Mr. Paul Zed (Parliamentary Secretary to Leader of the Government in the House of Commons, Lib.): Mr. Speaker, pursuant to Standing Order 36(8), I have the honour to table, in both official languages, the government's responses to 36 petitions.

* * *

(1010)

COMMITTEES OF THE HOUSE

PROCEDURE AND HOUSE AFFAIRS

Mr. Paul Zed (Parliamentary Secretary to Leader of the Government in the House of Commons, Lib.): Mr. Speaker, I have the honour to present the 54th report of the Standing Committee on Procedure and House Affairs concerning the associate membership of the Standing Committee on Finance.

With leave of the House, I move that the 54th report of the Standing Committee on Procedure and House Affairs, presented to the House earlier this day, be concurred in.

[English]

The Acting Speaker (Mr. Milliken): Does the hon. parliamentary secretary have the unanimous consent of the House to move the motion?

Some hon. members: Agreed.

(Motion agreed to.)

* * *

PETITIONS

NUCLEAR WEAPONS

Ms. Roseanne Skoke (Central Nova, Lib.): Mr. Speaker, I have two petitions to present to this hon. House today. Pursuant to Standing Order 36, I present a petition from my constituents who pray and call on Parliament to support the immediate initiation and conclusion by the year 2000 of an international convention which will set out a binding timetable for the abolition of all nuclear weapons.

TAXATION

Ms. Roseanne Skoke (Central Nova, Lib.): Mr. Speaker, pursuant to Standing Order 36, I present a second petition with 320 signatures of constituents in my riding.

The petitioners urge all levels of government to demonstrate their commitment to education and literacy by eliminating sales tax on reading materials. They ask Parliament to zero rate books, magazines and newspapers under GST. They ask Parliament and provincial governments to zero rate reading materials under the proposed harmonized sales tax.

GASOLINE PRICES

Mr. Ted White (North Vancouver, Ref.): Mr. Speaker, I have three petitions to present this morning. The first is from Mr. Bob Pollock of North Vancouver and 35 others. The petitioners mention that 52 per cent of the price of gasoline is composed of taxes and the Canadian Automobile Association reports that the federal excise tax on gasoline has already increased by 566 per cent over the last decade.

Therefore the petitioners request Parliament not to increase the federal excise tax on gasoline.

HIGHWAYS

Mr. Ted White (North Vancouver, Ref.): Mr. Speaker, the second petition is from Joyce Mulligan of North Vancouver and 57 others.

In this petition these residents of Canada draw the attention of the House to the fact that 38 per cent of the national highway system is substandard, that Mexico and the United States are upgrading their national highway systems and that the national highway policy study identified job creation, economic development, national unity, saving lives and avoiding injuries, lower congestion, lower vehicle operating costs and better international competitiveness as benefits of the proposed national highway program.

The petitioners call on the federal government to join with provincial governments to make the national highway system upgrading possible.

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GASOLINE PRICES

Mr. Ted White (North Vancouver, Ref.): Mr. Speaker, the last petition is from Margaret Wheeler of North Vancouver and 47 others.

The petitioners point out that approximately 52 per cent of the cost of a litre of gasoline is in the form of government taxes, that the excise tax on gasoline has risen by 566 per cent over the last decade, and they request that Parliament not increase the federal excise tax on gasoline in the next federal budget.

(1015 )

[Translation]

CANADIAN CITIZENSHIP ACT

Mr. Osvaldo Nunez (Bourassa, BQ): Mr. Speaker, I am pleased to table a petition signed by 214 voters from my riding of Bourassa and from elsewhere in Quebec.

These people are asking Parliament to intervene to ensure that the provision of the Citizenship Act concerning the automatic granting of citizenship to any child born in Canada not be dropped. This petition is in response to the federal government's intention to amend the existing legislation.

In support of their request, the petitioners maintain that such an amendment will create stateless children. Canada would then be in the position of not respecting its international commitments in this regard. They therefore ask that the legislation be left as is.

[English]

NATIONAL AIDS STRATEGY

Mr. Derek Lee (Scarborough-Rouge River, Lib.): Mr. Speaker, I have two petitions pursuant to Standing Order 36. The first one is from approximately 50 petitioners who point out that phase 2 of the national AIDS strategy will expire in March 1988.

The petitioners urge Parliament to ensure that a dedicated AIDS funding approach beyond that March 1988 deadline be put in place and to ensure that a sufficient AIDS strategy be continued by the government.

DISABILITIES

Mr. Derek Lee (Scarborough-Rouge River, Lib.): Mr. Speaker, the second petition is presented by approximately 50 petitioners from east metro and metro Toronto and parts of southern Ontario.

The petitioners point out the previous and continuing involvement of the federal government in the area of disabilities for Canadians. They call upon Parliament to urge the government to continue to be responsible for disability issues and to ensure that all Canadians are treated equally.

QUESTIONS ON THE ORDER PAPER

Mr. Paul Zed (Parliamentary Secretary to Leader of the Government in the House of Commons, Lib.): Mr. Speaker, the following questions will be answered today: Nos. 91 and 103.

[Text]

Question No. 91-Mr. Milliken:

What were the personnel costs of the Sound and Light Show on Parliament Hill in 1995, and what costs were incurred by federal government departments or agencies, other than the National Capital Commission, in respect of the said show?

Mr. Paul Zed (Parliamentary Secretary to Leader of the Government in the House of Commons, Lib.): I am informed by the National Capital Commission and the Department of Public Works and Government Services as follows: The National Capital Commission, NCC, personnel costs for the 1995 Sound and Light Show on Parliament Hill were $35,400.

In 1995, total expenditures in the amount of $103,407 were incurred by Public Works and Governments Services Canada, PWGSC, in respect to the NCC Sound and Light Show.

This was a one-time contribution, consisting primarily of a $100,000 payment to the NCC for the purchase by the NCC of a projector for the Sound and Light Show which was necessary for the adaptation of the show due to the restoration work being carried out on the Centre Block south facade.

An additional $3,407 was incurred for the design, supply and installation of new stainless steel lighting brackets on the north wall of the Peace Tower. The old brackets which were of ordinary steel were corroding and damaging the stone.

Personnel costs cannot be identified as this work, the replacement of lighting brackets, was included in the Peace Tower project.

PWGSC, as custodian of the Parliament Buildings, is responsible for assets occupied by tenants and is also responsible for grounds.

Other departments and agencies have no information on this subject.

Question No. 103-Mr. Robinson:

With respect to applications for Canada pension plan disability benefits and considering the time presently required between the submission of an application and when benefits are received, or the application is definitely rejected, can the Minister of Human Resources Development indicate: (a) the mean time, (b) the median time and (c) the maximum time for each quintile of applicants and what measures are being taken to reduce these delays?

Hon. Pierre S. Pettigrew (Minister of Human Resources Development, Lib.): As part of a major redesign of income security programs intended to streamline and modernize our delivery systems, the Canada pension plan, CPP, disability program was decentralized during 1996. This included the regionalization of

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operations and brought decision making for CPP disability applications and reconsiderations closer to our clients throughout Canada.

Roll out of the regional functions occurred on a schedule from November 1995 to June 1996.

As a result, all applications for Canada pension plan disability benefits, except those for Quebec and Prince Edward Island, are received and processed in the regions.

From January to the end of December 1996, Canada pension plan reveived 79,778 applications for disability benefits.

It is a massive undertaking to move files, functions, technology and some staff from headquarters to 10 regions, and to train local personnel who will be performing new duties, all this while continuing to receive and process applications of the magnitude received by CPP on a daily basis. Delays are inevitable during a breaking-in period. We are in that period now.

This adjustment period and the loss of some economies of scale subsequent to decentralization and the underestimation of resources have resulted in backlogs in some regions in the adjudication of disability applications.

a) Presently, the average national time to process a disability application in the region is 59 working days. In some instances further information is required from medical specialists. These cases require additional time beyond the national average. The following reflects the time elapsed from receipt of the application to the time a decision to grant or deny benefits is made. By region, it is as follows:

Newfoundland: 41
Nova Scotia: 35
New Brunswick: 60
Ontario: 49
Manitoba/Saskatchewan: 43
Alberta: 68
British Columbia: 117

b, c) A major redesign of the systems supporting the Canada pension plan disability process is under way. When it is in place in 1998 it is expected that the average processing time for a disability application will drop to 30 days. This will also give us the means to gather, manipulate and analyse in a variety of sophisticated ways data regarding various aspects of our service delivery approaches.

Until then it is not possible to provide the response time in terms of the median time and the maximum time for each quintile of applicants.

Plans are under way to redirect as of March 1, 1997 some regional files to headquarters where the efforts of some 30 adjudication staff will be redirected from the reassessment program to the processing of regional disability applications. Decreasing the backlog in British Columbia as well as Ontario where the volumes are greatest will be the first priority.

All regions are presently implementing an action plan that will decrease response time to an acceptable level by the end of May 1997. This will include hiring and training additional staff, the use of overtime and further streamlining of work processes.

A national committee has been established to develop an improved method of forecasting resources required for the disability program.

[English]

Mr. Zed: I ask, Mr. Speaker, that the remaining questions be allowed to stand.

The Acting Speaker (Mr. Milliken): Is that agreed?

Some hon. members: Agreed.

_____________________________________________

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GOVERNMENT ORDERS

[English]

SUPPLY

ALLOTTED DAY-TRANSPORTATION

Mr. Jim Gouk (Kootenay West-Revelstoke, Ref.) moved:

That this House condemn the government for its approach to federal transportation policies, and in particular, the cancellation of the Pearson Airport deal, the continued neglect of Canada's national highway system, costly inefficiencies in the grain transportation system, and the on-going subsidization of VIA Rail at the expense of taxpayers and private-sector passenger rail and bus operators.

He said: Mr. Speaker, I rise to speak on the Reform supply day motion. There are four specific items named in the motion but of course others may choose to expand beyond them. I will speak on three of the four items highlighted in the motion, leaving the grain question to be handled by my colleagues from the agricultural sector.

I open with a few comments on the Pearson airport contract. Yesterday Reform exposed some of the myths projected by the Liberal Party dealing with its finances. It seems unfair that the finance department alone should be singled out.

Let us take a look at the Pearson airport deal. It is a myth that this is a payoff for Tory businessmen. The fact is that there are more known ties to the Liberal Party in the make-up of the Pearson contract holders.

Another myth is: ``We had to cancel the deal because it was too rich''. The fact is that secret government documents have revealed it was a good deal for the government. What is more, the government is now in court arguing that the contract holders would not have made any money at all.

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The true facts of this scandalous, mishandled political blunder are as follows. During the election campaign the Liberals stated that they thought the Pearson deal was bad and that a Liberal government would investigate and would cancel the contract if it found wrongdoing.

I have no problem with that. To be honest, I felt the same way. At this point the public was ready to believe anything about Mulroney's old party. The problem was that when they got elected and investigated the contract, the Liberals could not find anything wrong with it. Further, studies in the possession of the Liberals clearly indicated that it was a good deal for the government and thus for the Canadian taxpayer.

(1020)

Without one shred of real evidence the Liberal government slanderously attacked the Pearson contract holders using no evidence whatsoever and using only political rhetoric. To protect themselves the Liberals then introduced the most undemocratic piece of legislation the House has ever seen, Bill C-28.

What should they have done? After the investigation did not actually turn up any evidence of wrongdoing and armed with studies that pointed out the value of the contract of the government, the Liberals should have stated that the contract was not quite as bad as they thought it might have been and that they would try to make some changes that would make it acceptable. I am sure if they had gone to the contract holders they could have arranged a few face saving changes to the contract and then pronounced it okay to proceed with the changes that the Liberal Party had made.

What did members of the public get instead? Right now they have a legal bill that is over $13 million to date and still growing. They have a lawsuit with a potential settlement of hundreds of millions of dollars, a lawsuit that the Liberals had been warned about in those same secret documents in their position before they proceeded.

Terminals 1 and 2 at Pearson airport would have been substantially rebuilt instead of being in the deplorable condition they are in to this day. They have no plans for the needed rebuilding of those terminals and they have no money in the bank. It will be interesting to see how the upcoming budget addresses that particular problem.

Finally, there were enormous job and tax revenue losses for metro Toronto. The loss of direct and indirect jobs from the cancellation of the contract has cost the Toronto area tens of thousands of jobs and business activity. If there is any honour among the Liberals they would pay the cost of their politically motivated mistake from their own party account. We know this will not happen because that honour is not there.

With regard to the recently released report on the national highway system renewal, there is nothing in it that deals with a solution to our deteriorating national highway. There is nothing there to get excited about. It is again filled with Liberal rhetoric.

I should mention that the press release put out by the chair of the Standing Committee on Transport has a neat little trick in it. It says: ``Not only are we excited about this but the official opposition has signed on and we are all singing together''. Maybe the official opposition did but the national opposition party certainly did not.

The report is full of Liberal rhetoric and when it comes to real solutions there are not any there. There are three fundamental problems. A huge majority of the witnesses who came before the committee asked for some portion of the federal fuel tax revenues to be dedicated specifically to dealing with the national highway system. It should be noted that the government collects about $5 billion a year in highway fuel taxes and spends a mere $200 million.

In a highly manipulated move the chair decided to hold a one-day invitation only round table discussion which he used to override the testimony of four months of witnesses. Virtually all the recommendations in the report arise out of that one-day meeting instead of the four months of testimony.

The report states that the government should commit long term stable funding for highway rebuilding but refuses to do this through a dedicated account because then it would have to live up to that commitment, which is something it will not likely do.

The second area where the report errs is by suggesting that shadow tolling is a funding source. Shadow tolling involves the checking of traffic and making a payment based on the traffic to the operator of the highway. It is a method used to repay a private contractor for building or rebuilding a bridge, highway or some other portion of highway infrastructure, but the payment still has to be made by the government. Shadow tolling and public-private partnerships are valid cost saving efficiencies but they are not funding sources. Unless the government is planning to rebuild our national highway system by the introduction of massive vehicle tolls, this section of the report is deliberately misleading.

The final and most important area of the report is relying on the private sector through public private partnerships to deal with much of the highway problem.

(1025)

This in itself has much potential but only if there is confidence in the private sector that the government is honourable in its dealings, and there is much evidence that this honour does not exist. The government handling of the Pearson contract was only the smallest tip of the iceberg.

In 1989 the government went to the private sector and asked it to take over the money losing VIA Rail Rocky Mountaineer. The

8049

private sector responded. The Rocky Mountaineer was purchased by a company known as the Great Canadian Railtour Company.

Although it was losing money at the time of its purchase, the Great Canadian Railtour Company spent millions of dollars building and advertising the Rocky Mountaineer. Today it is an overwhelming success story. It has increased its business by 30 per cent per year on an ongoing and constant basis.

When it was taken over there were 5,000 passengers utilizing that system. In 1996, 42,000 people travelled on the Rocky Mountaineer. Also in 1996 they announced their expansion plans for 1997. They then went to VIA Rail and purchased the coaches necessary for this expanded service and sent them to Kamloops in British Columbia to be refurbished and to bring them up to the high standard Rocky Mountaineer insists on. Three months later VIA Rail, knowing the expansion plans of the Rocky Mountaineer and having sold it the cars that Rocky Mountaineer was using for this expansion, announced that it wanted back in. That is unacceptable.

What is even more unacceptable is that the Minister of Transport is actually considering allowing it. He is not only considering it but actually we believe he is at the point of announcing it. This is not only unacceptable to me but it is unacceptable to a great list of other people.

I have a copy of a letter that was delivered to the Minister of Transport from the organization the government is now relying on to bail it out of the highway system problem it has got itself into. The letter is from the Canadian Council for Public-Private Partnerships. It states:

In the case of VIA Rail's Rocky Mountaineer service the government correctly got out of a money losing activity. If the government wants to re-enter the business now that an entrepreneurial private sector operator has made it profitable, this will deter future private sector companies from bidding on future government privatization opportunities. The example of the government exiting and re-entering a business will send a bad signal to entrepreneurs who are looking to establish these types of public-private partnerships.

So much for the government's great plan to rebuild our national highway system. It first has to get the private sector's trust. Even as the government says it wants it, it is throwing this in the private sector's face.

If the minister thinks that allowing VIA to proceed is good for tourism, why have the Council on Tourism Associations of British Columbia and the Tourism Alliance of Western and Northern Canada emphatically stated their opposition to it?

How can the minister think allowing VIA to proceed is good for B.C. when every passenger VIA takes from the Great Canadian Railtour Company means another person staying and eating on a subsidized VIA Rail train instead of staying in B.C. hotels and eating in B.C. restaurants?

If the minister raises the support of the Canadian Tourism Commission, is the minister not aware that his crown corporation has been subsidized to the tune of over $7 billion through VIA that it gives in terms of CTC dollars every year? Should he not reconsider that its input is biased? This is especially true if we consider that the vice-president of the Canadian Tourism Commission is a former VIA employee who was unsuccessful in his bid to acquire the Rocky Mountaineer and who ended up in litigation with the Great Canadian Railtour Company.

The chair of the Canadian Tourism Commission marketing committee is vice-president of marketing at VIA Rail and was also involved in the unsuccessful bid for the Rocky Mountaineer. According to the Liberal government there is no bias I am sure.

(1030 )

What public need is served by allowing a crown corporation that is subsidized hundreds of millions of dollars to compete against a private sector taxpaying company that has done everything the government asked it to do when it sold the route in the first place?

I have a few interesting quotes: ``If the government does not need to run something, it should not, and in the future it will not''. That was said by the Liberal Minister of Finance. The mayor of Kamloops said: ``VIA Rail's plan to increase passenger traffic would have a devastating impact on the Great Canadian Railtour Company and the Kamloops economy''.

Here is another dandy. I trust the parliamentary secretary is taking this one in: ``I cannot emphasize too much that we are not in the business of putting at risk anyone who has taken on risk in the private sector trying to help us out in the railway industry''. Who is that one from? The then Minister of Transport who is now the defence minister for that same Liberal government.

What did the public have to say through organizations like the Canadian Taxpayers' Federation? ``Forget the Vancouver-Jasper decision, Mr. Anderson. Put VIA Rail on the selling block, a 1990s version of the Last Spike that is long overdue''.

What is even more disturbing to me is the matter of honour with the Liberal government. In December the chair of the Standing Committee on Transport announced to me that he wanted to hold a round table discussion in Ottawa during the recess of Parliament in January. I told him I was not in favour of this because there was no possible way I could attend. This is not a break, as it is euphemistically called, but is in fact a required time to work in our constituencies.

Mr. Keyes: Not required-optional.

Mr. Gouk: It is an option for Liberals. Only Reformers actually work in their constituencies.

He said: ``I really want your approval for this and I am willing to make some kind of a deal with you. What do you want?'' I said:

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``What I need is a statement from the committee that it is the wrong signal from the government to allow VIA Rail to get back into competition with the company it sold to the private sector and that it is sending that signal out at a time when you are counting in the private sector to bail you out''. He agreed to that in writing. He then proceeded to hold the round table which is being used to override four months of testimony. Then they reneged on the written commitment that was made.

There is no honour on that side of the House. There is no honour in the Liberal Party. There is no reason for the private sector to trust the government as it now goes around saying: ``Help us, we have made a mess of the national highway system and now we need you to bail us out''. The private sector is capable of bailing out the Liberals, but it had better be awfully careful when it enters into a deal with the current Government of Canada, the Liberal Party.

Mr. Stan Keyes (Parliamentary Secretary to Minister of Transport, Lib.): Mr. Speaker, I have just two points for the hon. member opposite who is a longstanding member of the transport committee, of which I have had the honour to be a part since my election in 1988.

The member should know that a committee of the House of Commons is the master of its own destiny. If the member could possibly understand, a committee makes its decisions to proceed in the best way possible in order to glean all the information it can to make the decisions at the end of the day.

Mr. White (North Vancouver): How can you keep a straight face?

Mr. Keyes: Unfortunately the hon. member opposite would sooner spend his time, as he said he did, back in his riding holding what he called politically oriented meetings, et cetera, rather than doing the job that his constituents sent him here to Ottawa to do.

We were working very hard on a triple T study, as we call it, a trade, transportation and tourism study. We heard a bevy of witnesses on the subject.

(1035 )

To the credit of the chairman of that committee, he pulled together 22 players, who either came to the committee at one time or made written interventions to the committee, to sit at one table. It worked wonderfully. Unfortunately, the hon. member missed it. Not one member of the Reform Party was present. However, the government and the official opposition were there.

Twenty-two people were sitting around the table. Instead of the usual way a committee works, hearing witness after another, unconnected, and only hearing one side of the story, we had all these witnesses sitting around the table discussing the idea of finding new options, exploring new ways of helping to finance a national highways project. One person would say something and another person would argue sensibly, quietly and diligently why we may not be able to do something.

It was the most fruitful meeting I have been at in the nine years I have been sitting on committees. There was interaction at the table between the private sector, the public sector and members of Parliament who represent their constituencies. At the end of the day, there was a consensus among all the players. Even more important than pulling in witnesses and trying to come to some consensus as individual witnesses, it was a table that came together as a consensus. It was marvellous.

The consensus was to move toward a model. We would take an example of a structured road somewhere in Canada and apply the strategic thinking that went on at that committee to the model to see how to crunch the numbers, to see the options of payment, and to see where the government and the Canadian taxpayers would be taking a lower risk on a particular venture. These are the great ideas that came out of that meeting. Unfortunately, the member opposite was not at it.

On the subject of the Pearson airport deal, I have to ask myself about the hon. member of the Reform Party. Let us remind ourselves that he belongs to a party that prides itself on being the party of constituent consensus. Let us look at constituent consensus. What did constituency consensus state? In the Toronto Star, for example, on December 4, 1993, it stated: ``Prime Minister's Chrétien's decision to cancel the privatization deal of Pearson International Airport is a breath of fresh air that cleans the stench left behind by the shady deal worked out by the Tory lobbyists for friends of the previous government''.

``Friends of the previous government''. After hearing the intervention of the Reform Party member opposite, I have to think that he could not be a friend of the taxpayers. He is a friend of these lobbyists, of the company run by a guy by the name of Don Matthews, a gentleman who was a chief Tory fundraiser and past president of the Conservative Party. He came forward with this deal. There is not even an option or opportunity for the not for profit corporation, the GTAA, Greater Toronto Airport Authority, to get into the bidding process. It was not allowed to bid on the project and the deal went to Paxport.

At the end of the day Paxport, the company that won the deal, did not have the resources to follow through with what it wanted to do. What did it have to do? It had to reach out and pull in someone in order to meet the deal that it had promised the Conservatives. Therefore, it reached out to the owners of terminal 3, Claridge.

Mr. Gouk: Liberals.

Mr. Keyes: Yes, Liberals, because Claridge wanted to make the airport work properly. However, I have to ask the hon. member:

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Who is he standing up for? Is he standing up for the consortium that wants $600 million for itself, never having put a shovel in the ground, or is he standing up for the Canadian taxpayer who says: ``Government, you do what you have to do. You take these people to court. You make sure that you try to achieve a goal that says we are not going to give another penny over what is deserving, somewhere between $30 million and $60 million, not $600 million as demanded, to pay for things that were not done for the lobbyists and for the friends of Brian Mulroney?'' Where does the hon. member stand for the Canadian taxpayer?

(1040 )

Mr. Gouk: Mr. Speaker, I hope I have enough time left to respond to the comments made by the Parliamentary Secretary to the Minister of Transport.

First, I will deal with the last part of his tirade on the Pearson airport. He refers to the Toronto Star as his constituency. We know the Liberals play to the newspapers and we now have proof, right out of the mouth of the parliamentary secretary.

He keeps talking about the fact that this is a pay-off for the Tory supporters, but in fact, by his own admission, the principal group involved at the time of signing is the Claridge group which is made up of Liberals.

As far as the settlement is concerned, we do not want a specific settlement, we want the rule of law to apply like anyone else. The Liberals cannot screw up, which is what they did with the Pearson cancellation, and then write legislation to protect their own hides.

With respect to the highway study that he mentioned, he is the person who continually says that the committee is the master of its own destiny. I believe the chair of the committee is an honourable person, but he got orders from on high to disregard the commitments he made to me.

The suggestion was made by the hon. member that I would rather be in my riding than down here doing my work. There is a parliamentary schedule. There is a schedule to be here; there is a schedule to be in the constituency. While he was dithering around doing who knows what, I was in my riding conferring with my real constituents, the taxpayers of this country, not the Toronto Star. I held 18 town hall meetings during the January recess period and the parliamentary secretary knows that.

He says that they pulled in all these wonderful people. The principal leader was Moya Greene, who came right out of the transport department. He made a mistake. I asked for a certain report and they faxed it to me. In the report which they faxed to me were handwritten notes made by Moya Greene. They goofed again.

The more the Liberals try to twist the facts, the more trouble they get into. They heard four months of testimony from witnesses and on a one day, by invitation only, round table, they brought in their own special people to manipulate this thing. They overruled four months of testimony and wrote a report based on one day.

If that is what they intended to do, why did they waste hundreds of thousands of taxpayers' dollars travelling from one end of the country to the other? Time, money and effort were expended by all those witnesses who thought they were getting democracy, when the Liberals intended to hold a one day meeting and override the whole thing.

Honour and democracy are alien words to that side of the House. Instead of buying a new red book they should buy a dictionary.

Mr. Stan Keyes (Parliamentary Secretary to Minister of Transport, Lib.): Mr. Speaker, I want to respond to the remarks made by the hon. member and the Reform motion before the House which condemns the government for its approach to federal transportation policies.

First, I would like to address the concluding remarks of the member opposite. He said that his constituents are somehow different than the constituents of the Toronto Star. I have spent some 16 years in television news-

Some hon. members: Oh, oh.

Mr. Keyes: It was not just the Toronto Star but many other media outlets which displayed the same outrage on behalf of the people who read their newspapers, who just so happen to live in my riding and in the riding of the hon. member for Kootenay West-Revelstoke.

The views of the taxpayers are seen on the editorial pages. Maybe the hon. member does not go beyond the editorials written by the paper and read the editorials with constituents' names attached to them. Some of them are outraged. Many have written to say they did not like the deal, that it was a deal which was hatched in the dying days of a Conservative administration that was on its way out because it had the worst eight year record of fraud that was ever established in Canadian history. On how many occasions did we watch, as I did, ministers on the Conservative front bench stepping down because of their improprieties?

(1045 )

The media outlets are there. They are doing their job. In order to represent the Canadian taxpayer, they are the people who are watching out. It is quite so these days that this House of Commons does not have an opposition. The opposition is the news media in this country and I say thank God for that.

The government's transportation policies, the very policies that the hon. member for Kootenay West-Revelstoke would have this House condemn, are helping to boost Canada's trade competitive-

8052

ness. They are strengthening tourism. Best of all, they are creating jobs in Canada. That is because the transport minister and this government have a clear vision for the future of transportation in this country.

Over many years governments in Canada invested in, operated, owned, regulated and controlled our transportation systems. This led to an overbuilt, oversubsidized, overregulated environment. Today however a far reaching modernization is under way.

I believe it was the Minister of Finance who first pointed out to this House in one of his first budgets that the government ought to get out of the business of running business. That is part of the modernization process I am speaking to. Our government is working toward a more efficient, commercially driven, regionally responsive infrastructure that is less dependent on public subsidies. We are working toward transportation that a new economy can ride on.

For proof of that work we need look no further than the first subject of today's motion, Pearson airport. Our government transferred control of Pearson airport to the Greater Toronto Airport Authority last December. That is what the people wanted in this country. This transfer cleared the way for the GTAA to redevelop Pearson to its fullest potential and to market the airport as one of North America's leading international gateways.

The federal government ran Pearson airport for many years and it ran it well, but the federal government had neither the freedom nor the mandate to pursue the full commercial potential of the airport. However the GTAA has done both. It is free to aggressively market Pearson airport, to pursue new business opportunities, to use innovative financing for capital works.

The commercial orientation will ensure that Pearson, Canada's largest and busiest airport, remains responsive to the needs of the travelling public, shippers, carriers and the surrounding community. Already the Greater Toronto Airport Authority has announced a major redevelopment plan for the airport that will see terminals 1 and 2 eventually replaced by a modern, unified terminal building. The redevelopment plan represents an investment of $2 billion in the airport; that is $2 billion, with a b. That is in addition to the $250 million worth of projects already under way at Pearson, including the construction of a new north-south runway and a centralized aircraft de-icing system.

I emphasize that our government transferred control of the whole Pearson airport, not simply terminals 1 and 2. That will allow the airport authority to develop and put in place a vision for the airport as one single strong entity.

In accordance with our government's national airports policy, the GTAA must also abide by strict principles of public accountability. It must ensure that the concerns of airport users, the people who pay the bills, the local community and the taxpayer are not superseded by those of private interests, the friends of my hon. friend from Kootenay West-Revelstoke.

The authority's board of directors must be composed of representatives from the community, the various levels of government and other participating organizations such as boards of trade and labour organizations. That is what our government's national airport policy is all about: ensuring that Canada's airports reach their full potential, that they generate growth, create jobs, all the while working in the best interests of the community and the country.

The national airports policy is just one of our government's achievements in the air sector. We have been working hard to modernize Canadian air transportation. We have introduced a new international air transportation policy designed to better meet the needs of travellers, shippers and airport communities.

Also of significant impact to Canadian travellers was the signing of the landmark open skies agreement with the United States back in February 1995. Thanks to open skies, Pearson airport is enjoying a significant number of new direct flights to the United States.

(1050 )

On the issue of highways, just as improved air transportation leads to increased trade, tourism and jobs, so too does a safe, well maintained national highway system. That is why our government will be spending $292 million on cost shared highway development projects in this fiscal year alone. This is in addition to the approximately $100 million we spend each year on federally owned highways and bridges across the country. That is a total of $392 million, an amount that we just moments ago heard the Reform Party allege was a meagre amount.

To quote the Reform Party member: ``The government is spending a mere $392 million on highways'', a mere. That is close to half a billion dollars. Only a Reform Party member could call an almost half a billion dollar investment in highways a mere amount.

That is also why our government will be studying very carefully in the days ahead the recently tabled report from the Standing Committee on Transport which deals with the very issue of highway funding. It was when the report came together, when we returned to this House after the break, that we worked diligently day after day, hour after hour without the member for Kootenay West-Revelstoke who speaks so eloquently that we have a schedule here and a schedule there. Well, the schedule started two weeks ago and the member only returned to the House after our serious deliberations and meetings-

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The Acting Speaker (Mr. Milliken): Order. I think the hon. parliamentary secretary knows that it is improper to refer to the presence or absence of members. I invite him to refrain from that kind of comment.

Mr. Keyes: Point taken, Mr. Speaker.

As the hon. members across the floor well know, highways are mostly the exclusive jurisdiction of the provinces. The many funding agreements we have signed with the provinces and territories however are proof of our government's commitment to work with other levels of government to preserve and enhance Canada's national highway system.

On the subject of grain transportation which the hon. member brought forward but did not speak to, our government's efforts to ensure the provision of a well maintained road system in this country mirror our work to modernize the rail sector. This leads me to the subject of grain transportation.

The motion before us suggests that the federal government is responsible somehow for the inefficiencies in the grain transportation system. Nothing could be further from the truth. Since coming to office, our government has taken bold steps to modernize rail transportation, the principal means by which grain is shipped in this country.

The Canada Transportation Act for example has given Canadian railways the flexibility to compete by reducing costs and those excessive regulations. The new act has cut the number of railway actions or decisions requiring government approval to about 40 from a previous high of 200. Cutting excess regulation will benefit not only the railways but also its customers, which include the grain shippers, through lower rail costs. The new act also shifts the focus from rail line abandonment toward the development of a healthy shortline industry.

Canadian National is now a private company with the tools it needs to compete. Putting CN into the private sector was an important step in our government's plan for modernizing the rail transportation system. The privatization has placed CN and CP rail systems on a level playing field. It has also subjected CN to the disciplines of the marketplace.

Not only will this move ensure the survival of the railway, but the gross proceeds from the sale of the crown's 80 million shares returned to the Canadian taxpayer in the amount of $2 billion. The enthusiastic response to the share offering by investors through Canada, the U.S. and internationally was outstanding. In fact it demonstrates CN's position as a strong player in the North American rail industry.

Finally, let us talk about the issue of transportation subsidies. As even a casual observer will notice, our government has dramatically cut subsidies in the transport sector. We have done so because we believe that those who use the transportation services should pay a greater share of the cost of providing those services.

VIA Rail for example will see its annual subsidy reduced to $170 million for the fiscal year 1997-98.

Mr. Morrison: Only $170 million?

Mr. Keyes: Only $170 million because prior to that, my friend in the party opposite, it was well over $300 million and we have cut the subsidy. To its credit VIA Rail has not cut services in the process.

(1055 )

In conclusion, I have addressed all the principal concerns set out in what I call this laughable motion, but by no means have I exhausted the list of accomplishments our government has achieved in the transport sector. There is the national marine policy for example. There is last November's transfer of the air navigation system to the not for profit corporation called Nav Canada, a move that also netted the taxpayers of the country $1.5 billion. I am proud to say that we are meeting our goal in this government.

For five years I sat on the opposition benches. For five years I sat on the transport committee of the House and I watched the Conservative government-the same Conservative government that had its current leader sitting at the cabinet table-shelve document after document and not pay attention to the needs of transportation, not modernize transportation, not bring forward all the essences that make Canada great, that pull us together, that make us competitive and create jobs in this country.

I am proud of this government's record and I am going to stick by it. I am prepared to entertain any questions the hon. member opposite might have.

Mr. Jim Gouk (Kootenay West-Revelstoke, Ref.): Mr. Speaker, every time I hear the hon. member who just spoke I am more impressed with his talent. He just stood and gave 20 minutes of the biggest bunch of drivel I have ever heard yet he kept a straight face through the whole thing. Perhaps it is explained by his suggestion that he has a background in radio and television. I guess that is where he got his training.

A couple of quick points. He said that the CN share sale was a huge success, and it was. In fact it was such a success that many Canadian purchasers wanted to buy shares. However they were not allowed to because the Liberal government in its document designated a large portion of them to be sold only outside the country. This was in spite of the fact that the Reform Party put in an amendment to say that for the first 60 or 30 days allow it for Canadians only and then open it up. The government refused to do that and many Canadian purchasers who wanted to keep the rail company ownership in Canada were refused because of Liberal policy.

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The hon. member says that the Pearson deal was signed in the dying days. I do not know, maybe the hon. member lives in the publishing office of the Toronto Star instead of a house because if he has ever bought or sold a house he knows that once you make a commitment to buy a house, the signing, the final completion of the contract, the conveyance comes further down the road. Once the commitment is made, both sides are locked in. To do otherwise would be a breach of contract like the one the government has now found itself in as ruled by the Supreme Court of Ontario.

The hon. member said that government is oversized and oversubsidized and that the Liberals intend to cut it down. He also said that the government ought to get out of the business of running business. Why then would the government even consider for a moment allowing this huge subsidized VIA Rail currently being subsidized by an amount of $600,000 a day to compete against the private sector, the private sector that it in fact asked to take over VIA Rail operations? They not only did it, they were good. They made it one of the best successful businesses in British Columbia and now they want to destroy it.

If the hon. member is so worried about the papers, tell the papers in Kamloops and through them all the people in Kamloops, why this Liberal government wants to destroy 42,000 hotel nights a year in Kamloops by letting VIA Rail get back into the very business it sold. I would specifically like to hear an answer to the question as to why, given his own words-unless he is prepared to go back on them-they would even consider allowing VIA to now go into competition against the Rocky Mountaineer?

Finally, with regard to Pearson, he mentioned $2 billion in expenditures at Pearson airport. I have heard that amount too. The new head of the GTAA has said: ``We have this great plan. We are going to spend $2 billion''. Never mind the $800 million the private sector was going to spend without it costing the taxpayer a dime. Where is that money coming from? The Pearson contract specifically banned the private sector from introducing passenger user fees except under exceptional circumstances. Where is the money going to come from? Who are they going to stick for the bill for rebuilding the terminal now that the private sector which was going to do it at no cost to the taxpayer has been kicked out?

(1100 )

Mr. Keyes: Mr. Speaker, I will directly answer the member's questions. All the the member's hyperbole notwithstanding, there is a right to be protected here, the right of the Canadian taxpayer in regard to the Pearson airport deal.

Mr. Gouk: The right to pay more.

Mr. Keyes The member asked if I own a house. Did I ever sell a house or make a contract? Yes, I have bought a house but I have had the opportunity of knowing exactly what I am buying. Unfortunately, the Conservative government of the day sold a bill of goods in the dying hours of a campaign. It knew it was on its way out. The Canadian taxpayers recognized the deal was a sham, hatched by the Conservatives, and it was not going to be the right deal for the Canadian taxpayer.

However, the government is still on the record as saying it will leave every option open to reach a settlement that is satisfactory to the Canadian taxpayer, satisfactory to the plaintiffs in this matter, completely satisfactory. It means a payment, interestingly enough, with which the consortium is not happy.

The consortium is not happy with what it received back in payments to the tune of approximately $60 million. They are going all the way on this thing because they have bills to pay for their Conservative lobbyist friends; $600 million as opposed to $30 million or $40 million. Imagine.

There is a member of the House who represents constituents in a riding in British Columbia who is saying: ``I agree with those fellows. Let us give them $600 million because, gosh, we had a contract''. Let us talk about who is to be protected here. The Canadian taxpayers that we represent need the protection. The Canadian taxpayers have recognized this deal as a sham. This government is standing on its own two feet and making sure that the taxpayer is protected. It is ensuring that the right of the Canadian taxpayer is given paramount consideration in this matter.

Mr. Solberg: I think we need protection from your government.

Mr. Gouk: Do not forget to answer the VIA question.

Mr. Keyes: I know the hon. member opposite is very interested in the VIA question. Unfortunately, as is usually the case with the opposition, it is only telling half the story.

Let us look at the full story. A private sector company called the Great Canadian Railtour Company is doing a fantastic job, a wonderful job of providing-

Mr. Solberg: Why are you trying to destroy it?

Mr. Keyes: Do you want to hear it or do you want to keep yelling?

That company is doing a wonderful job of providing a tourism service. It provides the customer the opportunity to get on a train, travel through part of the Rockies, stay overnight in a community, have a meal and entertainment and get back on the train in the morning and continue on their way to the next location. It is a magnificent tourism service, a first class service.

VIA wants to run a train from one part of B.C. to another during the daylight hours, providing transportation to a group of people who live in B.C. who number in the thousands that are saying: ``We

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do not have enough room on this particular train. We need more room on another train to get from A to B.

Mr. Hermanson: And lose money.

Mr. Keyes It is not a luxury service. It is not going to be an overnight service. The members over there want to compare apples and oranges and cry that it is not fair.

We are working with Mr. Peter Armstrong at the Great Canadian Railtour Company to try to achieve a goal that will be fair to him and at the same time fair to the Canadian taxpayer who pays the bills for VIA Rail who has said: ``We will be arm's length from you. You are going out there. You are going to do the business necessary in order to get a return on the investment of the Canadian taxpayers''.

VIA's subsidy of $350 million a year is now down to $170 million yet it is not dropping any services. We telling them to become commercial and get competitive. That is exactly what it is trying to do. However, if VIA came in and duplicated the service of the Great Canadian Railtour Company in B.C., the government would not stand for it, I would not stand for it and neither would the constituents of British Columbia.

(1105)

[Translation]

Mr. Paul Crête (Kamouraska-Rivière-du-Loup, BQ): I am pleased to speak today on this Reform Party motion condemning the government for its approach to various federal transportation policies. The Reform Party has opted to focus on the partisan choices made by the present government. They are entitled to do so, and this may be one aspect that is particularly striking.

I wish in particular to draw the attention of the House to the present government's inefficiency in the area of transportation. At the present time, there is a fairly impressive number of examples of the federal government's shirking its responsibilities and therefore costing Quebec and Canadian taxpayers considerable amounts of money.

The first example is the Pearson airport. The former government decided to privatize the airport, and this one made a campaign promise to cancel that privatization. To that end, it tabled a bill which the hon. members on this side of the House rejected on the grounds that it was inadequate, inconsistent and unrealistic. It was even defeated by the Liberal majority in the Senate.

The government has had eight months now, since June 1996, to find a solution with the promoters of Pearson airport to settle the dispute without costing Canadians an arm and a leg.

We are still waiting. Will the federal government introduce a new bill in an attempt to get out of this mess, which is going to cost, who knows, maybe $85 million to $100 million if there is an out-of-court settlement? If there is a decision-the case is currently before the courts-the suit is for some $600 million.

The federal government is being illogical in defending the privatization of Pearson airport, after the Prime Minister himself said while campaigning: ``This privatization must be cancelled, because there will be outrageous profits, $200 million''.

Now the government lawyers are saying in court: ``No, no, the profits will not be that high. So they do not deserve any significant compensation''. The government needs to get its act Together, face its responsibilities, and take a stand.

Unfortunately, as far as transportation is concerned, for the past three years the government seems to have been on automatic pilot. It has deregulated and privatized, but it also stopped doing something that was not necessarily undesirable in all sectors. It stopped monitoring the effects of these policies.

We had an example this fall. In 1996, there was a dramatic increase in railway accidents. There was an increase in the number of deaths and accidents as a result of safety problems on the railway network. We had an aging network on which the lines were not always maintained. The government decided to privatize the system, which was not necessarily a bad thing. On the other hand, the government had no right to look the other way and cease to fulfil the mandate it still has, privatization or no privatization, to ensure the safety of our railways.

The motion presented by the Reform Party today concerns the partisan approach of the federal government to its transportation policies. However, I think the biggest mistake, the most obvious weakness in the government's approach is the fact that it is incapable of taking a position, making decisions and acting responsibly.

I gave the example of Pearson airport. There is worse yet. Yesterday, a judgment by a judge of the Quebec Superior Court stated that the federal government had failed to act responsibly in the matter of changing the roles of Montreal's airports at Dorval and Mirabel.

Today, we have a situation where everyone is back to square one. There are regions whose economies have been hard hit by this decision. The judge made the decision on the basis of the case before him. For the past six months at least, the Bloc Quebecois has suggested two things the minister should do. First, conduct public hearings on the question. And second, act responsibly as the lessee of the facilities at Mirabel airport and Dorval.

(1110)

These recommendations by the Bloc are exactly the same recommendations that were made in the judgment by Judge Viau.

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So it is not just an opposition party speaking out. Now we have a judge who made a ruling. The federal government, which has been dithering for six months, will now have to pull up its socks and act responsibly. This is one more example of the federal government's lack of effectiveness in the transportation sector. This department, which for years had been huge and very slow to act, is now having trouble monitoring the reforms that have been introduced and ensuring they will be implemented.

A third example is Canadian Airlines International. For many years the federal government has been artificially supporting this lame duck. According to its vision, we absolutely needed two national carriers in Canada. Well, one of them has been on life support for a number of years: it was given grants, even a tax holiday and compensatory funding. A precedent was set when the government intervened in labour relations to allow Canadian to survive.

This is irresponsible, coming from a government that sees itself as an advocate of free competition. When it formulated this principle, it should have abided by it and let the companies do the same. Air Canada has already done a lot of house cleaning. It had to make some very difficult decisions in the past: lay-offs of pilots and other staff. Today, it is a profitable company. It operates well and is aggressive on international markets. It would be prepared to expand if the Canadian government was not paralysing it by limiting its international routes.

Here we have three examples of federal government inefficiency, lack of decision making ability and inflexibility. They are Pearson airport, the Montreal airports and Canadian international. So we can see how the federal government has problems being effective in its transport policy, with examples such as these. One tends to wonder about the upcoming reforms.

In December 1995, the government tabled a reform of Canadian ports policy. In the meantime, it tabled Bill C-44. In December, we considered it clause by clause, but we have heard nothing since then. The bill has not reappeared in the House, and communities are quite anxious about how their port facilities will be returned to them.

Will there be enough money to return the ports to the communities in a reasonable state? Is the current figure of $125 million sufficient? Will they take into consideration our recommendation that commercial ports like Cacouna, in my riding, for example, be treated differently from ferry ports like Saint-Siméon and Rivière-du-Loup, which is also in my riding?

This sort of facility must be treated differently. The government's intention to maintain ferry services and port facilities, so long as the ferries continue to run, must be absolutely clear. We need clarity, because the longer decisions are put off, the greater the impact on the decision of business to settle in a region.

Eastern Quebec, as you know, was hit very hard by the employment insurance reform. So the federal government must hasten to establish clear guidelines and make choices in order to let people know the conditions under which the port of Cacouna will become the property of the port development corporation, so that business wishing to set up in our region may do so in full knowledge of the facts.

When a business makes a choice and says: ``I will set up a plant in a given sector'', this is not a short term vision. It is looking 5, 10, 15 and 20 years down the road. However, we are in a period of very rapid choices. Without adequate answers in these matters, businesses that may have been considering settling in our region could decide to go elsewhere, in New England or some other part of the U.S. eastern seaboard, where they will know where they stand.

I urge the federal government to take a position in this matter as soon as possible.

(1115)

Another example of the federal government's inefficiency and lack of foresight is last year's reform of the line conveyance procedures. Up till then, before a line could be closed, public hearings had to be held, and if the stakeholders' could find sufficient justification, the line was maintained.

The legislation introduced by the federal, which it got through the House but which we rejected, now allows the companies simply to put the line up for sale again. If the company can find a buyer, the line is sold. Otherwise, the line is abandoned. But they forgot to be specific enough in the legislation.

Let me give you a very concrete example. On the Matapédia-Chandler-Gaspé line, in the Gaspé, runs the Chaleur, a train administered by VIA Rail. The legislation should have included a safeguard whereby the government could prevent private companies from dismantling their lines without any regard for the existing passenger transport networks when there is only one operational line, especially during winter, to ensure that this only line is maintained.

The absence of such a safeguard in the legislation led to the current nonsense. CN is selling the portion of the line between Matapédia and Chandler. They have a buyer, the Société des chemins de fer nationaux du Québec, for that portion because it is used not only for passenger transport but also for freight transport. There is no buyer, however, for the other line between Chandler and Gaspé, which is the continuation, because it is used only by VIA.

VIA Rail passengers are therefore being held to ransom following the company's decision, and the federal government has

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absolutely no say in all this. It can only try to see, through a feasibility study, how the economic future of that line could be ensured. Again, we can see that the federal government lacks a sense of planning

CONTENTS

HOUSE OF COMMONS

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Prayers

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ROUTINE PROCEEDINGS

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GOVERNMENT ORDERS