January 19, 1973

PC
LIB

John Mercer Reid (Parliamentary Secretary to the President of the Privy Council)

Liberal

Mr. Reid:

If the price of potatoes in their natural state were going up as fast as the price of potatoes in the processed state I would say we should really be concerned, but that is not the case.

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?

An hon. Member:

You are never concerned.

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LIB

John Mercer Reid (Parliamentary Secretary to the President of the Privy Council)

Liberal

Mr. Reid:

One merely has.to read the speech of the hon. member for Bruce (Mr. Whicher) and other members who represent agricultural constituencies who spoke during this debate to learn that this is not so. Farmers are not making that much money, because farm prices are low. It is not the farmer who is making the money, it is the processor, the people who have caused this product to be in demand are the consumers who also have the opportunity of buying the product in its natural state. The consumer is spending his discretionary income, and apparently that is satisfactory. That is the simple point I wanted to make, and I think the hon. member now understands it.

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An hon. Member:

Thank you for making it, but how many months did it take you to come to that conclusion?

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LIB

John Mercer Reid (Parliamentary Secretary to the President of the Privy Council)

Liberal

Mr. Reid:

We are dealing with a society in which the life style has changed. We find ourselves in a situation in which we have added more links in the chain that brings the food from the farmer, through the processor, the wholesaler and the retailer to the consumer.

Before I was interrupted, I was talking about having interviews with people who operate small grocery stores in my constituency. They told me there were a number of reasons for the increase in prices last year. One individual told me quite bluntly that a substantial part of the increase over the last six months could be attributed to politicians.

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Some hon. Members:

Hear, hear!

Food Prices Committee

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LIB

John Mercer Reid (Parliamentary Secretary to the President of the Privy Council)

Liberal

Mr. Reid:

I was a little shocked by this statement. He said that a substantial part of this increase could be attributed to politicians who have been talking about the imposition of wage and price controls. As a result these companies, in order to protect themselves, increased the prices in case that event came about. It is difficult to say whether there is truth in that suggestion. If there is, there is a lesson for us to learn. We should be careful of what we are saying to those people who might actually believe that some of the members of this House are serious.

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PC

John Allen Fraser

Progressive Conservative

Mr. Fraser:

Well, you are innocent. You have not talked about wage and price controls.

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LIB

John Mercer Reid (Parliamentary Secretary to the President of the Privy Council)

Liberal

Mr. Reid:

The committee must consider the sociological factors. Most members have not bothered to mention this aspect.

The committee must also consider questions in relation to long-term food supply. I have been reading a book called "The Limits of Growth" in which the Club of Rome and MIT computer studies indicate that no matter what is done in terms of decreasing population through birth control, and increasing the supply of food through the use of non-arable land that might be exploited, and increasing the yield from land now under cultivation, there is no way we can meet the challenge to produce enough food to feed the estimated population of the next 30 years.

This year we have had reports of the beginning of famine in the new country of Bangladesh and in India. We have seen the prices for food increase across the world simply because there seems to be a shortage. The hon. member who spoke before me mentioned the substantial increase in the price of feed grains. He would probably be interested to know that last fall the United States removed all quotas in order to encourage the import of beef and other meat products into the United States because of a scarcity in that type of protein. He would also be interested to know that the country perhaps most noted for tariffs, France, was also faced with a shortage of protein and removed its 7 i per cent value added tax recently. So, countries are attempting to cope with this shortage by removing tariffs and destroying the protection they built up in respect of their food industries. This indicates that the problem is not solely a Canadian one but is worldwide, not only in the long-term but also in the short-term.

It was interesting to me to note that, in applying its wage and price controls, the United States specifically decided to exclude raw agricultural products although these controls were applied to other products of the manufacturing sector of the food industry in that country. Unfortunately, even though my hon. friends across the way deny it, there really is no easy solution to the problem. Canada, as an international trading nation with 25 per cent of its gross national product based on foreign trade, and one job in five based on foreign trade, will not be immune to these inflationary factors which are outside our control. We try to operate in an international economy and must do so. There are certain consequences which fall upon us. It seems to me that the problems of inflation which beset not only Canada and the United States but the world as a whole, are not solvable at the local level but

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rather on an international level. It is a brutal fact of life that we do not have sovereignty over a number of things which affect us and our living standards. It has always been Canadian policy to try to work through international organizations such as FAO, the United Nations and the Group of Ten in an effort to solve problems common to all. I suggest this is a problem which will find its solution, not in the deliberations of this House of Commons but in the deliberations of worldwide bodies.

Now, I should like to come to the point related to the question of nutrition. In the constituency of Kenora-Rainy River there were four candidates during the last election. There was myself, the Conservative candidate, the NDP candidate and an independent candidate. The independent candidate ran on the platform of a guaranteed annual income as well as the matter of nutrition. The point he tried to make in that election campaign was that the nutrition value of the food we buy is not as good as it should be, and that there are other ways in which to acquire the nutrition our bodies need. The federal government has sponsored a nutrition study to find out how well Canadians are being fed and how well they choose their food from what is available as well as how well that food is actually prepared in order to keep the nutritional value intact. The preliminary reports of that study are not particularly encouraging, because the indication is that many Canadians do not take advantage of the nutritional value of the food we now have. Perhaps an anecodote will illustrate the point.

When talking to a grocer I asked him about the nutritional value of many foods, particularly prepared foods, and he said that the greatest tragedy-

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PC

Robert Jardine McCleave (Deputy Speaker and Chair of Committees of the Whole of the House of Commons)

Progressive Conservative

Mr. Deputy Speaker:

Order. I regret to interrupt the hon. member but the time allotted to him, as agreed by the House yesterday and extended because of the interjections earlier has now expired. The hon. member may continue with the unanimous consent of the House.

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Some hon. Members:

Agreed.

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Some hon. Members:

No.

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PC

Robert Jardine McCleave (Deputy Speaker and Chair of Committees of the Whole of the House of Commons)

Progressive Conservative

Mr. Deputy Speaker:

It is not agreed. The hon. member for Burnaby-Seymour.

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NDP

Nels Edwin Nelson

New Democratic Party

Mr. Ed Nelson (Burnaby-Seymour):

Mr. Speaker, I should like to devote part of my remarks to supporting the amendment advanced by the hon. member for Scarborough-West (Mr. Harney) this morning. In passing, may I comment to the hon. member for Kenora-Rainy River (Mr. Reid) that in respect of time limits this government has had many years and the electorate has already imposed a time limit upon it. The electorate said to this government on October 30, "get off your butts and do something". We suggest it should be done now and within a time limit. I should like to echo the concern of my colleagues and other speakers about the rising cost of food in his country today. It is a concern that is reflected by the general public and by the media. It is also reflected in this House. In an editorial entitled "Let 'em eat Mackerel" the Vancouver Province of January 16 expresses skepticism that yet another Senate-Commons committee will produce the results that are needed. The editorial reads:

It is as though a gang of thieves were stealing from everyone's income and savings at a rate of 5.1 per cent a year ithe living cost rise) and the best the government could do was to find out how it was being done.

As a new member in this House, I have often been puzzled by the terminology used here. Through my growing years I had always thought that there were only two places, and that the other place was the place you found when you looked down. Through the lengthy debates yesterday, I discovered that the other place is over there and that there are more than three places-the other place, the place occupied by our colleagues to my right and the one you find when you look down. My puzzlement is abated. I am happy that the members of the other place have been excluded from the committee. I urge that the committee scrupulously avoid, so far as possible, any conflict of interest among members no matter from which of the three places they come.

Regarding the cost of living, the urgency of the situation has been testified to by the figures quoted by my colleague the hon. member for Vancouver-Kingsway (Mrs. Maclnnis) when she pointed out that the consumer price index has risen slightly over 17 per cent in the last two years. According to the Department of Agriculture, in the last five months food prices have risen 7.4 per cent. I do not need statistics and reports to tell me that the price of food has risen. The real autnorities on the rise in the cost of living, however, are not the researchers from Statistics Canada or the various party groups, not the Association of Grocery Product Manufacturers or the retailers, but the person who goes into the supermarket and pays out his or her hard-earned money. These are the people whose representations should be sought, not in the form of sophisticated briefs but in whatever form their representation is brought to the committee in order that light might be shed on reasons for the rise in the prices. These people, if you ask them, do not blame the farmers because too many of them have lived on the farm in the past, as I have, and have seen what the normal standard of living of the farmer is.

We hear a great deal, of course, about the affluent Canadian society and we are very proud of our affluence. However, it is a sad and ironic reflection upon this affluent society that there are a great number of Canadian citizens living below the poverty level. So many of them live at this low level that it has become necessary for groups to join together in anti-poverty organizations, as it is necessary for our elderly people to join together for their own protection, indeed for their own survival. It may be that ultimately, the only course of action will be for the poor and needy to organize and to arouse the citizenry in order to put enough pressure on the government to force some kind of immediate action.

The hon. member for Kenora-Rainy River (Mr. Reid) mentioned nutrition. During the last campaign I spoke to several old and deprived people who told me that they were reduced to eating dog food. "Oh, sure", said one old gentleman, "I always eat it in the last week before my cheque comes. It is not bad stuff". Since then I have had several complaints from dog owners who claim that their dogs have been made ill by certain brands of dog food. If

[Mr. Reid.l

January 19, 1973

you look at the variety of products in this multi-million dollar industry and the lack of any uniformity in the identification of what ingredients are contained in their products, the thought of Canadian citizens being reduced to eating such junk is revolting.

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PC
NDP

Nels Edwin Nelson

New Democratic Party

Mr. Nelson:

It is easy to blame the farmer for increased food prices, but anyone who has had experience with farming knows that although the land may be strong it is not easy to become wealthy by farming this strong land.

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PC

Lincoln MacCauley Alexander

Progressive Conservative

Mr. Alexander:

Not with those guys in power.

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NDP

Nels Edwin Nelson

New Democratic Party

Mr. Nelson:

According to the president of the Canadian Farmers Association, as reported in the Vancouver Sun of November 30, 1972, 94 per cent of farm products are bought up by big supermarket chains. Farmers, the editor pointed out, are powerless against the big food chains. They cannot strike like other workers because their produce spoils in the meantime. The result is that they have no real bargaining position. He pointed out that packaged, diced carrots sell for $350 a ton of which the farmer got $100. The label on a can of peas costs more than the peas inside, he said.

According to the Department of Agriculture, as reported across the country on September 13, 1972, the biggest culprits by far are the processors, packagers and distributors. According to the study prepared by the Department of Agriculture, 64 per cent of the $2.8 billion increase in food prices since 1961 has been accounted for by processors and merchants.

Consumer affairs minister of the government of Manitoba, Mr. Mackling is reported in the Globe and Mail of Friday, October 27,1972 as saying that his department:

-can document cases that prove merchandisers are intentionally using inflation as a reason to increase their prices.

As a result of the provincial-federal division of authority, provincial governments cannot impose price controls. But surely this House, through a group demonstrably free of conflict of interest, can take action quickly in consultation with provincial ministers of consumers affairs and a prices review board as suggested by my colleagues.

Let us examine a not too hypothetical single instance to illustrate what happens to a head of lettuce from the time it leaves the farm until it is finally sold. The farmer may get 4 cents for a head of lettuce with a profit of perhaps 1 cent or 2 cents. Harvesting and packing add 4 cents. Now it costs 8 cents. Plastic film, freight costs and handling add 13 cents. Brokerage, spoilage, inspection, advertising, store overhead and profit add another 18 cents. The lettuce sells for 39 cents, unless it comes from California in which case there may be additional charges.

In this continuum of profit making, it seems to me that the areas to be investigated most quickly and most thoroughly, are those of packaging, distributing and price fixing. Aside from the scope of the committee's inquiry, what concerns me deeply is the period of time allowed for that investigation. Granted, time is needed for any kind of effective inquiry, but what happens in the meantime? It seems to me, therefore, that the imposition of a two months' time limit is preferable to a longer time and that

Food Prices Committee

in the meantime the Department of the Attorney General should be intensifying investigations and unjustified price increases.

I agree with the member from the government side who said that there is no easy answer. So long as food prices are controlled by a handful of corporate food chains, so long as the citizens of Canada labour under the maldistribution of wealth that is characteristic of the regimes of both old line parties, there will be no easy answer. The most we can hope for is something in the nature of reforms to alleviate the problems of Canada's people. At least that much I urge the government to do and do quickly.

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LIB

Léopold Corriveau (Parliamentary Secretary to the Minister of Agriculture)

Liberal

Mr. Leopold Corriveau (Parliamentary Secretary to Minister of Agriculture):

Mr. Speaker, it is with legitimate and unconcealed pride that I intend to make some comments about the motion proposed and agreed to yesterday to establish a committee, which apparently will no longer be a joint one, to consider increases in food prices.

I would like to deal with the matter as a remote observer, as far as some technicalities of the problem are concerned, being neither a producer nor a dealer, but an ordinary consumer whose wife notices from time to time that such or such a product is more expensive than previously. This phenomenon, while rather disturbing, is not only a domestic but also an international one. I see however that the increase is not restricted to food, but also affects almost all other consumer goods sometimes less of a necessity than food.

Although apparently it does not cost any more today to buy food than it did 10 or 20 years ago, it is still recognized that the share of the family budget allotted to the purchase of food is smaller than what it was 10 or 20 years ago. We eat more and better today.

I for one find it illogical that, without complaining too much, people do not hesitate to spend more and more money to acquire luxury or recreative items. They complain a bit though resignedly, when every year the price of automobiles, skidoos and colour TV sets goes up. In this situation, we must admit that food prices have not increased as fast as wages and, as the minister of Agriculture (Mr. Whelan) was saying in Halifax this week, the Canadian consumer more than any other buys his food at bargain prices.

Mr. Speaker, the housewife is constantly hammered when she buys food at the retail store, and let me explain: When housewives go to the supermarket, they find pack-agings so attractive that they omit to check inside whether there is the right amount of the product.

I think that nowadays, because of information media, namely television and radio, our housewives are being constantly influenced by food chains mainly specialized in packaging. I am under the impression that after the inquiry we shall have discovered that the cost of packaging certain food products is higher than the cost of the actual contents. As one of my colleagues was saying a while ago, it is surprising that housewives, in their continual quest for the best processed and above all the most attractively

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Food Prices Committee

packaged products, sometimes forget to reflect on the cost of the packaging. Formerly, there were few firms specializing in the retail food line, whereas today a host of processing plants are increasingly specializing in packaging food.

Mr. Speaker, if all segments of society had developed their products at the same rhythm as farmers, we would not be facing our present problems of inflation.

It is not the farmers who have failed to produce more, because they have shifted their production thus ensuring a tremendous improvement in the field of food products. As a matter of fact, some farms in our area that we used to believe were restricted to cattle and milk production have been shifted to market gardening and, given our well organized road system, farmers found that they were not so far away from the main centres and that they can produce and deliver quality products very quickly.

According to statistical data, Canadians do not hesitate to spend more on such luxury items as a summer cottage, a yacht or travel, than on essential commodities. I wonder to what extent and at what cost people prefer to escape reality. Has the consumer really been well informed as to the various factors that influence food prices or are we witnessing the birth of a new scale of values in which what used to be considered a luxury has now become a necessity?

Mr. Speaker, almost every Canadian family now has one or two cars; many have snowmobiles, boats and various other luxury items. When the cost of foodstuffs increases by a few cents, they protest very strongly but when the price of liquor goes up by $1 or $2 a quart or gallon, no one complains. But if the farmers or milk producers plan to increase the cost of milk by 2 cents a quart, it's front page news. Are we going to use the cost of food as a pretext to justify expenses considered of secondary importance until very recently?

Mr. Speaker, this is the situation, but is it logical or acceptable? I am asking myself and every Canadian that question. I trust that the committee soon to be set up will throw light on the problem. I was happy yesterday to hear the minister offer his full co-operation to the new committee that will be created to look into the problem of food prices in Canada. To our amazement we will probably discover that neither the farmers nor the producers make big profits but that instead the advertisers and manufacturers of containers do. They vie with one another as to who will produce the most glamorous packaging to better sell the product.

In closing, I express the wish that this committee will enlighten the House in this regard, and as soon as possible.

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January 19, 1973