Debates of Nov. 15th, 1994

Supply

[Dick Harris, Reform, Prince George—Bulkley Valley, BC]

Mr. Speaker, unfortunately the members of the Bloc just do not get the truth of this whole thing. Canada is almost flat broke, if not already there. We have a $535 billion debt. We are operating $40 billion in the hole a year. There is no money for increasing services. The only way that can possibly be done at this stage is to increase taxes. Quite frankly, this is not a viable option. The Canadian people and Canadian businesses are taxed to death. They cannot take any more tax hits.

If we do not get our finances under control, if we do not get our deficit under control, if we do not start attacking the debt, Canada is going to hit the wall. All these services, the transportation services, hospital services, the infrastructure that the Bloc members are talking about are simply going to be gone, period.

This is a time when Canada has to clearly distinguish its wants from its needs. What we need is what we can afford to pay for; what we want is not what we can afford to pay for. The Bloc is talking about wants. The wants side of the thing should not even be on the agenda today, considering our financial position.

[André Caron, Bloc, Jonquière, QC]

Mr. Speaker, when you look at a country, you may look at its debt, but you must also consider its assets. Is Canada worth more than our present debt of $500 billion? If it is not worth more than that, obviously, we are going to disappear. But if you look at what Canada is really worth, with all its assets, its production, its natural resources, its people, if you add it all up and compare it to the debt, I believe that the difference is quite significant. My colleague will agree that to look at the debt without looking at the assets, is a bit short of good accounting practices.

With this, I will conclude, Mr. Speaker, that you must look at the assets instead of looking only at the debt.

[Yvan Loubier, Bloc, Saint-Hyacinthe—Bagot, QC]

Mr. Speaker, I would like to congratulate my hon. colleague for his excellent analysis and especially for having explained to the Reformers, who simply do not understand anything, that there is a difference between an asset and an expense.

When you have a productive asset, which will remain productive in the long term if you keep investing in it, in an area in development at the international level, like a railway system, anyone can understand that one day it will make the country richer. In other words it is possible to increase the wealth of a country and control spending by developing assets.

If we listened to the members of the Reform Party, with whom I work every day in the finance committee, we would empty nine tenths of Canada to fill the remaining tenth, because nothing is viable in their opinion. If nothing is viable, I wonder why they remain a federalist party. The country has to be dismantled. If they do not believe in the country as it is, why do they stay in politics? Are they here to improve the situation or to be accomplices to a systematic demolition? When it is not the railway system which is under attack, it is social programs. They started with unemployment insurance, then post-secondary education and health. If that is politics for them, hats off!

[The Acting Speaker (Mr. Kilger)]

A brief comment from the hon. member for Jonquière.

[André Caron, Bloc, Jonquière, QC]

Mr. Speaker, really, my hon. colleague summed it up very well. A country is much more than a bank account, much more than an accounting report. That is what we want to do in Quebec and we hope to be able to do it soon. At that time, we will show the Reform Party that it can work, even with people like us who sound like daydreamers, because there comes a time when if you cannot dream, you die, Mr. Speaker.

[Raymond Bonin, Liberal, Nickel Belt, ON]

Mr. Speaker, some people may want to destroy the country, but it would be too easy to destroy the railway system in Canada at the same time.

Canadians were led to believe that Canadian National is an inefficient company that does not meet the needs of the people. After a bit of research, we would come to realize that CN is subject to Canadian legislation which prevents it from being competitive and from selling shares. When it needs capital, CN must ask banks or individuals for a loan, contrary to Canadian Pacific, which can sell shares under these circumstances.

But even without a level playing field, Canadian National was able to make some very important decisions. The company was criticized for building a tunnel which shortens the trip from Montreal to Chicago by 12 hours. First in line to criticize CN were its competitors.

Nowadays, it is easy to rise in the House of Commons and say: "We are against any measure taken to save Canadian National, only because we are against it". We must realize that the time when Crown corporations in difficulty could get cartloads full of money is over. We now have to be efficient and innovative. We already know that Canadian National can easily compete with Canadian Pacific. I am even convinced that it can do better than CP.

Another important point is that while CN has been investing large amounts in its infrastructure, CP has not been doing this. It is normal, faced with the challenge of having to invest in its infrastructure, that it would want to repeat history and say to government: "Sell us this company for a dollar. We assure you that if you let us take over this crown corporation for a dollar you will not lose any more money". Well those days are over. CN is a valuable company in spite of the pressures put on it by government. It is an efficient company. Its employees are the best in North America. They have indicated their interest in making CN work.

The Capreol Save Our Rail Committee has been formed in my riding of Nickel Belt. The northern route has been faced with the challenges that CP initially wanted to merge with CN. This is something that is almost an impossibility when we think of two competitors that have not been very good friends in the last many years.

The next option was to purchase CN for a song and a dance in the same way that the Quebec City transit system was purchased by a very prominent Canadian, and a fellow Sudburian I should mention. The story was I am told: "Sell it to me for a dollar and you will never lose a cent again".

I am an Air Canada retiree. I was a victim of privatization. I am now the best spokesman for Air Canada that one will find and it does not have to pay me to do it. I saw that company grow from a company that was harnessed and handcuffed by federal legislation.

When I was working at Air Canada, we had a suggestion program for employees. If a suggestion led to savings, we got 10 per cent. We had very good ideas as employees. The sad thing is that each time we had a good idea to make the company profitable, we were told that Canadian legislation does not allow Crown corporations to do these kinds of things.

So how can such a company compete on the international market? We know now that our competitors are not here in Canada but around the world. Global competition requires that CN be able to compete on an equal footing with CP, its competitor.

We have mounted a campaign in my riding with the assistance of the Capreol Save Our Rail Committee. This campaign will grow. Our message is that we are giving Canadians facts about the situation of CN. It is not an inefficient company. It is a good company and its employees are excellent. It is performing well and is presently making a profit in spite of government legislation.

I would like us to remember that the airline industry underwent exactly what is happening now in the rail industry. Let us not forget that CP Air was purchased by a smaller company named Pacific Western. At that time it wanted to merge with Air Canada and then it wanted to purchase Air Canada. It is history repeating itself.

What was the message of Canadians? The message was that we need competition in this country. We cannot have just one airline or one railroad because the shippers will be forced to pay the fees required of them.

Our message to Canadians from the Capreol Save Our Rail Committee is: Privatize CN. The employees are signing cards indicating their willingness to participate in such a move. They want to do this because they know that as long as CN is a crown corporation other companies will want to take advantage of its good position. The best people who are in a position to take advantage of the good position of CN are the employees. Therefore, we are pushing for an employee led privatization of CN much like Air Canada did.

I think it is important to mention that Air Canada expects at least to break even and probably to make a profit. And the privatization of Air Canada took place during a recession. While other corporations were closing in Canada, Air Canada succeeded in becoming the great company it is today and, this year, it expects to break even or perhaps even to make a profit.

If Air Canada was able to do this during a recession, I am convinced that CN can do it in an economic upswing. I encourage all Canadians to show their interest in participating in an employee led privatization of CN.

I am not going to dwell on the past as my colleagues from the Bloc Quebecois are doing. I will not go over all the injustices they speak of. I may indulge a bit by saying that the repair shop in Capreol, a modern facility producing more efficiently than Joffre, was closed down in favour of the shop in Joffre, Quebec. As good Canadians we did not spend all our time crying. We sat down and tried to find ways of saving these facilities. We have not given up. The employees of these facilities are signing up. It is not a firm commitment to purchase shares in CN, but it is an indication of their willingness.

I urge Canadians, members of the opposition, all members of this House to seriously consider the benefits of privatizing CN.

As a former employee of Air Canada and as a retiree I know the pride and dignity employees develop in a company when, as in my case, you work for them for 25 years. In the case of the people of Capreol it was for three generations. When you speak of pride to a grandfather about how it was when he was on the railroad, he asks his grandson or granddaughter what it is like today. The pride you develop in a company is something you have to live. It is too easy to say that you worked for a company for a number of years and you either leave with a good package and love the company or leave with a lousy package and remember it forever with animosity.

In the case of Air Canada it used to belong to CN.

The employees of Air Canada and Canadian National are proud people. They are the ones who built the company. One criticism I would make of Canadian National is that if Canadians have come to think that CN is inefficient, that it loses money and makes bad decisions and if my research leads me to conclude that the decisions made by this company are good decisions that have allowed it to become profitable right after a recession, it must mean that the status quo cannot be maintained at CN.

Things must change. Governments have to sit back and try to understand and face up to what it is that a government offers its population. We struggle to offer our population the social services, assistance to the needy, care for the sick, food for people who are hungry, while putting millions of dollars into a company that can do better on its own. It is time Canadians faced reality. We do not print the money any more. Times are hard, but we are coming out of them.

The rail system forms part of our national strategy on the movement of goods and people. If the railroads have been inefficient in the transportation of people it is because of government legislation. Let us get those laws off their backs and allow them to compete through modern legislation face to face.

The competition will no longer be only between CP and CN. CP and CN must find partners. They must have the same tools to work with because their competition is south of the border. The competition is in the trucking industry. Indications are that the trucking industry can no longer maintain its past system of movement of goods. Our roads cannot handle it. Canadians realize they are subsidizing the roads in the same way we subsidized the railroads in the past.

It is difficult for that truck driver driving at four o'clock in the morning realizing he has $200,000 debt on the rig behind him. I am a firm believer that if we plan correctly we can develop a viable system for the railroads in co-ordination and co-operation with the trucking industry. It is reasonable as Canadians to expect that everyone should participate and everyone should become a winner. The transportation of goods in Canada should be a partnership between the railroads and the trucking industry.

As I conclude I would like to repeat my previous comment. The Capreol Save Our Rail Committee has been working diligently. A few months ago its members were faced with the prospect of losing their jobs. This community is a wonderful town. I was at its Santa Claus parade last Saturday. You should see the closeness and the unity in that town.

In the same breath CP says: "We will offer you a dollar for your company and you will never lose a cent again, but one thing we will do the first day we own that portion of CN is we will close the northern line". We are not taking the attitude that we will bring government to its knees or we will bring CN to its knees. We are addressing this issue in a different, modern, Canadian, Liberal fashion. We are meeting and working together. We have opponents but we sit with them. We get to know them and we learn to work together.

We will offer a solution to Canadians. We will maintain the transcontinental line coast to coast at least on CN. We will ask that there be legislation assuring that the transcontinental line will be maintained. I know that is the desire of CN if it should be privatized. By maintaining this line and CP if it can manage to do it would be better for all Canadians.

We could compete until we learn to complement one another in a transportation system that will be the envy not only of the rest of North America but of the world. Competitors could learn to complement one another instead of competing with each other and we could develop a system in co-operation with the trucking industry. Imagine that system which would be envied by all.

[The Acting Speaker (Mr. Kilger)]

It is my duty pursuant to Standing Order 38 to inform the House that the questions to be raised tonight at the time of adjournment are as follows: In accordance with the agreement reached earlier today the House will first hear the response from the government to the question of the hon. member for Calgary Southeast concerning the CRTC which can be found on page 7766 of Hansard of Monday, November 14, 1994; the hon. member for Notre-Dame-de-Grâce-Justice.

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

Mr. Speaker, before beginning my speech, I want to inform you that it will only be 10 minutes long, to allow my colleague from Argenteuil to speak.

The motion put forward today by the Official Opposition asks this House to condemn the government's lack of action and transparency with respect to the proposed restructuring of Canada's rail system, and especially its lack of vision with respect to high-speed trains.

We cannot help but conclude that the government is dragging its feet badly, as far as the high-speed train is concerned, so much so that we have to wonder whether it is not just watching the trains go by.

At a time when the government is concerned with meeting the challenge of the information highway, it is neglecting to meet the high-speed train challenge, a train which would give Canadians and Quebecers access to a modern, efficient and economical transportation system.

The high-speed train is a true revolution in the area of surface transportation. It is in some ways a revolution as significant as that of the information highway. The Europeans have understood that. While the French, the German and the Swedish have all opted for the high-speed train, the Canadian government has yet to move with the times. Introduction of a high-speed train service in the Windsor-Quebec City corridor would provide an ultra-rapid means of transportation to some 10 million people.

Fifteen million trips a year require an efficient means of transportation. At the dawn of the third millennium, Canada and Quebec must develop a means of transport for the future. The HST technology is the necessary and logical solution.

Initially developed in France, this technology is characterized by its profitability, its security, its convenience, its comfort and, above all, its speed performances. Based on a revolutionary technological concept, environmentally safe, the HST causes less noise pollution and greatly reduces energy consumption. With its successful performance, it has won a large share of the European market for medium and long-distance travel. By reaching commercial speeds of 300 km/h, it has become a very competitive means of transport compared with more traditional ones. The HST is faster, more comfortable, safer and more economical than cars. It stands in sharp distinction to air transport because it channels the movement of people over the entire territory. It helps to make downtown areas more accessible. Using existent rail lines, it enters the heart of cities.

The HST technology combines three essential conditions for the success of modern means of transport: connectedness, connectivity and nodality. Given these features, an HST for the Quebec-Windsor corridor is not a project which should stay on the shelf, but a necessity.

Rémi Bujold, the president of one of the consulting firms which worked on the HST project, said that this project would be profitable if it captured 40 per cent of the market for the Toronto-Montreal corridor, which now accounts for only 13 per cent of all transport needs.

As my colleague, the hon. member for Kamouraska-Rivière-du-Loup said last May, the cost-effectiveness of that system rests on its efficiency: "It can link Quebec and Montreal in 85 minutes, Montreal and Ottawa in 45 minutes and Toronto and Montreal in 140 minutes, at 50 per cent of the cost of a plane ticket. That is a real dream".

Given the inaction of the government, my colleague was wondering if Ottawa was not more concerned with defending the interests of the airline lobby than it was willing to participate in a job creating project, one very innovative project from a technological point of view and one which would be a driving force for the economy of our own businesses.

The HST has the support of many groups and public and private organizations in Canada and in Quebec. The Bombardier multinational, an unquestionable leader in the area of transportation, is ready to meet the challenge here in our country. That corporation, founded in Quebec, is very successful in selling its know-how, its technology and its products all over the world. Team Canada just got back from its tour and the federal government takes pride in the success and the accomplishments of our businesses abroad. But what does it do to encourage their development here in Canada and in Quebec?

The Prime Minister is going nowhere and evidently his government is marking time.

Several studies have shown that the HST would create approximately 127,000 work-years of employment. During the construction, with the technological and economical spin-offs of such a project, nearly 40,000 additional work-years would be created in various sectors. The management and maintenance of the network would create another 1,200 permanent jobs. The costs of funds for the HST project in the Quebec-Windsor corridor are estimated at approximately $7.5 billion over a ten-year period. The private sector would assume 70 per cent of start-up costs, while the remaining costs would be shared by the governments of Quebec, Ontario and Canada.

On April 26, Marc LeFrançois, president of the board of directors of VIA Rail, made an eloquent speech in support of this project. According to Mr. LeFrançois, the survival of passenger railway services in Canada will depend on the high-speed train project. According to the president of VIA Rail, the United States is an accessible market worth many billions of dollars. The high-speed train would give our businesses broad access to the North American market, where the high-speed concept has yet to make its mark.

At a time when draconian budget cutbacks have put what is left of Canada's and Quebec's railway industry at risk, at a time when our major railway companies are becoming less and less viable and thousands of workers in this sector are losing their jobs, I think it is high time the government showed some political and economic leadership by supporting a project that would stimulate and generate employment. The government should realize that this project is not only possible but necessary. As the government keeps pouring millions and millions of dollars into the Hibernia project, whose technology is not very exportable and, from the looks of it, not very profitable and unlikely to generate as many economic spin-offs as the high-speed train project, is it surprising that people get upset about the Liberal government's failure to act?

The government cannot afford to hesitate any longer. History has shown that Canada's present geopolitical entity was shaped by the railway that connected the Atlantic to the Pacific. This episode in Canada's history goes back more than a century. Considering the deterioration of Canada's railway network, a legacy of the negligence of many successive governments in Ottawa, one wonders what the Fathers of Confederation would have had to say. They would undoubtedly condemn this government's apathy. The government must make a decision now about the high-speed train, to prevent inertia from turning into inept policy making. The high-speed train project must be kept on track. Otherwise, the Fathers of Confederation would never forgive them.

[Dick Harris, Reform, Prince George—Bulkley Valley, BC]

Mr. Speaker, I listened again with some bewilderment to the comments of the member of the Bloc and there are a few points I would like to make.

She says that the government has been foot dragging on the high speed rail issue. Quite frankly, given the statistics, given the financial prospect, the viability of high speed rail in the Quebec-Windsor corridor if I were having to pay the bill believe me I would be foot dragging as well. I would not want to get into it.

The member talked about the success of high speed rail in European countries. For many years the high speed rail system in Europe has been heavily subsidized by the governments where the trains operate.

This country cannot afford to get into more subsidization of crown corporations or transportation systems. We are subsidized to death. We have VIA Rail being subsidized with hundreds of millions of dollars. It is interesting that the chairman of VIA Rail, a person who is operating a company at a huge loss every year, absolutely dependent on government subsidies to keep his company afloat, is now advocating and promoting a high speed rail system.

At least if we had some sort of track record with the company he operates, his support would at least be somewhat credible. The hon. member has talked about the economic factor of high speed rail. There is no financial data that support the fact that a high speed rail system in Canada, in the Quebec-Windsor corridor, could even begin to be financially viable without continued heavy subsidization from the government.

I would like to talk about one other thing. Where are the customers going to come from? Let us say that they did start to attract a lot of customers. Someone in the transportation industry is going to suffer. Is it going to be the airlines? Are we asking the airlines to lose more customers who would travel on trains?

Statistics and studies have shown that the Canadian people have a tremendous love for their automobiles. We are not going to change this love for the automobile that the Canadian people have simply by putting a high speed rail system in. They are not going to overwhelmingly start getting out of their cars and flocking to a high speed rail system overnight.

If this government were to enter into this thing it would be like going to the store to buy a new television set when you have no food in the cupboard. That is the state of the economy. That is the state of this financial house in Canada. We cannot afford to even think of a high speed rail system at this time.

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

Mr. Speaker, I wanted to make a definite promise but unfortunately I will not be able to keep it since, of course, I will not be sitting in this Parliament long enough. However, I can promise you that the day a train will link Montreal to Ottawa in 45 minutes, I will be delighted to take it with all the others who will want to come to Ottawa.

A high-speed train in the Quebec City-Windsor corridor will naturally be used by people who live along that corridor. Now, that area has a population of ten million people, industrial areas and many industries. That project will create almost 130 000 jobs. It is no small matter. People who work pay income tax instead of receiving unemployment insurance; so this is actually something fundamental and if the government waits too long to act, I agree that some interests have to be protected, namely those of air carriers.

When a country is in such financial difficulties as Canada, we obviously have to make the choices that are the most advantageous from an economic point of view. When a mode of transportation costs 50 per cent less than transport by air, I think that option deserves to be considered.

[Maurice Dumas, Bloc, Argenteuil—Papineau, QC]

Mr. Speaker, I will simply make an announcement. On May 23, Canadian Pacific Ltd. filed a request with the National Transportation Agency to abandon the Saint-Augustin-Mirabel-Thurso line.

The hon. member for Blainville-Deux-Montagnes, André Riendeau from the riding of Argenteuil, Paul-André David from the riding of Papineau, and myself, have prepared a submission. This document was presented to the National Transportation Agency of July 27, 1994. We requested public hearings and a five-year moratorium.

This is a rare occasion! We got the public hearing we requested, which will be held on November 22. Thank you.

[The Acting Speaker (Mr. Kilger)]

It being 5.30 p.m., it is my duty to inform the House that pursuant to Standing Order 81(19), proceedings on the motion have expired.

The House resumed from November 3, consideration of the motion that Bill C-53, an act to establish the Department of Canadian Heritage and to amend and repeal certain other acts, be read the second time and referred to a committee.

Department Of Canadian Heritage Act

[The Acting Speaker (Mr. Kilger)]

It being 5.30 p.m., pursuant to order made Thursday November 3, 1994, the House will now proceed to the taking of the deferred division on the amendment of Mrs. Tremblay (Rimouski-Témiscouata), in relation to second reading of Bill C-53.

Call in the members.

(The House divided on the motion which was negatived on the following division:)

[The Speaker]

I declare the amendment lost.

Pursuant to order made Thursday, November 3, 1994, the House will proceed to the taking of the deferred division at second reading stage of Bill C-55.

The House resumed from November 3 consideration of the motion that Bill C-55, an act to establish a board having jurisdiction concerning disputes respecting surface rights in respect of land in the Yukon Territory and to amend other acts in relation thereto, be read the second time and referred to a committee.

(The House divided on the motion, which was agreed to on the following division:)

Yukon Surface Rights Board Act

[The Speaker]

I declare the motion carried.

(Bill read the second time and referred to a committee.)

The House resumed from November 3 consideration of the motion that Bill C-54, an act to amend the Old Age Security Act, the Canada Pension Plan, the Children's Special Allowances Act and the Unemployment Insurance Act, be read the second time and referred to a committee.

Social Security Programs

[The Speaker]

Pursuant to an order made Thursday, November 3, 1994, the House will now proceed to the taking of the deferred division at second reading stage of Bill C-54, an act to amend the Old Age Security Act, the Canada Pension Plan, the Children's Special Allowances Act and the Unemployment Insurance Act.

(The House divided on the motion, which was agreed to on the following division:)

[The Speaker]

I declare the motion carried.

(Bill read the second time and referred to a committee.)

[The Deputy Speaker]

It being 6.15 p.m., the House will now proceed to the consideration of Private Members' Business as listed on the Order Paper.

[English]

Communications Security Establishment

[Derek Lee, Liberal, Scarborough—Rouge River, ON]

moved:

That, in the opinion of this House, the government should amend the Canadian Security Intelligence Service Act to authorize the Security Intelligence Review Committee to review the operations of the Communications Security Establishment (CSE).

Mr. Speaker, I am pleased to commence debate on a motion that I regard as important. Hopefully it will prove to be important to Canadians in the years to come if it is adopted by the House. The motion reads:

That, in the opinion of this House, the government should amend the Canadian Security Intelligence Service Act to authorize the Security Intelligence Review Committee to review the operations of the Communications Security Establishment (CSE).

From here on in I will refer to the Communications Security Establishment as CSE; the acronym is a lot easier to say.

The motion that CSE be reviewed is not a one-shot deal. It is intended that the monitoring continue on an ongoing basis just as the Security Intelligence Review Committee now reviews the operations of the Canadian Security Intelligence Service.

The Communications Security Establishment, CSE, was born in signals interception and code breaking developments during World War II. It was established in 1941 as the examination unit of the National Research Council. For the first part of its existence the examination unit was given particular responsibility for intercepting and analysing the communications of the Vichy government in France and the government in Germany.

It is estimated that by 1944 there were about 45 employees in the examination unit among whom were some very specialized people capable of thinking and communicating in what we call ciphers and codes.

In April 1975 control and supervision of the Communications Security Establishment was transferred by an order in council under the Public Service Rearrangement and Transfer Duties Act from the National Research Council to the Department of National Defence.

The CSE was officially acknowledged finally by the Canadian government, as I understand it for the first time, when on September 22, 1983 the Hon. Jean-Luc Pepin, then Minister of State for External Relations, stated in the House:

The Communications Security Establishment advises on, and provides the means of ensuring the security of federal government communications. It also provides, with the support of the Canadian Forces Supplementary Radio System, a service of signals intelligence in support of Canada's foreign and defence policies. I should explain that "signals intelligence" is the term given to information gathered about foreign countries by intercepting and studying their radio, radar and other electronic transmissions.

What about the budget of CSE? How much money does it spend? Actually we in Parliament who authorize expenditures for all government spending do not know because we have never been told. The question has been asked but it has never been answered.

However in 1991 it was estimated by a journalist who was well schooled on the issue-he did a lot of research and published a series of articles in the Toronto Globe and Mail -that the budget in 1991 was about $100 million to $125 million and that CSE employed about 800 persons.

As an aside here, what I know as a member of Parliament on the subject has come from a journalist. It has not come from questioning in parliamentary committees or in the House. We cannot find out here. In order to find this out I had to buy a copy of the Globe and Mail . That should say something about the process.

What does CSE do in its functions? We should look at that a little more closely but not too closely. CSE has a two-part mandate: first, the collection of signals intelligence on the diplomatic, military, economic, security and commercial activities, the intentions and capabilities of foreign governments, individuals and corporations. Second, it consults on the security of the communications of the Government of Canada.

We are led to believe that it is good at both tasks. The first part of the mandate is the signals intelligence program, the gathering of signals and their analysis, decoding analysis and analysis of the data. CSE with the support of the Canadian forces supplementary radio system collects, studies and reports on foreign radio, foreign radar, and other foreign electronic signals emissions to provide foreign intelligence to our government. As we will see later, some intelligence data can be and are shared from time to time with other governments.

CSE maintains signals interception facilities in several locations around the world. It uses a set of sophisticated technologies to decode and interpret. It uses leading edge induction technologies that permit it to read what is on a computer screen from a remote location. It uses voice recognition technologies and key word technologies which, with the assistance of sophisticated computers, are able to analyse and retrieve data on subjects and persons.

Presumably it intercepts signals to and from locations all over the world. At least it has the ability to do so. One would presume that it is capable of and does intercept signals sent from Canada to other parts of the world and from other parts of the world to Canada.

I do not read through that list to alarm anyone. It should not be a surprise to any member. These technologies and these functions are routinely used by most industrial countries in their gathering of foreign intelligence. I wanted to put on record that these technologies are out there and we are using them in foreign intelligence gathering functions.

What is the chain of command for CSE? Who is in charge? Who does it report to? I guess it is a bit of a puzzle but fortunately CSE through its executive and the government has been fairly forthright on that issue. It has done it over the last few years. It has not hidden it at all.

The Minister of National Defence is accountable to Parliament for the spending of CSE. The minister approves CSE's major capital expenditures, its annual multi-year operation plan, and with the cabinet committee on security and intelligence the major CSE initiatives with significant policy or legal implications.

The chief of CSE is accountable to the Minister of National Defence for financial and administrative matters but to the deputy clerk of security and intelligence in the Privy Council office for policy and operational matters. There is a two-headed management structure in place here. One is the Department of National Defence through the minister and the other is the Privy Council office, the head of which is the clerk and the political head of which is the Prime Minister.

I would note as well that the major client of CSE is the Department of Foreign Affairs and International Trade, being the major consumer of foreign intelligence data. In addition we are told in Parliament that arrangements have been put in place to ensure that CSE responds to the government's foreign intelligence requirements in a manner that is lawful, effective and sensitive to changes in international relationships.

I would note as well that CSE and its administrative head in the PCO have appeared co-operatively before the national security subcommittee in Parliament. That occurred at the end of the last Parliament. The amount of information conveyed was a lot less than members had hoped for, but we believe a relationship was established at that time.

In terms of communication security, the second part of its mandate, CSE is responsible for developing standards on electronic communications security for the approval of the Treasury Board, advising on the application of those security policies, and providing cryptographic material and documentation to appropriate government institutions. That is the coding exercise which prevents unauthorized parties from listening to or understanding intragovernment communications.

Also it works with international agreements in the communications and electronic security and signals intelligence programs and approves the release of classified or controlled communications security information and assets to government and non-government entities.

It reports to Treasury Board, when requested, on communications security. In fact members of Parliament rely on CSE expertise in protecting the security of our own internal communications in and around Parliament.

CSE provides a research, development and evaluation capability on security aspects of computer hardware, software and communications systems to ensure information is available to the government on the security of its computer systems and use in government.

As I mentioned before, the Department of Foreign Affairs and International Trade is the major client but there are other clients of CSE signals intelligence data. They include the Royal Canadian Mounted Police, the Canadian Security Intelligence Service and other government departments with an interest in security matters. All those exchanges of information are done by a tasking mechanism governed by memoranda of understanding, or so we are told.

Through the department of foreign affairs CSE exchanges signals intelligence data with foreign governments again through memoranda of understanding. We have never been told with whom. We can only guess.

CSE is a full partner in the U.K.-U.S.A. agreement which structures electronic signals intelligence sharing among the United Kingdom, the United States, Australia, Canada and more recently New Zealand. Again memoranda of understanding are said to be in place.

There are two questions. One is on the efficacy of CSE's spending and the other is on the potential impact of what CSE does on the rights and liberties of Canadians, given the extensive and intrusive powers of CSE.

Four years ago members of Parliament completed a five-year review of the Canadian Security Intelligence Service Act. That five-year review, after five years of operation, reported to the House in a report called "In flux but not in crisis". I read one excerpt from it that is most relevant:

While the Committee found no evidence of abuse by other agencies, it believes that a number of other collection agencies have a substantial capacity to infringe on the rights and freedoms of Canadians. The capacity of the Communications Security Establishment is a case in point. This organization clearly has the capacity to invade the privacy of Canadians in a variety of ways. It was established by Order in Council, not by statute, and to all intents and purposes is unaccountable. As such, the committee believes that the Communications Security Establishment should have a statutory mandate that provides for the review and oversight mechanisms for the agency.

The recommendation of the committee, which I point out was supported by all parties in the House of Commons, was that Parliament formally establish the CSE by statute, and second, establish the Security Intelligence Review Committee as the body responsible for monitoring, reviewing and reporting to Parliament on the activities of CSE concerning its compliance with the laws of Canada.

There was not an effective response to this from the government. In fact of the 117 recommendations in that unanimous report of members of Parliament I believe the government gave a favourable response to one. Someone once suggested it was one and a half, but it was not a meaningful reply, to say the least.

What is this proposal? Why do I reiterate the recommendation and proposal of that five year CSIS review?

Let us look at what SIRC does. SIRC does two principal things. It deals with appeals by individuals regarding complaints they have in relation to security clearance procedures and requests for security clearance. That comes from individuals in all departments of government. It is multi-agency in scope.

Second and most important is that SIRC reviews the work of the Canadian Security Intelligence Service for compliance with the statutory mandate of CSIS and the policies that are articulated thereunder, and for compliance with the laws of Canada. It also looks from time to time at the issue of management efficacy within CSIS.

SIRC, the Security Intelligence Review Committee, has access to all persons and documents within CSIS for the purpose of carrying out its role. It does it on behalf of Parliament and it reports to Parliament. I and others believe that SIRC is capable

of fulfilling the same function for CSE with only a marginal increase in expenditure.

We believe, and I am firmly supportive of this, that if Parliament adopted this motion, if the government implemented it, it would be a cost effective adoption of the concept of review and oversight already adopted by Parliament and working reasonably satisfactorily.

I want to read something from the McDonald commission, which is starting to look awfully long in the tooth but is still quoted extensively in these areas. The August 1981 second report of the McDonald commission indicates there is a serious moral issue involved in the way government deals with security intelligence matters.

I see my time is running short so I will not read all of it but I certainly want to incorporate that reference in my remarks here today.

I am not saying that the CSE is out there breaking laws now. It tells us it is not. However, it does have the means to invade the communications privacy of Canadians in ways beyond the comprehension of most of us.

Why wait for a scandal, why wait for an embarrassment, why wait for someone to make a mistake inadvertently, or advertently within CSE? Let us develop now a mechanism which will cause CSE to know that it is accountable to Canadians through Parliament and through the Security Intelligence Review Committee. Then the universe can unfold. Everyone will know what the rules are. Everyone within CSE will know who the players are and what the program is.

I want to point out that SIRC reports that CSIS is already routinely making use of CSE shared data and denoting that in the CSIS data base. Therefore SIRC clearly has an interest in this.

I quote a former chairman of the Security Intelligence Review Committee, Mr. Ron Atkey. "We are not looking for a new, additional assignment. We have plenty to do. However, we cannot fail sometimes to observe the absence of review mechanisms in other parts of the intelligence system". He was speaking specifically about CSE.

As I wrap this up, I realize that Parliament will have an opportunity to continue to debate this issue for a period beyond today and that the matter should come to a vote in due course.

I ask all members to consider carefully my remarks and the remarks of other colleagues, and to make a reasoned decision about this when we are called on to adopt this motion.

[François Langlois, Bloc, Bellechasse, QC]

Mr. Speaker, allow me to first congratulate the member for Scarborough-Rouge River, who also happens to be chairman of the Sub-committee on National Security, on presenting motion M-38 to the House.

Who could be in a better position to present such a motion than the chairman of the Sub-committee on National Security! I believe that this is tangible proof that we need better control. I support the motion presented by the member for Scarborough-Rouge River, subject to some reservations I will explain and a few changes I will suggest.

When talking about an agency such as CSE, the Communications Security Establishment, it is good to give a brief historical background. My colleague for Scarborough-Rouge River went back to 1941, but I would like to review, if I may, the legal instruments which, during the post-war era, produced this institution as we know it today.

CSE first started as a unit of the National Research Council, under Order in Council 54-3535 dated April 13, 1946. CSE was the successor to the civilian and military intelligence services which, during the war, had worked in co-operation with similar British and American services.

On April 1, 1975, responsibility for this communications unit of the National Research Council passed to the Department of National Defence. CSE's mandate was never officially defined by a statutory instrument, but it is generally understood that its mandate should be limited, by the Privy Council, to Canada's external security.

While we are entitled to expect that CSE's activities are targeting communications from or to foreign countries, or relating to foreign embassies, or any communications involving at least one foreigner, recent and serious allegations lead us to believe that CSE may have intercepted, without any legal mandate, with or even without ministerial authority, conversations and communications between Canadians, in Canada, and that it may even have eavesdropped on leaders of the Quebec sovereignist movement who are operating legally and legitimately.

Since CSE is accountable only to the Privy Council, its executives and its agents may have become somewhat too lax. Therefore, it seems imperative for the Security Intelligence Review Committee, commonly known as SIRC, to review the operations of CSE, while, of course, maintaining the authority of Parliament and of the Sub-committee on National Security over CSE's activities.

However, like Ceasar's wife the SIRC must be above suspicion but, unfortunately, this not the case at the present time. This review committee is made up of five members. Three were appointed on the recommendation of the party which governed during the 34th Parliament, the Conservative Party. These three appointees are Mr. Jacques Courtois, Mr. Edwin Goodman and Mr. George Vari.

There are, therefore, more Conservative members in this committee than in this House. We can see, already, that the Official Opposition is not represented on the committee, and this is not acceptable.

Another member is Mrs. Rosemary Brown, Chair of the Ontario Human Rights Commission. She is working full time for that organization and we did not have a chance to meet her when the SIRC appeared before the Sub-committee on National Security. Mrs. Brown was appointed on the recommendation of the New Democratic Party which was then the third party in the House, but has now lost its party status.

Finally, the last member is Mr. Michel Robert, whose qualifications we will not contest. Our only questions are: Could Mr. Robert be slightly over-worked, since on top of being a member of the SIRC he is also working, at the government's request, on a settlement in Oka? On the one hand he must work with ministers of the Crown, and on the other he must investigate the activities of the Canadian Intelligence Security Service. Maybe he should drop one job and concentrate on the one he is best suited for.

But in order to have a watchdog, a review committee, a renewed SIRC instead of the "circus" we have at present, it is imperative that the current members of the committee resign so that new appointments can be made that better reflect the 35th Parliament. This way, three appointments could be made by the government on the recommendation of a minister of the Crown, in all likelihood a Liberal, one on the recommendation of the Official Opposition and one more on that of the third party, that is to say the Reform Party of Canada. This would be an example of democracy in action, since the SIRC, like the Senate, remained unchanged after the election.

So, I do support the motion before us, but at the condition that new members be appointed to the SIRC, especially since the current members systematically refused, when testifying before the national security committee on September 13, to answer questions put to them by the committee on behalf of the House of Commons which is supreme in that respect.

How could we trust any longer individuals who refuse to co-operate with the elected representatives of the people and hide behind an overly finicky interpretation of Section 54 of the National Security Act to say that they account to the minister and nobody else? I am sorry, Mr. Speaker, but as long as the members of the SIRC will claim to be accountable only to the minister, there will be a serious credibility problem with the very institution of Parliament as well as with the House of Commons, as a component of the Parliament of Canada. The SIRC members must be replaced with individuals who understand that, until the contrary be proved, in this country, the lawful, fundamental and primary authority rests with the representatives elected by the people to sit in this House.

I will conclude with the following amendment proposal: I move, seconded by my colleague from Berthier-Montcalm:

That the motion be amended by adding after the words "Establishment (CSE)" the following: "and to table an annual report in the House on the aforementioned activities".

[The Deputy Speaker]

I declare the amendment in order.