Mrs. Nicole Roy-Arcelin (Parliamentary Secretary to Minister of Communications):

Mr. Speaker, I want to tell you first of all that I will share my time with the hon. member for York-Simcoe.

Canada's history illustrates the importance of communications as a means and condition for the nation's economic, social and cultural development. In fact, telecommunications is the first Canadian high-technology industry and provides an essential infrastructure for the economic development of the country.

Canada now has three main communications systems, those of Stentor, Unitel and Telesat Canada; two mobile cellular telephone systems; one overseas telecommunications system, Teleglobe Canada; 49 other telephone companies, located mainly in Quebec and Ontario; about 200 radio communication companies providing mobile radio-telephone and paging services; and finally more than 22 companies specializing in the resale of services.

The whole industry-that is, the above companies as well as the equipment manufacturers-does $23 billion of business and employs over 100,000 people and is one of the fastest growing sectors of the Canadian economy. More than 98 per cent of Canadian households have a telephone and public surveys invariably show satisfaction with the quality of service. The telecommunications industry has grown essentially in a monopolistic framework. The telecommunications company had a monopoly and provided all the facilities, services and equipment, from sophisticated transmission and switching facilities which were the very base of its system to the ordinary residential or business telephone set.

However, regulation by the various governments was extremely fragmented. It was based on a series of different regimes involving only one level of government: seven provinces regulated 30 per cent of the Canadian market, while the federal agency regulated the rest. Thus major interprovincial trade barriers made the Canadian market smaller and more fragmented than it should have been.

A decision of the Supreme Court of Canada in August 1989 clarified and simplified the sharing of jurisdiction. The court concluded that the main telecommunications companies in Canada, namely telephone companies in the Stentor system, come under federal jurisdiction. This ruling thus paved the way to an open Canadian market.

In the past few years, we saw the emergence of a very complex technological and economic environment contributing to the gradual elimination of traditional boundaries between telecommunications markets thus calling into question the traditional monopolistic approach.

The diversity within the Canadian telecommunications market, together with the requirements of globalization and stiffening international competition, made inevitable a re-evaluation of government policy and regulatory practices.

April 19, 1993

I would first like to say that the present world trend in telecommunications is toward gradual liberalization of market regulation and privatization of state owned telecommunications companies.

In keeping with this trend and given the small size of our domestic market compared to the markets of our main trading partners and the complex fragmented regulatory structure, the Canadian government thought that the country needed a policy that could apply to the whole territory and a more flexible regulatory regime that could encourage innovation and the faster development of our leading high-tech industry.

The foundation of this policy was laid in 1987 and is the framework for Bill C-62.

The CRTC's recent decision to allow competition in the long-distance market makes new telecommunications legislation even more necessary.

In conclusion, pursuant to Standing Order 26(1) I move:

That the House continue to sit beyond the normal hour of

adjournment for the purpose of continuing consideration of Bill

C-62, an act respecting telecommunications.

Ms. Nicole Roy-Arcelin (Ahuntsic):

Mr. Speaker, I am pleased to remind the House that April is dental health month.

Good dental health is important for our well-being and our looks. Bad teeth and gums affect our ability to eat properly and lower our self-esteem. We know that we must see a dentist every six months, but do we really know everything that must be done to keep our teeth in good health?

During dental health month, the Canadian Dental Association and its provincial chapters will help us increase our knowledge of dental health with exhibits in shopping centres and other health promotion activities.

So please join me in wishing the Canadian Dental Association and the provincial dental associations a very successful dental health month.

Ms. Roy-Arcelin:

I rise on a question of privilege, Mr. Speaker, simply to tell the House that the member for Quebec-Est is 50 years old today.

Mrs. Nicole Roy-Arcelin (Parliamentary Secretary to Minister of Communications):

Mr. Speaker, I am pleased to answer the question asked by the hon. member, on March 8, about the right of the francophone minorities to manage their own educational institutions.

The federal government has always supported, in a very concrete way, official language minorities, especially in the area of school management.

The government provided funding, in several provinces, to working groups made up of people involved in education, including representatives from minorities. These working groups have studied school management by minorities. French-speaking communities have welcomed the reports tabled by these working groups.

Moreover, the memorandum of understanding signed by the government in 1988 and the bilateral agreements with the provinces and territories have given official language minority groups easier access to education in their own language.

Supplementary agreements with several provinces, including Saskatchewan, have filled specific or appropriate needs.

As she already mentioned several times, the Secretary of State of Canada has discussed with her Cabinet

colleagues a package of measures to help provinces set up school management by minority groups. Thlks are continuing, and we expect to start, in the next few weeks, actual negotiation with the provinces.

The Secretary of State submitted to her cabinet colleagues a proposal to renew the Official Languages in Education Program. Pretty soon, we will be starting discussions with the provinces, which should lead to a new Protocol and new agreements.

Let me remind the House that education is a provincial jurisdiction. The federal government has always clearly shown the provinces its willingness to help them fulfil their constitutional obligations. But the provinces have to provide appropriate structures for official languages minorities to manage their own educational institutions.

In that sense we welcome the decision handed down by the Supreme Court of Canada last week, on March 4, three years after the Mahe decision.

While reinforcing the previous decision, the Supreme Court decision adds more elements which provincial governments will have to consider when they prepare school legislation. The federal government will have to be convinced that provinces abide by these principles before supporting any school management program.

Mrs. Nicole Roy-Arcelin (Parliamentary Secretary to Minister of Communications):

Mr. Speaker, I would like to thank the hon. member for Parkdale-High Park for giving me this opportunity to confirm the government's commitment to public support for the distribution of Canadian publications.

As for the hon. member's motion concerning the advisability of removing the postal rate subsidy for all firms using direct mail advertising and not using recycled paper, however, the answer is quite simple: postal rate subsidies do not apply to direct mail advertising.

Perhaps I may explain the purpose of the postal subsidy program which was created over 100 years ago. Its latest official title is the Publications Distribution Assistance Program. The program is used to subsidize postal rates for newspapers, magazines and books.

Under an agreement, the Department of Communications pays subsidies to the Canada Post Corporation so it can offer rates below the commercial rates to certain Canadian publications.

In other words, the losses involved in offering preferential postal rates to Canadian publications are compensated by the government.

These subsidies go back to the beginning of our postal services, when the government introduced preferential rates for newspapers and, a little later, for magazines. At the time, these publications were among the few means of communication and education, and the government wanted printed matter to be affordable for all Canadians. In fact, preferential rates existed before Confederation. Over the years, classes and rates have become increasingly complex.

February 23, 1993

As part of an extensive series of cutbacks initiated in December 1989 to reduce the deficit, the government decided to gradually phase out the postal subsidy program of $220 million annually and replace it with a $110 million direct assistance program.

On June 27, 1990, the then Minister of Communications announced the government's decision to phase out the Publications Distribution Assistance Program by the end of March, 1994. After that date, the postal rates for these publications will be the same as current commercial rates. However, new programs administered by the Department of Communications will replace the preferential rates.

The decision made at the time was twofold: first, to concentrate on supporting the most vulnerable sectors of the publishing industry, in other words, subscription-funded magazines, small community weeklies and the book sector; and second, to eliminate the support enjoyed by foreign-owned publications, dailies and small circulation publications.

When the announcement was made in 1993 the minister described two major implications of the new program. First of all, there would no longer be any distinction between paid magazines on the basis of content. Furthermore, publishers would no longer be obliged to use the services of Canada Post since they would now be able to use the distribution system of their choice. We are now engaged in consultations with the industry to establish the exact structure and eligibility criteria for the new programs.

Culturally speaking, the Canadian magazine industry is in good health. However, it still needs government policies that provide financial support. Because of the favourable climate created during the past 15 years, the Canadian publishing industry has been able to conquer an increasing share of our market. Today, that share is 40 per cent.

The postal subsidy program benefits this country's publishing companies, advertisers, retailers and last, but not least, readers. That is why it cannot be changed without giving due consideration to our cultural, industrial and social objectives. What are those objectives? To ensure that magazines, small community weeklies and books remain accessible to all Canadians and to maintain conditions that promote the development of Canada's publishing industry. The new programs will target com-

Private Members' Business

panies that are owned and controlled by Canadians and which publish books, subscription magazines or small community weeklies.

Thanks to these programs, Canadian publishers will enjoy the support they need to survive and prosper during the 90s.