Debates of March 11th, 1999

Petitions

[Peter Goldring, Reform, Edmonton East, AB]

Mr. Speaker, I wish today to present to the House five petitions by hundreds of Canadians who are concerned about merchant navy veterans.

Their concerns can be basically summarized as seeking war veteran status, prisoner of war benefits, recompense for years of denial of equality, and ceremonial day recognition.

I submit these petitions today on behalf of merchant navy veterans and their concerns.

[Stéphane Bergeron, Bloc, Verchères, QC]

Mr. Speaker, on behalf of the people in the riding of Verchères—Les Patriotes, who sincerely believe in equality between men and women and in justice, I have the honour of tabling two petitions, pursuant to Standing Order 36, demanding that the government withdraw its appeal against the public service pay equity decision and give effect to the court ruling in this regard.

This petition combines with those presented by my other Bloc Quebecois colleagues in the past few days.

[John Solomon, NDP, Regina—Lumsden—Lake Centre, SK]

Mr. Speaker, it is my pleasure today to present to the House of Commons, pursuant to Standing Order 36, a petition signed by Canadians who are very concerned that the OECD and the head of the OECD, Don Johnston, are continuing to negotiate a multilateral agreement on investment.

These Canadians are very concerned about the negative impact an MAI would have on Canada, our economy and jobs in our country in particular. They are asking the House of Commons to impose a moratorium on ratification of the MAI and to ask Don Johnston to stop negotiating something that is not wanted by anyone in the country except the large multinational American corporations that support the Liberal government.

[Richard Marceau, Bloc, Charlesbourg, QC]

Mr. Speaker, on behalf of the people in the riding of Charlesbourg, who sincerely believe in equality between men and women and in justice, I have the honour of tabling two petitions pursuant to Standing Order 36, demanding that the government withdraw its appeal against the public service pay equity decision and give effect to the court ruling requiring it to ensure pay equity for its employees.

This petition combines with those presented by my other Bloc Quebecois colleagues.

Questions On The Order Paper

[Peter Adams, Liberal, Parliamentary Secretary to Leader of the Government in the House of Commons]

Mr. Speaker, I ask that all remaining questions be allowed to stand.

[The Acting Speaker (Mr. McClelland)]

Is that agreed?

[Some hon. members]

Agreed.

The House proceeded to the consideration of Bill C-61, an act to amend the War Veterans Allowance Act, the Pension Act, the Merchant Navy Veteran and Civilian War-related Benefits Act, the Department of Veterans Affairs Act, the Veterans Review and Appeal Board Act and the Halifax Relief Commission Pension Continuation Act and to amend certain other Acts in consequence thereof, as reported (without amendment) from the committee.

War Veterans Allowance Act

[Herb Dhaliwal, Liberal, for the Minister of Veterans Affairs]

moved that the bill be concurred in.

(Motion agreed to)

[The Acting Speaker (Mr. McClelland)]

When shall the bill be read the third time? By leave, now?

[Some hon. members]

Agreed.

[Herb Dhaliwal, Liberal, for the Minister of Veterans Affairs]

moved that the bill be read the third time and passed.

[Bob Wood, Liberal, Parliamentary Secretary to Minister of Veterans Affairs]

Mr. Speaker, it is a pleasure for me to speak to third reading of Bill C-61 today. This omnibus legislation is designed to provide enhanced benefits for Canada's veterans and their survivors. It is a tangible expression of our gratitude to these men and women for their service and for their contribution to their country.

It is not often that members of the House agree on the need for swift passage of legislation. Let me at this point express my heartfelt gratitude to all members of the standing committee who saw the need and acted on the need by letting the bill pass through their deliberations with speed and dispatch. The fact they have done so is an indication of the high regard we all hold for our veterans.

The men and women who have served in our armed forces and in our merchant marines throughout the first half of this century have a number of things in common. They were young. They had high hopes for settling down, for starting families and for a bright future, and they loved their country. When war came they would surrender their youth and put their hopes, their families and their futures on hold for the love of their country. When called upon these young men and women, these ordinary men and women, they would come to do quite extraordinary things and in the process become quite extraordinary themselves.

When it was all over those who did not die on the field of battle came home to build a nation, and what a nation they built. We the generation that followed have known only peace and prosperity for the most of the second half of this century. As we are about to enter the new millennium we are the benefactors of the sacrifices of those brave men and women who served in two world wars and in Korea.

That is why the country made a pact with them which said “We will remember your sacrifices”, a pact which said “We will take care of you as you took care of us”. That is why over the years we have developed such a comprehensive set of programs that provide disability benefits for those whose injuries and illnesses from service continue to plague them; monetary allowances for those whose life circumstances have left them at the low end of the income scale; comprehensive medical and dental benefits as supplements to provincial plans; and a veterans independence program that allows veterans to stay in their own homes as long as possible and, when that is no longer possible, provides access to long term beds so that their care needs continue to be provided.

During second reading of the bill I spoke about the progress which has been made in building and improving upon a package of programs and services for veterans which ensures they are able to live as comfortably as possible and with the dignity they so rightly deserve. Our challenge now is to make sure that these programs and benefits continue to meet their needs which are changing with the passage of time. The bill will do just that.

Like most omnibus legislation, Bill C-61 is not about making great changes to policy. It will generate no great newspaper headlines. Rather, it concerns itself with the details that will affect, for the better, the day to day lives of many of our veterans. In short, the legislation is another step forward in providing top notch quality care to these men and women and their dependants.

What does Bill C-61 do for veterans? Very briefly, it brings the merchant navy under the same legislation as armed forces veterans and it puts an end to any uncertainty regarding their status as veterans. It also opens up the disability pension process so that more widows of veterans might be eligible for an increase in their pension payments. More than 35,000 widows fall in this category.

We are recognizing the special needs of former prisoners of war and affording them the opportunity to receive an attendance allowance to help with their day to day personal care.

Bill C-61 seeks to defer the deadline for termination of war veterans' allowance payments to allied veterans residing outside Canada. In so doing we will remove the possibility of any undue hardship which might be caused by requiring these individuals to return to Canada in order to continue to receive their payments.

We are also looking for changes to the Department of Veterans Affairs Act to allow for more orderly procedures regarding grave markers and financial assistance for funerals and burials.

There are proposed changes as well to the Veterans Review and Appeal Board Act to help smooth the process for the board's hearings and to make the scheduling of these hearings convenient for the board and, more importantly, for the appellant. Finally, through the bill we are providing continuing pension payments for those survivors of the terrible explosion in the Halifax harbour in 1917.

What is also noteworthy about these amendments is that they respond to priorities identified by the main veteran organizations. Bill C-61 demonstrates that we are listening and that we are prepared to act. Most importantly, it will provide direct improvements for the lives of these most cherished of our citizens.

I hope we can send another signal to veterans groups by demonstrating that we are prepared to act soon. I urge all members of the House to lend their support to this bill. We owe it to Canada's veterans by showing them that we care and that we have not forgotten them.

[Peter Goldring, Reform, Edmonton East, AB]

Mr. Speaker, today I wish to speak of Canada's unknown navy, the navy shamefully not found in many of our schools' history textbooks, the navy Canada's young know not of.

Canada's merchant navy of World War II developed into a force of 12,000 men and women who collectively sailed 25,000 merchant ship voyages. Canada's unsung soldiers moved vital war supplies through enemy lines not by mule, not by truck, but by ship at a horrendous cost.

Young men and women signed up for this service, just as they did for others. Restrictions on enlistment were lesser for the merchant navy, allowing the under-age and under-weight to still serve their country with dignity and pride. Dedication to service came at a high cost to these brave Canadians and Newfoundlanders. The first service causality of the war was with the merchant navy. On September 3, 1939, Hannah Baird of Quebec was killed aboard the unarmed vessel SS Athenia when a German submarine sank it.

To emphasize, as has never been done before in this Chamber, the real price of peace, the real sacrifice to merchant mariners, I would like to make mention of the lost ships. Canada's merchant navy was very small in the early days of the war. At that time it only consisted of 38 ocean-going vessels. By war's end, five years later, that fleet grew to 410 ships. Merchant crews were often unarmed and were forced to sail under rough sea conditions to supply the war effort. The crews did receive some training, but often that was done on the calm and safe inland waters such as the marine engineering instructional school located in Prescott on Lake Ontario.

By later 1940 the merchant fleet had grown from 38 vessels, but losses had already claimed eight vessels. In 1940 seven ships were lost: the Erik Boyle was torpedoed; the Magog was torpedoed and shelled; the Waterloo was bombed by German aircraft; the Thorold was bombed by German aircraft; the Kenordoc was attacked by submarine gunfire; the St. Malo was torpedoed; and the Trevisa was torpedoed.

We must remember that each ship also took the lives of many brave young Canadians to the ocean floor. Death was not often quick and painless. Badly burned, a person would swim until shocked to their death in the cold, oil-topped North Atlantic. Other ships in the convoy would do their best to help, but also had to consider their own safety.

Many veterans say, the worse the weather the better they slept. A calm, clear night with a full moon was cause for insomnia. A calm evening might end with the engine's monotony shattered by an attack that suddenly turned their world from peace into hell.

This was all too familiar in 1941 as 13 more ships were lost: the Maplecourt was torpedoed; the Canadian Cruiser was sunk by a raider; the A.D. Huff was sunk by a raider; the J.B. White was torpedoed; the Canadolite was captured by a raider; the Portadoc was torpedoed; the Europa was bombed by German aircraft; the Collingdoc was mined; the Lady Somers was torpedoed; the Vancouver Island was torpedoed; with the Proteus the loss was unknown; the Nereus was another unknown loss; and the Shinai was seized by the Japanese.

Canadians were not the only ones busy building for all-out war. In 1942 the German U-boat fleet grew from 91 to 212. This made the situation for the merchant ships deteriorate further. The addition of Canadian built, highly manoeuvrable Corvettes to Canadian convoys helped, but losses were still tragically high.

In 1942 alone 31 ships were lost: the Lady Hawkins was torpedoed; the Montrolite was torpedoed; the Empress of Asia was bombed by Japanese aircraft; the Vicolite was torpedoed and shelled; the George L. Torian was torpedoed; the Lennox was torpedoed; the Sarniadoc was torpedoed; the Robert W. Pomeroy was mined; the Vineland was torpedoed and shelled; the James E. Newsom was shelled; the Lady Drake was torpedoed; the Mildred Pauline was shelled; the Mont Louis was torpedoed; the Calgarolite was torpedoed; the Torondoc was torpedoed; the Troisdoc was torpedoed; the Frank B. Baird was shelled; the Liverpool Packet was torpedoed; the Mona Marie was shelled; the Lucille M. was shelled; the Prescodoc was torpedoed; the Princess Marguerite was torpedoed; the Donald Stewart was torpedoed; the Lord Strathcona was torpedoed; the John A. Holloway was torpedoed; the Oakton was torpedoed; the Norfolk was torpedoed; the Carolus was torpedoed; the Bic Island was torpedoed; the Rose Castle was torpedoed; and the Charles J. Kampmann was also torpedoed.

These were tremendous losses taken by the merchant navy with their ships sunk out from under them.

1942 was the year the ongoing battle of the Atlantic continued in earnest. German U-boats were infesting Canada's waters. Several ships were lost in the St. Lawrence River. Concern was at an all time high when even harbour anchorages did not put men's minds to rest. The wrath of the German U-boats was felt from the warm Caribbean seas all the way up to the chilly waters of Atlantic Canada.

As the war went on the Canadian contribution became so much more important. Supplies in continental Europe were quickly being depleted and supply lines into Britain were under constant attack. At one point it is said that a crisis developed when there existed less than 30 days of stocks and Canada was responsible for bringing the situation back to a manageable level.

Canada supplied to the war material as no other nation, save the United States, with 17,000 aircraft, 900,000 land vehicles and a million men and women in uniform. This truly was a war of material supply. Canada contributed raw materials like wood and foodstuffs, but also multitudes of manufactured materials like airplanes, vehicles, tanks, weapons and clothes. All of this material was transported by our merchant navy.

There was no such thing as a typical merchant navy ship. Ships of every description were utilized as the need for supplies across the ocean multiplied. Many of the vessels used had previous lives in industry before the war erupted. Some ships had sailed all the oceans, while others had never left Canadian waters before. Some were lakers recruited for war on the high seas. The same could be said for their crews.

Many seamen had high seas experience, but others had never left Atlantic Canada or even the Great Lakes. There were men who had sailed the west coast and had never dealt with the threat of icebergs before. Despite all of these obstacles, each one of these men was proudly Canadian and knew their lives were not safe on the seas, but they felt a duty to serve king and country.

Just as there was no typical ship, there was no typical seaman. Many of the people in the merchant navy had been working on their respective ships prior to 1939, so they were not the young teenage men we often picture. Many had families, children and grandchildren.

Just as the merchant navy was home to older, seasoned sailors, it was also home to our youngest seamen. With the adrenalin of the war effort, men and boys of all ages wanted to serve Canada overseas. With manpower in desperate need, many questions were not asked.

Just as the young could skirt the rules to enter the merchant navy, so could those with health problems and disabilities. Many barely missed the cutoff for the armed forces, but driven by patriotic pride they joined the war via the merchant navy.

We must remember that not all members of the merchant navy were men. There were also many women who participated. Of the 1,500 who died, eight of them were women.

Many young lives were lost in 1943 when three ships were lost, bringing the total to 54 vessels: The Angelus was shelled; the Jasper Park was torpedoed; and the Fort Athabasca was blown up.

As the war progressed many of the sailors had sustained injuries and many had lost a friend or two, if not their entire crew. Many wanted to return home to comfort grieving parents and some had not seen their wives for several years.

The tension of the battle of the Atlantic was several years old, but by 1943 the tide was turning to victory. However, losses in 1944 were still triple that of the previous year. Mines were taking a greater toll and the threat of enemy aircraft seemed worse, even as the RCAF and RAF began to gain air superiority.

In 1944 nine more ships came to rest at the ocean bottom: the Fort Bellingham was torpedoed; the Fort St. Nicholas was torpedoed; the Watuka was torpedoed; the Fort Missanabie was torpedoed; the Albert C. Field was torpedoed; the Fort Norfolk was mined; the Nipiwan Park was torpedoed; the Cornwallis was torpedoed; and the Fort Maisonneuve was mined.

The final year of the war was 1945, but the merchant navy continued its work long after the war's end, delivering humanitarian aid to the citizens of Germany. They still ferried supplies required for the rebuilding and restocking of Europe.

Merchant navy seamen were encouraged to continue on the ships by our government of the day. While a few were able to remain aboard the ships, most gradually lost their jobs when the ships were sold to other countries.

Merchant navy veterans were not entitled to the benefits of other veterans. They did not have the same access to education. They were disadvantaged as a result.

In early 1945 the merchant navy lost another six ships: the Point Pleasant Park was torpedoed; the Soreldoc was torpedoed; the Taber Park was mined; the Silver Star Park was lost in a collision; the Green Hill Park was blown up; and the Avondale Park was torpedoed.

We must also remember that the ships Watkins F. Nisbett and R.J. Cullen were also lost for unknown reasons on unknown dates. To this day their families are still wondering what happened and when.

The total of the merchant ships lost was 72. If a ship was lost, on average, only 50% of the crew survived.

I will reread some relevant comments I made in the House this past year in Statements by Members:

Canada's merchant navy of World War II is proud of its contribution to a free world and should remain the recipient of the enduring respect of all Canadians.

Canada's veterans of this global conflict are deserving of our undying gratitude for their service to our country.

Canadians must recognize fully that our existence and privileges enjoyed today are due not only to the efforts of our veterans, but also to the efforts of their missing comrades throughout the world.

Few finer examples of Canadian wartime success and magnificent effort can be found than in the annals of the battle of the Atlantic where merchant seamen sailed the enemy infested sea in keeping Allies supplied in World War II.

Many dedicated individuals have worked to have the merchant navy's concerns addressed. Their work will be remembered as part of the lengthy battle for equality.

I take a moment to pay a personal tribute to a man who has the utmost respect of all veterans and members on both sides of the House. Mr. Gordon Olmstead was forced to step back from the frontlines of this battle due to his health but he remains a respected voice among his peers. He was a prisoner of war and was instrumental in having this legislation drafted. No better tribute could be made than to call this bill the Gordon Olmstead act. I am pleased we can have this legislation passed without unreasonable delay.

Last year I was able to get the agreement of all merchant navy groups on these four points of outstanding concern: to be recognized as war veterans, to receive prisoner of war benefits, to receive compensation for years of denial of equality, and to receive recognition on ceremonial days. This legislation will address three of these four points and for this I am very thankful.

The fourth point will be addressed in committee due to a motion which I successfully had all parties support in committee. For the first time we will examine the issue of merchant navy compensation claims. The committee is committed to deliver a report with corrective recommendations to the House before the summer recess. Finally we will be able to bring closure to this unfortunate chapter in Canadian history. For the first time a formal committee will study the compensation aspect of the years of denial of equality.

I look forward to bringing closure to this long outstanding issue this year. Recompense is the final concern which begs for settlement.

[Maurice Godin, Bloc, Châteauguay, QC]

Mr. Speaker, I am pleased to speak at third reading of Bill C-61. This bill amends the War Veterans Allowance Act and certain other acts in consequence thereof.

It is with respect and honour that I will pursue at third reading the same objective I pursued at second reading, which is to improve the services provided to veterans and their dependents, to ensure the recognition of a unique status for all those who participated in these wars, and to pursue the retroactivity claim for merchant navy veterans.

Even though the bill is very incomplete, the Bloc Quebecois supports it because it provides benefits to veterans and because, for the first time, those who served in the merchant navy are given the same status as other veterans. This legislation is governed by the same acts that recognize the critical role of merchant navy seamen in the victory of the nations that fought for freedom. This legislation also puts some order in the various acts that apply to veterans and it ensures a degree of fairness.

The bill meets the concerns of a number of associations. During the debate at second reading, the Parliamentary Secretary to the Minister of Veterans Affairs announced that the House would respond positively to a key priority of the National Council of Veterans Associations, by allowing former prisoners of war to receive the special allowances. He indicated that, in passing these changes, the House would also respond positively to the number one veteran's priority of the Royal Canadian Legion, which is to increase pensions for survivors.

The merchant marine veterans presented two demands: recognition under the same laws and the benefits they did not receive for the past 50 years retroactively.

Why is the government denying today what it wanted yesterday? The Minister of Veterans Affairs said the following before a committee on April 29, 1998, and I quote:

I have personal knowledge of this. It was the fall of 1991. Three members of the opposition, including myself, took it upon ourselves to address what I personally had felt had been an injustice for many, many years, and the other members agreed with me.

In opposition, this member tried to repair the injustices. Now, in power, as the minister, he remembers nothing.

Why did this member, now Minister of Veterans Affairs, not include provision for retroactivity in his bill? Is he really serious as he cries over the fate of these veterans?

On the whole, this bill is intended to correct the anomalies of the past and to include financial compensation, which would repair the deeds of negligence of a previous government. That government passed a bill giving numerous benefits to armed forces veterans returning to Canada after World War II, but did not extend these benefits to merchant navy seamen, who volunteered to serve their country.

In 1992, legislation was tabled to give merchant navy seamen the same benefits to which army veterans are entitled, but not the same status.

It took 45 years for the role played by merchant navy seamen to be recognized and the same benefits, but not the same status, to be extended to them. Now they are being given the same status as members of the armed forces, but not the retroactive benefits of which they have been deprived all these years. Their demands are slowly being met. However, the average age of these veterans is 75.

Thus the bill is incomplete, since it does not accept retroactivity of the rights now recognized for merchant seamen back to the time they joined the battle. They have been deprived of 50 years of benefits. They have suffered all their lives because of this refusal.

Unlike other veterans, they never had the advantage of financial assistance for trade training or university. They never had priority for public service hiring, they never had access to land, housing or business funding.

At one of the committee hearings, a witness told us that most merchant seamen would discuss their post-war experiences amongst themselves, but hesitated to do so publicly, because they felt ashamed, although they were wrong to feel this way. They felt it was their fault that they could not support their families the way their fellow Canadians who had been in uniform could, with the help of government subsidies.

Yet they too were in the line of fire. In 1941, the monster Adolph Hitler issued the following order: “Attack the merchant marine, particularly on the return route, with all possible means. Sinking merchant marine vessels is more important than attacking enemy warships”.

The merchant seamen were exposed to dreadful working conditions and heavy loss of life. They sustained more losses than any other Canadian combat forces. During World War II, 13% of merchant seamen lost their lives, or one in seven. Personally, I would have preferred to be on board an armed ship and attack the enemy rather than on a defenceless cargo ship to be used as a human shield.

These brave Canadians, who plied the corridors of hell, played a vital role in our war effort, one as vital as that played by the regular forces, and one that is recognized throughout the world.

It would appear from the strong support the public gave the former merchant marines who organized a hunger strike on Parliament Hill, that they do not support the longstanding government negligence in this matter.

The government has fallen short of its responsibilities and of the justice required by the sacrifices these men have made, because from the outset, it could have included retroactivity in this bill.

It is hypocritical, even. It gives the impression of wanting to gain time and let history hide the facts, and when the hour has sounded for the last of these brave defenders of freedom, the Minister of Veterans Affairs, as has happened in Europe at certain commemorations, will weep warm tears over the fate of these defenders of democracy. However, he is untouched by their great suffering, especially their mental suffering.

At second reading of this bill, all the opposition parties called for either retroactivity or a lump sum payment to replace the benefits they did not receive after serving their country. Only the Liberal government remains intractable.

Great Britain gave full veteran status to the merchant marine seamen in 1940. In the United States, merchant navy veterans gained the same status as regular forces veterans in 1988, while Australia recognized full equality in 1995. Here in Canada, they had to wait until 1992 to get the same benefits, but not retroactively.

In 1993, the government decided to improve its image by inviting a few merchant navy veterans to participate in a pilgrimage to Liverpool, to commemorate the battle of the Atlantic. In 1994, the government made another symbolic gesture with the placement of a merchant navy book of remembrance in the memorial chamber. It lists the names of Canadian merchant mariners who lost their lives.

The Parliamentary Secretary to the Minister of Veterans Affairs said, at second reading of this bill, and I quote:

I want to assure members that merchant navy veterans are veterans in every sense of the word and this bill underscores that fact. By using the same acts to respond to the needs of both merchant navy and armed forces veterans we send a powerful signal that we value the service and sacrifice performed by the merchant navy during the wars.

If this intention and this assurance are real, why did the government not recognize the mistake made in this bill, apologize and make the whole thing retroactive?

Members will agree with me that Canadian merchant navy veterans can no longer wait: they have already been waiting for over 50 years. In addition to social benefits and disability pensions, they need a compensation package. Does the government have the necessary money?

An examination of the amounts not spent by the Department of Veterans Affairs over a 15-year period shows that it is not for lack of money that merchant navy seamen are not being compensated.

The Public Accounts of Canada lists the amounts not spent by the Department of Veterans Affairs for the years 1982 to 1997. They are as follows: in 1982-83, $22,903,618; in 1983-84, $56,128,372; in 1984-85, $70,082,937; in 1986-87, $33,631,696; in 1987-88, $56,647,600; in 1988-89, $56,050,578; in 1989-90, $40,103,973; in 1990-91, $35,262,562; in 1991-92, $20,073,856; in 1992-93; $50,489,052; in 1993-94, $154,747,329; in 1994-95, $113,023,778; in 1995-96, $83,742,347; and in 1996-97, $49,530,866.

A total of $887,960,424 was not spent. Merchant navy seamen are asking for approximately $40 million.

This bill could have restored this unspent money. For reasons unknown, the government put these funds into general revenue, as it does with the EI surpluses, cuts in provincial transfer payments, and unpaid commitments to Quebec.

In this regard, the following amounts are owed to Quebec: $435 million for Hydro-Québec towers after the ice storm; $58.7 million for the Palais des congrès de Montréal; $33.6 million for the Oka crisis; $70 million for day care centres; $86.7 million for young offenders; $351.4 million for social assistance. And I could go on and on. The total unpaid bill for Quebec is $3,807,400. The refusal of this government to pay retroactivity to the merchant seamen is just one of many similar acts.

Instead of solving problems, the government is concerned only with looking good, with enhancing its visibility. Such is the case, for example, with the millennium scholarships, although education is a provincial responsibility. Today the federal government is going to invest billions of dollars on window-dressing to create havoc and create duplication just to improve its image.

Nevertheless, in 1993, merchant marine veterans agreed to join with armed forces veterans in a visit to Liverpool to commemorate the Battle of the Atlantic.

Last year, they were again part of the delegation to commemorate that battle, and were also along on the pilgrimage to mark the 50th anniversary of various World War II battles and campaigns

I was also there. The Army veterans' recognition and respect for the merchant seamen was obvious. The merchant seamen showed no bitterness. Why are they still being refused what they are entitled to, 50 years later?

The government is very good about these pilgrimages. They make it look good. But all this show does not, when it comes down to the nitty-gritty, do much for the merchant marine veterans. As we saw last summer, right here in front of the Parliament Buildings, it just leads to hunger strikes and to despair.

Is it not this minister's mandate to provide veterans, civilians and their families with the benefits and services to which they are entitled, in order to ensure their well-being and self-sufficiency within the community and to ensure that all Canadians remember their accomplishments and their sacrifices?

Was it ensuring their well-being and self-sufficiency, was it fulfilling the governments' mandate in this respect to refuse the same benefits and services to which merchant seamen were entitled retroactively, right up until 1992? And what about that other responsibility, of ensuring that all Canadians remember that war? The people of Europe and Asia, who lived through it, already do remember.

What happens in these former theatres of war in Europe or in Asia when a whole contingent of youth and invited guests turns up? Most of the time, a handful of local people attend. I think these veterans should be allowed to return once in their life to a theatre of war accompanied by a relative. But at the moment, it is pretty much always the same people who go on these trips: the deputy minister and his team.

Why not establish a real national day of remembrance in Canada? It is Canadians we should be informing and involving. We should open Parliament the entire day to school children and veterans with their relatives, their MP and their minister and take the evening to remember those who were lost. In my opinion, providing documentaries to the media is a means of keeping alive the memory of their dedication. Having a real day of respect, of thanks and of commemoration. This first day could be devoted to the members of the merchant marine to compensate for the error of the past.

In committee, I introduced an amendment that was ruled out of order. However, included in the bill, it would have resolved the problem once and for all. It read as follows:

All payments of allowance or other benefits under the Pension Act or the War Veterans Allowance Act in respect of a merchant navy veteran of World War I or World War II or a Canadian merchant navy veteran of the Korean War are payable for a period beginning on the day on which that veteran would have otherwise first become entitled to the payment if the provisions of this Act had been in force on the date of commencement of World War I, World War II or the Korean War, as the case may be.

I once again call on the government so that the members of the merchant marine may obtain justice and the reparation of past errors through retroactive redress or a lump sum payment.

[Gordon Earle, NDP, Halifax West, NS]

Mr. Speaker, I rise today on behalf of my New Democratic colleagues in support of Bill C-61.

As veterans affairs spokesperson for the federal NDP, I am pleased that part of the stain on the record of how Canada treats its veterans has been removed. This bill should become law so that in word and from now on in deed merchant mariners will be treated as full equals to other Canadian veterans instead of being relegated to the margins of Canada's official military history.

These brave Canadians played a central role in Canada's war efforts. Many lost their lives and their health for our country. Families suffered. Communities suffered. As a result our country was poorer for the loss of so many merchant mariners, yet so much richer for the role they played in bringing victory to all of us.

While many of those whom we remember and honour today are those who served in the regular military, we must not forget the many others who served their country in a unique yet very important way, either as special construction battalions or merchant marines.

I am pleased to once again take the opportunity to commend the merchant marine veterans, their organizations, families, activists and supporters for bringing this bill into being. Without their tireless and for the most part thankless work, we would not be discussing this bill today.

What happened to the Canadian merchant mariners upon their return to Canada? In Britain they returned as full and equal veterans with equal access to post-war programs, services and benefits. In Canada they returned to virtually no support. They were denied upgrading courses at technical, vocational and high schools offered to regular forces veterans. They were denied health support and employment opportunities available to army, navy and air force personnel.

I am proud to support Bill C-61 which declares as law the equal status of merchant navy veterans with regular forces veterans.

I am not proud of this Liberal government's abject failure in providing just compensation for these Canadians. I mentioned at the outset of my comments that part of the stain on Canada's record of honouring and dealing with merchant mariners is to be scrubbed clean with this bill. The issue of compensation, one of paramount importance, remains a dark blotch on our record.

This government saw fit to provide an ex gratia payment of $23,940 each to Hong Kong veterans who were Japanese prisoners of war. This payment was promised last December. It strikes me as at least an effort to achieve a just settlement.

As mentioned earlier in my comments, it is a disgrace that this government has betrayed Canada's merchant mariners by refusing to compensate them for the discrimination that the merchant mariners faced upon their return home from serving Canada's war efforts. It has been estimated that merchant mariners are dying at the rate of about 12 per month.

On November 24, 1998 in response to a question I put to the Minister of Veterans Affairs, the minister said concerning compensation negotiations for merchant mariners “I am there to listen”. I already mentioned earlier that debating Bill C-61 before this House signals a time to act. Justice delayed is justice denied, particularly when the death rate among these veterans who served Canada so nobly is so high.

The Standing Committee on National Defence and Veterans Affairs is slated to explore this compensation issue after the passage of Bill C-61. Assuming that the committee comes forth with a recommendation, I worry a bit that the government will then take its time to respond and make an announcement. How many more honourable Canadian merchant mariners must die before the Liberal government does the right thing and provides just compensation?

Even today as I am speaking I am reminded of Mr. Gordon Olmstead who has fought long and hard on this issue and is currently in the hospital dying of cancer. It is just a matter of time probably, unless the good Lord sees otherwise. From where the New Democratic members sit, one more death before proper compensation is provided is one too many.

Further to this point, it is high time that the government supported improvements in the health care package available to all veterans, particularly those at a venerable and often vulnerable age.

I sincerely hope that the spirit of justice in Bill C-61 has an effect on the government's treatment of other Canadian veterans. What about Canada's aboriginal veterans? First nations men and women served their country well alongside non-native forces personnel despite the fact that when World War II ended, they were not allowed to vote or even own their own land.

Many first nations veterans were never told they were entitled to educational opportunities or that they were able to purchase land at a cheap price. Some even returned to Canada to learn that their reserve lands had been seized by the federal government to compensate non first nations veterans.

I also think in particular of the Canadian veterans who were wrongly sent as prisoners of war to the Buchenwald concentration camp by Hitler and the Nazis. This government disgraced those brave Canadians when they were sent cheques for $1,098 to compensate them for the horrors they faced in the concentration camp, horrors which are in some cases relived in the minds of these veterans over and over again.

Our Liberal government has failed miserably where so many other governments have succeeded. I hope the spirit of Bill C-61 has some effect on the government so that it moves to ensure the Buchenwald survivors find the justice they so richly deserve.

I am indeed pleased that this bill provides for the continuation of disability pensions for victims of the 1917 Halifax explosion. As the member of parliament for Halifax West, I am all too well aware of the horror of that tragedy and the pain, death and destruction it wreaked.

I am also pleased this bill clarifies which merchant navy veterans of the Korean War will be eligible for benefits.

[Elsie Wayne, Progressive Conservative, Saint John, NB]

Mr. Speaker, I rise today to lend my support to the third reading and passage of Bill C-61. This bill is something that many of our merchant navy veterans have been looking forward to for many years.

I have great feelings for those men and women who served in World War II, being the sister of two brothers who were overseas through the whole conflict of World War II. We were very fortunate that both my brothers came home safe and sound. I will never forget the day. I was only a little girl, about seven years old. I remember my uncle who was shot in the first world war, and we thank God that he lived through that, telling me, “Put on your very best dress, dear. We are going to the train station for the boys are coming home”.

The veterans are very dear to my heart. The first real legislation to deal with the Canadian merchant navy was brought in in 1992 by the Progressive Conservative Party of Canada, by the Hon. Gerald Merrithew who was the Minister of Veterans Affairs. At that time, omnibus Bill C-84 was brought in with an additional $100 million of funding to be allocated directly to the merchant navy and their claims. The bill brought in by my former colleagues was not perfect but it was a huge step in the right direction.

The reality of this legislation is that it took this administration six years to address the concerns of the veterans with the original legislation.

Bill C-61 will make changes to address some of the biases merchant navy veterans have faced when applying for benefits. By placing them under the coveted War Veterans Allowance Act, it puts an end to the cross-referencing each of the merchant navy veterans was subjected to when applying for benefits.

This I am sure will please many of the veterans as it now means that they will qualify for benefits they should have been receiving since World War II. Great Britain recognized the merchant navy men as the fourth arm of its services at the beginning of World War II and they received all the same benefits as other members of the armed forces.

It will also provide an additional $8 million to address the needs of those merchant navy veterans who were prisoners of war and be used to assist those who were widowed.

My heart goes out to all those across this nation who lost a loved one in the line of duty and to those who died later due to the complications of war related service, the soldiers who gave their lives, the air force men, the navy and our merchant navy men, so that all Canadians from Victoria to St. John's, Newfoundland could enjoy the freedom we have today. A large part of the war effort was filled by the bravery and tenacity of the Canadian merchant navy.

To all the merchant navy veterans who are listening today, many from across the country waiting to see what will happen with Bill C-61, I want to say thank you.

Is it enough for us to just say thank you, knowing what we know to be true and how the merchant navy was treated after World War II? How they must have felt, each and every one of them, as they watched their counterparts receive many benefits.

The counterparts should have received benefits, but they were benefits the merchant navy men never received. One of eight of every merchant navy men died at sea. This is the largest percentage of any of the armed forces groups.

Imagine serving your country well, with pride and dignity, and returning after the war you see your counterpart who was on the same boat with you given everything and you are given nothing. How would you feel? You would feel hurt. You would feel let down. I was not there. I can only imagine what these men must feel today.

Some of those men come into my office with tears in their eyes. Their wives, as well, get in touch with me. It has been 54 years that they have been fighting for equality.

The question remains whether we, as a country, owe these men something. I believe the answer we would hear from most Canadians is yes.

Why would people feel this way? People today are well informed. After the hunger strike held here by some of the merchant navy veterans last fall, Canadians from coast to coast took the time to become more informed.

Last year when those men were on a hunger strike people from Germany, Japan and China came to visit Ottawa. They came up on the Hill. They could not believe our merchant navy men were on a hunger strike. They signed a petition asking our government to please give them some compensation.

They know these veterans were not really paid a high premium for their service. A privy council document from 1941 showed that these men were not to be paid any higher than a sailor in the navy. This certainly dispels the myth that they were paid a higher wage and therefore should not receive any compensation.

The reality of the post-war era for merchant navy men was that they were the big losers after the war. A video has been made by Mr. Cliff Chadderton, president of the National Council of Veterans Associations in Canada, entitled Sail or Jail .

I have a copy in my office and when I watched the video it truly brought tears to my eyes. I do not know how Cliff was able to do this video but it shows when they were torpedoed. It shows when they were in the water and it shows them dying. It is there. I will share the video with any of my colleagues in the House if they want to see it. It quickly becomes apparent in watching Sail or Jail what the merchant navy lost. One of eight merchant navy men was lost at sea.

Regular forces veterans were given clothing allowances, and rightfully so. They were given rehabilitation grants, transportation costs to return home, re-establishment credit, employment reinstatement and out of work allowances for up to one year. They were also given education assistance, trades training, disability treatment, land grant opportunities and waiting returns allowances. I am pleased and proud that we gave these to them.

What was offered to merchant navy men? They were given hope as the government of the day talked about developing and maintaining the merchant navy. This is difficult to say but if we look at the history of the merchant navy, it appears that the government of the day did not want to pay benefits to these men so they were not given the opportunity to be part of the demobilization effort of the government. They were kept busy cleaning up the seaways.

After the troops were demobilized the boats they worked on were sold. The men were offered jobs on ships that were held in foreign registry and were paid wages in foreign currency. I know that may be attractive today but it certainly was not attractive in those days. After World War II the foreign currency being paid was not enough for people to survive on in Canada.

I had great concerns this week when I saw in the estimates tabled that $1 million was to be taken from the veterans independence program. I thank the parliamentary secretary for responding and telling us no, $1 million will not be taken from the veterans independence program because they need it.

Think about it, 54 years. Think of how old these men are today. They cannot go out and shovel. They cannot do the cleaning that has to be done. They cannot do the cleaning within the home. They need that part time service. We do not want them to be totally independent.

I am proud to be a Canadian. I do not think anyone would question that. When I think of how these men were treated after the war I get very angry inside and a bit ashamed. However, there is hope.

The Standing Committee on National Defence and Veterans Affairs is about to begin to study the issue of compensation. The findings of this study will then be turned over to the government for a response. I want to make it perfectly clear. There are all kinds of rumours out there that the merchant navy is looking for a great big lump sum payment. According to Cliff Chadderton, some would get $5,000. Is that not a big lump sum payment? I think the maximum was perhaps $30,000, although for very few of them.

I am told that every month we lose probably six or more of our merchant navy men across this country. There may be around 2,000 still living today.

I feel very strongly when I look at the fact that we have had lapsed funds in our veterans affairs that have not been used. The money is there. We can do this. We can give these men back their dignity. We can show them that we love and respect what they did, that they took my brothers over there safely and they took over their needs, ammunition, food and clothing, so that they could fight for you and me and could come back safely.

Like many Canadians, I hope the response given is in favour of the Canadian merchant navy request for compensation. It would not justify the 54 years of neglect, as I have said. At least they would feel we have finally said we thank them for the work they have done.

It would not stop the years of pain felt by those widows who could not apply for benefits to help them along the way and it would not turn back the clock, but it would help ease the pain through the simple act of recognition of service to their country, not just through simple words of kindness but through a payment of some sort to say thank you for what you have done.

I know many of my colleagues on the government side agree with me. I thank today the hon. Parliamentary Secretary to the Minister of Veterans Affairs for his assistance and his help. When we went to him when the men were on Parliament Hill on a hunger strike he said he would meet with them and he did. They appreciated it. He came to my riding. He sat down with them. That is what we need, that kind of dialogue to get the understanding we need. I thank him very much today.

I also thank the Minister of Veterans Affairs and the other committee members from all parties who have been working together to put this study in place and making Bill C-61 hopefully unanimous today when we vote.

It is our role and the role of all those on the government side to tell all of those merchant navy men today that we support them, to stand up for what is right and proceed forward with compensation after the study is referred back to the House.

[The Acting Speaker (Mr. McClelland)]

Is the House ready for the question?

[Some hon. members]

Question.

[The Acting Speaker (Mr. McClelland)]

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

[Some hon. members]

Agreed.

[The Acting Speaker (Mr. McClelland)]

I declare the motion carried.

(Bill read the third time and passed)

National Housing Act

[Marcel Massé, Liberal, for Minister of Public Works and Government Services]

moved that Bill C-66, an act to amend the National Housing Act and the Canada Mortgage and Housing Corporation Act and to make consequential amendment to another act, be read the second time and referred to a committee.

[Carolyn Parrish, Liberal, Parliamentary Secretary to Minister of Public Works and Government Services]

Mr. Speaker, it is a great honour for me to launch the debate on Bill C-66, an act to amend the National Housing Act and the Canada Mortgage and Housing Corporation Act.

First I congratulate the Minister of Public Works and Government Services who is responsible for CMHC for providing us with such a progressive and balanced piece of legislation.

Indeed Bill C-66 will simplify the National Housing Act by removing unnecessary restrictions, enabling CMHC to respond quickly to the needs of Canadians and to opportunities in an ever changing market.

Since it was created over 50 years ago, CMHC has made an unparalleled contribution to help house Canadians. Over the years it has been involved in every aspect of housing from building units to direct financing, urban planning, mortgage insurance and now trade development.

The achievements of CMHC have benefited the country. Many of our own families and communities have been helped. Through partnerships with all levels of government, community organizations and the private sector, CMHC works to allow Canadians to obtain the shelter they need.

The government also works on a number of fronts to assist low income Canadians and the homeless. One important tool is the CMHC's renovation programs which have provided assistance to low income Canadians for over 20 years. The funds provide help to repair unhealthy and unsafe homes. They help to upgrade accommodations for the homeless, or for those at risk of becoming homeless, and to modify units for persons with disabilities.

Other CMHC initiatives such as Homegrown Solutions and the Canadian Centre for Public-Private Partnerships in Housing are fostering community based initiatives that address the problem of affordable housing, some of which are specifically directed at serving the needs of low income people.

All members will agree that we want to ensure the benefits provided to past generations of Canadians will continue to be available to future generations. Passing the legislation will help ensure that Canadians continue to have access to housing, have a choice of housing and benefit from new housing research.

The benefits of the bill are threefold. First, Canadians will benefit from these changes because CMHC will be able to respond to shifts in consumer demand and market conditions. They will also benefit from the availability of low cost funds and access to mortgage financing, no matter where they live in Canada.

Second, CMHC will be able to better promote Canadian housing products and services abroad. This will result in job opportunities for Canadians here and abroad. Third, CMHC will be able to provide better service to all Canadians.

I will illustrate how Bill C-66 reflects several of our government's priorities and what they mean to Canadians. I will begin with CMHC's mortgage loan insurance function, a key part of our efforts to provide Canadians with access to housing in all regions of the country.

In recent years CMHC has been approached to support many new and innovative products. Unfortunately under the current National Housing Act the CMHC has not been able to bring the benefits of some of these new types of home financing products to our marketplace.

With these amendments CMHC will have the flexibility to consider products such as insurance for a reverse equity mortgage enabling older homeowners to use the equity in their homes to obtain funds currently while allowing them to continue to live in their homes.

The CMHC would also be able to develop non-mortgage financing for remote areas where the land registry system does not facilitate mortgages. It would also include similar financing arrangements on Indian reserves where restrictions exist on providing land as security for mortgages.

The corporation would also be able to ensure a greater variety of financing options for the housing rental industry. Another benefit is that the CMHC will be able to respond quickly to shifts in consumer demand and market conditions with new and innovative home financing products.

With these legislative changes Canadians for generations to come will have access to the benefits of public mortgage insurance. By giving CMHC the means to better manage its business, these amendments will ensure that CMHC's mortgage insurance activities remain competitive while being managed in a financially responsible manner. With this new legislation the CMHC will be able to respond quickly to changes in domestic and international markets as well as to organizations looking to use Canadian housing expertise.

The legislation will greatly enhance the government's ability to better promote the products and services of our Canadian housing industry abroad. To illustrate this point, I will use the minister's own participation in last fall's trade mission to Chile. Thirty housing industry representatives joined him on that mission. The delegation was made up of provincial and territorial governments, builders, manufactured housing suppliers, products and services providers, and urban planners. The members for the ridings of Kelowna and Québec also participated in the trade mission. The minister was pleased to lead this group of entrepreneurs and officials, successfully opening doors to Canadian exporters in this important Latin American market.

Through CMHC's market development programs and services it is anticipated that within one year following the mission this group of exporters will have generated over $35 million in new business, which translates into direct economic benefits to all Canadians.

Two more trade missions are planned for Korea and Germany in May and October 1999. Similar public-private sector collaborations have recently been undertaken with Poland and Germany. This is what I mean when I say the legislation will help the CMHC create job opportunities for Canadians here and abroad.

Consumers in the housing industry, indeed taxpayers of Canada, all stand to benefit from these amendments which will result in a modernized and more efficient approach to housing. The corporation's greatest strength has been its ability to identify and respond to emerging needs.

Such initiatives are developed either by CMHC on its own or in partnership with other governments or the private sector. CMHC either moves once the private sector players have developed the ability to take on the challenge or becomes part of the ongoing solution.

The amendments that are presented today will build on CMHC's ability to adapt to changing circumstances and help the corporation to carry out the government's vision for the future of housing.

Earlier I mentioned that these amendments reflect our government's priorities. This is demonstrated in several ways. For example, one of our government's top priorities is its commitment to stimulating job creation and economic growth. We are proud of the fact that more than 1.6 million new jobs have been created since the government was elected in 1993.

However we want to do more. We know that the housing sector is a key component of the economy, with considerable job creation potential. For every $100 million spent on construction, 1,500 person years of employment are created both directly and indirectly. Behind every construction worker many other workers are producing the materials needed to build a home.

Clearly the objectives of the housing industry and the government's goals of expanding international trade and stimulating economic growth are one and the same.

CMHC is proud of its record in participating in team Canada trade missions to many of the emerging world markets, unlocking opportunities for the Canadian housing industry and creating jobs at home. Canada's international reputation for excellence in housing technology helps to open doors to the Canadian housing industry in many foreign markets.

The corporation has helped foster that reputation through international representation and research. Now, through the Canadian Housing Export Centre, CMHC continues to play a key role in supporting the efforts of Canadian housing firms to market their products and their expertise abroad.

CMHC has also been a leader in helping to establish and research new building practices. The result has been improved housing quality, affordability and choice for Canadians. In so doing the corporation supports research and development, another one of our government's top priorities. As we can see, CMHC is helping our government turn its commitments into action in a wide variety of areas.

The amendments proposed in the bill will enable the corporation to continue these achievements by providing it with the tools it needs to move forward with its expanded role. At the same time the corporation will be able to ensure the long term viability of its mortgage loan insurance function.

Millions of Canadian families bought their first home thanks to the insurance program. In fact, one in three Canadian homebuyers have been helped by CMHC in this way. Through the bill we want to ensure that future generations of Canadians can continue to benefit from this service.

As one of Canada's oldest crown corporations, CMHC has always been a pioneer. As such, it has introduced government to a new way of delivering services. At the same time CMHC's core mission is not all that different from what it was 10 or even 50 years ago. Through the legislation the corporation will be able to continue to do what it has always done and will be able to do it well.

The bill to amend CMHC is part of the government's broader efforts to modernize government operations and ensure the efficient use of taxpayers dollars while improving services to clients.

CMHC will continue its most important basic function which is to help provide homes for Canadians. I encourage all members of the House to support the legislation and enable the Canada Mortgage and Housing Corporation to carry on with its work well into the new millennium.

[Werner Schmidt, Reform, Kelowna, BC]

Mr. Speaker, it is a privilege to enter into the debate on Bill C-66. The bill amends the National Housing Act and the Canada Mortgage and Housing Corporation Act. There a consequential amendment to another act.

I couch my remarks with regard to the bill in terms of some questions I would like to ask. Does the legislation bring the Canada Mortgage and Housing Corporation closer to the purpose and intent as stated in the National Housing Act? Are the proposed changes in the specific legislation consistent with efficiency in terms of administration? Are they consistent with effectiveness, in other words reaching the goal or the purpose more effectively? What are the financial costs? What are the economic costs? What about the quality of life?

These are the questions I wish to address. Within that context I would like to refer to some discussions we have had with the officials of Canada Mortgage and Housing Corporation. They have indicated rather clearly that the policy of the government is the object of what Canada Mortgage and Housing Corporation does. Its purpose is to implement the government's policy on housing. The details of that policy are in fact contained in the corporate plan.

I will refer to the corporate plan for 1998 to 2002, in which the mandate for CMHC is stated as follows:

Canada Mortgage and Housing Corporation (CMHC) is Canada's national housing agency. Founded in 1946, CMHC's general authorities are derived from the Canada Mortgage and Housing Corporation Act. CMHC is a crown corporation within the meaning of part 1 of schedule 3 of the Financial Administration Act (FAA) and is subject to the various conditions and requirements set out in this legislation. CMHC's specific authorities in housing are embodied in the National Housing Act (NHA). The NHA provides CMHC with a range of authorities and tools to address the housing and related needs of Canadians. These tools can be grouped under four main headings: housing finance, assisted housing, research and information transfer, and international activities.

In early 1995, CMHC's mandate in the area of housing research and information transfer was reaffirmed by the Treasury Board of Canada. Later that year, the government determined that CMHC should be given the authority to sell products and services in support of housing exports. In the 1996 federal budget, the government announced its intention to operate the mortgage insurance fund (IMF) and the mortgage backed securities guarantee fund (MBSGF) on a more commercial basis. At that same time, the government also announced that it was prepared to offer the provinces and territories the opportunity to take over the management of the existing federal social housing resources.

Is that not an interesting way of saying we are getting out of the business? In other words, we do not want it any more and will download it to the provinces. The government did not consult with the provinces. It simply said that it would not do it any more and in fact cut their funding. I will have more to say on that later. The plan continued:

Amendments to the NHA and CMHC Act are required to implement aspects of CMHC's new mandate.

The changes to CMHC's mandate have significant implications for the way the corporation will conduct its business in the future, necessitating changes to current products, structures and processes. The mission, vision and core value statements on the following page were developed by CMHC to reflect the new mandate.

We will stop there for the moment and indicate that the legislation before us today, March 11, 1999, follows the introduction of the corporate plan which clearly indicates what the direction will be.

Where is CMHC right now? I would like to go into some details as well. They too come from the corporate plan. With regard to mortgage loan insurance it stated:

Under the mortgage loan insurance program, CMHC provides insurance against borrower default on residential mortgages in consideration of a premium. Through default insurance, borrowers with down payments as low as 5% have access to mortgage financing at terms and conditions comparable to those with much greater equity. Financial transactions and mortgage loan insurance are recorded in the Mortgage Insurance Fund (IMF).

This is very useful for many young people or people with lower incomes that have not been able to accumulate a down payment of sufficient size. They are helped tremendously. It is a boon to families and to couples that wish to by either a condominium, a townhouse or a single dwelling house. It is a wonderful program. That is what it is doing. It continued:

For 1997, mortgage insurance volumes were on track with more than 442,000 units.... Insurance-in-force was expected to reach $152 billion by the end of the year. Under the NHA, the aggregate outstanding amount of all loans for which insurance policies are issued had previously been limited to $150 billion.

It could not go beyond the $150 billion.

The Corporation received a $50 billion increase to the ceiling in the fall of 1997.

In other words it was increased to $200 billion. It is very interesting that the bill does not change that. This is an interesting development. The corporation is running the show. It is fascinating and I will say more about it as we move along.

At the end of 1996, the MIF was in a surplus position of $18.1 million. A loss before taxes of $23.8 million was forecast at mid-year 1997, compared to a $76.1 million before tax income projected in the original 1997 plan. This decline in 1997 is attributed to an increase in claim expenses. By the end of 1997, the Fund was expected to have a small surplus.

In mid-1997, Treasury Board approved a policy whereby CMHC will make annual payments to the government for its backing of the Mortgage Insurance Fund.

This is interesting. In 1996 it had a profit. In 1997 it looked like it was barely going to have a profit, but in 1997 Treasury Board said that it now had to pay it because it had access to the consolidated revenue fund.

As well, CMHC will begin to fund the additional policy reserves required by private mortgage insurance by the Office of the Superintendent of Financial Institutions (OSFI) imposed on the private sector. This applies to new commercial mortgage insurance business initiated after 1996.

What is beginning to develop with CMHC is very interesting. It is no longer simply a crown corporation. Legally it is, but it is entering into direct competition with the financial institutions. I will explain that a little later. It goes so far as to put itself under the same kind of guidelines and provisions that OSFI imposes upon other financial institutions, particularly federally registered trust companies, banks and so on. That is one area.

CMHC is also involved in mortgage backed securities.

Through the Mortgage-backed Securities (MBS) program, CMHC provides a guarantee of timely payment on securities based on qualifying pools of NHA-insured mortgages. Financial transactions for the MBS program are recorded in the Mortgage-backed Securities Guarantee Fund (MBSGF).

Projected MBS insurance for 1997 has been revised to $3.9 billion, up from the original plan of $2.1 billion and reflecting renewed interest from lenders. In 1997, the MBSGF was projected to generate $13.0 million in revenues, compared to the original plan of $10.7 million.... Higher cash flows and resulting investments of $52.7 million were also expected. The year-end surplus was expected to increase to $36.6 million.

The mortgage backed securities business expands beyond NHA mortgages or guaranteed mortgages. There is an MBS guaranteed fund but there are also other mortgage backed securities. As we go along, we will find that CMHC now wants to get into mortgage backed securities that are not NHA guaranteed mortgages. It is getting into direct competition with the private enterprise sector; a crown corporation is getting into competition.

Let us go into other areas. Canada Mortgage and Housing gets into assisted housing.

Unilaterally or in partnership with the provinces and territories, CMHC subsidizes, on behalf of the federal government, more than 656,000 units of social housing. The portfolio is operated through long-term administrative and funding arrangements between CMHC and the provinces and territories, and between CMHC and locally-based housing organizations.

The federal government announced a new On-Reserve housing policy in 1996. Throughout 1997, CMHC has been phasing in the policy. This involves the conversion of the existing NHA Section 95 non-profit Housing Program into a full-subsidy program, and First Nations' capacity development to help them take on responsibility for the housing in their communities.

To reduce overlap and streamline existing administrative arrangements in social housing, CMHC began negotiations in 1996 to transfer to the provinces and territories the management of existing federal resources, with the exception of housing programs for Aboriginal people living on-reserves. The Government of Canada will continue to honour its long-term funding commitments to social housing (currently $1.9 billion per year).

In fact it is just under $2 billion. In 1997, agreements were signed with Newfoundland, New Brunswick, Saskatchewan, Nova Scotia and the Northwest Territories to get out of social housing. This is very interesting. This theme will develop as we go along here. What is happening here is significant.

CMHC today is also involved internationally. The hon. parliamentary secretary referred to that in some detail. I want to commend the people who went on the Chile trip. I was one of the participants in that trade venture. It was a good one. It was well organized. The industries involved paid their way. There was no government subsidy at all. I commend the way in which it was conducted. Some good things are happening in that area.

The question however is whether this is a function that CMHC should be undertaking in the first place. That is a different issue altogether. What has been done in this area is very good and I compliment it. But the real question is, is this a proper function of a crown corporation?

There are other initiatives.

From time to time, CMHC is called upon to administer short-term housing initiatives linked to federal policy priorities. The 1997 Federal Budget included funding of $51.9 million for 1997 short-term initiatives linked to job creation, including $50 million for the continuation of the Residential Rehabilitation Assistance Program (RRAP), the Emergency Repair Program (ER), Home Adaptations for Seniors Independence (HASI), and the Shelter Enhancement Initiative (SEI) for victims of family violence. An additional $1.9 million was included in ongoing annual funding for the SEI. In total, assistance for an estimated 12,868 units was delivered under these initiatives in 1997.

The corporate account is another area.

CMHC is a large mortgage and loan administrator as a result of activities in support of various housing programs. Including its land holdings, CMHC's asset portfolio is currently $15 billion.

The Corporation's profits are the result of the margin on its financing operations and gains on the disposal of land. In addition, CMHC offers services to government departments and agencies on a cost-plus basis in areas such as land development, inspections and appraisals, and mortgage administration.

We begin to see the intricate web that is being woven as to the involvement and then the extrication and involvement again in all kinds of affairs. That is what it is now.

There is a history with CMHC as well. I want to address that for a couple of minutes.

Although the federal government built some housing for World War I veterans, the groundwork for a federal housing agency was not laid until 1935, with the creation of the Dominion Housing Act. By 1938 the act had helped finance almost 5,000 housing units.

During World War II the Wartime Housing Corporation built 46,000 units, mostly for war workers, and helped prepare and modernize thousands of existing units. When the war ended, more than a million Canadians in the armed forces were ready to return to peacetime life which created a housing demand the private sector could not meet. The federal government responded in 1946 by creating Canada Mortgage and Housing Corporation, CMHC. That was the beginning. That is why it was created.

CMHC built thousands of housing units for veterans, but from the beginning the corporation's mandate was to improve housing for all Canadians. In 1954 the corporation began insuring mortgage loans made by private investors. The Bank Act was amended to allow Canada's chartered banks to lend money for mortgages, and the amount of mortgage funds available to consumers quickly increased.

Small surprise. There is no risk left for the lending institution if it is guaranteed by a crown corporation. Why would the financial institution not increase the amount of money available?

In the 1950s CMHC focused on improving the quality as well as the quantity of Canadian housing. The 1960s brought an emphasis on redeveloping inner cities, while new CMHC programs in the 1970s worked to maintain and improve existing communities. Since the 1980s the corporation has given priority to environmental concerns, sustainable communities and the housing needs of native peoples, the elderly and disabled.

There are other dimensions but before going into them I want to focus attention on the purpose and intent of the National Housing Act. It is very short. The housing act states very simply that it is “an act to promote the construction of new houses, the repair and modernization of existing houses, and the improvement of housing and living conditions”. That is it.

We all know that adequate shelter for all households has long been a social goal of federal, provincial and municipal governments in Canada.

Although housing is within provincial jurisdiction as a matter of property and civil rights, or matters of a merely local or private nature, since the 1937 passage of the National Housing Act, the federal government has played a major role in its provision, mainly through the federal spending power.

In 1946 the federal government established the Canadian Mortgage and Housing Corporation. Since then, CMHC has carried out the federal government's commitment to provide Canadians with equal access and opportunity to suitable, adequate and affordable shelter in safe, healthy environments. This commitment means providing assistance to the most disadvantaged of Canadians, a fundamental value that underlies Canada's social safety net. It also means encouraging self-sufficiency in the private housing market through support to financial markets and to the housing industry.

Social housing ranges from single detached family homes to townhouses, walkups and apartments. It includes rental units owned and managed by the government, non-profit units owned and operated by community and charitable organizations, co-op housing units, units provided for aboriginal peoples on and off reserve, and privately owned units subsidized by governments and rented to low income people.

Of the social housing portfolio which had CMHC assistance in 1990, over 34% was public housing, 24% was non-profit housing and close to 21% was low rental housing. The balance entailed co-op housing, 8%; rental supplements, 7%; and aboriginal housing, 6%.

I am reading from paper No. 8 by R. E. Jenness, published on March 23, 1994.

There is also a historic federal and provincial partnership here. Until the mid 1960s, government housing projects entailed relatively minor expenditures. There was a small public housing program under which capital costs and operating costs were shared on a 75/25 federal-provincial basis, and a small limited dividend program creating privately owned housing units to rent at slightly less than market rates.

As the 1970s progressed, CMHC expanded and diversified its programs. The upshot was a de-emphasis on high density public housing projects and increased reliance upon the following.

One, a non-profit and co-operative housing program, fully federally funded, that provided an ongoing subsidy to sponsoring organizations, including urban native sponsors, and added new units to the stock of social housing.

I raise these points because this is the area the federal government is getting out of.

Two, a federal-provincial rent supplement program, cost shared equally with the provinces that subsidized units in private buildings for rent geared to income clients.

Three, a residential rehabilitation assistance program, fully federally funded, that made loans, partly forgivable, to homeowners, landlords or non-profit groups to undertake repairs and alterations. The minister announced that the program was to come to an end. He recently announced there would be an infusion of money into that program again so it will continue.

Four, a rural and native housing program, mostly cost shared, 75% federal and 25% provincial, to provide new housing and renovation assistance for low income native and non-native people in rural areas.

Indeed, during the 1970s and early 1980s the federal government along with the provinces, municipalities and community groups steadily increased their collective commitment to social housing. According to the Canadian housing coalition, construction of new social housing units rose from 110,213 in 1971-75 to 185,000 in 1981-85.

In 1986 after a task force report and consultations with the provinces, new directions were taken on social housing. Changes were made with respect to program targeting, the nature of subsidy assistance, caps on special purpose housing, program planning and financial contributions from the concept of where need was accepted, and a housing needs allocation model was used to distribute federal resources among provinces under three federal main budget housing projects, non-profit, rent supplement, rural and native housing.

The lead responsibility for delivering the programs was in most cases given to the provinces. That is really the issue here. They were given the lead. Also, they are extremely capable of doing that.

I want to look at one of the most recent developments that I was very cognizant of shortly after I took over the lead critic role in this area. It has to do with co-op housing.

The government said for sure that it wanted to get out of social housing. It wanted to download it to the provinces. There are many different kinds of co-op housing but two basic ones, those that are federally operated and those that are provincial.

The federal government said the provincial ones are not its concern but the federal ones are. It wanted to download this. Then the association of federal co-op housing got a load of this and thought if this is to be downloaded, it is afraid it will lose its co-operative status. Lo and behold, enough pressure was created that the minister changed his mind. He said that federal co-op housing would stay where it is.

The philosophy co-op housing I support 100%. It provides pride of ownership. There are two kinds of co-op housing. One I really like is equity co-op housing. The individual buys a unit and begins to build up an equity they can use. They have the pride of ownership, the involvement and this is a good thing. It would be great if all social housing had some kind of pride of co-operative ownership. We all want this.

It is very interesting that as the government moved out of this the provinces recognized that if this would happen, they had better do something. They have been aware of this for quite some time.

I am not sure in Ontario where the numbers go, whether 16,000 co-op units are federal and 18,000 are provincial, but it does not matter very much. It is about a 50:50 split.

The province of Ontario has downloaded much of this to the municipalities. It is very interesting that I came across a study that I am sure members are aware of or have seen. It is the report of the mayor's homelessness action task force entitled “Taking Responsibility for Homelessness: An Action Plan for Toronto”.

I would like to read what these people are dealing with and compare it with what we talked about in terms of the CMHC. This report deals with simplifying and co-ordinating the service system. What would be simpler than to have one level of government involved instead of three?

Exactly what these people are talking about are what services are available at present, why the current approach does not work, changing the role of urgency hostels and shelters and making drop-ins and outreach more effective. We are getting rather specific but it gets more specific. They talk about specific strategies for high risk subgroups, families with children.

There has been a dramatic increase. Some of these shelters are being populated to a large degree now by families. I do not think I have time to get into some of the statistics but they are very revealing.

They mention youth, abused women, aboriginal people, immigrants and refugees and go as far as to talk about prevention strategies and how we can prevent the problem, shelter allowances, rent banks, housing help, legal assistance, anti-discriminations measures, additional strategies for social assistance recipients, individual support, discharge policies and practices and community economic development, the whole area.

What about the health component in all this?

We are talking about homeless people but we are dealing with more than simply not having a house: an overview of existing services, removing barriers to health care, mental illness and homelessness, addictions and concurrent disorders, and the whole area of supportive housing. The report goes into affordable housing and the case for public investment, lessons from our past, producing new low income housing, preserving existing affordable housing and finally implementation. There are some 110 recommendations that follow this report.

It is an excellent piece of work but I do not think it is the end. When I talked to the councillor in charge of social housing for Toronto he said they were just beginning.

We have to come to grips with this. One government can do this. As we go into this corporate plan it is interesting to note what CMHC says. In the 1998-2002 plan CMHC says it:

—plans to conduct a forum on “best practices” for addressing homelessness. This forum will bring together experts on the homeless, representatives of service providers and various levels of government to share information on homelessness and to recognize and promote best practices in the area. This will provide the basis for potential partners to work together to develop future strategies to alleviate homelessness.

How many different ways do we have to look at the same problem? One would almost think the city of Toronto was doing this in isolation. This task force received assistance from all kinds of experts. Did it get it only from Toronto? No. Let me read into the record where they went to obtain some assistance. They received assistance from Canadian cities like Calgary, Montreal, Ottawa, Vancouver and Winnipeg. They also went to American cities like Boston, New York, San Francisco and Washington.

This task force is not made up of amateurs. These are not people who do not care about policy. These are not people who are unaware of what is to be done. Now CMHC says it will conduct a forum. We have the information we need. We say it is only Ontario. It has a 50:50 split on co-op housing. It knows all about this.

I refer to what is happening in British Columbia. This task force reported in January 1999. A 1992 amendment to the municipal act required municipalities to include housing policies in their official community plan. Additional amendments have provided municipalities with a greater range of powers to address community housing needs.

In summary, municipalities have reviewed or are in the process of reviewing their OCP. Nearly all have adopted or are in the process of adopting housing policies within their plan.

Definitions of affordable housing have been or are in the process of being written in several communities. In a number of cases housing strategy documents outlining definitions, policies, procedures and specific methods to address housing issues have also been produced.

A variety of housing related techniques such as density bonusing and housing agreements is currently being utilized by municipalities to increase the diversity of the housing stock or to produce affordable housing units.

To increase residential density, many municipalities are permitting housing above shops, manufactured home parks, secondary suites and small lots for single family housing.

A definition of special needs housing has been developed or is nearing completion in many municipalities. Although the definitions vary, they speak to the importance of creating both market and non-market housing for individuals with special needs.

Municipalities are taking up the challenge and finding innovative ways to meet the need for special needs housing. Committees or task forces are dealing with special needs populations or addressing disability issues at the community level in a large number of municipalities. Reports or surveys identifying the special needs population have been produced or are underway in several areas of the province.

Municipalities are developing guidelines for adaptable housing and several are promoting this type of housing to provide access to suitable housing for individuals with special needs.

The provinces are able and competent to deal with this issue and constitutionally they have been given that responsibility. That is their job and now we have an intrusion into much of that through the National Housing Act and the central mortgage and housing act. There was a time when this was significant, in 1935. We have gone through this and we know what it is but it has changed into something quite different.

The involvement of multiple levels of government creates basic inefficiency. It creates mutual recriminations. If one level of government is not doing it, then the other level says it is your job, you go do it. As a result the very people who were intended to be helped by this act are the ones who lose. Most important in all this is the confusion, the chaos, the conflict, the confrontation and the contradiction that develops because of these different levels of government getting involved in each other's way. We do not need that. It could be simplified so easily. Then comes the worst of all, the lack of consistency in housing policy.

I suggest there is no consistent social housing policy as far as the federal government is concerned. There are immediate expedient types of solutions presented. The time has come for us to bring rationality to bear on this situation. The provinces have recognized this responsibility, have contributed to meeting that responsibility and have demonstrated they can do the job. As a federal government we need to create an environment that makes it possible for them to carry out the job they have ably demonstrated they can do.

We now know the CMHC has achieved many worthwhile things and is continuing to do that. This is not inconsistent with what the minister of housing has said. I quote directly from the statement he made on August 26, 1998 in Ottawa when he found agreement with Yukon:

Having only one level of government involved in the administration of social housing will maximize the impact of taxpayers' dollars. The territorial government will have the flexibility to meet the needs of its residents while adhering to national principles and an accountability framework.

Let us do that. This act does not come to grips with those kinds of things. It simply moves along and makes what is into law. Some of the things that are not yet approved are already happening and we just have not had the legislative provisions to do that.

I believe the CMHC has lost its way in another area. Not only has it not dealt specifically with some of the people who are in need, but listen to this strategy which comes from the corporate plan of 1998-2002. The strategy in one sentence is level the playing field for private-public competition. Interesting. The CMHC will now get into competition with the private sector.

It goes on to say:

This strategy involves behaviours consistent with the corporate value of entrepreneurship, as well as the creative and effective use of housing finance tools to achieve fair competition for the CMHC and the private sector, and otherwise support competition in housing markets. Collectively these measures will place CMHC on a more competitive footing with private competition by reducing costs through operational efficiencies, effective asset management and product improvements.

These are the key tactics:

In 1998, CMHC will fund additional policy reserves and commence payment to government, based on the capital and additional policy reserves that the office of the superintendent of financial institutions (OSFI) requires of private insurers.

That is the very point I made earlier and that is what is to be done here.

Based on current projections, total fee payments to the federal government are forecast to be $197.9 million over the 1997 to 2002 period.

CMHC plan improvements to its mortgage insurance product line. In 1998, CMHC will complete implementation of a plan for restoration of rental insurance viability through changes to existing products and the introduction of new products.

Also in 1998, CMHC will review revisions made to the First Home Loan Insurance (FHLI) program in 1997 to determine the impacts on the commercial viability of the product, and make more improvements if required.

In this whole area we have a private company that does essentially the same thing, G.E. Capital.

I mentioned earlier that CMHC was going to get into another aspect of mortgage backed securities.

To improve MBS program competitiveness, and in conjunction with improved program processes, the MBS fee structure is being reviewed to make MBS more competitive under a wider variety of interest-rate and liquidity conditions. In 1998, CMHC will introduce a new few structure for the MBS program that is more responsive to current market conditions. The Corporation will pursue CMHC-led multi-lender MBS pools in 1998. In the latter part of the planning period, CMHC plans to develop MBS pools for non-NHA mortgages and non-mortgage loans subject to legislative changes. An annual payment to the government is currently being developed.

That is exactly what this law does. It allows CMHC to get into another area of non-NHA mortgages, to put these into mortgage backed securities. There is a market that exists now. CMHC does not have to get into that mortgage backed security market. It is already there. It is simply getting into direct competition.

Here we have a crown corporation with total assets of the consolidated revenue fund of the country of Canada competing with private enterprise. I think that is wrong in principle. I do not think it is fair at all.

It goes on:

For seniors, CMHC plans to introduce a Reverse Equity Mortgage (REM) insurance product through at least one Approved Lender by 1999. The objective is to ensure REMs are available through two or more Approved Lenders by the end of the planning period. The Corporation also plans to consider MBS for REMs in 1999 or thereafter if there is evidence that Approved Lenders are unable to use their own resources to issue REMs.

What does a reverse equity mortgage mean? This is for seniors who own a house or who have very high equity in a house. They take a reverse equity mortgage, draw down more money and the interest rate goes up.

Here it is with a reverse equity mortgage insurance program, or at least that is what it is thinking of putting together.

Last night I had the opportunity to meet with a representative of the Bank of Nova Scotia. I asked this gentleman how he would insure a reverse equity mortgage. He looked at me with a blank look on his face and asked me what I was talking about. I told him that I had just read that the corporate plans for CMHC state that it is going to introduce a new product called reverse equity mortgage insurance. He said that he did not know how it would work and he did not understand how it could actually work. He went on to tell me that it was actually a very small market to begin with.

Maybe that market will grow. I am not here to debate whether one should or should not get into a reverse equity mortgage. That is another issue. However, one of the major financial institutions in Canada does not understand how this product could work. There is something fundamentally wrong in what is going on here.

We need to come to grips with a much bigger issue, which is the whole housing issue and how best it should be handled.