May 27, 1980

LIB

John Leslie Evans (Parliamentary Secretary to the Minister of Finance)

Liberal

Mr. Evans:

As a result, there is no interest paid whatsoever. Certainly if they go beyond that period, this government wants to ensure that the consumer knows clearly what the terms and conditions of that credit card are, and what the rates of interest going to be charged by that company are. If the consumer, knowing all the facts, decides to use the credit that is available through credit cards, then in those cases he or she knows what she or he is doing and can make that decision. The fact is that if you pay for your credit card within a period of 50 or 60 days, depending upon when you purchased and when your billing date is, no interest whatsoever is incurred.

Clearly, as the hon. member has pointed out, a great many individuals-40 per cent for Chargex and 50 per cent for Master Charge-are taking advantage of the cards and are using, effectively, the banks' money for a period of 45 to 60 days, paying no interest whatsoever.

I agree that beyond that period 24 per cent is a high rate that should not be paid by consumers if they have any alternatives whatsoever. I can assure you, Mr. Speaker, that in the market place today there are consumer loans available from a great many institutions at much lower rates. We would encourage consumers to seek out those loans rather than using the credit card as a vehicle for financing their expenditures.

Adjournment Debate

Topic:   PROCEEDINGS ON ADJOURNMENT MOTION
Subtopic:   CONSUMER AFFAIRS-INCREASE IN INTEREST RATES OF DEPARTMENT STORES AND OIL COMPANIES-DETRIMENTAL EFFECT ON CONSUMERS
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TRANSPORT-STUDY OF "AT AND EAST" FREIGHT RATES

PC

William Hunter (Bill) McKnight

Progressive Conservative

Mr. Bill McKnight (Kindersley-Lloydminster):

Mr. Speaker, my reason for asking for this late night debate arises from a question I asked of the Minister of Transport (Mr. Pepin) on May 23, which will be found at page 1354 of Hansard. I asked the minister if he had any intention of referring the "At and east", or Atlantic and eastern, flour and feed subsidies to a committee or a committee of inquiry. The minister apparently was not aware of what my question meant. The point I should like to make is that it is a question that I would have asked the minister but I have been given unanimous consent when we were in Committee of the Whole and when he had his officials with him so that he would have then had the ability to answer this question.

The other reason I found it necessary to ask this question is that the minister answered the hon. member for Vegreville (Mr. Mazankowski) in Committee of the Whole when the hon. member asked if he was going to refer the statutory rate for the movement of grain in western Canada, known commonly as the Crow rate, to a committee or a commission of inquiry. The minister said yes.

Unlike some other hon. members, I am pleased to see the parliamentary secretary to the minister present tonight because he is the only person who has given me an answer when I have sought information in this House, and I compliment him for that.

The Atlantic and eastern flour subsidies were set in November, 1960. The grain was to move at November, 1960, rates, and flour was to move at September, 1966, rates. This is western grain moving from eastern ports. It could move in relation to any of the railway points along Georgian Bay, along Lake Huron, along any waterways directly or indirectly connecting with Lake Huron, not being further east than Prescott, but including Prescott; in relation to flour it was any point in Canada east of the 90th degree of west longitude.

The ports are defined as the ports of Halifax, Saint John, West Saint John, any other points on the St. Lawrence River east of Montreal, including Montreal. This is for the movement of western grain to eastern ports. This is probably as important to the people of Ontario and east as it is to the people of western Canada.

If the minister says he is going to look at and study-and I am always concerned when people "look at and study" that they do it with something in mind-they are planning to study the Crow rate and I would think that is with something in mind. If the minister is going to look at one form of subsidy, I strongly recommend that he look at the other forms of subsidy.

Along with looking at the subsidy there is a question of the legality of Ontario grain moving at subsidized rates on the "At and east". This is done by shipping Ontario grain west and then bringing it back into the system and letting it continue on east at a subsidized rate. This rate on use of Ontario grain to be shipped east on a supposed program to complement western

May 27, 1980

Adjournment Debate

grain is increasing now to a point where it is almost one fifth, or 18 per cent, which 1 think is the exact amount last year, of the total grain moved at the "At and east" freight rate that actually came from Ontario. This is fine, but if we are going to have a subsidy, we should have a subsidy that covers Ontario grain. We should have it out in the open, up front, so that we all know whose grain is moving at what subsidy.

The concern that I have is that the minister is aware of some of the problems we will have. If he is going to consider the change, as he did on the Crow rate, we would suggest that he also consider looking at, although I am not recommending change, the "At and east" freight rates. I know that I will receive an answer from the parliamentary secretary that will probably set my mind at ease.

Topic:   PROCEEDINGS ON ADJOURNMENT MOTION
Subtopic:   TRANSPORT-STUDY OF "AT AND EAST" FREIGHT RATES
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LIB

Robert Theodore Bockstael (Parliamentary Secretary to the Minister of Transport)

Liberal

Mr. Robert Bockstael (Parliamentary Secretary to Minister of Transport):

Mr. Speaker, the hon. member has already described most of the information that is pertinent to the "At and east" rates.

The "At and east" rates and the subsidy mechanism are defined in section 272 of the Railway Act. The subsidy applies to grain moving for export by rail from points along Georgian Bay and other points east to Prescott, and to flour moving for export from any point in Canada east of Thunder Bay.

The federal government pays the railways a subsidy to cover the difference between the frozen rate and a compensatory rate. The so-called "At and east" grain rates were initially introduced for the export of western grain by rail in carload lots from ports located along Georgian Bay, the lower lakes

and the upper St. Lawrence to Montreal and maritime ports. Traditionally, these rates had been closely related to American rail rates for movement from Buffalo to ports on the Atlantic seaboard in order to offset the economic advantages of the U.S. route. The term "At and east" therefore initially referred to Canadian rates which would be comparable to Canadian rates on the movement at and east of Buffalo.

Since 1966, subsidies have been paid to the railways on the basis of the difference between the frozen rate level and a compensatory rate level determined periodically by the Canadian Transport Commission.

The "At and east" subsidy represents a considerable cost to the treasury. The repeal of section 272 of the Railway Act was incorporated in the anti-inflation omnibus bill but was removed because of the possible impact upon the Georgian Bay and maritime ports and elevators. The "At and east" subsidy payments in 1977 for grain and flour amounted to $27.4 million. In 1978 the subsidy on the same commodity amounted to $25.5 million. I personally respect the logic of the hon. member for Kindersley-Lloydminster (Mr. McKnight) when he points out that if we are going to look at one, we should be looking at the other. But to date no decision has yet been reached either on a commission of inquiry for the Crow rate or a similar commission for the "At and east" rate.

Topic:   PROCEEDINGS ON ADJOURNMENT MOTION
Subtopic:   TRANSPORT-STUDY OF "AT AND EAST" FREIGHT RATES
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LIB

Roderick Blaker (Assistant Deputy Chair of Committees of the Whole)

Liberal

The Acting Speaker (Mr. Blaker):

The motion to adjourn the House is now deemed to have been adopted. Accordingly, this House stands adjourned until tomorrow at 2 p.m.

Motion agreed to and the House adjourned at 10.29 p.m.

Wednesday, May 28, 1980

Topic:   PROCEEDINGS ON ADJOURNMENT MOTION
Subtopic:   TRANSPORT-STUDY OF "AT AND EAST" FREIGHT RATES
Permalink

May 27, 1980