March 26, 1979

?

Some hon. Members:

Agreed.

Topic:   GOVERNMENT ORDERS
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NDP

Lorne Edmund Nystrom (Whip of the N.D.P.)

New Democratic Party

Mr. Nystrom:

Mr. Speaker, I will take but one minute, and I thank the House for giving me the additional time. I was talking about-

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LIB

Denis Éthier (Assistant Deputy Chair of Committees of the Whole)

Liberal

The Acting Speaker (Mr. Ethier):

Order, please. I hear someone telling me that there is not unanimous consent.

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NDP

Thomas Clement (Tommy) Douglas

New Democratic Party

Mr. Douglas (Nanaimo-Cowichan-The Islands):

Mr. Speaker, I have a point of order. I hope that you, sir, will take note of the fact that to the speaker of the Conservative party who moved this motion, we gave unanimous consent. I want the House to notice how ungracious certain members in the official opposition appear to be.

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LIB

Denis Éthier (Assistant Deputy Chair of Committees of the Whole)

Liberal

The Acting Speaker (Mr. Ethier):

Order, please. That is a matter which is beyond our control.

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SC

Eudore Allard

Social Credit

Mr. Eudore Allard (Rimouski):

Mr. Speaker, in support of the hon. member for Nanaimo-Cowichan-The Islands (Mr. Douglas), I must say there was unanimous consent, I think, to allow the hon. member for Yorkton-Melville (Mr. Nystrom) to continue his speech for a few minutes. I respect your decision, but I would like to add a few remarks on the motion presented by the hon. member for Calgary Centre (Mr. Andre). It is a pity, Mr. Speaker, that once in a while-in fact, often-we have to introduce motions such as this one to make the public aware of the carelessness and incompetence of the government which has been in power for almost ten years.

On November 29, 1977, in a motion I introduced in this House, I mentioned particularly the lack of foresight and

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March 26, 1979

Waste and Mismanagement

leadership on the part of the government. Naturally, when I said steps had to be taken to get the economy going again, Mr. Speaker, I mentioned among other things a few very important points, namely the weakening of our industry as a result of the flooding of the Canadian market with imported products, foreign products, inadequate funding to create employment in the economically weak areas and particularly the very high interest rates we have to pay on borrowings by federal, provincial and municipal governments and school boards.

The two hon. members who spoke before me talked abundantly of the waste of this government. I refer to the fact they forgot to mention-I hope they simply forgot to mention-the shameful waste that we have been witnessing and the fact that every day we are paying over $17 million-$17.9 million, to be more specific-in interest on this country's debt. And we of the Social Credit Party of Canada are convinced that it is a shameful waste because the Bank of Canada could readily be used to create the necessary credit and thus be indebted to ourselves rather that to foreigners. So, except for us, this government and the opposition forget to talk about those important things particularly trying to show the people of this country the mismanagement of this government in face of the constant waste going on day in and day out.

Mr. Speaker, during that motion I introduced in November, 1977,1 asked and still ask on behalf of the people of my riding, the people of Rimouski and the people in the Gaspe area in general, the government at that time to take immediate steps to ensure the freedom and security of workers, farmers, mothers and people in general. I also urged the government to create jobs for young people coming out of our universities or CEGEPs with big, beautiful diplomas, with big, beautiful parchments but who face nothingness-we have no job. Mr. Speaker, those people have courage and will, they want to earn a decent living. They face the incompetence of the government, unemployment, welfare and misery.

Mr. Speaker, as the incompetence of the government apparently became its trademark and as regional disparities are increasing, it becomes more and more difficult to find jobs in some areas. After the budgetary cuts, those same areas are also unnecessarily affected by those drastic measures, namely the less favoured areas, as I said earlier.

When I spoke last October 17 in reply to the Speech from the Throne, the rate of unemployment in my area was 15 per cent; in Quebec, only the Abitibi-Temiscamingue area had a higher unemployment rate, and only by a few decimal points. Today, Mr. Speaker, even if our area is represented in cabinet, even if all the neighbouring constituencies are Liberal, the rate of unemployment has, sad to say, climbed to 21.2 per cent; this is the highest in Quebec and comes right after the Corner Brook area in Newfoundland where the unemployment rate is 24.3 per cent. It is therefore important to remind everyone of

this situation, Mr. Speaker. I always make a point of recalling this situation because I feel we must remove these economic disparities if we want Canada to develop in harmony. It is most discouraging to note, however, that the gap between rich and poor areas has again widened.

Mr. Speaker, I would now like to come back to the relevancy of today's motion which concerns government waste. The latest example of this, and probably the most inexcusable, is certainly the famous $23 million contract with General Instruments to launch the notorious and short-lived Loto Select. Once again, the federal government did all it could to go over the heads of the provinces and do what it wanted while interfering underhandedly in an area of provincial jurisdiction. In addition to the financial losses caused by the cancellation of this contract, there was also the arrogance that this government showed toward the provinces. But the provinces no longer tolerate this type of interference and are showing an ever more united front, so the government had to backpedal and the Canadian taxpayers, that is all of us, now have to pay the piper without having danced to the tune and to suffer from the incompetence of the government opposite.

Mr. Speaker, on October 23 last, the hon. Minister of Finance (Mr. Chretien) asked to be allowed to make a very small additional loan of $17 billion for so-called operating expenditures. The financial requirements of the government reached astronomical proportions at the same time as all sorts of things were done to save $4 billion by cutting back very important existing services. During that time, the Bank of Canada exhausted its reserves to support our drowning dollar, which has been trying to surface for several months already, but to no avail, Mr. Speaker, since the dollar stayed at 85 cents and floated between something over 85 cents and 84 cents, to the great satisfaction, it seems, of the Minister of Industry, Trade and Commerce (Mr. Horner).

The government has also invested in all sorts of programs of doubtful need and effectiveness. We could talk, for instance, of all the commissions on prices that we have seen. We have had the Prices Review Board, the Anti-Inflation Board, the Centre for the Study of Inflation and Productivity, and finally, the National Commission on Inflation. I would like to know the cost of establishing and dismantling all those commissions, which have been totally ineffective and, in any case, never had any real power.

What about real estate resources? We now have more office space than we need because the public service will curtail its expansion and even cut back staff in some instances. It will even be worse with a Progressive Conservative government since that party intends to cut 60,000 government jobs. Also, the government decentralization will also affect the surplus of space. The government has shown a complete lack of foresight. I hope it knows where it is going. In any event, the final verdict belongs to the people and it will come soon.

March 26, 1979

I also want to mention the propaganda war going on between Quebec and the federal government which both want to promote their view of federalism. We spend large sums of money in advertising not to promote federalism as is but rather to promote Trudeau style federalism, a centralized and dictatorial form of federalism where the provinces are only the pawns of the central government. There again, we do not know how much that will cost us. This debate strikes me as sterile. Instead, the government should apply itself to making concrete proposals to the provinces, at least to prove to Quebec its willingness to come to terms. While the Pepin-Robarts report has gone to gather dust on shelves somewhere, both DREE and the Department of Supply and Services are going ahead with their little publicity campaign in Quebec, simply because the provincial government made a campaign of its own to get people involved in its OSE program. It seems to me those federal funds could be better invested. I know many unemployed workers in my riding who would be very happy to know the Canada Works program has more funds at its disposal.

Another example of inconsistency comes to my mind, that of the child tax credit. Anyone who has the right to claim that tax credit will have to fill out a separate tax return; this means that in a family where there is but one wage earner, that is the father, the mother will have to fill in her own tax return. And talk about the problems of separated couples and the income of dependent children! Revenue Canada will have to check over two million additional tax returns, that is the tax returns themselves, checking the return of the wife against that of her husband, and all the appended slips and required vouchers. Now that is another costly administrative chaos. In addition, a large number of those returns will surely not have been filled in properly. Can you imagine all that paper work, all that red tape in order to reduce family allowances!

Mr. Speaker, when ordinary folk have to tighten their belts because inflation is eroding their pay cheques and unemployment constantly threatens a large number of workers in this country, we must react quickly and use public funds to solve urgent problems and so improve the lot of our people and foster human dignity in this country.

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LIB

J. Judd Buchanan (President of the Treasury Board)

Liberal

Hon. Judd Buchanan (President of the Treasury Board):

Mr. Speaker, I rise to speak on this motion because I am concerned that members opposite are continuing to ignore the genuine progress that is being made in the area of management efficiency by this government. I am concerned because, in the rush for public attention, facts are being overlooked and much evidence is lost in the mud of political rhetoric.

I -vant to take the next few minutes to review for hon. members some of the initiatives that have been undertaken and to discuss some of the actions now under way. I will discuss the continuing program of restraint in spending and in the administration of the government operations, as well as draw attention to the IMPAC studies under way by the

Waste and Mismanagement

Comptroller General. I will comment also on the government's restraint program.

As far as administrative measures are concerned, Mr. Speaker, I would like to remind the members of this House that a program of administrative restraint was introduced by the Minister of Finance (Mr. Chretien) when he was president of the Treasury Board on March 25, 1976. This program has been carried through vigorously both by my predecessor, the present President of the Board of Economic Development Ministers (Mr. Andras), and myself, and I am pleased to report to you the following achievements of administrative restraint during the first nine months of fiscal year 1978-79.

In keeping with the new Treasury Board guidelines on office accommodation, the government in consolidating and reducing its over-all use of office space. More than 82 accommodation requests were received by the Treasury Board during the last year and the space requested was reduced by more than 20 per cent. As a result, government reduced its actual inventory of office space by about one million square feet with a concomitant saving of about $7 million in annual rent.

In keeping with government policy to conserve energy, Treasury Board has issued new guidelines for the acquisition of motor vehicles. As a result, the purchasing trend of a few years ago, which was made up mainly of full-sized sedans and station wagons, has been completely reversed. Compacts now account for 55 per cent of new purchases, while full-sized car purchases dropped to 3 per cent in 1978. Apart from the obvious savings in energy consumption, the reduced purchasing price that can be attributed to this changing mix in the government vehicle fleet is of the order of $1 million per year.

With respect to broader energy savings, Treasury Board, in co-operation with the Department of Energy, Mines and Resources, has instructed departments to observe the necessary caution of energy consumption. As a result, the government energy bill last year was reduced by $31 million. Reflecting these measures of prudent housekeeping, Ontario Hydro reported that the city of Ottawa was the only major city in Ontario to use less electricity in 1977 than the year before. A good part of the credit goes to the federal government, according to Ontario Hydro, for cutting down its consumption.

In a further attempt to conserve energy while supporting public transportation, government no longer provides all of its employees in city core areas with free parking. In 1978-79 this policy, which is now in effect throughout most Canadian cities, produced revenues of $1.4 million.

In the broad area of office equipment, government savings last year were some $3 million as a result of better tendering procedures, limiting choices and further restraint in acquisitions. Similarly, with respect to office furniture, expenditures have been reduced sharply over the past years and are now stabilized at around $5 million per year, compared to $7 million per year before the restraint program took effect. Meanwhile new policies have been put in place to maintain the newly established ceiling of $5 million.

March 26, 1979

Waste and Mismanagement

To cut down on the number of employees that were engaged from temporary help agencies, Treasury Board last year instituted a new policy whereby such employees cannot be hired for more than eight weeks and all contractual arrangements with the agencies would be conducted by the Department of Supply and Services. These policies have resulted in a much better utilization of existing public service staff while reducing government expenditures on outside help by millions of dollars.

Whereas newpaper articles last year quoted figures of $25 million for temporary help, these expenditures for the first nine months of the current fiscal year were $6.6 million for the national capital region and about $4 million for federal offices elsewhere in Canada.

First class air travel by public servants has been reduced by 90 per cent since 1975.

With respect to electronic data processing, government expenditures, expressed in 1974 dollars, have remained virtually constant at a level of some $210 million per year. In keeping with government policy, the services of the private sector are used extensively and are expected to reach $49 million in 1979-80 out of total expenditures of about $380 million.

New policies and more stringent reporting mechanisms have been introduced with respect to such expenditures as hospitality, conference travel and essential membership fees, with the result that the newly established expenditure codes for these items will enable close scrutiny and year to year monitoring.

In keeping with our general determination to improve administrative practices throughout the public service, Treasury Board has implemented over the past year new policies on the management of large capital projects, improved reporting requirements for contracts with individuals, more stringent guidelines on permissible fees and stricter control on contracts with retired public servants.

In addition to this broad range of administrative measures, Treasury Board has given new impetus to the government-wide program of incentive awards to reward those employees who make specific suggestions to improve the efficiency or effectiveness of their programs. I am pleased to report that the net effect of this rejuvenation has been demonstrated by savings of $9.7 million during 1978. These savings constitute a 300 per cent increase over the average annual savings of past years. These initiatives have brought about a sharply increased awareness among public servants of the importance of administrative restraint. This has resulted in a saving of some $75 million through these measures during the past fiscal year.

This is not the only area where public servants have shown a greater awareness for economy and efficiency in their departmental activities. Another obvious one relates to the office of the Comptroller General of Canada. Not long after the appointment of the Comptroller General the government announced that his office was undertaking a project with the acronym IMPAC-"Improvement in Management Practices and Controls". The objective of IMPAC is to work with departments to identify needed improvements in the area of

(Mr. Buchanan.]

management practices and controls and to develop action plans to implement these improvements. IMPAC would also provide government with an overview of the current state of management practices and controls across the public service and thus provide the basis for fact-based statements about the quality of such practices and controls.

Initially the IMPAC survey was to include the 20 largest departments of government and cover 70 per cent of the budget and 84 per cent of person-years. Subsequently a further 11 organizations have been added to the survey and the totals are now 76 per cent and 90 per cent respectively.

The IMPAC survey is being conducted by teams composed of more than 40 experts from the office of the Comptroller General and is co-ordinated by a small secretariat of five persons. The survey covers the major portion of the management cycle, from planning through the various administrative and control mechanisms to audit. It is based on a questionnaire prepared by the office of the Comptroller General prior to the start of the survey. The findings of the survey form the basis of discussions between the Comptroller General and the deputy minister of the department involved. The result of the survey and these discussions will be an action plan prepared by the department to bring about improvements in its management practices and controls, where the need for improvement has been identified in the survey.

At the present time the surveys of 13 departments are completed; the remaining seven of the first group are more than half finished. Action plans are being concluded in three departments. It is expected that all the action plans of the first group of 20 departments will be agreed to by December, 1979, and those of the other group of ten departments by April, 1980.

There are already visible results from the IMPAC survey. Often when the teams arrive at a department they find that the major needs have already been identified and corrective action is under way. Some of the action plans resulting from the IMPAC survey will take a number of years to implement fully, and although there should be an immediate improvement in management practices and controls across government, some major projects will not be completed for a number of years. The Comptroller General will be reporting progress to Treasury Board and ensuring that the momentum now under way is maintained.

Finally Mr. Speaker, I would like to draw attention to the government restraint program. The government announced its restraint policy in 1975 as part of the anti-inflation program. Spending is linked to growth in the GNP. This policy is applied to all spending including budgetary outlays, loans, investments and advances. Furthermore, the government committed itself to a target in advance of the fiscal year. In every year beginning with 1976-77, the first full year of the program, the targets have been set at or below the growth of the GNP. In every year the government has held actual spending well below the targets.

March 26, 1979

In both the 1976-77 and 1977-78 fiscal years, actual spending was held more than $1 billion below the announced ceilings, for growth rates of 10.4 per cent and 7.1 per cent respectively. Hon. members are aware that for 1978-79, the fiscal year just ending, the original ceiling of $48,800 million was reduced by $500 million as part of last August's spending cuts. When the public accounts come out later this year, I am confident they will show we have come in well under that ceiling. That means spending growth in 1978-79 will be less than 9.5 per cent.

For this coming fiscal year, 1979-80, $2 billion was cut from originally forecast requirements last August to give us a target of $52,600 million. I announced the details of the government's planned spending within that total when the estimates were tabled on February 19. That represents an increase of 8.9 per cent over 1978-79 spending.

The distribution of that increase among the various types of federal spending provides an indication of just how firmly the government has acted to control spending growth. About 58 per cent of the total budgetary growth is accounted for by transfer payments to individuals and other levels of government, subsidies and assorted other transfer payments. Another 43 per cent of the net growth is caused by the rising cost of the public debt. This means that estimates for operating and capital expenditures of government departments and agencies are actually lower than they were in 1978-79. In addition, I would like to note that departments, within those reduced budgets, still have to absorb the effects of inflation.

Control of public service growth is also part of the restraint program and the government's record is just as impressive. Here are the facts Mr. Speaker. In 1976-77, the first year of the program, traditional growth rate of authorized person-years was dramatically reduced to 1.3 per cent. In both 1977-78 and 1978-79 this growth was held to only six-tenths of 1 per cent. For 1979-80, largely as a result of the spending and public service reductions announced last August, there is an absolute reduction of 6,685 person-years. That is 2.1 per cent lower than last year. At that point, the size of the public service will be approximately the same as it was four years ago.

The record of the government is exactly the opposite to what is suggested by the motion before us, and knowing the sound judgment of this chamber, 1 am sure it will have the good sense later this day to soundly defeat the motion.

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PC

Arthur Ronald Huntington

Progressive Conservative

Mr. Ron Huntington (Capilano):

Mr. Speaker, I had intended to rise and speak on a global matter until I heard the President of the Treasury Board (Mr. Buchanan) tell us about this period of restraint which the government in its self-worship has imposed upon the Canadian people.

I should like to remind hon. members that they are busy spending $1 billion a week and creating a deficit of $1 billion a month. We have been told by the Minister of Finance (Mr. Chretien) that the national deficit has now increased by $1.2 billion over the estimates for the fiscal year 1979 in this "period of restraint." The Minister of Finance has further

Waste and Mismanagement

advised us that in fiscal year 1980 we will carry close to a $13 billion deficit. If this increase in the rate of deficit continues, the 1983 deficit will be close to $16 billion and the aggregate deficit between 1979 and 1983 will be $70 billion. So much for restraint!

In addition, this government has utilized $4.2 billion of United States funds in reserve to support the sinking Canadian dollar, an amount which represents about 90 per cent of the foreign reserves available in September, 1977. We have negotiated two foreign lines of credit to supply more reserves for foreign currency and by November 1, 1978, drawings in these credit lines amounted to $2.4 billion. Again, so much for the restraint expressed by the President of the Treasury Board.

Further, between 1968 and 1978 federal spending will have quadrupled, going from $12 billion to $50 billion. So much for the words of the Prime Minister (Mr. Trudeau) when he requested national air time on August 13, 1969, to discuss the economy, on which occasion he said we would be on the road to disaster if nothing was done to bring spending under control. Yet the hon. gentleman talks about restraint.

During the Prime Minister's three years of "restraint", federal spending increased by $14.3 billion, or 44 per cent. This increase amounts to $226.50 per Canadian and represents an amount larger than the entire federal budget for 1968. I am talking simply of the increase in spending during the "period of restraint."

The gross public debt is now running at about $6,700 per Canadian worker and at about $3,000 per Canadian-an increase of 87 per cent in nine years. On that same August night of August 13, 1969, the Prime Minister told us that deficits were to become a thing of the past. Mr. Speaker, the gross public debt today amounts to $67.1 billion and total government spending as of January, 1978, was $50 billion. Yet the President of the Treasury Board stands in his place and enumerates "tinkertoy" items of restraint in an effort to disarm criticism.

As I said, Mr. Speaker, I had intended to deal with a more global aspect of the problem which faces us. Once again we are engaged in a debate on waste and mismanagement. It is entirely possible that the Canadian public is numb, because in the aggregate the figures are overwhelming; it is difficult to relate to them. Just two weeks ago a reporter asked me why I was so upset about the possibility of $22,000 in postage being wasted by one of the departments of government. The reason I get upset is that I know how hard it is to save $22,000. I know how hard it is to pay back $22,000 when you have borrowed it from the bank. I also know that between $22,000 and $50,000 of capital can create one new permanent job. So I get angry when I see such a sum wasted. I know what an additional $5,000 a year could do for many people at the low income level.

There is deep and widespread concern that this parliament is not representing or serving the people properly. No doubt the introduction of electronic Hansard and the electronic media is accelerating the concern that something is seriously wrong. Only last Friday in the Ottawa Journal, Mr. W. A. Wilson

March 26, 1979

Waste and Mismanagement

wrote a column headed "Feeling of Malaise Grips the Nation". He spoke of the "Me first" syndrome. He talked of a sense of public responsibility that seems to be missing. Few good examples are being set by political leaders, business leaders and professionals. In Mr. Wilson's view the political process does not bear upon the sort of malaise that is affecting the nation. He pointed out that in the debates on universal suffrage at the turn of this century it was feared that full democracy would lead to such heavy demands that the system would collapse. Although this has not occurred, Wilson states:

Groups within the political process discovered the art of creating public appetites and then built their hold on power by satisfying them.

While on this malaise which is of increasing concern to many people who want to see freedom survive and an improved quality of life evolve, I refer to a series of articles by Norman Macrae, the deputy editor of London's The Economist. These articles are entitled "Ailing Democracies may be Terminal Cases". Mr. Macrae points out that voting democracies have some serious challenges ahead. One of those challenges is public sector imperialism. Power has passed to what Solzhenitsyn, in his warning to the western world, called the "political bureaucrats" and the ''official bureaucrats".

Macrae pointed out in his articles that these two groups now spend a higher proportion of gross national product than did the priests, kings, nobles and capitalists during their own peaks of power. I suppose the problem we face is one of human nature, for it seems that every time we allow a particular group to have power, it is certain to develop ways of keeping its own bureaucracies growing. In his articles Macrae also pointed out, and I quote:

The concentration of spending power in the hands of bureaucrats has been sanctified on the supposition that there are lots of services that can more efficiently be produced by state monopoly than by the market.

Macrae also said, and I quote:

In the past few years, it has become probable that none of these now exists.

He pointed out, and I quote:

Productivity per man in the civil service has sometimes declined during the past two and a half decades by over 90 per cent while productivity in the market sector has more than doubled.

We have an example of that here at home. The Auditor General's report of 1978 states that the public service and the federal civil service is at a productivity level of about 65 per cent when the least we should expect is an 85 per cent level. The rate is 20 per cent less than should normally be expected. Of some 330,000 man-years, 20 per cent is 66,000 man-years. On just a quick calculation, if we want a dollar measure, that adds up to something in the order of three-quarters of a billion dollars. That is an unproductive burden on those involved in real work.

Our challenge as parliamentarians is to reverse the incentive aspects which are built into this system. At present it is not in the interest of the bureaucracy to be productive, for its status and comfort are measured by the size of its budget and the person-years of departments.

In addition, bureaucrats work in an information environment where problems are committed and studied but seldom solved. Bureaucracies live on unsolved problems. For instance, since 1969 there has been a total of 26 royal commissions appointed by this government. In the public accounts of 1978 the cost of six commissions and studies or reports came to over $5 million. I have not been able to obtain the figure for the cost of studies over the last decade.

Another serious aspect of public concern, as I sense it, is that the interests of parliamentarians seem to be above those of the people and that this institution has become a top down-not a bottom up-institution of democracy. That has become dramatically evident in the last decade. Parliament has gone completely contrary to the popular will on such issues as capital punishment, bilingual policies, communications policies and the use of the Unemployment Insurance Commission as a welfare and wealth distribution scheme instead of protecting the insurance aspects of its purpose. That alone this year is another $5.3 billion burden which should really be a self-supporting program.

The inability of parliament, through fear or its shrug attitude, to do anything about the problems within the civil service and the mismanagement and anarchy within the Post Office is a challenge which has been with us for the last five years. The situation today is no better than it was five years ago. I suppose it is fair to say that there is lack of leadership in this institution because we are caught up in the "Me first" syndrome, and we are not offering the leadership which must come from the top. We have failed so far to get the system under control and to deliver an efficient, economic and effective use of the tax resource, which comes solely from those engaged in real work. This concern exists in all free countries, not just here, and because this institution does not react as it should we call for direct democracy. We see the Prime Minister and some of his wise men from the west calling for this great direct democracy, which is symbolized, in most people's minds, by proposition 13 in the state of California. Just as an aside I would like to say that when the Prime Minister and some of his hypnotized followers speak of direct democracy, the farthest thing from their minds is the example of proposition 13, which has the force of law.

I am new to politics and have trouble relating to the art, which really serves only the short-term, election to election needs of political power. To me there is a serious flaw in a system which fails to look beyond the next election in planning the use of its resources wisely. I note that there is nothing in the proposed constitutional changes and entrenchment of rights which moves to correct these flaws. Where do we see a right for the taxpayer to be guaranteed a balanced budget? Where do we see entrenched a right for the taxpayer to be guaranteed efficient, economic and effective use of the tax resource?

I have also been reading Reginald Whittaker's book "The Government Party", which is an expose on the organizing and financing of the Liberal party from the years 1930 to 1958. It really boils down to the fact that the art of political power in

March 26, 1979

Canada, as perfected by the Liberal party, is the art of patronage and building and controlling a bureaucracy. The last decade has seen the use of these instruments of political power rise to the point where the rank and file Canadian can no longer contain his disgust for politicians and the system. Patronage does not serve the poor. It does not distribute wealth, as the Prime Minister loves to imply with his quote "From those with means to those with no means". Patronage redistributes wealth on a constituency basis, with the beneficiaries being the middle class. It ignores minorities.

The building and use of the bureaucracy as a root of political power in the last decade has now arrived at the point where its cost is overwhelming those responsible for the production of wealth. The increasing workload on members of parliament caused by civil servant buck-passing, indifference and, at times, sheer arrogance, is becoming truly alarming. This issue is not limited to the Canadian civil service. It seems to be a wide issue in the western world and is very well reported on in a book from the United Kingdom entitled "The Disobedient Civil Servant". So I say again that we are dealing with a phenomenon which is not limited to our own country but, nevertheless, one which must be addressed in a serious way in this House when we are debating the mismanagement of our resources.

We must ask whether parliament, which sits over this bureaucracy, can survive as a form of government capable of continuing to protect and serve man's freedom and man's quality of life. Can the member of parliament improve his performance and serve meaningfully a public which feels increasingly isolated? In the role of watchdog over supply, can the member of parliament accept the full role of a director elected to represent the shareholders of Canada? Our record is tragic, and the neglect of our overview and watchdog role with regard to the nation's tax resource is a disgrace.

The introduction of television into the House now delivers the challenge of these questions squarely onto the desks of members of this House. Can we react to the warnings of Solzhenitsyn and Norman Macrae of The Economist of London, England? I think we can. I think we have to move in a substantial way to improve the committee system of parliament if we are going to manage the tax resource properly.

I offer the following suggestions. First, the public accounts committee should be given a permanent director with the right to hire and/or call on research staff as required on particular subjects. The committee should be given a permanent committee room with office facilities adjacent. The committee should perhaps be reduced to 14 members or less with parliamentary secretary pay and status. The chairman should be from the opposition and should be given the proper status for his responsibilities. The function of the committee should be to conduct audits, and it should study and report on governmentwide issues. Perhaps the committee's proceedings should also be televised.

Waste and Mismanagement

In addition, and parallel to that committee, I should like to suggest that there be put in place a permanent expenditure committee with a permanent director, a budget and the right to hire or call on research staff as problems require. It should be given a permanent meeting room and office facilities, perhaps adjacent to those suggested for the Standing Committee on Public Accounts. It should be made up of 14 members or less, members should have parliamentary secretary status and pay, and the chairman of that committee should also be an opposition member. Its function should be to examine and review the criteria supporting the spending process.

In view of the fact that we now have 400 Crown corporations, I think that a permanent Crown corporation committee should be set up with an act supporting the function of that committee. Its object should be to review the objectives and the use of resources by Crown corporations. Again a permanent director should be appointed with a budget to hire or draw on research staff as required for the subject matter at hand. Again these facilities should be co-ordinated with those suggested for the public accounts committee and the expenditure committee. The parliamentary secretary pay and status should also apply to members of that committee.

With these suggestions, if we could put a view on the spending process at the beginning and also at the end and examine the activities of Crown corporations which also have a spending capacity based on a public resource which creates a contingent liability, we could start to get the essentials of this process under control.

I should also like to draw the attention of members to Votes and Proceedings of Friday, March 23, and the substantive report which members of the Standing Committee on Public Accounts submitted to the House in their third report dealing with the reorganization of the form of the estimates, marrying that form to the public accounts so that we can have audit trails from a vote appropriation all the way through to the reporting of the fact in the public accounts. We are also calling for an informational system in the form of the estimates, a summary volume and other volumes to follow which would provide the detail within each department, opening up and removing once and for all this aura of secrecy which seems to prevail around a poorly presented wealth of information which has not been organized in the proper form. I would commend to hon. members a reading of that third report because I think it is one of the more important reports that that important committee has tabled in this House.

As I listened to the President of the Treasury Board I came to the conclusion that only self-worship or the narcissism of this Liberal government prevents their recognition of the malaise that faces our people and our form of government. They have had an opportunity to correct the system in the last decade and they have not. We have heard of the extent of their restraint program and I have figures to show the infinitesimal effort that has been made in light of the magnitude of the challenge that has faced the government. They have delivered a debt which future generations will have to carry and which

March 26, 1979

Waste and Mismanagement

rests at $67 billion at present. The service cost on that debt is 150 per cent the amount spent by our Department of National Defence. This government, with its restraint program, has borrowed money to pay interest on loans and is spending $6,500 million a year servicing that debt when it spends only-

Topic:   GOVERNMENT ORDERS
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Sub-subtopic:   ALLOTTED DAY, S.O. 58-NON-CONFIDENCE MOTION- CONDEMNATION OF CONTINUING GOVERNMENT WASTE AND MISMANAGEMENT
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LIB

John Napier Turner

Liberal

The Acting Speaker (Mr. Turner):

Order, I regret to interrupt the hon. member but the time allotted to him has expired. He may continue with unanimous consent. Is there unanimous consent?

Topic:   GOVERNMENT ORDERS
Subtopic:   BUSINESS OF SUPPLY
Sub-subtopic:   ALLOTTED DAY, S.O. 58-NON-CONFIDENCE MOTION- CONDEMNATION OF CONTINUING GOVERNMENT WASTE AND MISMANAGEMENT
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?

Some hon. Members:

Agreed.

Topic:   GOVERNMENT ORDERS
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?

Some hon. Members:

No.

Topic:   GOVERNMENT ORDERS
Subtopic:   BUSINESS OF SUPPLY
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LIB

Hugh Alan Anderson (Parliamentary Secretary to the Minister of Indian Affairs and Northern Development)

Liberal

Mr. Hugh A. Anderson (Parliamentary Secretary to Minister of Indian Affairs and Northern Development):

Mr. Speaker, I listened with great interest to the two speakers from the official opposition, the hon. member for Calgary Centre (Mr. Andre) and the hon. member for Capilano (Mr. Huntington). Perhaps it should be noted that at present the Government of Canada redistributes approximately 71 per cent of the tax money it collects to the people of Canada in the form of direct payments, such as CPP, old age security, family allowances, and the transfer of payments to the provinces for medicare and welfare.

In other words, out of the 100 per cent revenue which the federal government collects, approximately 29 per cent is spent directly by the government on the armed services, the Post Office and various direct contributions which the federal government makes. What we have seen in the last generation, that is in the last five, ten or 15 years, is a very large increase in the amount of money that is transferred to individuals and provinces, and a gradual decrease in the amount for which the federal government has direct responsibility. Some of us on this side of the House have concern over the fact that the federal government has less and less operating room as the amount of money it spends shrinks, whereas our non-discretional amounts increase.

The hon. member who spoke before me referred to the deficit and the increase in federal expenditures. What he did not say is that those increases are taking place in areas which I have already mentioned, that is, old age pensions, family allowances and transfers to provinces. If the hon. member is going to be honest and call for a cutback in government expenditures, he would have to call for that cutback in moneys that are paid out to the provinces and to individuals; but I have never yet heard the opposition call for a cutback in transfer payments to individuals or in old age pensions. Quite the contrary, they would like to have it both ways. They would like to appear financially responsible and at the same time ask for further increases in government expenditures.

If I may, Mr. Speaker, I would like to quote from an article in today's Ottawa Citizen by Leonard Shifrin entitled "Strange Paternity of Politics". It reads:

Since the Budget Control Act of 1974, the U.S. has treated tax expendi-tures-selective benefits provided to the tax system by way of deductibility of mortgage interest, a preferential treatment of capital gains, and so on-the same

as direct expenditures. Every year Congress is presented with a tax expenditure budget as well as a direct expenditure budget, and the two are debated and passed together.

The tax expenditure concept has been virtually ignored in Canada until Clark pushed it into prominence in his long list of selective tax cut promises. With the total cost of those promises now approaching $6 billion, the idea that tax spending needs to be watched as closely as direct spending is starting to take hold.

We heard just prior to my rising in the House two members of the official opposition who have gone up one side of the government and down the other regarding budgetary deficits. It appears from the article from which I quoted that there is a fear, not only among the press but among other people, that the official opposition, in their quest for power, has now brought out a program which would add a further $6 billion deficit to the existing deficit. I have heard no one in the House deny that the various programs outlined by the hon. Leader of the Opposition (Mr. Clark) would not in fact cost Canadians an additional $6 billion. Yet in considering an official opposition motion today, under which we are supposed to be discussing waste and mismanagement, the remarks of two members of the official opposition have been to the effect that we should decrease the budgetary deficit. I am not sure if hon. members have read the comments of the hon. Leader of the Opposition who has said exactly the opposite. In fact he has gone on record-

Topic:   GOVERNMENT ORDERS
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PC

Arthur Ronald Huntington

Progressive Conservative

Mr. Huntington:

You are misleading the House and you know it.

Topic:   GOVERNMENT ORDERS
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LIB

Hugh Alan Anderson (Parliamentary Secretary to the Minister of Indian Affairs and Northern Development)

Liberal

Mr. Anderson:

1 hope the hon. member is not disagreeing that the Leader of the Opposition said that they would increase the deficit from its present level. In fact, the finance critic of the official opposition, in trying to explain that position, said that it would be only a temporary increased deficit for perhaps a month or two. If the offocial opposition is saying that it can go into an additional $6 billion deficit and eliminate it in a month or two, perhaps this should be brought forward to Canadians. Not only many members on this side of the House but people across Canada wonder how a $6 billion deficit can be diminished in a month or two.

Hon. members opposite seem to feel that their position is rational, that we should be attacked as being financially responsible for the deficits we have incurred. Yet they will be more financially responsible by incurring even greater deficits. If hon. members opposite can marry those propositions together, God love them, because they will have to do so not in the House but before Canadians within a short period of time. Then the people of Canada will judge whether they can give out promises of $6 billion and at the same time attack the government for not being financially responsible. Until hon. members opposite marry those two propositions together, I suspect Canadians will do exactly what I am doing today. They will ask, "How can you criticize the present government for deficits when you are telling us that you will give us even greater deficits?"

March 26, 1979

The hon. member for Calgary Centre questioned the adequacy of the government's implementation of management and administrative procedures which will ensure that taxpayers' funds are spent efficiently, effectively and according to the will of parliament. Only a few weeks ago in the House I participated in a debate wherein, due to the fact that teaching facilities at universities for doctors, nurses and dental assistants were sufficient and that there were more rooms and class facilities than were being utilized presently, the Government of Canada decided to cut that program off. Obviously it was no longer needed. The classrooms which were built and the facilities which were put up were not being utilized fully at the present time. In the same debate I listened to the official opposition say that the Government of Canada should spend that money anyway since it is committed to the provinces, and that regardless of spending another $12 million, $15 million or $20 million, we should create additional classrooms even though the present ones were not being fully utilized.

I bring this matter up because it is very hard for some members on this side of the house to hear that we are being financially irresponsible, yet on almost every occasion when we say that funds can be cut from this or that area and we provide a rationale for it, usually we are criticized in ringing terms for not caring for the people of Canada. There are certain ways it can be done. For five years I have listened and the most criticism we have received is that various departments are not funded enough. Hon. members on this side will realize that day in and day out we are castigated because we do not provide money for worthy projects. One can say that on one hand, and then say on the other hand that the government should be more financially responsible, should not increase its deficit or its budgets. But one cannot have it both ways.

Topic:   GOVERNMENT ORDERS
Subtopic:   BUSINESS OF SUPPLY
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PC

Steve Eugene Paproski

Progressive Conservative

Mr. Paproski:

When did you start becoming responsible?

Topic:   GOVERNMENT ORDERS
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LIB

Hugh Alan Anderson (Parliamentary Secretary to the Minister of Indian Affairs and Northern Development)

Liberal

Mr. Anderson:

One cannot have it both ways. One must be financially responsible and say no, especially when considering the stupid argument regarding whether further classrooms should be built for dentists, doctors and nurses. It was the most ridiculous argument I have ever heard, that since we committed the money, whether it was needed or not, we should continue to spend it. That is what the official opposition does: they want it both ways, and they cannot have it both ways.

With respect to taxpayers' funds being spent officially, it must be obvious to all members that parliament has made many provisions by which the Government of Canada accounts to parliament for the funds which it has appropriated. The principal piece of legislation is the Financial Administration Act and the related regulations promulgated thereunder. Parliament is provided with many opportunities to review the government's financial operations, contrary to what has been said by some members today, both prospectively and retroactively. For instance, these opportunities are: the estimates tabled by the President of the Treasury Board (Mr. Buchanan); the budget introduced by the Minister of Finance (Mr. Chretien); the statements of financial operations published monthly by the government in the Canada Gazette', and the

Waste and Mismanagement

public accounts of Canada prepared by the Minister of Supply and Services (Mr. De Bane) and tabled in parliament by the Minister of Finance. The estimates and the public accounts of Canada are reviewed in depth by committees of the House of Commons, and the budget of the Minister of Finance is debated in the House. Also there is the annual report of the Auditor General which is tabled in the House. This provides members with the opportunity, if they wish to partake of it, to review an independent opinion of the financial operations of the government.

It is no secret that we in this House are dealing with the main estimates in each of the standing committees at the present time. Hon. members have alleged that they are not given an opportunity of looking into departmental spending, yet last Thursday the Standing Committee on Indian Affairs and Northern Development met and we sat for 35 minutes waiting for a member of the opposition to show up and look at the main estimates of the department. Obviously members are busy, but we hear the same complaint month in and month out, year in and year out, that members do not have an opportunity to look into the estimates and spending of departments.

If people in Canada attended a standing committee meeting, they would wonder what we are doing. It is obvious to many members on both sides of the House that the time we have to look at the main estimates is not utilized very well. Often we wait 15, 20 or 25 minutes for a quorum to start proceedings. In many instances members do not discuss the main estimates but matters which pertain to their ridings. They use this procedure as a means of asking questions of departmental officials, as well as the minister of the particular department concerned. I do not disagree with the right of members to do so, but if they are before the committee to look at the main estimates and to question government spending, then I am sorry I have to say that the time is not being utilized well.

Also it is fair to say that the annual report of the Auditor General gives members of the House the opportunity to review an independent opinion of the financial operations of government, especially as it relates to the use of spending authorities according to the will of parliament. The forum for this review is the Standing Committee on Public Accounts.

I should like to refer to one matter which has caused me some concern; it has been discussed by members on both sides of the House. We now have an Auditor General who is totally independent, we have a Comptroller General and we have people who look very closely at the spending of government. I wonder if hon. members in the opposition have considered that it is all very well to look at the actual spending and the fiscal accounting operation of departments and their budgets but have concluded that there is an overstepping into the actual decision making about money to be spent by particular departments. From my own point of view, I have some fear that the more controls and the more watchdogs you have in respect of government spending, the more in fact you are questioning the decisions of the government to spend.

March 26, 1979

Waste and Mismanagement

Topic:   GOVERNMENT ORDERS
Subtopic:   BUSINESS OF SUPPLY
Sub-subtopic:   ALLOTTED DAY, S.O. 58-NON-CONFIDENCE MOTION- CONDEMNATION OF CONTINUING GOVERNMENT WASTE AND MISMANAGEMENT
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?

Some hon. Members:

Agreed.

1 am sure there will be several projects in the department for which I have concern, the Department of Indian Affairs and Northern Development, which in years to come will come under criticism in reports of the Auditor General. We are in a devolution period in the Department of Indian Affairs and Northern Development. We are asking Indian people across this country to participate more in decision making regarding their own affairs, and this includes financial responsibility. However, with decentralization not only from Ottawa to the various regions across Canada, but decentralization of funds to Indian bands, with those bands making more decisions regarding their financial affairs, there will be the creation of additional conflict between the Auditor General and the Department of Indian Affairs and Northern Development.

I bring this to the attention of the House in the hope that at some future date we will not have so many watchdogs over the Government of Canada, this parliament and the various departments that no one will want to make a decision for fear the decision will be brought forward in the Auditor General's report, or in some other report, showing the financial administration carried out by them in disfavour.

I think it is fair to say that the government shares a healthy concern for adequate accountability which, I hasten to say, has not been brought about because of a malfunction of the system but rather by a desire to improve the existing system. To achieve this very objective let me remind members that the government established a royal commission of inquiry on financial management and accountability in the Government of Canada. The creation of this royal commission was announced by the then president of the Treasury Board on November 22, 1976. If I may quote him, he stated at that time:

Topic:   GOVERNMENT ORDERS
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?

Some hon. Members:

No.

Topic:   GOVERNMENT ORDERS
Subtopic:   BUSINESS OF SUPPLY
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THE ROYAL ASSENT

LIB

John Napier Turner

Liberal

The Acting Speaker (Mr. Turner):

Order, please. I have the honour to inform the House that a communication has been received as follows:

Government House Ottawa

March 26, 1979 Sir,

I have the honour to inform you that the Honourable Yves Pratte, Puisne Judge of the Supreme Court of Canada, in his capacity as Deputy Governor General, will proceed to the Senate Chamber today, the 26th day of March, at 8.15 p.m., for the purpose of giving royal assent to certain bills.

I have the honour to be, Sir,

Your obedient servant, Edmond Joly de Lotbiniere Administrative Secretary to the Governor General

Topic:   THE ROYAL ASSENT
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March 26, 1979