Debates of May 5th, 1994

Supply

[The Acting Speaker (Mr. Kilger)]

Very well. There will be a five minute period for questions and comments to the member who just spoke.

[Jean H. Leroux, Bloc, Shefford, QC]

Mr. Speaker, I listened carefully to the speech of my colleague, a member from Quebec. I think he drew a good picture of the situation. He presented the facts globally, discussing the problem that could ensue.

I have a question for him. Is it not the role of a responsible government to stimulate, encourage and assist the implementation of policies that could facilitate the conversion of defence industries? In this perspective, as a member of his caucus, is he committed to promoting such action so that ultimately, in Quebec and elsewhere in Canada, we really get a conversion policy that will allow regions to survive?

As you know, 11,000 jobs have been lost in Quebec since 1988. It is most important for us that the government, of which my colleague is a member, come up with solutions. It is about time they stop telling the House they are aware of the problem, that they know all about it. Everybody knows the problem but we are waiting for the government to take a firm stand. We expect this government that was elected to govern to present us with policies that would bring about a fast recovery in this sector and the conversion of the defence industry. I would like to hear his comments in this regard.

[Patrick Gagnon, Liberal, Bonaventure—Îles-De-La-Madeleine, QC]

Mr. Speaker, this government has presented its job creation program in its Budget and, these last few weeks, through the Minister of Human Resources Development. New technologies are the order of the day, of course. The government would like Canadians and Quebecers to get more involved in sciences.

I believe that diversification is in the cards for the near future. We know all about the defence industry, or rather its sorry state brought about by the end of the cold war. Since 1989-90, we have been living in a new world, a different world, and I believe that the government is committed to bringing about a greater diversification of Canadian industries to increase our competitiveness. I think that what we have achieved in the past six months-we have been in office six months already-for instance, the infrastructure program, the job creation program, the youth programs, the budget cuts, shows a certain maturity and exemplary fiscal responsibility. I believe that we are going to stay the course with regard not only to the military sector, but also to the Canadian industrial sector as a whole.

[Joe Fontana, Liberal, Parliamentary Secretary to Minister of Transport]

Mr. Speaker, I appreciate this opportunity to speak on this topic which is so important to a large number of Canadians.

I thank the hon. member opposite for focusing attention on the future of the defence industry. It is an industry which over the years has provided much employment across Canada and will do so in the future.

The future prosperity of the defence industry is vital to the future prosperity of Canada. As a vibrant part of Canada and North America, its industries can keep pace with global change and technological advancements.

I applaud the interest of members in raising this question and I would like to speak for a few moments on this matter.

European markets for defence sales have dropped remarkably leading to a loss of 150,000 jobs over the last three years. That is 10 per cent of the workforce in the aerospace and defence sector.

In America the experience is similar with large reductions in military procurement matched by significant job losses, more than 300,000 jobs in the last three years.

Both European and American industries have been faced with a serious industrial adjustment program. In various countries governments have responded in various ways. It is tempting to look at solutions such as those proposed in the United States for the problems facing our industries.

I believe we can learn from others. I am confident that some of the lessons which we might learn from others in defence/industrial conversions are universally applicable.

The term defence/industrial base defies easy definition. Companies that make military products are obviously included but it is important to consider the broader picture. These are many firms that market commercial and dual-use products in addition to the military sales. Of course the military itself uses many of these products. For example when our peacekeeping troops needed a soft desert boot, not a normal item in the Canadian forces supply system, we bought commercial products.

Another reason the defence industrial base is hard to define is that like all products military ones are composed of many components. When you get down to basics these components are pretty small, things like screws, nuts, bolts, washers, and rubber gaskets. One would not normally think of these as defence products but in fact we could not build military products without them.

Having made these cautions I would like to provide a brief overview of Canada's defence industries. Canada's defence industrial base is quite small by world standards. Depending on how widely it is defined it contributes about 1 per cent to 1.5 per cent of Canada's GDP and about 70,000 jobs. That is about 1 per cent of the Canadian labour force.

A large majority of the firms are small or medium in size, having sales below $100 million per year.

The defence industry is largely foreign-owned, about 60 per cent, especially the larger firms.

This is not to say that the defence industry is not important. While small it nevertheless contributes to Canada's economy in important ways. The products it produces generally fall within the realm of high technology, many of these at the leading edge.

As a consequence it generates highly skilled, highly paid jobs which are not only nationally important but which also make a substantial contribution to both regional and local economies.

Another main benefit derives from the fact that these companies are highly export oriented. These revenues help our balance of payments. The defence industry is highly specialized in niche markets such as subcomponents in aerospace, electronics and communications sectors.

Our companies are well respected in specialized fields such as major aircraft components, flight simulators, satellite subsystems, unmanned air vehicles, armoured vehicle fire control systems and magnetic anomaly detection systems. Their successes in both the civilian and military markets improve the overall competitiveness of the Canadian economy.

Along with the aerospace industry defence firms perform more R and D than the rest of the Canadian industry although somewhat less than their competitors in other major western nations. One finds defence industries throughout the country and the regional distribution has been slowly changing over time.

The munitions sector is a small sector which produces excellent ammunition and small arms. Companies involved in this sector include SNC and Expro, Bristol Aerospace, and Diemaco in Ontario. This sector is naturally highly dependent on DND purchasing. Exports and export potential are modest. Reduced spending in this sector by both Canada and the U.S. presents a special challenge in this sector.

In conclusion, Canada's defence and defence related industries are small but a vital sector of our economy. While the defence industry could never be considered to drive the economy it does make an important contribution in crucial high tech sectors.

While Canadian shipyards have historically focused on the domestic market, St. John's Shipyards is currently exploring other marketing opportunities. In addition to its expertise in the commercial sector St. John's Shipyards has acquired valuable expertise in constructing naval vessels as a result of its contract for the Canadian patrol frigate. This expertise will assist the company in its search for offshore sales.

The military vehicle sector is a very small, highly specialized, subset of the Canadian automotive sector. Two companies are currently producing vehicles for DND. Western Star located in Kelowna, B.C. produces DND's fleet of light trucks. In the great city of London, Ontario the diesel division of General Motors

produces light armoured vehicles, the best in the world, with huge export markets.

Efforts to market these vehicles internationally have been very successful. They are being sold in the United States and Saudi Arabia and further exports are likely.

On the aerospace side it is estimated that the top four companies, Bombardier, Pratt and Whitney, Bell Helicopter and Spar, account for some 45 per cent of production. Defence sales represent about 25 per cent of their revenues. On the defence electronic side it is estimated that 80 per cent of the output is exported. There is significantly greater reliance on defence sales for revenue.

This sector, particularly the aerospace side, is well positioned to survive reductions in defence spending. The defence electronic side is less well positioned and smaller companies with limited product lines and a high dependence on defence sales face greater challenges.

The shipbuilding repair and marine equipment sector relies mainly on government procurement. There are few commercial opportunities. Despite the rationalization of shipyards in Ontario and Quebec and rationalization currently under way in B.C. excess capacity still exists in Canada.

Historically, due to population density and patterns and the need for concentration of manufacturing for the war effort Canada's defence industries were highly concentrated in Ontario and Quebec. The defence industrial base is generally conceived as consisting of four main sectors. The largest sector is the aerospace and defence electronic sector which produces complete aircraft, various aircraft components and parts, navigation and space equipment and other defence electronic equipment. This is the most diversified sector by producing a mix of commercial, dual use and military products.

I think it is important to note that this government's commitment is to ensure that the high skilled, high tech jobs that we have in the defence industry are maintained, that in fact we work toward transition of those industries where possible. But we must not forget that Canada needs a strong defence industry. Where applicable and where appropriate we will continue to do what we can to maintain that, but at the same time look at opportunities to be able to move into transition for those defence related industries which may find lesser and lesser markets in the future. We must make sure that we have adjustment programs for the workers, adjustment programs for the industries and take advantage of the great high skills that the workers have, as well as the high technology that the defence industries now have.

We welcome this opportunity to debate this very important issue.

[Jean H. Leroux, Bloc, Shefford, QC]

Mr. Speaker, I listened very carefully to my colleague opposite and I noticed that parliamentary secretaries speaking on this motion are fond of talking from an historic perspective. They paint a clear picture of the situation, which shows that they are well informed. However, as I said earlier, the government was elected to make decisions. Unfortunately, they are well aware of the problems. They know what is going on. Perhaps they should be sitting on this side of the House.

However, since Canadians chose them to form the government, I think it is high time for them to stop reviewing the situation. While this government seems to have a very clear picture of all that is wrong, Canadians and Quebecers expect it to make decisions and to move forward.

This morning, the minister spoke to us about the deficit. He said that he could not make any decisions at this time because of the deficit. During the election campaign, it was the Conservatives who focused on the deficit. The Liberals, on the other hand, talked about the jobs, jobs, jobs that they were going to create. But that does not seem to be happening now. The feeling in Canada is that we have simply traded in one government for another identical one. As far as this debate is concerned, nothing substantive has been put on the table.

In conclusion, I have a question for my hon. colleague. Does he not feel that it is important for a government to stimulate, encourage and help private enterprise? In this particular area, 11,000 jobs have been lost in Quebec and I think the government should be doing something. I would appreciate his comments on this point.

[Joe Fontana, Liberal, London East, ON]

Mr. Speaker, I appreciate the question of the hon. member. He should realize that we have only been in government six months. We understand and our commitment to jobs has not wavered at all. In fact, some of the announcements that we have already made as a government with respect to the infrastructure program or support for small business or support for research and development will pay big dividends in terms of job creation.

Our commitment to jobs is not any less today than it was before the election. Our red book talked extensively about a change in the economy. One of the changes in the economy is with respect to the defence sector. I think historically we should realize, and I tried to point this out in my speech, that in terms of what is happening in Europe and in the United States, Canada in fact is facing some of the same challenges.

I hope the member is not suggesting that we close down the whole defence industry in this country because that is thousands

and thousands of jobs. We realize there is a need for defence industries and we have some of the best in the world right here in Canada, including in London, Ontario where we have many.

In Quebec and B.C. we have great industries. They are serving a useful purpose. Whether or not that purpose is still justified 10 or 15 years down the road no one knows. I think our red book says, and I would point this out to the member, that defence conversion consists really of three points: (1) redefining Canada's defence policy and the role of the military. As he knows there is consultation now on what that defence policy should be; (2) the rationalization of defence infrastructure, and that means looking at how we can assist these industries, communities and workers. As I said, these workers are very highly skilled, in high paying jobs. We need to look at how we can have adjustments for these workers; (3) the conversion of the defence industrial base to reduce the dependency on defence sales. I think that is important. We cannot cast out those industries and those workers just like that. We need to work with those companies, utilize their highly skilled workers, utilize their high technologies and be able to look for commercial applications of those things.

The member should realize, as I tried to define in my speech, that certain materials and certain parts produced by certain companies are not only defence related industries. They, in fact, serve a dual purpose. We ought to take advantage of making sure that this country faces the new economy by relying on the high skilled jobs that the defence industries have and also their technology.

We are prepared to work with those members and all members to ensure that we provide employment in this country.

[Jack Frazer, Reform, Saanich—Gulf Islands, BC]

Mr. Speaker, on behalf of the whip of the Reform Party I would like to advise the House that pursuant to Standing Order 43(2) our speakers on this motion will be dividing their time.

Before I speak to the motion, I would like to address some remarks made earlier by the member for Beauharnois-Salaberry who evidenced some concern with the aspect that the standing joint committee on defence was not addressing the problem that we are dealing with in this motion today.

I would like to go on record as saying that my concept of the standing joint committee on defence policy is to establish what it is that Canadians want from their defence department. He mentioned that we are travelling across the country and this is true. We are travelling from coast to coast. We are visiting every capital with the view of seeing informed Canadians on the aspect of defence and also to talk to people off the street who want to come in and make their views known.

We are also going to Europe and to the United States to establish with the appropriate agencies the importance of the Canadian defence contribution to their plans and our plans for mutual defence and obviously now in security.

The main thing I think that we want to do is establish a criteria whereby the security of the world is enhanced and thereby Canada's ability to operate in the world both industrially and tradewise will be better.

As I see it, the motion submitted by the member for Hochelaga-Maisonneuve is basically a demand for more funds to support industrial conversion. There is in my mind a defence aspect to this, but a very minor one. This is basically a matter of industry.

The defence aspect of it I will discuss a little later, but right now I would like to speak to the industrial aspect of it. The defence industry productivity program, a program whereby the federal government gives some $200 million-plus to various defence industries to support research and development and defence aspects, has been in place for some time.

In point of fact during our election campaign, the Reform Party was against this program. The rationale for that was that if private industry and private citizens do not see the value of investing in such programs, why should the Canadian taxpayer.

Since my election I have been approached by a number of people in these industries and they have pointed out that there is a very valid reason for this. In fact there is a good repayment program. I accept this and am willing to look at it again, but I also know that in some cases this money has been granted to very dubious projects and that there has been a tremendous amount of this money that has just disappeared never to be returned to the Canadian government.

The defence industry covers many sectors. Among them I would mention aerospace, electronics, ship construction, aircraft construction including many components, avionics and communications mainly involved in the defence area in command and control but very, very adaptable to civil industries as well.

Many of these companies have international links which provides them access to merging technologies and global markets. A great deal of Canada's high tech industry in fact has evolved from defence research and development or procurement projects. There are some 800 companies employing over 60,000 people who are active in the defence related industries in Canada.

The Canadian Defence Preparedness Association provided a briefing to the standing joint committee the day before yesterday. They represent some 60 companies and said categorically that they have had great success at conversion.

The Aerospace Industries Association of Canada, which represents a large number of companies in this field, is evidence again of a very successful conversion program from defence to civil industries. In the past their ratio of output went from 70 per cent defence and 30 per cent civil to today, where it is exactly reversed. Their output now is about 30 per cent defence and 70 per cent civil.

This is where I am getting back to the impact of how industry impacts on defence. Obviously there are certain industries where Canada must retain a defence production capability and it is in those areas that I think the government should be involved. They may not be completely economical but they are of overriding importance to our ability to maintain a defence posture and government may have a place in there. It is not only prudent but necessary that government may do this.

However I think basically it should be left to the managers of industry to decide how they run their businesses, what products they get into and which avenues they should follow.

It brings a question to mind that if government directs the conversion of industries from defence to civil, does the government also then have to assume some responsibility for the success of those companies? If they move them from an area where there has only been a defence relationship into a civil one and the company fails, does that mean the government has to pick up the tab for that? I do not think that is the way it should be. I think that is an industry situation which should be covered by the industrial manager.

Indeed if the conversion is into an area where there is already a surfeit, too much capability, it could in fact result not only in the company that converted into that area failing but also other companies that were in there. There is a rollover effect there.

I think it is without any question the responsibility of the managers of industry to find and occupy the appropriate niches. If I may use the analogy, there is not much call for chariots any more, so a chariot manufacturer would not be a very viable occupation or a business. But that company might very well develop into bicycles or cars. On the other hand they have to accept the fact that there are many other competitors and they would have to be prepared to meet that competition.

It is the responsibility of the industry concerned to say this is no longer viable and where are we going to go to maintain our industry.

I think there is a place for government in industry in providing support. That support should be in the areas of perhaps providing a strategic analysis, to say to industry: "This is where we see Canada emerging, this is where we see the marketplace going, this is an area that you might look at to exploit in future".

I think government, as the minister said earlier, should be in the business of, wherever possible, removing barriers to trade. We should enhance the ability of our industries to compete on the world market. We should not subsidize them; we should enhance their ability to do it on their own.

I think probably the most tremendous impact the government could have on our industry, whether it be defence, whether it be civil or whether it be the conversion thing, is to bring the spending habits of the government back into line to balance the budget, to lower taxes. This in itself, in and of itself, would create a far more vibrant industry, it would result in far greater employment and to a large extent it would solve the problem that we are dealing with.

In conclusion I would just like to say that I do not believe that the government has too much place in the conversion from defence to civil industries. Certainly as I have mentioned, there is a road clearing process that it could do to remove the barriers, to enhance the trade, to indulge or enter into trade agreements, reciprocal agreements with other countries and other areas. Other than that I think the industrial base of a country should be run by the industrial managers who are concerned with it.

[Ian McClelland, Reform, Edmonton Southwest, AB]

Mr. Speaker, if I may have the indulgence of my hon. colleagues in the House, I would like to read the opposition motion. For those watching on TV who might have just joined us, it might be interesting for them to know exactly what we are discussing.

In the affairs of this House the opposition parties from time to time have the opportunity to bring forth subjects of debate. We get relatively short notice. I think it is quite interesting that we get relatively short notice, perhaps as much as a day in some instances, and we then debate the issue brought forward by the opposition.

Today the Bloc has brought forward this opposition motion which is being debated in the House:

That this House condemn the government for its unacceptable delays in developing and implementing a genuine strategy for the conversion of defence industries to civilian production, which would save and create new jobs in high technology sectors.

I do not know if I want to condemn the government for not doing this. There are many, many things we could condemn the government for, but I do not think this is one of them.

It is my opinion the government should keep its fingers out of business and out of the marketplace. It should let the marketplace decide who will be the winners, who will be the losers, who will be successful and who will not. It is survival of the fittest.

Why was it such a big shock to the defence industries that they were going to have to change? Was it because it happened overnight? Did we have this incredible industrial military complex that drove the economy and the country? No, it did not; and no, we have not.

Canada has never had a particularly large military industrial complex. Most of our sophisticated military equipment was purchased offshore. Many members would know, as would those watching, that one of the blackest days in the history of our country, at least in my opinion, was the cancellation of the Avro Arrow. By and large that put Canada right out of the high tech aerospace industry. Ever since that time we have been trying to force feed industry into areas of the country that may or may not need it, that may or may not get the industry because of political connections, political power, or power of the voter.

I submit that our country can no longer afford to artificially pick winners and losers. The fact of the matter is that if our world has changed and our country's defence posture has changed to the extent that the defence industries in a particular part of Canada, whether it is in Ontario or Quebec, are harmed because things change, then so be it.

It is up to those industries to convert or to find another use for their capital, for their people, for their industries. If they do not, they have every right to go out of business just like anybody else. Were this not the defence industry, if this were an industry of garment makers in Winnipeg, would we be having a debate in this House today that this House would condemn the government for not supporting garment workers in Winnipeg? I think we would not.

I want to acknowledge the help given by the Canadian Defence Preparedness Association in preparing the background paper I am using in my debate. It is interesting to note that Canada's defence industry, like most industry in Canada, is concentrated in Ontario and Quebec. For example, western Canada and Atlantic Canada each contain about 15 per cent of the total defence industry, whereas 70 per cent is in Ontario and Quebec, with 40 per cent in Ontario and 30 per cent in Quebec.

It is generally a high tech industry which is research and development intensive. That is particularly and precisely the kind of industry we want. However research and development in high tech industry is industry that depends upon the people who are part of that industry to stay alive. It is a fast moving industry. What is unique and innovative today could be tomorrow's hash browns.

We cannot have the government deciding where the high tech industry is going to be. The marketplace has to decide where the high tech industry will be and who will be the winners and losers.

It is also very interesting to note that according to this paper 70 per cent of the output of the manufacturing of the so-called defence industry in Canada is for the commercial or the civil market. At the same time, 70 per cent of this defence market we have in Canada supplies 70 per cent of the requirements for the Canadian defence department. That tells me that our defence industries in Canada by and large are already fairly diverse. They are not, as they are for example in many places in the United States, entirely dependent on the manufacture of one item, such as an aircraft. For instance, in Canada we have seen nothing like the decimation of the aircraft industry in San Diego. It was highly dependent on military contracts for all of the research and development. The defence budget in the United States as compared to ours is just absolutely enormous.

We do not have the same critical mass in the defence industry to start with and our defence industry, although concentrated primarily in Ontario and Quebec, is fairly balanced between these two provinces. It is not totally 100 per cent dependent on military manufacturing to stay in business according to this paper. That seems to me to be a fairly solid and a fairly good way to run a business.

Historically as a nation there are some areas where we have decided we were going to pay a premium in order to maintain an industry of our own. One is ammunition manufacturing. I think there is a place in Toronto that manufactures ammunition. Ammunition could be purchased offshore but we buy our ammunition at home.

I wonder whether free trade and the relationship we have under the GATT, but particularly under NAFTA, would allow for this kind of protectionism anyway.

I would also point out to my hon. friends that one of the reasons that people in other parts of Canada who do not directly benefit from the manufacturing heartland of central Canada, being Ontario and Quebec, just go crazy is the fact that it always seems to be necessary to protect the manufacturing base in central Canada. We have this insane situation even as I speak that we have to negotiate to break down interprovincial trade barriers.

We have 11 governments at the table trying to negotiate the decimation of these insane trade barriers. Think about it. That is more people at the table negotiating the removal of trade barriers within Canada than were sitting at the table to negotiate the removal of the trade barriers between the United States, Mexico and Canada. There were only three parties at that table and we have 11 in Canada.

We are debating a motion on whether our government, our taxpayers, people earning 10 bucks an hour, paying two or three bucks an hour taxes, should come to the federal government so it can decide who will be the winners and who will be the losers and we find ourselves subsidizing an industry for which there is no need.

We have to break down the trade barriers within Canada so we can be competitive within Canada. If we cannot be competitive within our own borders how on earth can we presume to be competitive in the world environment?

Let us put the horse before the cart. Let us get rid of internal trade barriers. Let us get our construction, our manufacturing, our capital resources, our people working together, and let us let the marketplace pick the winners and then compete world-wide. I submit that if we take that kind of approach we will be winners the world over because we can compete without government help, without government subsidy in any market in the world.

[Benoît Tremblay, Bloc, Rosemont, QC]

Mr. Speaker, I hope one day people like the hon. member for Calgary Centre will give up their ideological vision and understand the real economic situation in Canada and other countries.

The hon. member said that the military sector is fundamentally a high-tech industry, and we know full well that it will become less and less important in the years to come in North America, and even more so in the United States than here, in Canada. We should not forget that the American companies are our main competitors.

For many, many years, most of the federal research and development subsidies went to defence industries, in areas like telecommunications, development of new products or aeronautics. Governments used a good deal of their research and development subsidies for military purposes, because they wanted the armed forces to be in the vanguard of progress in aviation and telecommunications. Also, the development of new products was always crucial to the other two sectors. That is why the United States have a competitive edge in these sectors, where research and development is concerned. Now, of course, we must seek new ways of doing things. We are indeed in favour of the reduction in military production, but at the same time we must ensure that all of the research and the discoveries that can serve civilian purposes are not abandoned simply because some of these businesses go bankrupt tomorrow morning, after the government decides all of a sudden to cancel major contracts, like it just did with the helicopter deal.

For our country to be competitive at the international level, we need more than rhetoric; we cannot only tell the government never to interfere. We have to take into account the source of our competitiveness. Obviously, for years, the defence industry has been one of the main sources of our competitiveness in the non-military sector. The Americans set up a program for the conversion of defence industries to civilian production. They also developed alternative national strategies in areas like R and D, telecommunications, development of new products and aeronautics. They now have alternative strategies to replace the defence industry as instrument of R and D.

The Bloc Quebecois is only suggesting today that the government give us precisely what our competitors are getting. We can talk about being competitive at the international level and revel in rhetoric, but 80 per cent of our business, especially in the industrial sector, is with the United States. Thus, we need the tools, we need a transition process to maintain our competitiveness.

As you said it yourself, these businesses have already decided to go for the civilian market. We just have to get things moving toward conversion from defence to civilian production, since we must cut substantially our military spendings to reduce the government's budget and deficit. And this must be achieved without ever losing our competitiveness in the high tech sector. That sums up the precise and straightforward position of the Bloc Quebecois.

[Ian McClelland, Reform, Edmonton Southwest, AB]

Mr. Speaker, I respect my hon. colleague's opinion and I share some of the opinions he just put forward.

However there is a contradiction. I recall in my presentation saying that if there was an epiphenomenal moment in Canada where we said goodbye to high tech it was when we said goodbye to the Avro Arrow 35 years or so ago. We were world leaders and we said goodbye to it. Ever since that time we have relied on offshore industries for our high tech aircraft or high tech defence materiel. The nucleus, the germ of it comes from offshore. I agree 100 per cent.

Therefore, if I agree with that and the contention that my hon. colleague brought forward, he must also agree that if we are getting that high tech initiative offshore we cannot also be getting it onshore. We cannot depend on both. The defence industry has been a high tech driver in Canada. Of that there is no question.

We look at the satellites and Canadarm and those kinds of things. They could be considered defence and defence oriented, but those things are not going to come to an end. We are still going to have satellites going up. We should all say a prayer for Anik E2 up there somewhere. God knows what it is doing. However, the whole high tech industry is not going to dry up and go away.

We need the vision of the people who are the shareholders of those companies that were in that business. That is what their job is. The job of the directors of those companies is to anticipate, to see where they should be putting their energies in the future. Perhaps it is in the environment. Perhaps it is in extracting minerals from difficult places.

My point is that it is not the role of government to decide what that initiative should be. It should be the role of industry and the owners of industry. They will do a far better job than we will. When we went through our orientation, no one said all of a

sudden when we passed through these doors that we would become venture capitalists with the ability to pick winners and losers in the marketplace. It did not happen.

[Georgette Sheridan, Liberal, Saskatoon—Humboldt, SK]

Mr. Speaker, I appreciate the opportunity to speak on this topic which is so important to a large number of Quebecers. I would like to thank the hon. member opposite for focusing attention on the future of the defence industry. It is an industry which over the years has provided much employment in the province of Quebec and will continue to do so.

The future prosperity of the defence industry is vital to the future prosperity of Quebec. As a vibrant part of Canada and North America, Quebec and its industry can keep pace with global change and technological advancement.

I applaud the interest of the member in raising this question and I would like to speak for a few minutes on this important matter.

The Quebec defence industry is made up of many small companies and fewer than 20 medium to large ones, the vast majority of sales being made by the latter.

All these companies, small and large alike, have seen their defence sales dwindle over the past few years. In light of the falling business activity on the defence markets, it is reasonable to assume that this trend could well persist.

European markets for defence sales have dropped remarkably, leading to a loss of 150,000 jobs over the last three years. That is 10 per cent of the workforce in the aerospace and defence sector.

In America, the experience is similar, with large reductions in military procurement matched by significant job losses, more than 3,000 in the last three years. Both European and American industries have been faced with a serious industrial adjustment problem.

In various countries, government has responded in various ways. It is tempting to look to solutions such as those proposed in the United States for the problems facing Quebec's aerospace and defence industry.

I believe we can learn from others. I am confident that some of the lessons we might learn from others in defence industrial conversion are universally acceptable. For example, there are a number of internal and external obstacles to diversification and defence conversion.

These include a narrow client base, lack of experience in export and commercial markets, over-engineered products and small product runs. External obstacles include shrinking global defence markets, difficulty in attracting capital and market protectionism among others.

The various approaches adopted world-wide by governments to deal with their defence industrial conversion problem all address these common elements but the approaches are often tailored to the particular circumstances unique to their particular defence industries.

As a general rule, none of these programs envisage getting out of military markets. Instead the first goal of diversification is normally to retain a viable industrial base. Many governments have approached this question as a regional or community issue focusing their support accordingly.

Many have formed committees involving all of the stakeholders concerned including government, trade unions and industry. The so-called dual use technologies, commercial and military, are often a criterion for government R and D support.

One key objective of all these programs is to maintain knowledge, intensive industries and the high quality, high technology employment which is part of it.

[The Speaker]

The hon. member has just begun her statement and she will have priority when we resume debate.

It being 2 p.m., pursuant to Standing Order 30(5), the House will now proceed to Statements by Members pursuant to Standing Order 31.

Spinal Health Week

[Ted McWhinney, Liberal, Vancouver Quadra, BC]

Mr. Speaker, the week of May 1 to May 7, 1994 is Spinal Health Week. The program was established in 1985 to initiate and maintain good spinal health habits in children.

It is sponsored annually by the Ontario Chiropractic Association, a voluntary membership organization that represents more than 1,350 Ontario chiropractors. Its objective is to provide public education and promote research to improve the quality of health care for the citizens of Ontario.

Eight out of ten Canadians suffer from back pain during their lifetime. The incidence is increasing. A healthy lifestyle including proper posture, exercise and good nutrition is the key to prevention.

Please join me in wishing the Ontario Chiropractic Association a very successful Spinal Health Week.

Oral Question Period

[Chuck Strahl, Reform, Fraser Valley East, BC]

Mr. Speaker, one of the promises contained in the infamous red book pertains to accountability. However, when key questions of importance are asked in question period relating to federal overspending, health care, native self-government and criminal justice, the government consistently demonstrates an unwillingness or inability to answer.

The only time the government answers any questions is when one of its own members asks the Liberal question of the day.

We on this side of the House are asking legitimate questions affecting the lives of Canadians. Where is the accountability and when will question period become answer period? Canadians want and deserve straight, hard answers to these questions. Reformers will keep demanding the government fulfils its promise to be more open and accountable.

Palestinian Self-Government

[Philippe Paré, Bloc, Louis-Hébert, QC]

Mr. Speaker, yesterday, Israel and the PLO signed in Cairo an historical agreement regarding Palestinian self-government.

Following several decades of political and military conflict, Yitzhak Rabin and Yasser Arafat have agreed on an action plan for the creation of a Palestinian territory in the Gaza Strip and in Jericho.

This agreement marks the begining of the end of a long and difficult armed occupation of Palestinian territories. Certainly apprehensions persist on both sides, but it is now up to the parties to show their good will and lay the foundations for co-operation between the Israeli and Palestinian people.

We congratulate negotiators on both sides on this truly remarkable achievement. This agreement goes a long way toward bringing lasting peace to the Middle East, and we hope it will be received favourably by all those who live in the region.

National Forest Week

[John Loney, Liberal, Edmonton North, AB]

Mr. Speaker, the week of May 1 to May 7 marks this year's National Forest Week. Each year the Canadian Forestry Association bestows on a municipality the title of forestry capital of Canada.

I am proud to inform the House that the city of Edmonton was chosen as the 1994 forest capital. I am delighted that the people of Edmonton have been recognized for their commitment to promoting the contribution of urban and rural forests to the city's environment, economy and social development.

Edmonton is a green city, noted for having one of the largest urban parkland areas per capita in all North America. These forested areas are enjoyed by local residents and by numerous visitors. Edmonton is also the gateway to the huge northern forest lands of Alberta which are becoming increasingly important to the diversification of Alberta's economy and to Canada's forest sector as a whole.

Allow me to congratulate the people of Edmonton and all the forestry workers in my region whose contribution has made 1994 a memorable year for my city.

Bosnia

[Reg Alcock, Liberal, Winnipeg South, MB]

Mr. Speaker, last week I had an opportunity to attend an international meeting of parliamentarians concerned about the situation in Bosnia-Hercegovina.

I was proud as a Canadian of the work that Canada is doing there. I wish to commend the Minister of Foreign Affairs, the Minister of National Defence and the men and women who are on the ground in Bosnia-Hercegovina doing important work. I cannot help but wonder whether or not we can do more.

During World War II Canadians opened their hearts and their homes to the children who were caught in war zones. I would urge us to think about doing the same again to provide some relief for those people who are in such terrific danger and to get the children out of the way of the bullets.

Transport

[Gurbax Malhi, Liberal, Bramalea—Gore—Malton, ON]

Mr. Speaker, high licensing fees for taxis and limos at Pearson airport are forcing operators on to the unemployment lines.

Each year rising insurance rates, gas prices, vehicle maintenance and licence fees along with poor business have made it impossible for operators and their families to survive.

It is like the tobacco smuggling problem. High licensing fees are driving legal operators out of business and have opened a window of opportunity for non-licensed operators to illegally scoop fares.

I call upon the Minister of Transport to direct the airport authority to lower its licence fees. Lower fees would ease the financial pressures on the operators and put an end to illegal fare scooping.

Bosnia

[Madeleine Dalphond-Guiral, Bloc, Laval Centre, QC]

Mr. Speaker, I would like to call the attention of the House to an intolerable reality that we have the power to alleviate. I am talking about the plight of children in Bosnia. More than anybody else, these children are innocent victims of an unbearable conflict.

A great many European countries are welcoming Bosnian children with open arms, but Canada's welcome remains discreet, too discreet, Mr. Speaker. Canada has a reputation of being a generous nation. Our involvement in peacekeeping activities is ample proof of that. But we can and must do more. We must welcome in our country these children held captive of a blind war which turns their lives into hell on earth. We cannot remain insensitive to their plight because by failing to act, we would in fact be condoning this war and its inhumane consequences.

Gaza-Jericho Accord

[Ed Harper, Reform, Simcoe Centre, ON]

Mr. Speaker, for the second time in a week the world has witnessed the peaceful conclusion of long and sometimes frustrating negotiations toward true democracy.

Like the South African election, the historic signing in Cairo yesterday of an agreement to end 27 years of Israeli occupation will bring to an end the senseless killing of so many innocent people.

In any successful negotiation there must be flexibility and an understanding on the part of both sides. The winners here are not those who sat at the bargaining table. The real winners are those millions whose lives and futures will be greatly improved.

Let us hope the actions taken here by these leaders will be an inspiration to those involved in conflicts in other parts of the world that there is a better way.

The world today is indeed a better and safer one as a result of the dedication and hard work of negotiators on both sides. I ask all members to join with me in an expression of gratitude to those whose efforts brought this difficult situation to a peaceful conclusion.

Palestinian Self-Government

[David Berger, Liberal, Saint-Henri—Westmount, QC]

Mr. Speaker, all Canadians were no doubt moved by the scenes from Cairo where representatives of Israel and the PLO finally signed an agreement on self-government for the Palestinians. It is important to mention the courage and vision of the architects of this peace, Yitzhak Rabin and Yasser Arafat.

We know that change will not come overnight. Much bitterness remains, but this first step is very significant. The parties have decided to settle their disputes through negotiation. We must continue to help the partners build mutual trust, which we hope will lead to a broader lasting peace that will extend to the whole region.

Citizenship

[Gar Knutson, Liberal, Elgin—Norfolk, ON]

Mr. Speaker, I rise to comment on the recent announcement concerning citizen court judges.

On behalf of my riding I would like to express sincere thanks to the minister of immigration for this step. Not only does the minister's plan promise to save the government money and end a cycle of patronage, but it puts more meaning into the proceedings surrounding becoming a Canadian citizen.

Those who are concerned with the deficit or patronage should be well pleased with the minister of immigration for a job well done.

Gaza-Jericho Accord

[Sarkis Assadourian, Liberal, Don Valley North, ON]

Mr. Speaker, historical and joyous are two words which best describe the Gaza-Jericho accord, signed on Wednesday, May 4, between the PLO and Israel.

This unprecedented agreement offers new hope for a region which for many years was torn apart by bloodshed and religious differences. I wish to extend my warmest congratulations and best wishes for a lasting and progressive peace to all Palestinians and Israelis affected by the accord.

The true impact of the agreement can only be realized through honest and mutual co-operation from both sides.

It is my hope that the Government of Canada will continue to offer its support for lasting and constructive peace throughout the entire region of the Middle East.

Multiple Sclerosis

[Pauline Picard, Bloc, Drummond, QC]

Mr. Speaker, it is an honour for me to announce in this House the official launching of the carnation campaign for multiple sclerosis, which will take place next weekend.

Multiple sclerosis is the most common neurological disease among young adults in Canada; it is estimated that over 50,000 Canadians and Quebecers have this disease, for which there is no treatment so far. We must also mention that Canada has one of the highest rates of multiple sclerosis of any country in the world. Given the seriousness of the situation, the Multiple Sclerosis Society of Canada hopes to raise $2 million in its national carnation campaign.

I am therefore pleased to join the Multiple Sclerosis Society of Canada in asking hon. members and all Quebecers and Canadians to support this worthy cause.

[English]

Bosnia

[Art Hanger, Reform, Calgary Northeast, AB]

Mr. Speaker, I rise today to bring to the attention of all Canadians the tragic plight of children in Bosnia.

None of us has been unaffected by the misery in Bosnia that we witness nightly. The children deserve a special degree of compassion. Untold thousands are homeless. Thousands have lost their parents. We do not know how many are languishing as refugees.

I urge Canadians to remember these innocent victims. I especially urge Canadians to support the work of Bosnian Children's Relief. I do not need to tell you, Mr. Speaker, that in your riding five Bosnian children are now safe and secure, having been granted a safe haven by Bosnian Children's Relief, but there are many more.

I call on the minister of immigration to review the guidelines relating to the granting of temporary safe haven visas for children.

With the help of the government, Bosnian Children's Relief could do much more in helping to preserve the innocence of children caught in an adult nightmare.