May 28, 1984

?

Some Hon. Members:

Agreed.

Topic:   GOVERNMENT ORDERS
Subtopic:   CANADA DEVELOPMENT INVESTMENT CORPORATIONS ACT
Sub-subtopic:   MEASURE TO ESTABLISH
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LIB

Harold Thomas Herbert (Deputy Chair of Committees of the Whole)

Liberal

The Acting Speaker (Mr. Herbert):

There is consent. The Hon. Member for Crowfoot (Mr. Malone).

Topic:   GOVERNMENT ORDERS
Subtopic:   CANADA DEVELOPMENT INVESTMENT CORPORATIONS ACT
Sub-subtopic:   MEASURE TO ESTABLISH
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PC

Arnold John Malone

Progressive Conservative

Mr. Malone:

Mr. Speaker, I will not abuse the privilege given to me.

Topic:   GOVERNMENT ORDERS
Subtopic:   CANADA DEVELOPMENT INVESTMENT CORPORATIONS ACT
Sub-subtopic:   MEASURE TO ESTABLISH
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NDP

Ian Deans (N.D.P. House Leader)

New Democratic Party

Mr. Deans:

You said you were only halfway through. I am expecting 20 more minutes.

Topic:   GOVERNMENT ORDERS
Subtopic:   CANADA DEVELOPMENT INVESTMENT CORPORATIONS ACT
Sub-subtopic:   MEASURE TO ESTABLISH
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PC

Arnold John Malone

Progressive Conservative

Mr. Malone:

You will certainly get enough detail here to be able to give a good 20 minute speech. Why should we grant favourable approval to an agency which has subverted Parliament, intends to operate in secrecy and defies the laws of our land? The persons who I have already pointed out are to become the managers of CDIC. They bought Petro-Canada from a Belgian oil company at double its value. The Prime Minister (Mr. Trudeau) claims that the land is strong. It is not strong like moose. It is strong like skunk. There is great concern with respect to-

Topic:   GOVERNMENT ORDERS
Subtopic:   CANADA DEVELOPMENT INVESTMENT CORPORATIONS ACT
Sub-subtopic:   MEASURE TO ESTABLISH
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NDP

Ian Deans (N.D.P. House Leader)

New Democratic Party

Mr. Deans:

This is deteriorating.

Topic:   GOVERNMENT ORDERS
Subtopic:   CANADA DEVELOPMENT INVESTMENT CORPORATIONS ACT
Sub-subtopic:   MEASURE TO ESTABLISH
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PC

Arnold John Malone

Progressive Conservative

Mr. Malone:

You think you should not have given me unanimous consent. Well you think about that just a bit more.

Topic:   GOVERNMENT ORDERS
Subtopic:   CANADA DEVELOPMENT INVESTMENT CORPORATIONS ACT
Sub-subtopic:   MEASURE TO ESTABLISH
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NDP

Ian Deans (N.D.P. House Leader)

New Democratic Party

Mr. Deans:

This is deteriorating something awful since we gave you unanimous consent.

Topic:   GOVERNMENT ORDERS
Subtopic:   CANADA DEVELOPMENT INVESTMENT CORPORATIONS ACT
Sub-subtopic:   MEASURE TO ESTABLISH
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PC

Arnold John Malone

Progressive Conservative

Mr. Malone:

People wonder what the principles are by which this company will be managed. What objectives are CDIC to assume? If one checks under the restrictions of the corporation, one finds that there is to be no restriction whatsoever on this company. It is typed right in that there is to be no restriction. That comes back to the fundamental principle of a Crown corporation. No Crown corporation should be set up as an instrument of Government without it first being specified that it is there to meet the objectives of a Government policy. That policy ought to be spelled out very clearly. There should never be the establishment of a company for which the restrictions are labelled as ''none", yet that is precisely the situation with regard to CDIC. The restrictions to its management are none. Even though my friend opposite chastises me while he is giving me extended time, I make no apologies for repeating that. It is so serious that it deserves to be repeated.

Topic:   GOVERNMENT ORDERS
Subtopic:   CANADA DEVELOPMENT INVESTMENT CORPORATIONS ACT
Sub-subtopic:   MEASURE TO ESTABLISH
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NDP

Ian Deans (N.D.P. House Leader)

New Democratic Party

Mr. Deans:

Repeat it again.

Topic:   GOVERNMENT ORDERS
Subtopic:   CANADA DEVELOPMENT INVESTMENT CORPORATIONS ACT
Sub-subtopic:   MEASURE TO ESTABLISH
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PC

Arnold John Malone

Progressive Conservative

Mr. Malone:

To repeat it again, indeed, the restrictions on this corporation are none.

Topic:   GOVERNMENT ORDERS
Subtopic:   CANADA DEVELOPMENT INVESTMENT CORPORATIONS ACT
Sub-subtopic:   MEASURE TO ESTABLISH
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NDP

Ian Deans (N.D.P. House Leader)

New Democratic Party

Mr. Deans:

None at all?

Topic:   GOVERNMENT ORDERS
Subtopic:   CANADA DEVELOPMENT INVESTMENT CORPORATIONS ACT
Sub-subtopic:   MEASURE TO ESTABLISH
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PC

Arnold John Malone

Progressive Conservative

Mr. Malone:

That, Sir, is more important than the four letters it takes to spell it. Every Crown corporation should be set up with specific stated objectives. Once the objectives are met, an analysis should be made with regard to the continued existence of the corporation.

The Government is willing to create this monster corporation, but is unwilling to publicly disclose the nature of its restrictions as it should. The corporation has a mandate to grow, expand and increase but does not have the specific objective to divest, shrink or decrease.

There are currently some 350,000 Crown corporations, and some suggest there are in excess of 400 Crown corporations when one takes into account wholly and partially owned corporations. That figure in itself is a very important reason to bring these Crown corporations under constant scrutiny.

Bill C-25 is a guarantee of more bureaucracy, intervention and centralized planning which consequently removes the agencies themselves from the touch of the people. In fact, it strangles and destroys the initiatives of individuals. It gives the corporation the ability to acquire without any obligation to divest. Divesting must be part of its objectives if those objectives are to privatize. If it is the intention of this corporation to divest, then it must be so stated.

I want to make it clear the Crown corporations are not automatically wrong. Obviously there are social and economic conditions that require the establishment of Crown corporations from time to time. However, no Crown corporation should be established and allowed to continue without challenge. This Bill does not provide a legitimate mechanism for challenging the existence and continued expenditures for each or all of those Crown corporations.

Topic:   GOVERNMENT ORDERS
Subtopic:   CANADA DEVELOPMENT INVESTMENT CORPORATIONS ACT
Sub-subtopic:   MEASURE TO ESTABLISH
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NDP

Ian Deans (N.D.P. House Leader)

New Democratic Party

Mr. Deans:

You mean there are no conditions?

May 28, 1984

Topic:   GOVERNMENT ORDERS
Subtopic:   CANADA DEVELOPMENT INVESTMENT CORPORATIONS ACT
Sub-subtopic:   MEASURE TO ESTABLISH
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PC

Arnold John Malone

Progressive Conservative

Mr. Malone:

There are no conditions. There are none. In opening this debate today, the Minister of National Revenue (Mr. Bussieres) implied that the corporation will work within the public view. That is false in the extreme. The corporation is established so that it can always make an end run around Parliament. It becomes a shield between Parliament and the existing Crown corporations. While there is a legitimate concern being voiced for the inspection of Crown corporations, the mechanism being put before us is not workable.

I suggest that the most effective way to make Crown corporations accountable is to establish a special parliamentary committee with the authority to call Crown corporations without ministerial reference, to issue subpoenas to hear sworn evidence and to take the necessary time to conduct a full and legitimate analysis of their books. Perhaps this could be done in co-operation with the Auditor General's staff, such as is done in a United States Congressional or Senate committee. This parliamentary committee could scrutinize Crown corporations much more effectively than an obscure new Crown corporation whose job it is to manage all other corporations but really does not permit us to begin to review them at all.

According to Bill C-25, the CDIC can acquire up to $4 billion. Furthermore, it can get any other amount of money the Government ascribes to it on the basis of a dollar vote. Currently, it can run up to one-tenth of our annual deficit through the Crown corporation structure, without having the dollar vote.

Let us put into perspective what the Government is doing with $4 billion of the taxpayers' money. That amount in one dollar bills could be laid end to end two and one-half times from Vancouver to Halifax. The CDIC is being given that amount to strutinize and manage all other Crown corporations. It is simply an attempt to hide a sublayer of government through Crown corporations, as has been pointed out by these auditors general, and the latest Auditor General, Kenneth Dye, in particular.

In conclusion, I am pleased to hear the Government talk about the need to privatize Crown corporations. However, I am not being at all fooled by their camouflage because the fact is that the structure and the personnel it has put into place means that Canada will have an acceleration of Crown owned companies that will encroach upon the free marketplace and the right of people to purchase. It will indebt our citizens ever deeper. In the final analysis, this is not a agency for protection but an agency to veil and hide the true facts from Parliament, and consequently the Canadian people. I hope that Members of Parliament from all Parties will return to the basic principles that we are trying to establish and reject this Bill as it presently exists.

Topic:   GOVERNMENT ORDERS
Subtopic:   CANADA DEVELOPMENT INVESTMENT CORPORATIONS ACT
Sub-subtopic:   MEASURE TO ESTABLISH
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LIB

Harold Thomas Herbert (Deputy Chair of Committees of the Whole)

Liberal

The Acting Speaker (Mr. Herbert):

There follows a ten-minute period for questions or comments. Debate.

Topic:   GOVERNMENT ORDERS
Subtopic:   CANADA DEVELOPMENT INVESTMENT CORPORATIONS ACT
Sub-subtopic:   MEASURE TO ESTABLISH
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PC

Gordon Edward Taylor

Progressive Conservative

Mr. Gordon Taylor (Bow River):

Mr. Speaker, I wish to say a few words in this debate on Bill C-25 because I believe it gives us an excellent opportunity to set out the reason why our country is in such terrible shape. While I am not one who

Development Investment Corporations Act glorys in gloom and doom, neither will I put my head in the sand and ignore the conditions that exist in this country.

Our country was built on the principle of free enterprise. Many people went into business on their own, sometimes with little more than the shirts on their backs. They had very little money but it was their own and they believed in what they were doing. They worked hard and prospered. When thousands of people did this, it made the country great.

We have strayed far from that free enterprise principle. Today it is difficult for an individual to invest his money because he must receive approval from numerous boards and agencies, which only leads to discouragement. It is no wonder that there are two million people unemployed today. If Canadians were permitted to invest their money, run their own business and assume responsibility for their own mistakes or successes without government interference, we would not have these conditions today. A prime reason for so much unemployment is simply that the Government is trying to run our affairs.

I have given some examples of this before, but I wish to repeat them because they are so evident. For example, the capital cost allowance was an excellent innovation. It was established in recognition of the fact that equipment, such as machinery, wears out. Because it wears out on its own, there should be enough money to eventually replace that machine. So we introduced the capital cost allowance provision which is a sound principle. It is accepted universally in free enterprise countries.

What did this Government do with regard to capital cost allowance? It introduced another principle. It said the machine does not wear out the first part of the year, so the Government will not allow any capital cost allowance in the first year. That disallowance, and it may seem very small, was the means of throwing hundreds of people out of work, particularly in Eastern Canada because that is where farm machinery and other equipment is manufactured. I see the Hon. Member for Ottawa Centre (Mr. Evans) just shaking his head-at least I hear him shaking his head. But I want to tell you, Mr. Speaker, he should look at the facts.

Topic:   GOVERNMENT ORDERS
Subtopic:   CANADA DEVELOPMENT INVESTMENT CORPORATIONS ACT
Sub-subtopic:   MEASURE TO ESTABLISH
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LIB

John Leslie Evans (Parliamentary Secretary to the President of the Privy Council)

Liberal

Mr. Evans:

You should look at the facts.

Topic:   GOVERNMENT ORDERS
Subtopic:   CANADA DEVELOPMENT INVESTMENT CORPORATIONS ACT
Sub-subtopic:   MEASURE TO ESTABLISH
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PC

Gordon Edward Taylor

Progressive Conservative

Mr. Taylor:

There is one agency in my constituency that cancelled an order for seven combines. That is just one agency. The order for the seven combines was cancelled because the farmers said after that provision came through "we will stick with our own. We will make our old combines do, or we will rent out the work." As a result, seven combines that would have been manufactured in Eastern Canada were not manufactured. Multiply that kind of cancellation from scores of dealers across the country and you begin to see why Government policy has been so influential in causing unemployment.

In this Bill we have an aggravation of Government policy. We have another corporation that is supposed to solve the problems of Canada. I have not yet seen a corporation that

May 28, 1984

Development Investment Corporations Act solved the problems of Canada, and I do not expect to see one. If we could forget a lot of these corporations, go back to the simple principles of free enterprise and create a climate where people will invest their own money, take responsibility for losing it, and of course, have the chance to make a profit without the Government grabbing most of it, then we would see things altogether differently here in Canada.

Risk is fine. In a free enterprise system you know there is a risk of losing or making money. But you survey the situation and come to the conclusion whether you can make a success. If you succeed, you make a few dollars. You have a profit. You risk the money you have, and you work in order to achieve that end. That is simply free enterprise. But we do not like that anymore. Perhaps it is too simple. You hear people say profit is a bad word. You cannot make a dollar anymore without feeling guilty, or that the Government will grab too much of it if you do make a dollar. Consequently we are killing the goose of free enterprise that has laid the golden eggs for so many years and has kept the country going. We are substituting the goose for corporations which do not invest their own money, but invest the people's money. That is the big difference. Corporations will do anything with the peoples' money. They do not have to take the responsibility if they lose thousands of dollars. They simply go back to the Government trough and get more money. It is almost as simple as that.

Canadians are getting well informed about Crown corporations. They have seen examples where thousands of dollars are being used up wastefully by corportions with no accountability for that waste. That is really why this Bill is before us today. CDIC needs money again.

It is very strange, but the Government did not come to Parliament when the CDIC was formed. The Government avoided Parliament for two years while the CDIC was set up, financed and operated. But now CDIC needs more money. The Government ignored Parliament until now when CDIC has run out of ways of getting money without coming to Parliament.

What does the Government say the objective of this organization is? What is it supposed to do? What is its purpose? To put it bluntly, it is to establish the Canada Development Investment Corporation and to clarify its status. That part is necessary. It is to empower and prepare the Canada Development Corporation for privatization. Isn't that wonderful, Mr. Speaker. It is to prepare the Canada Development Corporation for privatization. If that is the objective, I would like to know where in the Bill that is going to be done. It looks to me as though the Government is getting further and further away from privatization and wanting more and more Crown corporations to run the business of this country.

When this Bill was first introduced on May 25, 1983, under Bill C-158, it set out certain items. The new Bill, Bill C-25 incorporated some changes to Bill C-158 as well as putting in some additions. It is to make CDIC conform with the general framework proposed for all Crown corporations under Bill C-24.

Maybe that is not that bad. If we are going to have Crown corporations, maybe there should be some basic premise to which they all conform. It is stated that this is supposed to be the objective. The Government wants a commercial operation with the control residing with the private shareholders. That is standard except at the first chance the Government will use the CDIC to bail out the companies in order to pursue the Government's own political objectives. In other words, the Government overrides the shareholders.

There are a number of things I hope to deal with in the time allotted to me this afternoon that shows while the objective is to make the corporations conform to some of the basic premises in Bill C-24, it is not doing that at all. With the increased power of the Cabinet the Government can set the remuneration of the CDIC directors, chairman, and president. Let us look at Clause 19 in Bill C-25. It reads:

The company may employ such officers, agents and employees as are necessary for the purposes of the company and, except as provided in subsection (2), the officers, agents and employees shall be deemed not be employed in the public service of Canada.

They will not be civil servants. That is fine. Right after we find power in the next clause. The next clause gives the Cabinet power to override that clause under the conditions set out. We find that all the way through the Bill. Principles are set out and then there are powers to override. We found that also in Bill C-24. In fact, that is far too evident in Bill C-24.

Then we come to another clause. This morning the Minister said the Government will present all of the facts to Parliament and report to Parliament. He quoted Clause 36. He said there will be accountability because the Government will submit this whole thing to the Parliament of Canada. If the whole budget of CDIC were brought here and we had an open debate and questions either in Committee of the Whole or a committee set up by the House, I could see some rhyme or reason to what the Government is saying. But when I looked at the Bill immediately after the Minister said that, that is not what clause 36 does at all.

Clause 36 reads:

The Minister may, with the approval of the Governor in Council, cause a motion for the authorization of an acquisition referred to in Section 35 to be moved in both Houses of Parliament.

He may, he does not have to; it is up to him. When it comes to budgets, the Bill gives authority to the Minister to bring in a summary. He does not have to bring in the entire budget at all. He may bring in a summary which he approves. He has to approve it before it can be brought before the Parliament of Canada. We are not entrusted with the entire budget. We will only be entrusted with a summary approved by the Minister. He can leave out what he wants and include what he wants. That is a pretty amateurish way of running business. Certainly it is another black eye for the people of Canada and for the Parliament of Canada.

May 28, 1984

The Minister is making an awful lot of to-do about Clause 33 and disclosures as to what the corporation is doing. Clause 33 reads:

The Minister shall cause a copy of every summary he approves-

Is that not interesting? He will not bring in an income account or expenditures account. We will not see them any more than we do right now. Under law he will be able to bring in a copy of every summary he approves, and only the summary he approves is what Parliament will see. That is terrible legislation. The House should not pass legislation which gives the Minister an opportunity to fool the people of Canada, and that is exactly what it is doing.

Surely Canadians are entitled to know what is happening to their dollars. It is their money. Under the free enterprise system, when people invest money they know what happens to it. If a company is formed, the shareholders know what happens. They approve policy and they receive an expense and income accounting of every dollar spent. They can chastize the directors or managers if they find that things are not going right. However, in this case the shareholders of Canada or the people of Canada will not have that opportunity. They will simply receive a copy of every summary the Minister approves. If he does not approve any, nothing will come. He can leave out what he wants under Clauses 31 and 32.

Why is the whole capital budget not brought before the House of Commons for discussion, not just the part the Minister wants to bring before us? Talk about disclosure! In this Bill disclosure is just a nice word which means nothing. It does not do anything. Of course this is not surprising when we have a man like Senator Austin running the show in CDC and CDIC. The man was never able to get elected. Every time he tried, the people said: "Nothing doing, we are not trusting him in Parliament". I see Mr. Speaker indicating that I only have two minutes remaining; I have barely started. The people have said that they would not trust Senator Austin in Parliament and have refused to send him here. Therefore, what did he do? He became involved in a Party which appointed him a Senator. He kowtowed and was put in charge of this corporation. He has never run a successful business in his life, and he is not running one now. Look at the mess he made of Canadair. Even its own president said that the corporation did not need 22 vice-presidents.

What kind of a business are they running? No wonder Canadians are becoming tired of government. They think there is no possible hope of having a government which will run the country in accordance with the thinking of the people. Reflecting the thinking of the people is free enterprise. That Government over there would be pretty smart if it threw out these corporations and returned to the basic principles of free enterprise which built this country.

Topic:   GOVERNMENT ORDERS
Subtopic:   CANADA DEVELOPMENT INVESTMENT CORPORATIONS ACT
Sub-subtopic:   MEASURE TO ESTABLISH
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LIB

Harold Thomas Herbert (Deputy Chair of Committees of the Whole)

Liberal

The Acting Speaker (Mr. Herbert);

There follows a 10-minute period for questions or comments. As there is no one wanting to put any questions, for continuing debate, the Hon. Member for Lanark-Renfrew-Carleton (Mr. Dick).

Development Investment Corporations Act

Topic:   GOVERNMENT ORDERS
Subtopic:   CANADA DEVELOPMENT INVESTMENT CORPORATIONS ACT
Sub-subtopic:   MEASURE TO ESTABLISH
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May 28, 1984