We increase employment in one region and decrease it in another region, proof of which is this: Our total unemployment is not falling. I suspect we are not being given the true unemployment picture in this country, and this bothers me.

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PC

Maclyn (Mac) Thomas McCutcheon (Deputy House Leader of the Official Opposition)

Progressive Conservative

Mr. McCutcheon:

Aha! Now, we come to the nub.

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PC

Harold Warren Danforth (Progressive Conservative Party Caucus Chair)

Progressive Conservative

Mr. Danforth:

The government talks about a 6 per cent unemployment rate. That figure represents only those who are drawing unemployment insurance. Does it include those who are being retrained? I believe 90,000 people are undergoing retraining. Does it include students who are looking for jobs, who have never worked and who, therefore, are not registered as unemployed? Although the government talks about 500,000 or 600,000 people being unemployed, I have as much right as hon. members opposite to suspect that one million Canadians

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Employment Incentive Programs today are unemployed. That figure, I suspect, is closer to the truth than the 600,000 figure.

This government embarked on a policy that no other Canadian government has ever embarked upon. It has used taxpayer money to buy people off the unemployment rolls. That is what it has done-it has bought people off the unemployment rolls. You can say to the government you are mobile and willing to move from A to B, and you will be eligible for an incentive grant because the government wants to take you off the unemployment rolls. It does not matter if the project is productive, if it will add to the gross national product. The government is interested in one thing only, its public record just before an election.

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?

Some hon. Members:

Hear, hear!

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PC

Harold Warren Danforth (Progressive Conservative Party Caucus Chair)

Progressive Conservative

Mr. Danforth:

The people of Canada know this. That is why we are debating the matter. Certainly, the opposition is not always right; but it is not always wrong, either.

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?

Some hon. Members:

Hear, hear!

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PC

Harold Warren Danforth (Progressive Conservative Party Caucus Chair)

Progressive Conservative

Mr. Danforth:

We resent the attitude of this arrogant government which says that everything it does is right and not open to challenge. It is because of the government's attitude that we are in our present trouble. It will not accept the simple truth that it may be wrong and that not all its policies are correct.

Government members say the people of Canada never had it so good. I suggest, instead, that never before have they been so uneasy and unsure of their future. The minister said that the people in Canada are spending more money than ever on consumer goods. We know why. In view of the government's tax policies, it does not pay to save. The more you save, the more the government will take of your savings. It is small wonder the people are saying, "We may as well live today, because we will be persecuted tomorrow."

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?

David Vaughan Pugh

Mr. Hugh lames Faulkner (Parliamentary Secretary to Secretary of State):

Mr. Speaker, the hon. member's contribution was a remarkable contribution, although I am not sure to what. Certainly, it was indicative of the style we may expect the hon. member to use time after time in his campaign; however, I remind him that this is the House of Commons and we are debating a specific motion. Perhaps he followed the questionable example shown by the hon. member for Prince Edward-Hastings (Mr. Hees) who showed, I suppose, some sort of political acumen in avoiding the whole question.

The motion is specific. It says that the government's incentive programs have failed.

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PC

Harold Warren Danforth (Progressive Conservative Party Caucus Chair)

Progressive Conservative

Mr. Danforth:

They have.

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PC

George Harris Hees

Progressive Conservative

Mr. Hees:

Hear, hear!

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LIB

James Hugh Faulkner (Parliamentary Secretary to the Secretary of State of Canada)

Liberal

Mr. Faulkner:

That, of course, is the characteristic position of the opposition. Its record is one of complaints and criticisms, indicting the government, without respite, from the very beginning for everything it has done. I suggest to the opposition that, for the sake of its own credibility, it might say once in four years that the government may have done something right.

The opposition again today brought forward one of those negative indictments of the government and government programs. I was interested to note how carefully hon. members opposite avoided dealing with incentive programs, the subject we are debating. I happen to represent an industrial constituency. A number of major plants are to be found in Peterborough, including those owned and run by Canadian General Electric, Outboard Marine and De Laval, Fisher Gauge and many others. I have argued strenuously for more incentive type programs. I have argued that way since first arriving here in 1965 and still remember the discussions that took place in committee at that time. We said the government should support the secondary manufacturing sector. That is what the government has done, and done reasonably effectively. No one on this side of the House, as the hon. member for Kent-Essex (Mr. Danforth) tried to intimate, says that every one of these programs is perfect or could not be improved. I repeat, no one on this side says that; so, let us dismiss that nonsense and save it for the hustings and campaign platforms because, certainly, it is nonsense. There is no place for such nonsense in the House of Commons.

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?

Some hon. Members:

Hear, hear!

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PC

Harold Warren Danforth (Progressive Conservative Party Caucus Chair)

Progressive Conservative

Mr. Danforth:

The hon. member did not listen to the minister.

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LIB

James Hugh Faulkner (Parliamentary Secretary to the Secretary of State of Canada)

Liberal

Mr. Faulkner:

During the past four years this government, with incentive programs, has tried to help the secondary manufacturing sector of the economy become more efficient and compete more effectively in order that it may make inroads in export markets and provide the level of employment that we want for Canadians. If the opposition is arguing that these programs have failed, it is incumbent upon them to show where they have failed. Which programs are they talking about? Which programs did the hon. member who moved this motion mention? Not one. It was one of those airy, vague, fuzzy, confused speeches intended for the hustings.

What does the opposition think about some of these programs? What, for instance, does it think about the Adjustment Assistance Program? Is this a program we should scrap, or should it be revised? And if so, in what way? What about the BEAM program? I can remember when this was introduced by the President of the Treasury Board (Mr. Drury). It was applauded by the opposition. There was no mention of that this afternoon, no word about any way in which it might be improved.

What about the program providing for the remission of duty on new machinery coming into the country to support Canadian manufacturers? Is this a program which should be scrapped, or should it be revised? Not a word, not a suggestion, and no advice from the opposition. What do they think about programs to increase productivity? That is an incentive program, a program developed by the Department cf Industry, Trade and Commerce. Is that a program which should be scrapped or changed? Again, not a word.

It does seem to me as one member who represents an important industrial sector of the economy, as a member

June 20, 1972

who has consistently advocated an enlarged government role in a support position and as one who has consistently declared himself in favour of programs such as PAIT and IRDIA, that this is an excellent use of tax dollars. I would put this to a vote in the city of Peterborough at any time. I could put it to a vote of members of local 524 of the UE.

I could put the question to the steel workers: Do you believe the PAIT or IRDIA should be abolished? Not one of them would agree with such a proposition. They know they are able to place in foreign markets such as Brazil and Botswana the products they are producing because the government has come into these schemes. I would say to the ministers concerned: Keep it up. That is what the people of Peterborough want. They are not concerned with all this nonsense we have heard today from the other side of the House.

I wish to spend a few moments considering one or two areas of effort which particularly concern me. The first is the work of the Export Development Corporation. This may not be described as an incentive program but it is certainly a support program. In 1971, Canadian General Electric-I am thinking particularly of the Peterborough Branch-was financed to the extent of $3.5 million by the agency.

Let us look at the record of the EDC. Exports insured in 1971 amounted to about $392 million in value. These are operations under section 24 of the act. Under section 27, exports insured amounted to a value of $89 million. Speaking from the base I represent, one of the things which has plagued us continually is the problem of concessional financing. The government has gone a long way to meet this difficulty under section 79. In area or export financing, the value of contracts signed amounted to $240 million. Under section 31, the value of contracts signed was $100 million.

At the present time Canadian General Electric Company is seeking to make major inroads into the export market, particularly in the heavy electrical field, and I think it can be said that the Department of Industry, Trade and Commerce, and the Export Development Corporation in particular, have played an important support role in this effort. Some of these business propositions involve very difficult markets-Roumania, Israel, Poland and New Zealand, for example-and the arrangements which can be made in respect of the financing are often critical in ensuring success.

We are very optimistic about the possibilities of the deal now contemplated with Roumania. The role the corporation and the department are playing has become critical to the success of these ventures. I would therefore have expected to hear more from the opposition with regard to the operations of the Export Development Corporation as one agency with which the government has been associated.

I wish to consider briefly, now, the role played by PAIT. The Parliamentary Secretary to the Minister of Industry, Trade and Commerce (Mr. Howard) has touched on it. Again, it is fair to say that in the case of the Canadian General Electric Company, support under PAIT and IRDIA has been offered and accepted. This has led to the carrying out of work for which we are peculiarly adapted

Employment Incentive Programs in Canada and which has put us in the forefront of technological progress in a number of areas.

I think of the Eel River power development; I think of the work done jointly by the New Brunswick Power Commission and the Canadian General Electric Company; I think of the new high voltage direct current technology which was developed and installed in large measure as a result of the support given to the company by the Department of Industry, Trade and Commerce under the IRDIA program. Other companies in my area have received the benefit of similar support, including the de Laval Company and the Fisher Gauge Company, a small, totally Canadian-owned and highly successful venture. Again, they have been assisted by the Program for Advancement in Industrial Technology.

In my judgment, these programs put forward by the government have worked to support Canadian manufacturing and Canadian technology. They have made it possible for Canadian manufacturers not only to compete at home against offshore competition but to find new markets abroad. In doing so they have provided the employment with which all of us are deeply concerned. If there is criticism to be directed against these programs, it can only be that they have not gone far enough.

I have studied the development of PAIT. In 1965, PAIT, it seemed to me, was a defective program. It was not as good as it is today. It has been improved. That is true of some of the other programs. If the debate today were to serve any useful purpose, the opposition should have taken a hard look at these programs and produced suggestions for improving them; I am sure the mind of the government is open with respect to considering ways in which they could be improved. To my mind, the debate has been a failure because of the refusal of the opposition to deal specifically with the programs they have brought before the House for criticism. I now turn to a subject I have raised before in this House. I think specifically of the position of the heavy electrical industry of this country. The government's recordin support of the heavy electrical industry has been pretty clear. Some of the financing that we have made available to the utilities in the various provinces, and the conditions attached to such financing to the effect that they support Canadian technology, have in fact served the interests of Canadian technology. But the fact remains that the utilities are the creatures of the provinces. Their main interest is to get the generators, the switch gears and whatever heavy electrical equipment they need at the lowest possible price, and apparently up to this point, with very few exceptions, they have been unwilling to really support Canadian technology, Canadian workmen and Canadian manufacturing to the extent they should.

Let me examine the Peace River project. Out of a total of $49 million spent on that project, foreign firms from Japan, the United Kingdom, Switzerland, Sweden and France took over 50 per cent of the orders. I should like to ask, when was the last time Canadian heavy electrical manufacturers were successful in bidding in any of those countries? When was the last time Canadian heavy electrical manufacturers were able to bid in Japan, Sweden or Britain? They are closed markets. They do not accept,

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June 20, 1972

Employment Incentive Programs through various means, devices and ruses, our manufactures of these products. Yet here are we offering open hunting to these offshore suppliers.

Let us take the Nelson River project. These figures may be dated, but it appears that out of a total of $65.3 million spent, foreign firms have taken over 65 per cent. Even though these figures can be updated, I suspect the proportion is the same. Some years ago Mr. Walter Ward, who at that time was executive vice-president of Canadian General Electric Company, in a very interesting speech entitled "Urgent Need for Co-operative Effort" suggested that the utilities, the federal government and Canadian industry should co-operate in support of the Canadian heavy electrical industry because it was a key industry in this country. I suggest-

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LIB

Prosper Boulanger (Assistant Deputy Chair of Committees of the Whole)

Liberal

The Acting Speaker (Mr. Boulanger):

Order, please. I regret that the time of the hon. member has expired.

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NDP

John Edward Broadbent

New Democratic Party

Mr. Edward Broadbent (Oshawa-Whitby):

Mr. Speaker, it is distressing for me today to speak in this debate with the full knowledge that neither the Minister of Industry, Trade and Commerce (Mr. Pepin) nor the Minister of Regional Economic Expansion (Mr. Marchand) is present. One would have thought that when their departments were being subjected to criticism they would try to be here to reply to the points that are made, that they would try to defend the government's record. I think it is important that they be here and I regret their absence.

In the brief period available to me I want to make some specific criticisms and suggestions. The Minister of State for Science and Technology (Mr. Gillespie) took great pride in the fact that the job creation rate in Canada was something to behold in this modern world. He was followed by the Parliamentary Secretary to the Minister of Industry, Trade and Commerce (Mr. Howard) who was just as euphoric in telling us that we must be doing a good job in terms of making grants and tax concessions to further regional development in this country, because after all we are creating a lot of jobs.

I suspect that both the minister and the parliamentary secretary were referring to the OECD study some time ago which provided comparative information about our performance compared with other countries in the western industrial world. It would have been very interesting had he revealed the full import of that study. For example, he covered the last quarter of 1971, but what he neglected to tell us was that in West Germany, for example, one of the countries surveyed, a country governed by a social democratic party, there was an unemployment rate of 0.5 per cent. Indeed, West Germany imported two million foreigners because they have more jobs available than workers to fill them. But the hon. gentleman neglected to mention that.

He also neglected to mention that in Sweden only 2.7 per cent of the population were unemployed. Sweden is another country that is governed by a social democratic party. He could also have mentioned Norway, with unemployment at 1.4 per cent-again, coincidentally perhaps, governed by a social democratic party. However, the point is that their unemployment rates are very low indeed, the lowest in the world, so it would be absolutely absurd for them to have a very high job creation rate. Canada has to

have a high job creation rate because we have the highest level of unemployment of all industrial countries in the world. I suggest it is absolute idiocy to say that these other countries do not have the same job creation rate that Canada has, since they have virtually full employment.

During the last quarter of 1971, for example, in the countries surveyed in western Europe there were 1,502,000 unemployed. However, 1,163,000 jobs were available for them. This means that obviously those countries do not need to create more jobs because they have virtually full employment. There was almost one job available for each man looking for a job. The countries in western Europe to which I referred have the highest level of employment, I argue, in man's history. To suggest that their job creation rates are not as good as Canada's is a very poor argument. We need a high job creation rate because we have such high unemployment, for which the government is directly responsible.

Let me refer to some other interesting figures relating to the multitude of programs offered by the Department of Industry, Trade and Commerce to assist private enterprise, the kind of programs that made George Bain write recently in his column in the Globe and Mail that if the welfare state exists in Canada at all, it exists for the corporate sector, not for the ordinary citizen.

I have a list of programs offered by that department, 12 in number, for which the private sector can receive outright grants from the government. During the period 1968-69 you will find that spending under those programs to assist private corporations amounted to $390,593,000. The following year it increased to $399,481,000. In the period 1970-71 the amount was $370,004,000. Last year the government gave out $472,136,000 to the corporate sector. The estimate for 1972-73 is $530 million. This makes a grand total of $2,162,217,000 outright grants to the poor, struggling, private enterprise sector, companies which like to say-out of the other side of their mouths, of course-that everyone should be rugged individualists and that government should not interfere in the daily lives of citizens, except, of course, when giving handouts to them.

A look at the unemployment statistics for that period reveals, not a positive correlation between money going into the private sector but a negative correlation. Average unemployment figures for the previous five-year period reveal that in 1967 the rate of unemployment was 4.1 per cent. In 1968 the rate was 4.8 per cent, in 1969 it was 4.7 per cent, in 1970 it was 5.9 per cent and last year it was 6.4 per cent.

I say to those two ministers who have been boasting so much about job creation as a result of this spending that they should check their statistics. We have spent over $2 billion, and we have an increasing rather than a declining rate of unemployment. I suggest that not only are we providing fantastic sums of money, supposedly for regional development programs intended to create jobs but which do not have any significant impact and conceivably, in some cases, have a negative impact-we in Canada are experiencing a phenomenon that has concerned Senator McGovern of the United States.

June 20,1972

I for one hope Senator McGovern gets the nomination, wins the presidency of the United States and goes on to do what he says he will do, because he is moving marginally in the direction about which we are talking in Canada. He recently referred to the "corporate rip-off" in the United States, indicating that the average and poor American citizen is subsidizing the corporate empire in that country to a fantastic degree. If he is elected president, he intends to change that situation.

I suggest this is not occurring just in the United States. If you look at what has happened in the shift of the tax burden in Canada since 1950, what will be seen is a trend that anyone with minimal concern for equity should view with apprehension. In 1950 the personal income tax share of the total tax burden was 26.7 per cent, while the corporate share was 28 per cent, or just about even. In 1953 the personal share went up to 33.5 per cent, while the corporate share went down to 24.3 per cent. In 1956 the corporate share went down to 23.9 per cent, while the personal share remained at 33.5 per cent. In 1957, the last year of Liberal government before the change, the personal share of the total tax burden went up to 37.1 per cent, while the corporation share went down to 20.6 per cent.

Then we had a change of government. We moved from the bad old Liberal days to the good Conservative days! One would think that under the right hon. member for Prince Albert (Mr. Diefenbaker), coming from the populace that he did, we would have seen a significant shift in the tax burden, with the average citizen paying less and the corporation paying more. We did not see that shift; the same inequitable trend continued. In the first year of the Diefenbaker government the corporate share was 21.8 per cent and the personal share 35.6 per cent. In the next year, the personal share was 38.4 per cent and the corporate share 20.1 per cent. The corporate share declined again in the subsequent year of the Diefenbaker government.

Then we had another switch and the Liberals came back into power. Everybody thought that with a change in government we would get a change in the tax burden. But the same trend continued. The amount of tax paid by corporations in Canada began to decrease significantly.

What is the present situation? Remember that in 1950 corporations were paying 28 per cent of the tax burden and ordinary citizens, through personal income tax, paid 26.7 per cent. In 1973, based on tax rates now, the corporate share of the tax burden will go all the way down to

12.2 per cent, while the personal share of the tax burden will go up to 49.9 per cent. This is a complete reversal in terms of trend which can be noted by anyone who is really concerned about tax equity in Canada. The Liberal government has made no progress in this regard over the preceding Tory government, which in turn made no progress over the Liberal government which preceded it.

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NDP

Stanley Howard Knowles (N.D.P. House Leader; Whip of the N.D.P.)

New Democratic Party

Mr. Knowles (Winnipeg North Centre):

The more things change, the more they are the same.

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NDP

John Edward Broadbent

New Democratic Party

Mr. Broadbent:

We have, in very significant proportions, what can only be called a corporate tax rip-off in Canada about which neither of the traditional parties in this country seems to be concerned.

What has happened in respect of DREE programs? These have been referred to today as programs to provide

Employment Incentive Programs

jobs but they are having little success. We have spent $1.2 billion on them since 1969. The only study that has been made of DREE programs and is now publicly available suggests this money is being wasted. The study indicates that the money is not being spent in the way it was intended.

The study was made of 72 per cent of the 25 corporations with assets of $20 million or more as of March last year. It was determined conclusively that these corporations were getting a windfall profit. The decisions made to locate in one part of Canada as opposed to another had absolutely nothing to do with the grants being provided by the taxpayers of Canada. In short, the corporations intended to locate where they did locate, but cooked the books and prepared a nice case to get handouts from this government. That is some regional development program and some waste of the taxpayers' money!

At six o'clock the House took recess.

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AFTER RECESS The House resumed at 8 p.m.


LIB

John (Moody) Roberts (Parliamentary Secretary to the Minister of Regional Economic Expansion)

Liberal

Mr. John Roberts (Parliamentary Secretary to Minister of Regional Economic Expansion):

Mr. Speaker, I listened with great interest to what other speakers have said today in this debate. Unfortunately, I was not able to be here for all of it. Of the speech of the hon. member for Prince Edward-Hastings (Mr. Hees) there is not much that need be said, nor indeed much that could be said. Perhaps the kindest, and cruelest thing that could be said of it is that it was up to his usual standard. The speech of the hon. member for Nanaimo-Cowichan-The Islands (Mr. Douglas) was one with which I confess I had some sympathy, particularly the hon. member's emphasis on the necessity of doing more to assist the position of the smaller businessman in our society.

I know the Parliamentary Secretary to the Minister of Industry, Trade and Commerce (Mr. Howard) has already spoken in relation to this problem. I suggest it is not a problem which can be dealt with only through tax concessions in relation to profits made by small enterprises. There are real problems in Canada in finding and providing for small businesses the seed capital which they require to establish themselves. It is all very well to give tax benefits to those who overcome the obstacles of establishing themselves. What we need, however, for I believe our financial system has been inadequate in providing such capital, Eire institutions supported by government which meet seed capital requirements. Perhaps we might look more closely at what is being done in the United States to make available to business more of the kind of capital needed in what are necessarily high-risk operations.

There was one point made by the hon. member for Nanaimo-Cowichan-The Islands on which I should like to comment. He implied-perhaps this is understandable in a British Columbian member-that there is a bias against British Columbia in the making of grants. It was not clear exactly what kind of incentives he was discussing; it was

June 20, 1972

Employment Incentive Programs

not clear whether he was referring to operations under the Department of Industry, Trade and Commerce or under the Department of Regional Economic Expansion.

He contended, for instance, that British Columbia did not receive its fair percentage of grants in comparison to levels of unemployment. In so far as he was referring to the Department of Regional Economic Expansion, I put to him that the functions of the department in an incentive program are not simply to combat immediate problems of unemployment. Unemployment is certainly an important factor which we look at in designing our programs. However, there are many other factors which are also important in designing those programs. For instance, there is the extent of investment in an area or province or the per capita level of income in a province. British Columbia, on a per capita basis, is the third richest province in Canada. The fact of that relative wealth must be taken into account when considering where regional development incentives should be concentrated.

I should like to spend some time this evening discussing the comments of the hon. member for St. John's East (Mr. McGrath) who has had a long and continuing interest in the activities and programs of the Department of Regional Economic Expansion. In the first part of my remarks you will understand, Mr. Speaker, if I reply to some of the charges he has made. The first was that the minister made no attempt to respond to the criticisms of the department's program. In fact the minister appeared, and so did his departmental officials, at a multiplicity of hearings of the standing committee dealing with this subject.

The committee met 14 times, with a variety of appearances by senior officials and by the minister. Indeed, the committee met so often and the minister met with it so often that the hon. member for St. John's East himself complained that the committee might as well cease its hearings, since the subject had been lengthily covered.

The hon. member for St. John's East contended the government has created record unemployment. No economy in an industrially developed country has a better record in the creation of jobs than Canada over the past four years. It is true that we have high levels of unemployment. However, these are not the result of immediate government policies but are a reflection of structural problems in the Canadian economy, particularly the problem of the very high rate of entry of young people, and increasingly of married women, into the labour force. Indeed, if you look at the job creation side of the Canadian economy, one would have to conclude that the government has done a good job.

But there is perhaps a more fundamental objection to that comment by the hon. member for St. John's East. It is basically this. The problems of regional development, the disparities in regional development in this country have been with us now for something over a century. The activities of the Department of Regional Economic Expansion were not constructed in the belief that we could, through a magic wand, somehow overcome immediately these deep-seated, long-term disparities. The minister has often said he believed it would take perhaps up to 15 years before we could determine whether or not we were having a fundamental, significant impact on the removal of economic disparities in this country.

The charge that the Department of Regional Economic Expansion has been operating for three years and that its programs have been a failure is a misunderstanding and a misapprehension of the nature of our approach to the structural problems of regional development. We have never contended that we could, through the immediate application of our programs, raise almost overnight the Atlantic region, from which the hon. member comes, to the level of Ontario or some of our other more developed provinces. We recognize that this is a long-term struggle and is not one which can be solved overnight, not even in these short years.

The hon. member spoke a great deal about what he calls the Dr. Springate thesis. He referred to the brief presented to the regional development committee by Dr. Springate of the University of Tennessee. The conclusions of a study are only as good as its methodology. Dr. Springate himself, volunteered to the committee that he was not satisfied with the methodological base on which his study was made. It was simply too small. The subject groupings were too small and the interview technique was too imprecise. The amount of information he was able to collect was done on the basis of subjective interviews. He made no attempt to cross-check them with objective information that was available. All of this Dr. Springate clearly admitted.

Dr. Springate commented, as did Dr. Brewis who appeared with him before the committee, that he was dismayed with the kind of political use being made of the findings of his thesis. In effect, Dr. Springate's thesis is as valuable to us as a colour landscape painted by a colourblind man. It indicates some shadowy areas where further study could be usefully carried out. It shows some patches which could be examined in more detail, and more rigorously, than Dr. Springate had time to do. For the hon. member for St. John's East to use this academic document as a universal condemnation is a disservice both to Dr. Springate and to the programs of the department.

The hon. member for St. John's East raised one main point of criticism of the department. He suggested that various groups such as the Atlantic Development Council and the Atlantic Provinces Economic Council had been critical of the department's programs. It is true that on occasion they have been critical of some of the operations we have undertaken. However, in many ways they have expressed their approval for the principles of what we have been doing. They have also suggested ways in which we could improve our activities. Their support for the program is well known, as indeed the hon. member for St. John's East admitted when he said he felt that the concept of the department was a good one.

The hon. member suggested that the incentive areas were spread too thinly across Canada. I can understand that one might reach this conclusion if one simply looks at a map and regards the coloured areas as areas which are eligible for regional development incentives. But we do not simply concentrate on a geographic base in terms of square miles. We concentrate on areas where there are problems of deep-seated economic disadvantage. In fact, a very large degree of our efforts have been undertaken in the Atlantic provinces.

June 20, 1972

The hon. member referred to two specific cases, one of which was the location of Acme Seely in Renfrew and the other was the project of establishing a sugar refinery in Cornwall. Perhaps I might deal first with the question of locating a sugar refinery in Cornwall. I doubt, Mr. Speaker, whether anyone in this House would be able to convince you that the location of a sugar refinery in Cornwall would not be of some assistance in dealing with the problems of that area. I am sure there is no one in this House more aware than Your Honour of the personal problems which have been created by the very high levels of unemployment, virtually 20 per cent which now exists in the Cornwall area.

I was moved by the eloquent plea of the hon. member for St. John's East who spoke at length and with great sincerity about his concern for the plight of the people in the Cornwall area. He said that he wanted to make it clear he was in no way opposed to assisting the people of Cornwall. He was against the sugar refinery, but he was certainly concerned about the plight, concerns and problems which resulted from the very high level of unemployment in the Cornwall area.

I ask the hon. member, as a member of the Conservative party, if he is not able to contact his colleagues at the level of the provincial government of Ontario. Because at the federal level we have been prepared to assist in the establishment of an Uncle Ben's brewery in the Cornwall area with great financial support from the federal government. We are concerned about the levels of unemployment in that area. It is the hon. member's colleagues in the Conservative government at the provincial level who have refused to come to the joint assistance of that area by supporting that program. I would be more impressed by the crocodile tears which the hon. member shed if he would give us some indication as to whether he will bring pressure to bear on the members of his party who, temporarily I hope, hold the position of government in Ontario.

I hesitate to become too political on an occasion like this, particularly when we have someone from Cornwall in the chair who might find it difficult to bring me to order when I am so eloquently defending the interests of his area.

Topic:   GOVERNMENT ORDERS
Subtopic:   BUSINESS OF SUPPLY
Sub-subtopic:   ALLOTTED DAY S.O. 58-ALLEGED FAILURE OF GOVERNMENT'S INCENTIVE PROGRAMS TO STIMULATE TRADE AND CREATE EMPLOYMENT
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June 20, 1972