Debates of Oct. 24th, 1996

Supply

[Some hon. members]

Hear, hear.

[Pierre De Savoye, Bloc, Portneuf, QC]

Thank you, dear colleagues.

So, essentially, the secretary of state is promising strategic action, an action plan, is explaining the past, but is he ready to commit yourself, before the House, his colleagues and the public, to spend that fourth quarter in Montreal, so that next year Statistics Canada will be able to say that 25 per cent of all Canadian expenditures have been made in Quebec and that Montreal got its full and fair share? Or will there be, one year from now, another official opposition day when we will once again stand in this House and say that Montreal is once again not getting its share? I await his answer.

[The Acting Speaker (Mrs. Ringuette-Maltais)]

The hon. member has only 30 seconds to answer.

[Pierre De Savoye, Bloc, Portneuf, QC]

Then, is it yes or no?

[Martin Cauchon, Liberal, Outremont, QC]

Briefly, in 30 seconds, we are asked to promise to get involved. We are not promising to get involved because we are already actively involved in the metropolitan area and have been for a long time.

I did not like the fact my colleague talked about spending money in the metropolitan area. The Canadian government does not spend money in the metropolitan area and throughout Canada, it invests. This is the way we look at it.

[Stephen Harper, Reform, Calgary West, AB]

Madam Speaker, I rise today to speak to the Bloc's motion on the current economic situation in Montreal. This is one of those times when I feel I do not belong, being part of a different family, but that I must still take part in their debate. Anyhow, the motion reads:

That this House recognize Montreal as the economic mainspring of Quebec society and, therefore, condemn the federal government's lack of concrete initiatives in supporting the Montreal area economy, primarily-

It then lists several particular areas in which the federal government has failed.

I notice that we are dealing here with the Montreal area, where the support for the Bloc is not as strong as in the rest of Quebec. This may not be pure coincidence, but I believe that there is here reason enough to blame both the federal government and the sovereignist movement. If I may, I intend to move an amendment later on reflecting my point of view and my party's to the effect that both sides are to be blamed for their policy with regard to this economic crisis.

[English]

What has happened to Montreal? When I was a young boy growing up in Toronto, Montreal was a substantially larger city than Toronto and was recognized in Toronto at the time as being the economic centre of Canada.

Before I was a teenager all of that had changed and today in Montreal, which I visit frequently, one can see on each visit the gradual decline in the economic importance of that beautiful and important city. One can see evidence of decline in its infrastructure, the growth of unemployment and the decline of employment opportunities. One can see evidence of the decline of business and the shift of growth and economic activity and opportunity outside of Montreal, particularly to Toronto, but also in some cases to other parts of Canada.

No doubt today we will be treated with arguments which are basically the following from the federalist side. I am a federalist. However, we shall hear from the Liberal side that the separatist movement is solely responsible for the decline in Montreal and for the economic uncertainty it faces and that the sovereignty movement has chased away any economic prosperity and activity.

I often point out to the people in western Canada that the separatists will say: "Look at what being part of the federation has done to Montreal over the past 30 years". I think there is a lot of insincerity on both sides of the debate. The separatists never want to use the word independence to describe their proposals for the province of Quebec, economic independence and economic separation from the rest of Canada, as the Minister of Intergovernmental Affairs has noted. Also some of the federalists in the province of Quebec today do not seem to want to say the word province to describe their view of Quebec's position in Canada. They want distinct society or whatever the latest buzzword is to get the separatist vote.

Both, in blaming each other, are right. There is an old quote by a political scientist which says that in a democratic system both major parties-speaking here of the province of Quebec-spend most of their time trying to prove that the other is incompetent and unworthy of government. Both succeed and both are usually right. That may apply in this case.

I am not terribly interested in taking sides on this other than if push came to shove I would certainly vote against this motion. We certainly do not see anything in the separatist proposals, either economic, constitutional or political, that would resolve any of the difficulties. Clearly they have worsened it.

Let me digress on some of the difficulties that Montreal faces and some of the reasons for its decline. I will make some reference to a paper that has recently been written by Professor John Richards of Simon Fraser University entitled "Language matters: ensuring that the sugar not dissolve in the coffee".

Professor Richards was at one time a social democrat or socialist. I think he still calls himself that but increasingly his friends in the New Democratic Party do not. He has been labelled a budding conservative, although that may be premature.

Professor Richards has asked me on numerous occasions to write something about the situation in Quebec and I promised him that and I have yet to deliver. I promised to review this paper he has written for the C.D. Howe Institute.

His argument is worth examination, and that is what I am doing, that the provinces generally, but Quebec specifically, should have enhanced jurisdiction over language as part of a solution to the national unity problem. That is perhaps in a different form part of the Reform Party's own proposals.

He does make reference on page 3 of his paper to the following:

-the Quebecois want provincial legislation to promote French and, to some extent, to limit the use of English.

Their Charte de la langue francaise (Charter of the French Language) most often still called Bill 101 although it was enacted in 1977, has done the job. It has strengthened the status of French as the working language in the province, preserved Montreal as a predominantly francophone metropolis, and confirmed that French remain the dominant language in the school system. Bill 101 has been controversial but necessary.

That is mentioning something in the very narrow context of language policy but I think more significant is what is not mentioned here. It is quite arguable that the success of Bill 101, of nationalist policies and nationalist language policies specifically, has not really been to strengthen French in Montreal but in fact to weaken English in Montreal, to be part of a massive exodus we have seen of English language people and allophones outside of the province of Quebec, taking with them much of the economic activity they have generated, both capital and labour.

The consequence has been a dilemma for all Quebecers, not just for separatists, in the attempt to make Montreal an entirely French city or to encourage Montreal as a French city as opposed to an English city or a bilingual city. It has meant the decline of Montreal as a national, international and particularly a continental centre. This is the great dilemma.

Those who want to preserve, protect and strengthen the role of Montreal as the francophone capital of Canada have no answer to the problem of how they will stop the decline of Montreal as a centre that has economic importance outside of the province of Quebec. This is certainly a dilemma for the separatist movement but is also a dilemma for nationalist movements that are nominally on the federalist side. If I have time I will make some mention of those later.

This is a dilemma. It is at the heart of the decline of Montreal as an economic centre.

This is not my own theory. I will give as an example an article written by William Coffey and Mario Polèse for the publication Recherches sociographiques . It is entitled ``The Decline of the Montreal Empire. An Overview of the Economic Situation in a Changing Metropolis''.

Here is an excerpt:

For the past three decades, the Montreal economy has taken a nosedive, resulting in the loss of hundreds of thousands of jobs. Cut off from its Canadian imperial economic hinterland, Montreal is reduced to being merely Quebec's metropolis.

This article is more optimistic than many others, even though it makes reference to the same problem I mentioned.

There is, however, no doubt that decline has happened, whatever one believes the cause of the decline is. Let me also be very specific about this by mentioning some facts which are reported in various publications that one can read on a monthly basis. Maclean's magazine indicates that during the 1980s the population in the Montreal region grew by a modest 9.6 per cent. Toronto expanded by 22.1 per cent. Vancouver grew by 25.2 per cent. The number of jobs in Montreal between 1971 and 1991 increased 60 per cent, but well behind Vancouver, Toronto, Ottawa, Edmonton and Calgary, all of which saw jobs grow by more than 100 per cent in the same period.

Let us look at some recent economic statistics. Here I quote the Toronto Star . The unemployment rate in Toronto in recent months is 2 to 3 percentage points below Montreal. Frankly, that is a fairly narrow gap compared to what we have seen in recent years.

Employment as a percentage of adult population was 5 per cent lower in Montreal. The percentage of the population below the poverty line in 1994 was 17 per cent in Toronto and 25 per cent in Montreal, the economic engine of Quebec.

Housing starts were up 9 per cent in Toronto and down 9 per cent in Montreal. Bankruptcies are double in Montreal what they were in Toronto. Consumer bankruptcies are about 25 per cent higher. There is slower growth in sales as the economy recovers.

These are all substantial and significant pieces of evidence of the relative weakness of the Montreal economy. Nobody should deny that, not the Liberals, not the separatists, not the federal government and not the provincial government.

There are always explanations offered by separatists who try to blame entirely the federalist side. Some of them are more far fetched than others. One is mentioned in an article.

It is an article which describes the sovereignist perspective on the economy of Quebec and Montreal. It says "the incompetence of Mr. Jean Chrétien is reason enough to worry investors", writes Mr. Roy in L'Action nationale . He also mentions several reasons in the sovereignist perspective, including the role of the air transportation sector and he compares Canadian Airlines and Air Canada. In his article about what might worry investors, Mr. Roy does not mention what we find time and time again in polls, that is that sovereignty, the next referendum and the separatist movement is what worries them.

He does mention the role of Air Canada versus Canadian Airlines. I give this as one of the more far fetched examples. The supposed favouritism of the federal government for Canadian Airlines, which is based in Calgary and Vancouver to a lesser extent, over Air Canada, which is based in Montreal and Toronto to a lesser extent, is given as a reason.

First I should mention that very few people at Canadian Airlines believe this and I know that for a fact. However, let us not forget the facts here. Whatever separatists or others want to pick at as a particular incident, the reality is that the existence of Air Canada as a corporation based in Montreal is entirely the consequence of the federal government having basically created and funded that corporation for decades and then by legislation placed its head office in the city of Montreal. There is no such parallel for Canadian Airlines.

Furthermore, I just have to mention these uncomfortable facts. For all the favouritism that supposedly generated, Air Canada is in

fact making money. Canadian Airlines has not turned a profit since 1988 and as we know is constantly under financial pressure.

There are other facts and there are certainly failings of the federal government and federalists. There is demonstrable and researched uncertainty, it has been said over and over again by the business community of Montreal, about the next referendum and the sovereignty movement.

There is as well the particular problem of the language wars and the language legislation. This summer the premier of Quebec, Mr. Bouchard, was personally involved and responsible for heating that up. We had some protests in Montreal about English language customers in English language areas of Montreal demanding from English language businesses service in English to be completely acceptable under the laws of the province of Quebec. Yet Mr. Bouchard jumped into the debate and with elements of the Parti Quebecois threatened to once again raise the issue of further language legislation and debate.

It is important to point out to people outside Quebec that this was contrary to the wishes of virtually all Quebecers. This was not just the anglophones but the vast majority of francophones, including most francophones who actually supported the sovereignty side in the referendum. This was once again the pet project of a particular element of the separatist movement. The federal government is not all to blame.

In this regard let me mention the tax burden in the province of Quebec. A major reason that people often live in Ottawa as opposed to the Outaouais is the tax burden at both levels of government. Let me mention some facts on this which are not arguable. These are not reasons for the economic performance of Montreal.

The combined federal-provincial top marginal tax rate in Quebec is 52.94 per cent which is the third highest in the country. Quebec payroll taxes are 4.26 per cent, the highest in the country. Non-financial corporation capital tax is 0.64 per cent, the highest in the country. Gasoline taxes are the highest in the country. Interest rates on provincial bonds demanded by the international investment community are the highest in the country.

In the time that remains let me mention in all fairness to the sovereignty movement some of the failures of the federalists and of the federal government because these are important. On the provincial level, let us not forget that the Liberal Party was supposedly a federalist party that governed Quebec for part of the period of this decline. It has often pushed the same kind of damaging nationalist policies that we see from the Parti Quebecois. It is the same type of financial mismanagement as we have seen from the federal Liberals in Ottawa over the past generations. Therefore that side is not blameless.

I might even point out that I have questioned many times even giving that party the title of a federalist party. The Quebec Liberal Party certainly wants Quebec to remain part of Canada but it also supports the idea that there is a unilateral right to separate. This would be six of one, and half a dozen of another.

Let us look specifically at the economic philosophy of the federal government. This federal government in the classic style of a centralist party that governs without vision and principle but only on the basis of power and patronage brags about the kind of largesse it can dispense to various Canadians. There is no shortage of its bragging about the kind of largesse it has often dispensed in the province of Quebec. This is well documented. I can point to studies by Professor Mansell at the University of Calgary in which I participated.

It is interesting to note the nature of these things: subsidies, unemployment insurance, equalization payments, social assistance in all forms. It is never what the Reform Party or others have proposed. It is never the idea that we should have a competitive economy, that we should lighten the tax burden, that we should make sure that economic opportunity is available to all Canadians, that we should lighten the load of the federal government, bring decentralization to the country. Unfortunately I am not going to have time to elaborate on these things.

What is generally interesting is that the parts of the country that have benefited from these Liberal programs, massive movements of money across the country, are the have not provinces. The question to really ask over time is, are they getting this money because they are have not provinces, or are they have not provinces because of these economic policies? Instead of exploiting their natural advantages and the dynamism that is possible in the resource base of those economies, they have been reduced to economies that operate on subsidy through the various regional development offices and through social assistance.

The Minister of Finance, a Quebecer, yesterday condemned the Reform Party saying its policies would deny welfare to single mothers. Perhaps its policies would offer a job to single mothers so they would not need welfare. That always escapes the Liberal Party in this kind of thinking.

In conclusion, I would like to move an amendment. I move:

That the amendment be amended by adding the following after the word "the", "separatist threat is hampering the".

[The Speaker]

My colleague, I will take this amendment under advisement and I will render a decision on it in just a short while.

[Bob Ringma, Reform, Nanaimo—Cowichan, BC]

Mr. Speaker, on a point of order, to help in your deliberations regarding the subamendment which was just proposed, I would like to direct your attention to a similar motion that is on today's Order Paper.

On page 11 of today's Order Paper there is an amendment to the speech from the throne and it reads as follows:

That the following words be added to the Address:

"This House deplores that Your Excellency's advisers have demonstrated a lack of vision in the face of the fundamental issues confronting Canada and Quebec, such as job creation, better administration of public funds, the re-establishment of fiscal justice for all, the recognition of Montreal as the economic hub of Quebec society, the need to protect Quebec culture;

and show a lack of sensitivity toward the poor by proposing a reform of the social programs that strikes at those who are unemployed or on welfare, as well as seniors and students;

and show a total lack of understanding of the referendum results".

There is also a subamendment by the member for Okanagan Centre. As listed on today's Order Paper, his subamendment reads:

That the amendment be amended by adding after the words "Quebec Society" the following:

"and, in particular, recognition that it is the separatist movement in Quebec that threatens the economy of Montreal".

I would refer to Beauchesne's sixth edition, citation 580.(1): "The purpose of a subamendment-is to alter the amendment-.it should deal with matters that are not covered by the amendment". And finally, citation 584.(2) states: "A subamendment must be relevant to the amendment it purports to amend".

[Gilles Duceppe, Bloc, Laurier—Sainte-Marie, QC]

Mr. Speaker, on a point of order, I think that the situation is fairly clear. A subamendment can only modify the amendment, and not the main motion.

The proposed amendment, which was accepted this morning, reads as follows: "the region of". We could of course amend this amendment and, to this end, propose a subamendment. We could say: "the beautiful region of", "the great region of". But it must relate to the words, the ideas, the concept of the amendment. It cannot deal with the whole motion, only the amendment. A subamendment should seek to modify the amendment and not the main motion. This seems clear to me and I urge you, once you have read the amendment and reflected on it, to reject this initiative of the Reform Party.

[Réal Ménard, Bloc, Hochelaga—Maisonneuve, QC]

Mr. Speaker, I always thought the Reform member was a serious and informed man, and I am sorry to advise the House that I was mistaken. I think he is, to say the least, unacquainted with Quebec's situation, which the Reform Party has itself admitted to being, and I can reassure him today by telling him that, with such a statement, he can rest assured that his party will be considered to be many generations away from Quebec.

The hon. member stood in this House, and showed a lack of consideration that had not been seen for a long time, to tell us that the cause of economic hardship in Montreal-we know that, as we are speaking, Montreal is one of the capitals of poverty-is the language situation, Bill 101 and, finally, that it is because a majority of people want to speak their language that things are going badly on the economic level.

You will understand that the hon. member is just repeating the same old platitudes, the same obsolete approaches, which are not serious at all and are based on absolutely no analysis. I think what the hon. member must be reminded of is that there is a nation in Quebec. There are people who speak French, who control a territory, who have a history, who have a legal system, and that is called a nation. You know very well that a nation is destined to become sovereign.

Having said that, if the hon. member wants to look up the history of this concept, I refer him to the recent regional commission and to the bill that was introduced in the national assembly. I speak about this with firsthand knowledge, because I was a member of that commission, and I have excellent memories connected with of it.

It was recognized that there is in Quebec an English speaking founding minority to which were conferred very specific rights over the control of a number of institutions. I know the hon. member is aware that it is possible to take courses in English from childhood to university in Quebec. It is possible to be served in English to obtain health services in Quebec. When it is rrequested specifically, it is also possible to receive correspondence from public authorities in English.

What the hon. member did not understand is that we are saying that, collectively, we think a language is not insignificant. The common language of a nation is not something to be treated lightly, because it is a rallying code, an identity code. That is how we can communicate with one another.

As sovereignists, we are for people speaking or understanding many languages-English, Chinese, Spanish, Portuguese. It was Montaigne who said that to learn a new language was to learn a new way of thinking. As parliamentarians, I believe we all agree with that.

That said, our point is that our situation is not the same in Quebec as in Prince Edward Island, Saskatchewan or other provinces, since we have the specific mission of preserving this

language of ours which is unique in North America. That is why the legislator passed Bill 101 and, later, Bill 178.

I would like our hon. colleague to tell us whether he agrees that, since we are a nation enthusiastically moving toward sovereignty, the legislator acted responsibly in ensuring that French-speaking citizens in these parts of America can continue to do so in the next few years?

[Stephen Harper, Reform, Calgary West, AB]

Mr. Speaker, the hon. member claims I blamed Montreal's economic situation on Quebec's language situation. This is not true. I said it was one of the problems in Quebec's current economic situation.

I repeat what I said. There are people in Quebec-not only the sovereignist movement, but also the Quebec Liberal Party-who think Quebec and Montreal should be French. The price of this policy is that Montreal's importance as an economic centre has declined in the rest of Canada and North America where the language is English. I am not saying that this policy is wrong or mistaken, but that it is the price to be paid.

In my opinion, Montreal's strength as a city in Quebec, Canada and North America is that it is the only city of its size on this continent where Canada's both official languages are widely spoken. This is Montreal's strength. If the provincial government decides not to capitalize on this strength, it is one of the consequences it must accept. It cannot have it both ways.

I should point out that, in this regard, sovereignty would make the situation worse than it is today. My friend mentioned that Quebec is a nation that should achieve sovereignty. I assume he is right. But I also see that, in the two referendums held in Quebec, the people made themselves heard and decided they were part of the Quebec nation, of course, but also of the Canadian nation. As I said several times, only through federalism can both sides of Quebec's personality be expressed.

[Martin Cauchon, Liberal, Secretary of State (Federal Office of Regional Development-Quebec)]

Mr. Speaker, you realize that we will oppose the resolution, because it is way too divisive. This resolution goes against any idea of partnership.

With respect to my colleague from the Reform Party, I would like to mention, without going through all the details which he mentioned in his speech, that I am pleased to see that the Reform Party recognizes the economic problems that exist in the Montreal area. Of course the idea of an upcoming referendum in the province of Quebec does not help the Quebec economy. That was mentioned by the Prime Minister at the beginning of the week.

I would like to remind my colleague from the Reform Party that we voted here in the House, with respect to the province of Quebec, on a resolution for a distinct society designation, which is important. That not only means something for the province of Quebec, it means something across Canada.

We recognize the economic problems of metropolitan Montreal. The Canadian government is acting on those problems. Our action is one of vision. We are getting involved in five areas, which I will mention again: science and technology, international development, SMEs, culture and tourism, social and local economic development. We have been working hard with the province of Quebec, and with metropolitan Montreal, in those five areas.

We are doing many things in the Montreal area, the Saguenay, Lac-Saint-Jean and many other regions of Quebec. We have done many things in cities across Canada: for example, Halifax, Moncton and Winnipeg. We are also doing things in other regions across Canada.

[Stephen Harper, Reform, Calgary West, AB]

Mr. Speaker, I am not sure how to respond to that. It sounded more like an extension of the member's speech than a question put specifically to me.

Let me repeat that Reform members do not doubt for a minute that the policies being pursued by the government in Quebec are also being pursued by it in other parts of the country. What we quarrel with is the appropriateness of those policies.

Our governments do not need to be involved in giving large sums of money to major corporations, which also happen to contribute to the Liberal Party, in order to spur economic development. What the country really needs, for example, is a lighter tax burden. Take away the subsidies and lessen taxes, both in Quebec and in other regions of the country and the private economy could exploit the advantages which our resources and the North American market offer to us.

It should be mentioned that Quebec was a leader, not just the federalists but also the separatists, in the free trade debate. They supported the extension of free trade and the economic opportunities that brings. Let us exploit the opportunities of a market economy rather than trying to do it through big government and corporate subsidies. That is one objection I have.

I also have to mention the reference to the distinct society motion, which my party opposed and will continue to oppose. We will continue to say that the solution to this problem is not for so-called federalists in Quebec to walk around repeating separatist claims that the French language is in some kind of jeopardy in the province of Quebec, which it is not, and needs some kind of special status to protect it. We have said repeatedly that there are things which can be done to improve this federation, but putting separatist slogans in the Constitution is not the way to proceed.

Separatists themselves recognize that the true distinct societies of this world sit at the United Nations. Quebec is a province of Canada. It fulfils an important role and its name must not be changed.

[The Speaker]

Before returning to debate I have been asked to rule on an amendment to the amendment. So that we are all dealing from the same spot, the motion stated:

That this House recognize Montreal as the economic mainspring of Quebec society and-

The amendment was:

That this House recognize the region of Montreal as the economic mainspring of Quebec society and-

The amendment of course was acceptable.

By adding the words after that this House recognize "the separatist threat is hampering the region of Montreal as the economic mainspring of Quebec society and-" in my view enlarges on the scope of the amendment and it should not.

The hon. member from the Reform Party was very kind to give me his advice and I thank him for intervening. However, in my view this would enlarge the scope of the amendment. Therefore, it is not receivable.

We will continue the debate.

[Francine Lalonde, Bloc, Mercier, QC]

Mr. Speaker, it is with anger that I will speak this morning to support my party's proposal. I am angry because the speech delivered by the Prime Minister to the Chamber of Commerce of Metropolitan Montreal is tainted with a dose of cynicism that is hurtful.

When the Prime Minister stated, as quoted in this document, that we have a duty to target, as a priority, the problems of a city, he should have referred to a region with 675,000 poor, which is twice as many as in all of Atlantic Canada, a region where one unemployed Canadian in seven lives. When the Prime Minister says we have a duty to target the problem as a priority, he should remember what his government did to the poor, who are found in very large numbers in Montreal, since he took office.

The fact is that his government did not target poverty, it targeted the poor. The employment insurance reform follows another UI reform. Together, these reforms will result in a shortfall of over $900 million for Quebec, almost $1 billion. In 2001, according to the government's own figures, the figure will reach $1.2 billion. Forty per cent of this $1.2 billion, that is at least $500 million per year, will be a huge shortfall in the fight against poverty in the Montreal region.

In other words, the government decided to target the deficit by making the poor pay, and since there is a large concentration of poor people in Montreal, the city's contribution to reduce the deficit is greater than that of a lot of others.

Have job creation projects been set up to make up for what is taken away from the poor?

We would have heard about them, because they made such a fuss over an $87 million loan. The attention given to this $87 million loan shows how little the government is doing in this city, in this area, which has the misfortune to hold the Canadian record for poverty.

I would like to add, for the benefit of my colleague in the Reform Party who spoke earlier, that separatism is not the cause of all this. I would like to remind him that in 1962-63, for example, there was a commission in Quebec, the Boucher Commission, which looked at poverty. It concluded that the leading cause of poverty was the weakness of the Quebec economy at that time.

What has federalism done since then, before there arose this nationalist movement of Quebecers, the majority of them raised in these poor neighbourhoods where these victims of poverty wanted to take control of their future? Anyone in Canada who fails to look at this aspect of the fight against poverty by Quebec's nationalist movement is missing the key to understanding a large part of the movement.

I spoke about the cost of unemployment insurance, the Liberal cuts, the Liberals' gift to Montreal. This year, the cost is $400 million and by the turn of the century, 1999, it will be $500 million.

The Prime Minister cannot stand up and say, even with a smile on his face: "We have a duty to give priority to the problem of a city where there are 675,000 people living in poverty". But that is not all.

If only the cuts were limited to unemployment insurance. But there were also large cuts in social transfer payments. These transfer payments were reduced by $7 billion over a period of two years, which leaves about $1.9 billion for the entire province of Quebec. Again, this means 40 per cent for the Montreal region, or more than $400 million.

This shortfall affects health care, education and social assistance. But the worst part is, and we cannot repeat this often enough,

this Canada social transfer includes a dimension that should be criticized loud and clear. This Canada that is so anxious to meet the needs of its population, this Canada is changing by reducing equalization. That is what is happening. And it will become increasingly obvious, because without the resources that belong to the Canadian state, the city of Montreal, the municipality and the region will have tremendous problems, even with the support of the Quebec government. That is why we want to have all our resources to deal with this situation.

I repeat, the Canada social transfer is bringing about fundamental changes. Unfortunately, every recession sees an increasing number of people who must rely on social assistance to survive. This social assistance was 50 per cent funded by the Canada assistance plan.

With the Canada social transfer that is no longer the case. When the conditions are renegotiated, something that is still pending because of pressure from other provinces, especially Ontario which also has a comparatively high poverty rate, and we understand those pressures, what will happen? The government will want to relegate Quebec to a role based on its population. Here again, Quebec will be alone in bearing the additional load of new welfare recipients who will arrive in a steady stream, since we know there will be another recession, especially with the economic measures to reduce the deficit, because these cuts are the result of offloading the deficit on the provinces, on Quebec and Montreal.

It is outrageous. I repeat, because of these changes, the deficit will be fought at the expense of the poorest in our society. What happens to the surplus in the unemployment insurance fund? What happens to this adjustment? People are talking about tax cuts for everyone, including the rich.

That makes no sense at all. People in Quebec were already talking about what the federal government did not do, but they said that at least they had more unemployment insurance and social assistance. From now on, even that will no longer be true. For many people, sovereignty was not the only option. But increasingly, that is changing, and it is high time it did.

[Martin Cauchon, Liberal, Secretary of State (Federal Office of Regional Development-Quebec)]

Mr. Speaker, when I listen to my colleague for Mercier, I note her rather amazing talent for painting a sombre picture of what the government has done, whereas these have been actions with concrete effects, extremely beneficial effects, for all of the people of Quebec and of Canada, and this is something my colleague for Mercier knows full well.

When they refer to employment insurance they refer to cuts, but I want to speak to you of basic reforms, reforms called for by everyone in this country, as well as a good many international organizations.

Employment insurance reform means that today people needing jobs can use this new program to gain access to tools, to means of acquiring additional skills for getting back into the work force. This is one of the elements, one of the goals of employment insurance reform.

With the change from a system based on weeks worked to one based on hours worked, employment insurance reform will provide coverage to thousands of men and women who work part time. They will be able to draw benefits, which they cannot at present. Before, as my colleague has said, the existing system was based on areas. It is true that, over the past 20 years, certain companies have closed down. The economy of the metropolitan region is changing, as it is everywhere in Canada, as well as in a good number of G-7 countries.

We have answered the call, we were present and accounted for when needed. We worked with the CDECs in the metropolitan region, those grassroots bodies which work together in collaboration. Think of RESO and the Corporation de développement Angus already referred to. These are approaches we will be continuing to use. They already have the means, means that could do with some fine tuning, and I would just ask them to focus their efforts on that.

Just think about the education issue, the tax agreements with the metropolitan region-two fundamental elements which come under their jurisdiction and where they have plenty to keep them busy.

[Francine Lalonde, Bloc, Mercier, QC]

Mr. Speaker, I mentioned a $400 million a year reduction of benefits in one region. He counters with the employment insurance, saying that it will provide $200 million more a year throughout Canada, because of pre-existing active programming. The only difference between the employment insurance and the old active programming is that, from now on, the money will no longer come from the consolidated revenue fund, but from the unemployment insurance fund. Active programming did exist before.

He then goes on saying that the federal government is involved in CDECs. An so it should. Despite this $400 million cut, despite the shortfalls in federal spending in Quebec, when Ontario was awarded a contract to build tanks, all the east end of Montreal got was a contract to repair old tanks.

The ones who have to watch what they are saying are people speaking on behalf of the Canadian government. They cannot just ramble on. People who live in poverty want to get out of it. The hon. member may not know what poverty means. I bet that some of his constituents who would like to work could tell him all about it. I am not saying that some may not want to, there may even be some among members. However, there are lots of people who want to work but cannot because there are no jobs.

[Réal Ménard, Bloc, Hochelaga—Maisonneuve, QC]

Mr. Speaker, could you please let me know when there will be only one minute left, because I am announcing right now that we will be moving an amendment.

I am really convinced that the official opposition is taking on its responsibilities and is doing its job by apprising the House of the seriousness of the financial situation, and therefore the social situation, in Montreal; it is sounding an alarm that this government must hear.

I want to talk about one characteristic in particular and that is the defense economy. Before that, however, let me remind you that people from outside this House, people who are not sovereignists and who were not elected under the Bloc Quebecois banner, are joining their voices to that of the official opposition today to express their concern over the situation in Montreal.

Let me remind you that, a few days ago, the mayor of Montreal, who is after all the official spokesperson for his city, tabled a brief with the commission on taxation. In this brief, he presented several facts that government members should try to understand. If Standing Orders allowed me to be more specific I would do so, but I will resist temptation because, as you all know, I abide by the rules.

The mayor quoted a recent Canadian Council on Social Development report stating that 22 per cent of all Montrealers are classified as poor and that, in Montreal, one child out of five does not get enough to eat. Furthermore, there is a problem with the rental housing stock because 60 per cent of all housing units were built before the sixties and now, it must be said that all the taxes Quebecers send to Ottawa are no longer applied to the maintenance and construction of social housing.

Someone reminded us that employment growth is very slow in Montreal; Montreal is losing jobs, particulary in the manufacturing sector. Who among us, whether a member of government or of the opposition, could rise in the House today and speak seriously? I am not thinking about the few amusing comments that we heard earlier because you will admit that this is not the kind of talk we should be hearing. Who could rise and say that the federal government really took some significant measures in order to solve the critical situation prevailing in Montreal? It is so true.

This debate today is not a device to garner popularity. We all stand to benefit from Montreal doing well. Montreal is my passion, my life, my city even since I was born. I have lived in Montreal all my life, always in the same neighbourhood. I will not go as far as to say that I lived in the same house all that time, I did not. But if there is someone in this House who is familiar with the back streets of Montreal, the sheds, the Olympic Stadium and the subway, it is yours truly.

I know Montreal like the back of my hand. And today, I am not too pleased to see that Montreal has become a city of poverty, a city on the decline. We must recognize that, beyond the changing international circumstances the secretary of state keeps referring to, there were deliberate choices made that have undermined the economic vitality of Montreal.

Let me give a specific example. This way, the secretary of state will not complain later that I talked in generalities. He knows that I do my homework; rigour is a quality of mine he appreciates. I am telling him that what hurt Montreal was a decision made by a minister from Ontario, who deliberately chose to weaken the defence component of the Montreal economy.

The secretary of state spoke earlier and he was right. I agree with one thing he said. Two in fact. The first one was when he said that I am a good MP and that I had invited him to come and visit my riding. I thank him for his support to the SIDAC Ontario merchants. L'économie de la défense? I have always thought that economic problems were non-partisan issues.

The second thing he said that I agree with is that there is in Montreal a strong area that makes us proud, the aerospace industry, and that Montreal is the only region in Canada where airplanes and helicopters can be built from nose to tail so to speak, without having any part of the aircraft shipped in from outside. That was what we called the defence component of the economy, on which nearly 30,000 jobs were dependent in Montreal.

This was one program we were benefiting from equitably. We rose time and time again in this House to complain about being treated unfairly. There was only one program in the history of the federal government where Quebec ever got its fair share and it was DIPP. This is not a venerial desease, it stands for Defence Industry Productivity Program.

Fifty six per cent of the aerospace industry is concentrated in Quebec and in Montreal in particular. Quebec would usually receive about 50 per cent of program funds. We must keep in mind that, in good years, this program had a $300 million budget, of which Quebec would receive 50 or 51 per cent. Why? Because the flagship aerospace industry was based in Montreal.

What did the Minister of Industry, who comes from Ontario, do when he realized this could benefit Montreal? He abolished the program to all intents and purposes. This year, DIPP has a $22 million budget and, in 1998, it will cease to exist. Is this the kind of decisions the Secretary of State is proud of when he comes to Montreal to talk about federal support for that region?

Does the Secretary of State agree with me that the defence industry will need help in the next few years? We need help. I want to be clear. I am asking the Secretary of State in a friendly, non-partisan way-because we are both from Montreal-to put in place a fund to help defence industries convert to civilian applications.

What you do not know and I will tell you is that, if nothing is done within two years, 10,000 jobs will be lost in the defence industry in the greater Montreal area. DIPP could have been a way for the government to take concrete action and support industries that need help in converting to other uses.

I am not shy. I went to see public officials. I went to that bastion of intellectual reflection that is Industry Canada, and I wish you had been with me. I asked industry officials to tell me what they thought of DIPP. They told me it was a great program.

I have here documents I will not use. But I saw documents I could table anytime if the Secretary of State asked me to. According to these documents, every dollar spent on DIPP generates the following economic benefits: $25 in sales, $18 in exports, $4 in research and development. Industrial performance shows that the industry was successful in converting to more desirable applications. This allowed the industry to grow and be ranked sixth in the world. The aeronautical industry is recording trade surpluses.

If nothing is done in Montreal, where the defence industry is concentrated, 10,000 jobs will be lost. If the Secretary of State is serious, he will take action. The conversion of the defence industry to civilian uses is important.

We need market studies, we need help in finding niches, new products upstream or downstream of what we already produce. I hope I have been convincing in my serenity and that the Secretary of State will not turn a deaf ear.

I move:

That the amendment be amended by adding immediately after the word "of" the following:

"the Greater".

[The Speaker]

The amendment to the amendment is in order.

[Martin Cauchon, Liberal, Secretary of State (Federal Office of Regional Development-Quebec)]

Mr. Speaker, as regards defence industry conversion, the Canadian government took action a long time ago. The hon. member referred to the famous DIPP. This program is now called TPC, or Technology Partnerships Canada, and it also relates to the issues raised by the hon. member for Hochelaga-Maisonneuve. It gives very concrete results, as was hoped, and these results benefit the whole community.

This dynamic and concrete initiative is part of Industry Canada's program, and we co-operate together. As you know, regional development officers are on Industry Canada's team, and we all work together regarding the point raised by the hon. member.

As for defence industries, here are some examples of contracts awarded between April 1996 and now: ammunition purchase from SNC, $140 million; automated systems for low altitude air defence from Oerlikon, $62 million; DND uniforms from Logistik and Newcourt, $42 million; Spar Aerospace, $39 million for space program trinkets for Canadarm and RADARSAT; DND aircraft repair and overhaul by Allied Signal Aerospace, $22 million; Godfrey Aerospace, $16 million-

[The Speaker]

The hon. member for Hochelaga-Maisonneuve.

[Réal Ménard, Bloc, Hochelaga—Maisonneuve, QC]

Mr. Speaker, I thank Myriam Goodwin for having sent to the Secretary of State what he had to say about Industry Canada. The real issue is that there is currently no support fund for industry conversion.

I challenge the Secretary of State to tell us today that Technology Partnerships Canada has actual funds available for feasibility studies, so that we can truly change production technologies. The fact is there is no such fund.

In spite of the commitment made during the election campaign by the Prime Minister's team to allocate specific funds for conversion, this has not been done. Let me remind you that, if nothing is done, 10,000 jobs will be lost. We cannot remain impassive to this situation.

[The Speaker]

We will return to the debate. I will now recognize the hon. member for Parry Sound-Muskoka. My colleague, before you begin, it is my understanding that you will be splitting your time with the hon. member for Winnipeg. You will have 10 minutes and 5 minutes.

[Andy Mitchell, Liberal, Parry Sound—Muskoka, ON]

Mr. Speaker, I will be sharing my time with the member for Winnipeg St. James

I am pleased to have an opportunity to talk on this opposition motion offered by the Bloc in respect of Montreal. I have no doubt that its suggestion that the economic situation in Montreal is critical is a reality. However, I firmly believe and I know most Canadians, most economists and most people who know how economies work believe that the analysis that the Bloc has put forth in its opposition motion is at best flawed.

The situation in Montreal today is caused in large part because of the political uncertainty that exists in that province and in that city. If Bloc Quebecois members want to know why Montreal is

suffering economically today, I suggest they and their PQ cousins look themselves clearly in the mirror and they shall see the enemy.

For the economy in Montreal, in Quebec and indeed for the Canadian economy in general to prosper and move forward we need political stability. That means that this experiment, this flawed idea of sovereignty must be put aside. For Montreal to prosper as a community, for it to serve as the engine of the Quebec economy, political stability has to be brought to that province. The constant and continual constitutional debates must come to an end. The Quebec government must, as this government does, focus its energy on the economy, on job creation and on seeing the economy move forward. If it wants to identify a problem that is where it should be looking.

As part of the specific comments that were made in that motion, I am going to take the opportunity to talk a little about Natural Resources Canada and its R and D investment. I have the opportunity of serving as the chair of that committee. I know Natural Resources Canada is going to continue to fund energy research and development activities, those that are expected to generate benefits in the short and medium term. We are also not going to abandon the long term activities. We are placing a priority on research and development activities that will address critical long term issues like climate change and will be doing that sooner rather than later.

The natural resources portfolio of this government is doing a great deal of work. It is setting research and development as a priority. We see things across Canada. We see things like the oil sands where we are working to have sustainable development of the Alberta oil sands. We are looking at the area of energy efficiency where we are working to create alternative sources of energy which create no pollution. These are the priorities of Natural Resources Canada and they demonstrate that we are in fact investing in research and development in this country.

There is a great and lengthy story that I could espouse about in Natural Resources Canada's development activities, but I want to be more specific about the motion before us today. I want to point out very clearly that the investments that Natural Resources Canada is making are not just in western Canada, eastern Canada or Ontario; they are right across the country. No one would know it from reading this motion, but these investments are happening in the province of Quebec as well.

Natural Resources Canada is working on the advanced houses program, including two in Quebec, and is just completing its one year public demonstration period. These houses deal with the whole issue of air quality requirements. These are houses in which we are dealing with the whole issue of air quality requirements. We are looking at an advanced housing program that will see better and more efficient homes built in this country. This project is happening across Canada. It is happening in Quebec.

The expertise assembled at the Natural Resources Canada energy diversification research laboratory at Varennes, Quebec, was instrumental in the European space agency's award to EDRL of a $100,000 contract to evaluate the potential of advanced heat pumping technologies in space applications. That is happening in the province of Quebec.

Natural Resources Canada with Environmental Canada and the Government of Quebec funded a field trial of the combustion of old tires in a cement container at the St. Constant, Quebec, cement plant of Lafarge Canada. Again, that is new technology which is working to protect our environment. It is investment in research and development by Natural Resources Canada and it is happening in the province of Quebec.

Natural Resources Canada is working with the École Polytechnique at the University of Montreal and Canadian gas utilities to develop an energy efficient process which uses natural gas to reduce organic contamination in industrial waste water. That is important research and development that continues to occur in this country and it is occurring in the province of Quebec.

At Laval University's hydro-turbine test laboratory, Natural Resources Canada supported the development of a 120 kilowatt tubular S-turbine which has now been licensed for international manufacturing and marketing. Again, that is sound research development into future energy needs and it is taking place in the province of Quebec.

The suggestion that the Bloc is trying to make, that we are taking one part of the country and playing it off against another part of the country, is totally absurd. That is not what the government is doing. It is what the party on the other side of the House is trying to do. It is trying to play one part of Canada against the other. It is trying to play one part of Quebec against another part of Quebec.

It is clear on the research and development aspect that the government has not favoured one part of the country over another. The Minister of Natural Resources has had to make some tough decisions in this fiscal climate. She has had to govern. The Minister of Natural Resources has had to make those hard choices which any government is required to make. She has made them understanding what sound fiscal management is all about. She has made them understanding what leadership is all about. She understands that governing is for all of Canada. She understands that she must make decisions which are in the best interests of all Canadians.

The ministers that make up the government, and the Prime Minister in particular, understand their obligation to the whole country. That obligation is not just to Ontario, the prairies or the maritimes, and it is not just to Quebec, it is to the whole country.

The province of Quebec, as all other provinces in Canada, has the opportunity within this great nation to move forward. The

province of Quebec has, the province of Ontario has, the east and the west in Canada have as well.

As an individual who represents a riding in rural Ontario, I can say that I resent the insinuation in the motion that the government is ignoring its obligation in one part of the country. That simply is not true. The government recognizes its obligation to all parts of the country, including the province of Quebec. It has exercised that obligation in a sound manner. It has exercised its obligation showing leadership, making tough decisions when they have been required, but always remembering that we are one nation from coast to coast to coast. We govern that way and we govern that way effectively.

[Pierre De Savoye, Bloc, Portneuf, QC]

Mr. Speaker, I listened carefully to the speech made by my hon. colleague opposite. If we believe what he said, things could not be any better. So, why have not only his government but the previous federal government and all the governments during the last 30 years allowed the economic situation in Montreal to deteriorate? It did not happen overnight, it occurred over a certain period of time.

We only have to think about the Borden line which closed down three refineries in eastern Montreal. About Mirabel airport that reduced traffic in Dorval without increasing its own, which explains why air traffic shifted to Toronto.

Earlier, I heard the hon. member put the blame on the political instability and so on. In 1966, it was a federalist and not a separatist government that was in office in Quebec, as far as I know. And in 1976, Mr. Bourassa ran into trouble with the Borden line, which led to the closure of three refineries.

In 1984, Mr. Bourassa was re-elected and remained in office until 1994. Of course, we had Mr. Johnson the last few months but all these Quebec leaders supported federalism. Meanwhile, Montreal was getting poorer and poorer. To argue that the sovereignty issue or political instability was at the origin of Montreal's problems is totally wrong.

In fact, let us examine these things clearly. Canada has a free trade agreement with Israel. As far as I know, people are not throwing rocks or firing machine guns off in the streets of Montreal, but such things do happen every day in Jerusalem. So, please, do not bring up the issue of political instability.

We are talking about helping Montreal with some investment. We know that the government opposite donated $11 million to Vietnam. Vietnam is a fine country, I agree, but let us not forget that Montreal is the poorest city in our country. Montreal needs $7 million for the Tokamak project to go on. Can the hon. member tell me why his government seems to prefer Vietnam to Montreal?