Debates of May 26th, 1994

Budget Implementation Act

[The Acting Speaker (Mrs. Maheu)]

In my opinion the nays have it.

And more than five members having risen:

[The Acting Speaker (Mrs. Maheu)]

Pursuant to Standing Order 76(8), the recorded division on the motion stands deferred.

[Jim Gouk, Reform, Kootenay West—Revelstoke, BC]

moved:

Motions Nos. 16, 17, 18 and 39

That Bill C-17 be amended by deleting Clause 15.

That Bill C-17 be amended by deleting Clause 16.

That Bill C-17 be amended by deleting Clause 17.

That Bill C-17 be amended by deleting Clause 32.

Madam Speaker, although we do not mention names in the House, I would like to clarify that the name is Gouk. I would not want people to think we have 53 members in the Reform Party just yet.

We have moved this amendment to allow us to address the various parts of the bill. When I first spoke on this I pointed out that it was an omnibus bill. The nature of an omnibus bill is something that presents so many different parts that may not closely or even relatively link to one another that it is impossible to pick and choose what you can support and what you consequently have to reject.

If there are things in it which are totally unpalatable and one cannot support then one has to reject the entire bill. The reason we have moved this amendment is so that we can address the individual parts of the bill in debate.

With regard to the transportation subsidies, as I said before that is one portion which I can agree with at least in principle. I also suggested at the time that the government had not really done its homework on these issues. Had it done so it would have found that there were many areas, both in the western grain transportation subsidies and in the Atlantic regional subsidies where other costs could have been cut that would have achieved the same or a higher level of saving for the government without penalizing the people of the region that these subsidies were initially designed to serve.

It could be done in such a way that the subsidies could be reduced and the local people would still realize a saving in money if we got rid of some of the waste and inefficiencies. I suggested this was a lack of homework on the part of the government. I have seen very little in the ensuing period since I last spoke on this issue to suggest that the government is yet ready to do this work.

Much of this can be resolved in committee. I believe that is what committees are for. It is unfortunate that the government sees fit to take all these different aspects of things generally relating to the budget, lump them into one omnibus bill and then suggest that we have to accept or reject the bill in its entirety.

We have seen the folly of this under such things as the Charlottetown accord. The Charlottetown accord was probably the most omnibus piece of work that has ever come from any government. It was rejected by the majority of Canadians who reviewed it and said: "While there may be some things in there that we support, there are things in there that we cannot plug our nose and vote in favour of as the previous Prime Minister suggested". Consequently the majority of Canadians in their own best interest rejected that.

Forevermore, from the previous Prime Minister to the present Prime Minister and all his cabinet ministers, every time we try and raise an important issue for Canadians we hear that we rejected that. We hear: "We offered that to you and you rejected it under the Charlottetown accord. Never, ever bring it up again".

Using that same rationale, it brings to us Bill C-17. In Bill C-17 there are probably some good things we would like to see through. We are told that the government has to reduce its cost and yet every time it tries we reject what it is saying. We say there are things in here where we can save money and we support that. Transportation subsidies is one area which in general principle we can support.

An example of something I personally cannot support tied into the same bill is allowing borrowing by the CBC. It is not bad enough that the government borrows more than it can ever hope to repay and cannot even pay the interest on, but now it wants to farm out those rights to its various crown corporations so that they can borrow. In that way it is not seen as part of the government's national debt.

With regard to the transportation subsidy I would support the reduction in grain subsidies but I couple that with a request if not a demand that the government at the same time look at the inefficiencies of the transportation system. It has been proven that simply pumping money into the transportation system does not get the grain moving and that is what the farmers require.

By all means we can reduce the costs but at the same time we have to get rid of the inefficiencies. I suggest that if we got rid of all inefficiencies we could get rid of subsidies almost entirely without any penalty to the farmers who are in dire straits because of government inaction.

With regard to the Atlantic regional subsidies, again the same situation. There are many areas where the government could reduce subsidies if it would improve certain other areas which penalize the Atlantic region. One that I mentioned specifically was the icebreaking services provided without cost to the shippers in order to keep a frozen port open while ice free ports remain underutilized. This is penalizing the Atlantic region.

As I mentioned, I have no problem with keeping that service available but shippers should pay the cost of providing that service which costs $20 million a year. This would more than offset the type of subsidy it is looking to reduce and which is actually penalizing the Atlantic region.

I also mentioned the economic development grants. Those could be reduced as well if at the same time the government would do something about interprovincial trade barriers which costs the Atlantic region more than its entire economic development grants.

On the basis of breaking this up, I will support with my added remarks the transportation subsidy portion. But until the bill is broken up and the parts dealt with individually so that the ludicrous parts can be eliminated, it makes it very difficult to support.

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

Madam Speaker, I will not talk at length about this part of Bill C-17, since I do not think there are major problems with the administrative provisions on transportation contained in this bill.

I will rather speak about the lack of seriousness of the Reform Party when it proposes to examine the bill section by section. We were just told in a very strange way that the party wants to eliminate the entire clauses of that part of the bill, while recognizing that some provisions could be beneficial. I have never heard such a thing before. I have already seen politicians

who were not serious, but we expected that the Reform Party would be a little more serious than that.

Had they proposed constructive amendments to this part of the bill, it seems to me that it would have been promising for the overall examination of the bill. I see that they are unable to do that, because they are not serious. All the more so since it was just said that the bill contains some provisions that are beneficial for Western grain transportation. They have been elected only in the West and they are proposing amendments to eliminate these provisions as a whole, including the ones concerning Western grain transportation, the famous Crown's Nest Pass Agreement.

Do these people talk to their constituents? As they claim, their way of doing politics is somewhat different. They bring up questions faxed to them by citizens. They should have gone directly to their constituents, especially the western farmers and the western carriers to seek their opinion, instead of acting so irresponsibly and proposing these amendments.

I also noticed that each time a bill, including the motion introduced by the Reform Party, dealt with a region east of Manitoba, it was necessarily bad. One said for example that, in the Maritime Provinces, users could have been asked to pay for the ice monitoring. As if these people were not already overburdened. I noticed it during the hearings held by the sub-committee on bill C-17, especially on the part dealing with unemployment insurance. Let us stop -as the Reformers always do-taking the Maritime Provinces as the sole example to illustrate inefficiency.

The same thing applies to regional development grants. I feel it is a little too much. I wanted to stress that. It does not add anything to the motion introduced, it does not take away anything from it. But the attitude of the Reform Party today is disgraceful.

[The Acting Speaker (Mrs. Maheu)]

Is the House ready for the question?

[Some hon. members]

Question.

[The Acting Speaker (Mrs. Maheu)]

Is it the pleasure of the House to adopt the motion?

[Some hon. members]

Agreed.

[Some hon. members]

No.

[The Acting Speaker (Mrs. Maheu)]

All those in favour of the motion will please say yea.

[Some hon. members]

Yea.

[The Acting Speaker (Mrs. Maheu)]

All those opposed will please say nay.

[Some hon. members]

Nay.

[The Acting Speaker (Mrs. Maheu)]

In my opinion the nays have it.

I therefore declare Motions Nos. 16, 17, 18 and 39 negatived.

(Motions Nos. 16, 17, 18 and 39 negatived.)

[Monte Solberg, Reform, Medicine Hat, AB]

moved:

Motions Nos. 19 and 20

That Bill C-17 be amended by deleting Clause 18.

That Bill C-17 be amended by deleting Clause 19.

[Suzanne Tremblay, Bloc, Rimouski—Témiscouata, QC]

moved:

Motion No. 21

That Bill C-17, in Clause 20, be amended by replacing line 37, on page 9, with the following:

"year, including indication of the purposes for which the Corporation plans to borrow money and its plans for repayment of the borrowed money."

[Monte Solberg, Reform, Medicine Hat, AB]

moved:

Motion No. 22

That Bill C-17 be amended by deleting Clause 20.

[Suzanne Tremblay, Bloc, Rimouski—Témiscouata, QC]

Madam Speaker, while the government bill proposes to amend the rules pertaining to unemployment insurance, Canada Assistance Plan and collective bargaining by imposing a salary freeze upon its employees, while the government is making cutbacks everywhere and taking money in the taxpayers' purse, it is still granting the CBC a borrowing authority of $25 million which could be increased under an appropriation act.

First of all I would like to denounce the omnibus bill which in the hands of the government becomes a way to disguise important policy changes. This bill is a soup containing to many ingredients and too spicy to the taste of the poorest.

That being said, I would like to emphasize the borrowing authority that the government intends to give the CBC. According to the rule book, a line of credit is generally granted to individuals and to financial institutions that know how to add up figures, how to administer their business, that have expansion plans based on market research studies or who know how to balance their books. In other words, individuals and institutions that have a financial reputation that can justify their request.

Yet, this is far from being the case with the CBC. Let us have a closer look at the facts. Based on data prepared by senior officials of the Department of Canadian Heritage, the CBC will see its deficit grow from $41 million this year to $78 million next year and this does not take into account the budgetary cuts of April 1993. You must add to those projections an amount of at least $100 million that the Minister of Canadian Heritage intends to recover from the CBC over the next five years.

The minister also stated that he would like to see the CBC less dependent on advertising revenues. Those revenues will account for 26.3 per cent of the total revenues of the CBC in 1994, that is almost $400 million on a total budget of $1.5 billion.

Up until now, several drastic measures have been taken by the Canadian Broadcasting Corporation to redress its structural deficit. With a document published by professor Lauzon, I want to remind you of some of those measures which in the end did not solve anything and, above all, did not allow the corporation to balance its books. Yet, we still suffer from some of those measures. There have been 2,800 jobs lost since 1984, including some lay-offs, French and English television services have been restructured, three local television stations have been converted to satellite stations, and all regional programs have been cancelled except for news bulletins. That measure should bring about an economy of $46 million.

Incidently, it is impossible for me, as a citizen, to find out how much it costs to operate the French CBC station in Quebec City. People in Eastern Quebec have the vivid impression that that station profited from the savings that were to result from the closing of the Rimouski, Matane and Sept-Îles stations. But when we ask for information in Quebec City, the answer is: "Sorry, we have competitors, we cannot give you that information".

Let me go on with the list of cuts the CBC made in order to reduce its deficit: $12 million in expenditures for the television network. Another apparent cut affects precisely the office of the Speaker of this House; the parliamentary channel has been transferred to the budget of his office. Such a measure seems to result in an economy of $5 million but in reality the service still costs taxpayers $5 million; it has simply changed envelopes.

Another cut was the reduction of Radio Canada International services abroad and the transfer of its financing to Foreign Affairs. This might look like a $20 million saving for the corporation, but it is costing $20 million to Foreign Affairs. Such measures are deceitful for the public; they are a real disgrace.

But not all services have been cut, not all services have borne their share of budget cuts. The amounts withheld from the regions have simply been transferred to the networks.

According to a study conducted by the Syndicat des journalistes de Radio-Canada, contrary to what they would have people believe, the closing of stations in the regions in 1991 has not reduced the costs of television programming. It has led to a transfer of funds to the networks. If you compare the costs of television programming for 1991 with those for 1992, you realize that they have decreased by $40 million in the regions and that the costs of the regions' contributions to the network have also decreased by $7.1 million. One regionally produced program we all know very well is "SRC Bonjour" which originates right here in Ottawa.

Therefore, you will say, there was in fact a cut of some $47 million. Quite the opposite; if you look at the figures, the network costs have increased by $60.7 million. There you have another example of the kind of cover-up this government and that corporation are carrying out. The final cost was $13 million higher than the anticipated cuts. Therefore, the network benefited from the closing of our regional TV stations and it hurts even more. We are still reeling from it.

I would like to mention something that was promptly dismissed by the president of the Canadian Broadcasting Corporation and by the Minister of Canadian Heritage, namely the funding discrepancies between Radio-Canada and the Canadian Broadcasting Corporation.

On April 5 last, the Coalition pour la défense des services Français de Radio-Canada, which, I will remind the House, is made up of technicians, journalists, musicians, researchers, and in-house artists, published a report showing that the funding discrepancy between the two networks now totals $76.4 million. SRC gets $69 million, whereas CBC receives $146.1 million.

One hour of TV programming costs on average $37,400 on CBC, and $18,390 on SRC. Producing the news on the French network costs on average $7,000 an hour, whereas the same thing on the English network costs $18,000. And yet, news are news, no matter the language.

Comparing average drama production costs is just as shocking: $68,000 on the French network against $99,000 on its English counterpart. In spite of such disproportionate funding, which can only be due to cultural racism, CBC and the Société Radio-Canada have comparable audiences. With a BBM audience rating of 13.6 per cent, the Canadian Broadcasting Corporation reaches approximately 2.8 million viewers whereas the Société Radio-Canada, with a rating of 33 per cent, reaches an audience of 2.2 million. Therefore, such funding discrepancies between the two networks cannot be justified.

Recently, the CBC bought the broadcasting rights for the Olympic Games in Atlanta for $28 million. Its competitors were offering $10 million. The corporation believes that it can sell $35 million worth of advertising, which experts in this area tend to doubt. Does the corporation intend to use its new line of credit to make up for any revenue shortfall? It is a question every citizen is wondering about.

In view of such financial mismanagement, the Bloc Quebecois, on behalf of Canadian and Quebec taxpayers, wants the Canadian Broadcasting Corporation to be accountable to Parliament for the use of its line of credit. That is the reason why we proposed an amendment which would make it compulsory for the corporation to explain to Parliament the purposes for which it plans to borrow money and its plans to repay the borrowed money. What sense is there in giving the corporation borrowing authority if it is unable to manage its affairs?

[Monte Solberg, Reform, Medicine Hat, AB]

Madam Speaker, I am pleased to speak today on part four of Bill C-17 which would grant borrowing authority to the CBC.

I wish to address the several flaws inherent with this notion. First, the government has committed itself to a management and funding review of the CBC. Without waiting for the completion of this same review the government has remodelled funding for the CBC on two occasions.

In the first instance this administration has reversed spending cuts announced by the previous Conservative government from $350 million to $250 million over four years. Meanwhile the government's budget includes a provision that a $25 million borrowing authority be awarded to the CBC in order to offer it more businesslike flexibility.

I am very sceptical when it comes to assuming that the ability to borrow $25 million would accomplish efficient management not realized with $1.1 billion in appropriations from the Canadian taxpayers.

It really does baffle all logic that the government would call for a funding review in one instance while at the same time tampering with existing funding formulas.

It is obvious to me that the provision to grant the corporation borrowing powers is premature based on the government's own announcement. From a practical standpoint it makes no sense whatsoever to allow the CBC to seek loans.

The CBC is not like a business in the private sector. There are no shareholders or customers in the normal sense to answer to. There is no compelling obligation to strive for efficiency because there is no bottom line. In short, there is no need to worry about turning a profit, nor is the concept of bankruptcy a constant preoccupation.

In this type of structure there is never a shortage of things on which to spend money. Permitting the CBC to borrow is more likely to enhance the national debt than corporate efficiency.

The budget document suggests that the public broadcaster may be allowed to borrow an amount greater than $25 million with parliamentary approval. In effect the ceiling of $25 million is really a decoy. How did the government arrive at this figure? What measures will keep it from climbing to $50 million or $100 million? Who will be ultimately responsible for the debts incurred by the corporation?

The general trend is that when one includes clauses like these in legislation, there is a tempting desire and requirement to use them. The law of wasteful spending requires that unaccountable financial entities will spend any and all funds directed toward them without adherence to efficiency.

While testifying as a witness before the Standing Committee on Canadian Heritage not long ago on April 12, CBC president Anthony Manera conceded that the corporation currently estimates a shortfall from all sources to be in the order of $180 million over the next four years. The CBC has a $45 million deficit on operating budget on revenues of about $1.4 billion.

It would be paramount that any business facing such a financial crisis first put its own house in order before assuming any further liabilities. Borrowing to reduce debt load is synonymous to using a Visa card to pay down a MasterCard. Even in a best case scenario, it would require shrewd investments and a commensurate amount of time and good luck for the CBC to realize economies of scale from its borrowing authority.

Allowing an indebted company to accumulate further debts at the public's expense is poor management and it is morally irresponsible. The rationale behind the new borrowing power is supposedly to allow the corporation to make investments in systems and equipment that will result in long term savings.

What are these investments? What are the risks involved? What is the projected return on investment? Who will be responsible if the investment fails? These questions demand answers before this request by the CBC can even be considered.

It has also been suggested that a levy be raised on private broadcasters or cable subscriber fees be initiated to fund the CBC to the detriment of their competitors and the public. The crown corporation cannot have one hand in taxpayers' pockets and another in the marketplace, giving it the best of both worlds when there is no incentive to be cost effective or competitive.

With respect to its mandate, the CBC is facing an abundance of difficulties. For example, the CBC English language television audience has been declining steadily since 1990-91. The viewership has declined to only a 13.3 per cent share of audience, which caused CRTC chairman Keith Spicer to remark to Mr. Manera at a recent licence renewal hearing: "You are going down the tubes here in ratings. You are going down to oblivion".

What of the U.S. programming during prime time and a litany of U.S. soap operas from one until six in the day? How does the CBC explain the decline in arts programming, in children's programming since 1987? All of this combined with technological breakthroughs cause us to question the need for the existence of the CBC.

Specialty channels and the electronic superhighway have become catch phrases of the 1990s. Is there a need for a public broadcaster when the public will have 500 channels to choose from offering a similar and cheaper product to the CBC? The CBC has jointly submitted a bid to operate one of these specialty channels under the name of Festival.

Since Parliament has not changed its mandate, is it even appropriate for the CBC to establish and operate new television networks? One must also examine whether the CBC is undermining its current obligations by engaging in another channel bid. This relates both to its legally required programming as well as its management of scarce resources.

In addition, it would be important to critically examine the program management and copycat production practices of the CBC. Canadians frequently criticize the Canadian style U.S. programs that find their way on to the air waves. Meanwhile the shifting around of "Prime Time News" from 10 p.m. to 9 p.m. only to have it return to its original time slot has diminished public confidence in the operation of the CBC.

In the futile task of persistently propping up the CBC, there are some serious questions to consider with the prospect of borrowing money. Here are four issues which really demand answers. First, how will the CBC generate profits on its revenue in order to repay any loans it has incurred?

Second, clause 19 of the bill states: "Notwithstanding the Financial Administration Act, part VII of that act does not apply to a debt incurred by the corporation". It is not clear after consulting the Financial Administration Act and the Broadcasting Act if the crown or the corporation would be ultimately responsible for the debts of the CBC.

Third, what guidelines has the government established to the exercising of this borrowing authority?

Fourth, why is the government allowing the CBC to borrow money in the first place? Would it not be more financially sound to privatize portions of its operations and realize substantial savings which then may be used to finance new cost effective ventures?

It is crystal clear that any attempt to revitalize the CBC using measures normally reserved for companies competing in the private marketplace undermines its integrity as a public broadcaster. Any special measures designed to raise capital for the CBC, such as loans, subscriber fees or licence fees, would be an unfair advantage should the CBC underbid its private counterparts for any services which it is given in addition to its heavy state sanctioned financing.

These factors along with the changing technological landscape bring into question the relevant role of the CBC. It is for the reasons outlined above that our caucus will not be supporting this borrowing authority.

[Roger Simmons, Liberal, Burin—St. George's, NL]

Madam Speaker, I too would like to say a few words on Bill C-17. I will come in a moment specifically to section 18 which deals with the proposed amendment to the Broadcasting Act to grant CBC some borrowing authority from the consolidated revenue fund.

First, the bill, in effect the budget implementation bill which flows from the budget of a couple of months ago, would seek to do a number of things. I am surprised, I say to my friend from Medicine Hat, that he did not spend a good amount of his speech lauding the bill because a lot of it goes straight to the issue of budget restraint which in some ways will be painful for various parts of the country, but necessarily painful because, as the Minister of Finance has said again and again and as the Prime Minister has said repeatedly, we are committed to getting our financial house in order and Bill C-17 goes a fair distance to doing that.

In light of the comment made by my friend from Medicine Hat, let me come directly to the matter of the proposed amendment to the Broadcasting Act.

This amendment would give to the CBC the businesslike flexibility which I submit is necessary for a billion dollar corporation by authorizing the CBC to be able to borrow up to a limit of $25 million from the consolidated revenue fund and from Canadian banking institutions through lines of credit, through commercial loans and the issuing of bonds or commercial paper.

I believe this measure would represent an important step in our campaign to help the CBC by permitting it to become more efficient in operations and allowing the corporation to enter into other ventures acceptable to the government that provide a return on investment. It is perhaps in this context, I say to the member for Medicine Hat, that I find his objection most surprising. It is interesting to note that he did not say what he was going to do today. He said what his caucus was going to do.

I say to my friend from Peace River, I assume that is another example of the free vote approach of that party. Now one stands up and says what the entire caucus will do. What happened to the free vote we used to have in that great party, that party that I have come to admire? Where is the leader today when I need him to answer on this particular issue of why suddenly he is allowing the member for Medicine Hat to muzzle a party of free voters?

I digress. On the one hand the member for Medicine Hat decries the bill for allowing the CBC some borrowing authority but yet we hear them wax eloquently from time to time about how we ought to become more efficient as a government and as crown corporations. Again I say to him that we cannot really have it both ways, can we?

The funds that the bill would permit the CBC to borrow would be used only to generate operating savings. This idea that somehow it is going to go out and buy Lotto 649 tickets with it or somehow splurge-

[Charlie Penson, Reform, Peace River, AB]

It might be a better investment.

[Roger Simmons, Liberal, Burin—St. George's, NL]

In fairness, the member for Peace River interjects that it might be a better investment. I have to say to him in response that for a member of the Reform Party hope must spring eternal.

These borrowed funds would be used to generate operating savings or for venture investments. The operating savings would come from investments in capital equipment and projects which have a payback of four years or less. At the present time the CBC is unable to take advantage of these opportunities due to its shortage of capital resources and the immediate need of addressing physical obsolescence in plants and equipment across the country.

Perhaps a good example of how this proposed borrowing authority would help the CBC was the arrangement reached by the corporation to disaffiliate from its Pembroke, Ontario station and replace it with rebroadcasting towers at a capital cost of $2.2 million.

The subsequent annual savings in payments to the affiliate less the cost of using the towers yielded net savings to the CBC of $374,000. As well the corporation earned an additional $1 million in advertising revenue as a direct result of this disaffiliation in Pembroke. A capital investment of $2.2 million was repaid in under three years. That flexibility to undertake such initiatives is an indispensable tool for the CBC.

It is worth reminding ourselves that under no circumstances would the CBC be permitted to use these borrowed funds to address an operational shortfall and thereby operate on deficit financing.

I say to my friend from Medicine Hat, there is the answer to one of the questions he raised. If he listens to the debate he will get the answers to all these questions. We heard his questions. We not only heard them we had anticipated them beforehand because these are some of the legitimate questions that need to be asked. Nobody has scored the member for Medicine Hat for being unthoughtful. He is very thoughtful about his questions but he rushes to judgment a little too quickly. He decides this is a bad thing before he has fully examined it. However I give him credit for at least knowing the questions to ask.

I repeat to him that the CBC will not be allowed under any circumstances to use these borrowed funds to address operational shortfalls and thereby operate on deficit financing. It is not only a commitment of the government. It is a caveat that will be in the agreement that would be entered into between the government, the Minister of Finance on the one hand and the CBC on the other.

The CBC's borrowing ceiling under this provision would be $25 million. A memorandum of understanding between the CBC and the Department of Finance would, as I have just said, set out the terms and the conditions governing the borrowing authority. Foremost among those conditions is that the CBC would require the approval of the Minister of Finance, in accordance with the established Department of Finance guidelines, for each transaction it undertook pursuant to this particular provision.

We have heard again, particularly from my friends in the Reform Party, some concern about this issue. It is not surprising on the one hand because we know they are for the dismantling or the privatization of the CBC and I respect that point of view as a policy position. I do not agree with it myself and my party does not agree with it either but certainly I respect the point of view. It flies in the face of our position. It is diametrically opposed to what we believe on this issue. We see the CBC as a key national cultural institution.

At the same time I cannot resist mentioning to my friends in the Reform Party that there is a bit of an inconsistency in their position in that we hear them so often talking about the importance of the businesslike approach. I believe the record, what we said on this issue, demonstrates that what we are trying to achieve here is a more businesslike approach for the CBC.

Finally there have been concerns about adequate reporting to Parliament. This is addressed by the procedure under which the borrowing authority will be included in the corporate plan summary which the CBC is obliged to table annually in Parliament.

In the context of the $1 billion crown corporation that we are talking about, the $25 million we are talking about is a relatively small amount. I submit the government is taking adequate safeguards to see that it is done in a reasonable manner.

[René Canuel, Bloc, Matapédia—Matane, QC]

Madam Speaker, in Bill C-17, it is mentioned that the government can authorize a borrowing of $25 million. I wonder about that. Where will this money be spent? Will it be in large centres or rather in fringe areas?

Madam Speaker, you know that in my region, in Matane, Rimouski and Sept-Iles, we have been terribly penalized. It is a sparsely populated rural area. When constituents are few, it seems that they can take everything away from you. It hurts us in the rural areas.

How many of these millions will be used to restore television service in Rimouski, Matane and Sept-Iles? In our modern world, communications are extremely important. In my region, in small isolated parishes with nothing for 8, 10 or 15 kilometres around, people are beginning to speak out.

Last Saturday, I attended a meeting of Urgence rurale in Saint-Marcellin, a small community of 300 inhabitants. For once, the people spoke for themselves instead of inviting Ph.Ds from the university. They were asked: "What do you want in your region?" They had stunning things to say. For the last 15 or 20 years, these people have taken things into their own hands and almost made miracles with very modest, very minimal means. Their parish was supposed to be closed, but they reacted. They asked me why they no longer had services from Radio-Canada in Matane, Rimouski and Sept-Iles. They told me they had invited reporters to a meeting of Urgence rurale, but the CBC never bothered to cover their story. They were too small. Small parishes are not important for the CBC.

Then, I asked myself: "Where are these 25 million going to go?" If none of it comes to our area there will be a serious problem. You must realize that there might be some political game involved. Duplessis used to say: "The less people know, the more they will vote for me". He had another saying: "In Quebec, we have the best education system in the world". Of course, it was not true then.

Is our communication system threatened? If we cannot communicate with each other we will stay ignorant, and ignorance is the saddest and the most rotten thing in the world.

We demand to be provided with CBC services. Today we do not have such services. We can still communicate of course, but we do it differently, we have to go through the telephone. This is a rather crude way, when television could really unite us.

Our region includes the Magdalen Islands, Sept-Îles, Matane, Rimouski, and we cannot communicate with one another. As long as we are unable to talk to each other, the governments will be satisfied. Because we are isolated, we are almost islanders and this give us a tremendous dynamism, although we cannot export it to the right places.

As I was saying, the area of the Lower St. Lawrence, the area of Gaspe, the islands, the North shore, no longer has access to its own means of communication and this is painful.

In order for people to develop a sense of self-worth and to understand one another and in order to raise their collective consciousness, communication is essential and the Radio-Canada television network is an excellent communication vehicle. If the government does not want to give money to Radio-Canada, then it should give it instead to Radio-Québec or to community television stations, because this money comes from the taxes Quebecers pay. It is their money to begin with. We could use this money to readily defend ourselves with dignity.

Three stations were shut down and a decision was made to broadcast from the Quebec City station. I have nothing against this station. Quebec City reporters are undoubtedly very competent, but what do they know about our region? Do they know that there is no university in my riding? Do they know that there is only one CEGEP? What do they know about eastern Quebec or about the federal-provincial agreement? Absolutely nothing. Are Quebec City reporters familiar with the unemployment rate in the area ridings? Absolutely not. They deliver the evening news and they do a good job of it, but they know nothing at all about our region. Even if they want to be as objective as possible, quite often they are ignorant of local events and do not give a totally fair account of the facts.

The ties that bind us together are being severed. In today's global village, we receive news from around the world. We receive an immediate account of events taking place in all countries abroad, whereas we have to wait two, three or four days, and sometimes even one week, before learning about the goings-on in our own backyard.

Would you not agree that this is insulting and frustrating? The $25 million to be spent should be spent in the regions. I firmly believe this and I hope that my colleagues opposite understand the problems faced by rural communities. I hope that they will come to our defence because we too pay for a great many things in Canada through our taxes. However, we do not get our kick at the can as often as we should.

[Jim Silye, Reform, Calgary Centre, AB]

Madam Speaker, I rise today to speak in opposition to this portion or grouping of Bill C-17, specifically clauses 18 to 20 which authorize the Canadian Broadcasting Corporation to borrow up to $25 million, plus more by special legislation if necessary.

When will the Liberal government and the country understand that this borrowed money is in fact debt capital and not equity capital which at the end of the day will simply increase the government's deficit?

The government in this fiscal year will add $41 billion to the debt which will take it over the $550 billion mark. It is this debt and the interest to service the debt that have helped to create the recession and put 1.7 million Canadians out of work and forced countless businesses to close their doors.

Why does the government continue to lend money it does not have? When will it face up to the reality that just as Canadians are forced to curtail spending so must the government?

Unaccountable crown corporations like the CBC sail through these troubled times spending money believing that there is plenty more where that came from.

In the finance department's March 16 news release regarding Bill C-17 the finance minister stated:

The act proposes to implement initiatives in support of our twin objectives of job creation and deficit reduction.

I put this question to all members of the House and all taxpayers watching this on TV: How can $25 million in borrowed money, in addition to the $1.1 billion of taxpayers' money that the CBC currently receives, possibly reduce the deficit? Is the CBC going to hire more people? Will the tax revenue from income create a profit for the government?

This is a contradiction in terms. It is like saying the more money we spend the more money we will have in savings. The CBC is not a made for profit corporation. Therefore any amount of money that we give it will add to the deficit. It is a corporation whose ratings have dropped and the only way it generates any revenues at all is by playing U.S. produced shows which do not satisfactorily portray Canadian culture.

It is this generosity with other people's money that creates the pie in the sky Liberal logic which takes the emphasis off the real problems in this country, high debt, high interest costs to service this debt and high taxes to pay for wasteful grants and subsidies.

Liberal government members have said that 85 per cent of real jobs are created in the private sector. Therefore I submit they would do a better job creating long term, meaningful jobs with $1.1 billion in tax reduction rather than subsidizing the CBC with $1.1 billion.

If the government truly wants to promote Canadian identity and pride, let the private sector create long term, meaningful jobs and put Canadians back to work. The government should regulate, administer, pass laws and defend borders, but stop interfering with the marketplace by endlessly funding crown corporations and short term job creation programs that benefit the few and not society as a whole.

If the federal government sees a vital role for Canadian content on TV then regulate it, do not pay for it. Let the law of supply and demand dictate which shows stay on and which shows are cut.

I believe it is time to consider a partial privatization of the CBC. The fact is that under the present situation Canadians are not watching.

At a recent licence renewal hearing CRTC chairman Keith Spicer told reporters that CBC's English network saw its audience share dip to 13.5 per cent in 1992-93 from 15 per cent in 1990-91. Mr. Spicer went on to say: "Your ratings are plummeting. They are falling like a rock".

This is a perfect example of what happens when companies lack a competitive atmosphere. There is less incentive and lower overall quality of the product. Private sector companies in this position have shut their doors and have closed forever. This is not the case, however, with the CBC which has guaranteed government backing. With Bill C-17 it will have yet another option to borrow.

When will the government acknowledge that it is in fact part of the problem and not the solution? When will the government stop the unlimited funding of the CBC? When will the government create the atmosphere and environment for investment and stop making investments with money that it does not have? The private sector understands this. It is time that cabinet ministers did too.

Private sector growth generates confidence and opportunity. It sends a message to investors that this country is able and willing to compete.

The Liberal government should send a message to foreign and domestic investors, lenders and businesses that Canada welcomes competition in a fair marketplace, free from government interference, subsidies and grants. This signal alone would bring in equity capital for businesses and the government could get out of businesses it knows nothing about such as the CBC, Petro-Canada and Canada Post.

The CBC presently pays millions of dollars to broadcast American comedies. Mr. Spicer stated: "The network is merely tinkering with this direction in the face of crisis". Where is the accountability or the justification?

As a businessman I know that corporations both public and private over time begin to lose their overall objectives. Perhaps Mr. Spicer's quote is an indication that the CBC has itself moved away from its original objective of providing quality Canadian programs, promoting Canadian culture and talent.

Privatization of the CBC in whole or in part would, as Mr. Spicer said, force the company off the road to oblivion without a rescue plan.

With privatization the performance of the CBC would be subject to market rules with market benefits and market sanctions. Even partial privatization would reduce the deficit and still maintain jobs. Time and again private corporations have proven that they can operate more efficiently and effectively than crown corporations. A dollar spent in the private sector requires three dollars for the same service in the public sector.

At risk money motivates, government money obligates but it obligates the wrong people, the taxpayers, without enough say. Decisions in the private sector must be made quickly to take advantage of investment opportunities as they arise. Companies that make these decisions subsequently suffer or gain from the consequences. Crown corporations have long been criticized for their inability to make these decisions. It is largely due to the lack of incentive, motivation and accountability because the government acts as a safety net.

Who gets fired if a costly program never airs? Who ever hears about it? Who ultimately pays for the extravagance and the errors?

Government involvement gives these corporations a kind of financial longevity that corporations in the private sector do not have. Therefore the longevity becomes a burden to taxpayers. This promotes unfair competition within industry sectors, those who have to answer to shareholders and those who have an endless supply of taxpayers' money.

Privatization would also improve the government's financial position. Selling assets would allow this government to reduce its monetary requirements for the year, which for this year will be $41 billion, and repay part of our accumulated debt of over $516 billion.

Privatization in whole or in part of the CBC, not $25 million in borrowing authority, would help the government truly meet the so-called twin objectives of the finance minister of job creation and deficit reduction.

As of eleven o'clock this morning, the Doomsday clock calculated the national debt at $516,293,742,299.79. Since 11 o'clock this morning the debt has continued to grow at a rate of $1,473.50 per second with a debt per taxpayer of $36,730.20.

[Jean-Paul Marchand, Bloc, Québec-Est, QC]

Madam Speaker, Bill C-17 is an omnibus bill dealing with a wide range of subjects, from unemployment insurance to Western grain transportation and Atlantic region freight assistance, including a line of credit for the Canadian Broadcasting Corporation.

In fact, Bill C-17 affects directly or indirectly 16 acts of Parliament, that is 11 directly and another 5 indirectly. This goes to show the lack of transparency of the federal government, in spite of its campaign promises to that effect.

Bill C-17 typifies the lack of will to be open on the part of the federal government, by bunching various acts together and asking the House to vote on them as a whole. There are many good things in Bill C-17 and some bad ones. I am totally opposed of course, to the planned unemployment insurance reductions in view of how severe the unemployment situation is in Canada.

As for the $25 million line of credit extended to the Canadian Broadcasting Corporation, I would like to focus on this aspect of Bill C-17 for the next 10 minutes. We cannot object to the CBC having a $25 million line of credit. Many reasons can be provided in support of the CBC. The hon. member for Burin-St. George's mentioned earlier "the intention is to put the financial house in order".

There are several other reasons, including perhaps acquisition of new equipment or restructuring. The problem is not so much the line of credit as the matter of control. How will we know how this $25 million will be spent and on what? And how will it be repaid? That the problem. If this government was concerned about transparency, it would make sure this $25 million loan will be subjected to the scrutiny of this place, like all CBC expenditures. Even a blind person could see that there is mismanagement at the CBC.

Here a few examples of mismanagement at the CBC that basically reflect the essence of this government. There is financial mismanagement in government in general. It is particularly obvious at the CBC. And we parliamentarians cannot examine the particulars of CBC expenditures. It would seem that the corporation has no business plan, but if it ever did, it was shelved a long time ago. Recently however, this mismanagement has being causing serious problems. While this government is taking money out of the pockets of the unemployed and away from seniors in their tax credits, it seems ready to tolerate blatant squandering on the part of the Canadian Broadcasting Corporation.

I would even dare to ask questions on the fact that the CBC increasingly seems to favour the English-language network at the expense of its French-language counterpart. On the subject of mismanagement, that is quite obvious. Did you know that since 1984, 10 years ago, about 2,000 jobs have been cut at the CBC? Rather drastic cuts were made, for instance, in regional production. In 1990-91, regional production was cut by $46 million.

The Minister of Canadian Heritage even announced very recently that another $100 million would be cut over five years. While experiencing major cuts, layoffs, job losses and service cuts in the regions, the CBC has increased its share of the advertising market.

Between 1979 and 1992, the CBC increased its share of the advertising market from 15 per cent to 25 per cent, nearly doubling its market share in 10 or 15 years. Its revenues have therefore doubled or increased considerably.

Despite drastic cuts in the staff budget and a growing share of the advertising market, CBC's deficit continues to climb. From 1992 through 1995, CBC's deficit was absorbed by the employee pension fund surplus. This deficit is expected to reach $41 million in 1995-96 and CBC itself predicts that it will increase to $78 million by 1998-99. My God, what is wrong at the CBC?

We have serious questions on the operation and management of the CBC. It is obviously poorly managed, there is no control. It is a little like the federal government: a kind of ship sinking in the middle of the ocean.

All we ask for on this side of the House is not necessarily to object to CBC's line of credit because CBC is, of course, an important network with top-notch reporters and expertise we want to keep. We do not necessarily object to this line of credit, but we would still like to have the power, as parliamentarians, to see where this money goes and why the deficit keeps growing despite the cuts and CBC's bigger share of the advertising market.

It is a basic request, and if the federal government really cared about transparency, it would grant it to us. But it will not do so, of course, because its majority will enable it to pass this bill regardless of the good reasons to improve it.

The cuts are serious. For example, I just told you that in 1991-92, CBC's budget was cut by $108 million. Did you know that it cost $129 million to cut this $108 million? The reorganization, that is, all the services put in place to implement the cuts, costs $29 million more than the cuts themselves.

The fact that CBC's production costs rose by $177 million from 1988 to 1993 leads me to believe that this mismanagement on the part of the CBC- In fact, if I had more time, I could have shown you that money has been transferred to the English-language network at the expense of the French-language network.

In any case, in conclusion, we on this side would certainly like to have the right, as parliamentarians, to review the use of this $25 million line of credit to the CBC.