Legislative Assembly of Manitoba DEBATES and PROCEEDINGS Speaker The Honourable Peter Fox Vol. XXI No. 148 2:30p.m., Thursday, May 30th, 1974. First Session, 30th Legislature. Printed by R. S. Evans-Queen's Printer for Province of Manitoba

Electoral Division ARTHUR ASSINIBOIA Bl RTLE-RUSSELL BRANDON EAST BRAN DON WEST BURROWS CHARLESWOOD CHURCHILL CRESCENTWOOD DAUPHIN ELMWOOD EMERSON FLIN FLON FORT GARRY FORT ROUGE GIMLI GLADSTONE INKSTER KILDONAN LAC DU BONNET LAKESIDE LA VERENDRYE LOGAN INNEDOSA ORRIS M M 0 p p p SBORNE EMBINA OINT DOUGLAS ORTAGE LA PRAIRIE R ADISSON RHINELAND RI EL RIVER HEIGHTS R R R OBLIN OCK LAKE OSSMERE RUPERTSLAND T. BONIFACE s s s s s s s s s s s s s T T T T. GEORGE T. JAMES T. JOHNS T. MATTHEWS T. VITAL TE.

ROSE ELKIRK EVEN OAKS OURIS KILLARNEY PRINGFIELD TURGEON CREEK WAN RIVER HE PAS HOMPSON RANSCONA VIR DEN w w w ELLINGTON INNIPEG CENTRE OLSELEY Name J. Douglas Watt Steve Patrick Harry E. Graham Hon. Leonard S. Evans Edward McGill Hon. Ben Hanuschak Arthur Moug Les Osland Harvey Patterson Hon. Peter Burtniak Hon. Russell J. Doern Steve Derewianchuk Thomas Barrow L.R. (Bud) Sherman Lloyd Axworthy John C. Gottfried James R. Ferguson Hon. Sidney Green, O.C. Hon. Peter Fox Hon. Sam Uskiw Harry J. Enns Bob Banman William Jenkins David Blake Warner H. Jorgenson Hon.

I an Turnbull George Henderson Donald Malinowski Gordon E. Johnston Harry Shafransky Arnold Brown Donald W. Craik Sidney Spivak, O.C. J. Wally McKenzie Henry J. Einarson Hon. Ed. Schreyer Harvey Bostrom J. Paul Marion Hon. Bill Uruski George Minaker Hon. Saul Cherniack, O.C. Wally Johannson O.J. Walding A.R. (Pete) Adam Hon. Howard Pawley Hon. Saul A. Miller Earl McKellar Hon. Rene E. Toupin J. Frank Johnston James H. Bilton Hon. Ron McBryde Ken Dillen Hon. Russell Paulley Morris McGregor Philip M. Petursson J.R. (Bud) Boyce I.H. Asper Political Address Postal Affiliation Code P.C. Reston, Man.

ROM 1XO Lib. 10 Red Robin PI., Winnipeg R3J 3L8 P.C. Binscarth, Man. ROJ OGO NDP Legislative B ldg., Winnipeg R3C OV8 P.C. 2228 Princess Ave., Brandon R7B OH9 NDP Legislative Bldg., Winnipeg R3C OV8 P.C. 29 Willow Ridge Rd., Winnipeg R3R 1 L5 NDP 66 Radisson Blvd., Churchill ROB OEO NDP 978 Garwood Ave., Winnipeg R3M 1N7 NDP Legislative Bldg., Winnipeg R3C OV8 NDP Legislative Bldg., Winnipeg R3C OV8 NDP Vita, Manitoba ROA 2KO NDP Cranberry Portage, Man. ROB OHO P.C. 86 N iagara St., Winnipeg R3N OT9 Lib. 132 Osborne St. S., Winnipeg R3L 1Y5 NDP 44- 3rd Ave., Gimli, Man. ROC 1BO P.C. Gladstone, Man.

ROJ OTO NDP Legislative Bldg., Winnipeg R3C OV8 NDP Legislative Bldg., Winnipeg R3C OV8 NDP Legislative Bldg., Winnipeg R3C OV8 P.C. Woodlands, Man. ROC 3HO P.C. Steinbach, Man. ROA 2AO NDP 1294 Erin St., Winnipeg R3E 2S6 P.C. Minnedosa, Man. ROJ 1EO P.C. Morris, Man. ROG 1KO NDP Legislative Bldg., Winnipeg R3C OV8 P.C. Manitou, Man. ROG 1GO NDP 23 Coral berry Ave., Winnipeg R2V 2P2 Lib. 135- 16th St. S.W., Portage la Prairie, Man. R1N 2W5 NDP 4 Maplehurst Rd., Winnipeg R2J 1W8 P.C. Winkler, Man. ROG 2XO P.C. 3 River Lane, Winnipeg R2M 3Y8 P.C. Legislative Bldg., Winnipeg R3C ova P.C. lnglis, Man. ROJ OXO P.C.

Glenboro, Man. ROK OXO NDP Legislative Bldg., Winnipeg R3C OV8 NDP Manigotagan, Manitoba ROE 1EO Lib. 394 Gaboury Place, Winnipeg R2H OL4 NDP 1Oth fir., 330 Portage Ave.,Wpg. R3C OC4 P.C. 318 Ronald St., Winnipeg R3J 3J8 NDP Legislative Bldg., Winnipeg R3C OV8 NDP 418 Home St., Winnipeg R3G 1X4 NDP 26 Hemlock Place, Winnipeg R2H 1L7 NDP Ste. Rose du Lac, Man. ROL 1SO NDP Legislative Bldg., Winnipeg R3C OV8 NDP Legislative Bldg., Winnipeg R3C OV8 P.C. Nesbitt, Man. ROK 1PO NDP Legislative Bldg., Winnipeg R3C OV8 P.C. 310 Overdale St., Winnipeg R3J 2G3 P.C. Swan River, Man.

ROL 1ZO NDP Legislative Bldg., Winnipeg R3C OV8 NOP 1171 Westwood Dr.,Thompson R8N OG8 NOP Legislative Bldg., Winnipeg R3C OV8 P.C. Kenton, Man. ROM OZO NDP 681 Banning St., Winnipeg R3G 2G3 NOP 777 Winnipeg Ave., Winnipeg R3E OR5 Lib. Legislative Bldg., Winnipeg R3C OV8

THE LEGISLATIVE ASSEMBLY OF MANITOBA 2:30 o' clock, Thursday, May 30, 197 4 Opening Prayer by Mr. Speaker. INTRODUCTION OF GUESTS 4115 MR. SPEAKER: Before we proceed, I should like todirectthe attention of the honourable members to the gallery where we have 90 students, Grade 11 standing, of t he St. Mary's Academy. These students are under the direction of Mrs. Gaier and Miss Weber. This school is located in the constituency of the Honourable Member for Fort Rouge. We also have ten students of Grade 10 standing of the Dryden High School of Dryden, Ontario. These students are under the direction of Mr.

Nielsen and they are our guests. And we have ten senior citizens of the Notre Dame Day Centre who are here under the leadership of Mrs. Reuben. This Centre is located in the constituency of the Honourable Member for Winnipeg Centre. On behalf of all the honourable members, I welcome you here today. Presenting Petitions; Reading and Receiving Petitions; Presenting Reports by Standing and Special Committees; Ministerial Statements and Tabling of Reports; Notices of Motion; Introduction of Bills; Questions. ORAL QUESTION PERIOD MR. SPEAKER: The Honourable Member for Roblin. MR. J. WALLY McKENZIE (Roblin) : Mr.

Speaker, I have a question for the Honourable the First Minister regarding certain statements on the front page of the Free Press 1:30 edition today. I wonder could the First Minister advise the House when he became aware of the apparent cover-up of the Department of Tourism and Recreation concerning the resignation of Mr. Teillet, the former director of the Manitoba Citizens' Ca mpaign agency. MR . SPEAKER: The Honourable First Minister. HON. EDWARD SC HREYER (Premier) (Rossmere): Well, Mr.

Speaker, dealing with the facts of the matter and not with respect to any innuendo about cover-up, I would say simply that it was some time in early autumn and it was in the month of November that we moved to carry out the advice relative to the Auditor' s report, and among the steps taken were the appointment of Mr. Bedson as Chairman of the Board and the assignment of Mr. Bob Goodman, who's had many years in the public service, to the accounting role and the ascertaining, the tightening up of accounting and other procedures. So that was Nov ember 197 3. MR. McKENZIE: .. . question, Mr. Speaker.

I wonder can the First Minister advise the House if he was informed by the former Minister of Tourism and Recreation ? MR. SC HREYER: Well, Mr. Speaker, insofar as being advised of it, I was advised of it some time subsequent to the Auditor's report and certainly in advance of the appointment of Mr. Bedson and Mr. Goodman to the allocated tasks. If I understand my honourable friend's question, I believe that' s the answer. MR . McKENZIE: Another question.

I wonder if the Honourable First Minister could advise the House when the members of the House will be able to have access to this report that's reported today to be public information in the files of the Free Press. MR. SPEAKER: The Honourable Minister of Finance. HON. SA UL CHERNIACK , Q. C. (Minister of Finance) (St. Johns) : Mr. Speaker, I'd like to answer that question and may I, as a preliminary, indicate that a letter, as the honourable member knows, often goes out to various Ministers dealing with matters within their depart­ ment fro m the Provincial Auditor.

The copy which I received is dated August 24, 1973 , and I do not have and never have had the kind of detail that is described in this Free Press article.

The reason is - and I checked with the Provincial Auditor - that these are working papers which were in use by the Provincial Auditor in dealing with the department to point out specific mat­ ters which needed correction, and as the auditor complained, probably at every meeting of Public Accounts, these are the kinds of letters that he does not consider should be made public because, as he has said, they involve names of people, they refer to specific things and, since he does not want to accuse but wants to correct, he does not make this kind of letter public unless he feels that there is not satisfactory compliance with his recommendations.

In this case he believes that there has been substantial improvement and compliance with the recom­ mendations he's made.

4116 May 30, 1974 ORAL QUESTIONS THE SPEAKER: The Honourable Leader of the Li beral Party. MR. I. H. ASP ER (Leader of the Li beral Party) (Wolseley): Mr. Speaker, my question's for the First Minister. Was the Conservative national leader, Mr. Stanfield, correct when he stated in Halifax on Wednesday evening that the First Minister of Manitoba shared and supported his desire to see wage and price controls introduced into Canada? MR. SPEAKER: The Honourable First Minister. MR. SCHREYER: Well, Mr.

Speaker, judging by the cou ntenance of my honourable friend, I have to assume he's serious but I suspect he's asking the question with tongue-in-cheek. I can only reply by saying that it was last August that all premiers of all provinces unanimously endorsed a resolution and authorized the sending of a communique to the Government of Canada urging that substantive and major action be taken to combat inflation, and that the province pledge themselves to support whatever steps were deemed necessary by the Government of Canada to that end. Now that, I think, covers one part of it. The other point, Mr.

Speaker, is that at no time have I indicated support for Mr. Stanfield's specific anti-inflation proposal, largely because I don't understand it and therefore I can hardly be expected to support it. I don't know if it is for a two-year duration, nine months, or ninety days, and that has changed so mewhat. I do not wish to denigrate Mr. Stanfield, Si.r, but certainly I find it impossible to support something which I understand now is to be refused to be explained during the campaign, which makes for yet additional diffi­ culty. MR. ASPE R: To the same Min!ster.

Is it not also the position of the Government of Manitoba that wage controls would result in a very severe hardship for all working and salaried people in Manitoba? MR. SCHREYER: Well, Mr. Speaker, I'm in your hands, Sir, as to the extent to which one should attempt to answer questions that really relate to a federal campaign.

There are of course problems with respect to wage restraints as there are problems with respect to price restraints, but I suppose on balance one would have to agree that just as there can be selectivity in price constraints, there would also conceivably be graduation with respect to wage echelons and restraints thereon. MR. AS PER: Mr. Speaker, to the same Minister. I wonder, then, if he would indicate, or whether he would advise the Leader of the National Con servative Party so that the position of Manitoba would not be distorted around • . . MR. SPEAK ER: Order please. The Honourable Member for Swan River.

MR . JAMES H. BILTON (Swan River): Mr. Speaker, on the matter that's presently being discuss ed, I wonder if I may direct a question to the First Minister. Did Mr. Stanfield call on the First Minister during a recent visit to Winnipeg? MR . SPEAKER: The Honourable First Minister. MR . SCHREYER: Mr. Speaker, I had the pleasure and privilege of meeting with Mr. Stanfield a few months ago, not however the last time he was in Winnipeg. MR . BILTON: A supplementary, Mr . Speaker. I wonder if the First Minister would take us in his confidence.

At that time, was there a discussion taking place on the matter of wage and price control? Did Mr. Stanfield ask the opinion of the First Minister? MR . SCHREYER: He did ask my opinion, Sir. However, he did not as sure me he would follow my advice. MR. SPEAKER: The Honourable Member for Lakeside. MR . HARRY J. ENNS (Lakes ide): Mr.

Speaker, I think more germane to the proper dis­ cuss ion in this House, my question to the First Minister is: did the First Minister indicate that he was among the other First Ministers across this province as being one who supported the idea of a temporary wage and price control within this country? MR . SPEAKER: The Honourable First Minister. MR . SCHREYER: Well, Mr.

Speaker, I can only answer that question by recalling to memory the discussion that took place at the Charlottetown meeting of First Ministers, and at that time the discussion , while understandably rather broad and general, nevertheless culmi­ nated in a resolution which was sent to the Prime Minister, in which all the premiers unani­ mously agreed to wording which made it clear that the provinces would support, and to make it clear that the provinces would support anti-inflation measures and that there was no specific preclusion of sixty, ninety or one hundred and twenty day restraints. I readily admit that.

May 30,1974 4117 ORAL QUESTIONS MR. ENNS: On a supplementary question, Mr. Speaker, directed to the First Minister. No preclusion with respect to 60 or 90 days. That leaves the implication ... MR. SPEAKER: Question. MR. ENNS: My question to the First Minister is if there was some discussion of the validity of a price control restriction being put on the country as an anti-inflationary measure which was considered unanimously by the First Ministers. MR. SCHREYER: Yes, Mr. Speaker, there was considerable discussion. MR. SPEAKER: The Honourable Member for Roblin. MR. McKENZIE: Mr.

Speaker, I have a question for the Honourable the Minister of Tourism, Recreation and Cultural Affairs. MR. SPEAKER: Order please. MR. McKENZIE: Mr. Speaker, I wonder if the Honourable Minister can advise the House if he was aware of the suggested irregularities or he had knowledge of the Auditor's report when he assumed the portfolio which he now occupies as Minister of Tourism, Recrea­ tion and Cultural Affairs? MR. SPEAKER: The Honourable Minister of Tourism and Recreation. HON. RENE E. TOUPIN (Minister of Tourism, Recreation and Cultural Affairs) (Springfield): Yes, Mr. Speaker. MR.

SPEAKER: The Honourable Member for Pembina. The Honourable Member for Roblin. MR. McKENZIE: I wonder if the Honourable Minister can advise the House what action he has taken to bring this matter to the attention of his department and to the members of the Legislature. MR. SPEAKER: The Honourable First Minist er. MR. SCHREYER: Well, Mr. Speaker, may I make it very clear that the problems and the difficulties that were discovered by the Provincial Auditor were reported by the Provincial Auditor to the appropriate Ministers - Finance, and Tourism and Recreation- at that time.

Remedial action in compliance with his suggestions was undertaken and implemented as of November, 1973. When the Honourable the now, the incumbent Minister of Tourism and Recreation, was appointed to that portfolio, the compliance and remedial course of action was already well under way. MR. SPEAKER: The Honourable Member for Pembina. MR. HENDERSON: Thanks, Mr. Speaker. My question is for the Minister of Mines and Natural Resources. Last Tuesday I asked him if there was going to be any further studies taken of the Carman area in regards to drainage, and he said he would report back.

Are you in a position to report? MR. SPEAKER: The Honourable Minister of Mines. HON. SIDNEY GREEN, Q. C. (Minister of Mines, Resources and Environmental Management) (Inkster): Mr.

Speaker, I do believe I said that there were continuous studies relative to drainage in all parts of the province, and I believe I said - and if I didn't, I say it now - that there was a specific intention to undertake a study of the previous cost benefits on the Boyne River diversion, or possibilities of such a diversion, to see whether the cost bene­ fits which were negative some years ago were in any way changed as a result of present day costs. If I didn't advise the honourable member that, I'm sorry. Mr.

Speaker, while I'm on my feet, I was asked yesterday what is the level of Lake Dauphin, by the Member for Wolseley. The present water level on Lake Dauphin is 859. 17 and this was recorded on May 29th and it is the highest on record. I was asked by the Member for Ste. Rose whether the Fairford Dam is still open. The Fairford Dam is still fully open. MR. SPEAKER: The Honourable Member for Ste. Rose. MR. A. R. (Pete) ADAM (Ste. Rose): Thank you, Mr. Speaker. I just wanted a point of clarification. That would be approximately five feet above the normal maximum, then? On Lake Dauphin. Is that correct? MR. GREEN: Mr.

Speaker, I don't know the number of feet. I just left my office and the figure of five feet was mentioned but that's very unreliable information. It's certainly the highest on record. MRo SPEAKER: The Honourable Member for Lakeside.

4118 May 30, 1974 ORAL QUESTIONS MR. ENNS: Thank you, Mr. Speaker. Mr. Speaker, I direct a question to the Honourable Minister of Mines, Natural Resources and Environmental Management. Has the Honourable Minister had an occasion to consider the appeal made to him by a delegation that visited his office yesterday with respect to the possibility of a greater usage of the Portage diversion to alleviate the water problems between Portage and Winnipeg here? MR. SPEAKER: The Honourable Minister of Finance. MR. GREEN: Mr.

Speaker, I don't have a definitive reply yet but I want to indicate immediately that it was pointed out to the delegation that the use of the diversion in that fashion would have the effect of increasing high water on Lake Manitoba, and that I would then be faced with another delegation of people from that area, which of course would not have the same view as the previous delegation. However, I did undertake to assess the situation whilst telling the people that they should not be optimistic, and I don't have a definitive response at the moment. MR. SPEAKER: The Honourable Member for Roblin. MR. McKENZIE: Mr.

Speaker, I have another question for the Honourable Minister of Tourism, Recreation and Cultural Affairs. I'm wondering if the Honourable Minister can advise the House, re certain allegations of Chairman Leach of the Manitoba Lotteries Commission and the resignation of Mr. Teillet, if he's considered now to ask the Attorney-General for a judicial inquiry. MR. SPEAKER: The Honourable Minister of Tourism. MR. TOUPIN: Mr.

Speaker, I've been asked this question by some press reporters and I indicated to them, like I'll indicate to the House, that I would be discussing this with my col­ leagues, and I have had an opportunity to discuss the problem with some of my colleagues, and I've again reviewed the file that is before me. The points brought out by the Provincial Auditor were in-house, were not the report that was tabled by the Provincial Auditor in his Annual Report to the Assembly.

The Minister of Finance, being the Minister reporting for the Provincial Auditor's activities, indicated to the House a few minutes ago that what happened did not indicate the recommendation to be taken within the written report submitted to the House, and as far as I'm concerned the matter lies where it has lain in the past few months, and action to be taken on my part would be premature. If individuals feel hurt by what has been said by the press it's for them to pursue the matter. MR. SPEAKER: The Honourable Member for Roblin. MR. McKENZIE: To the Honourable Minister.

I wonder can we as the members of the Legislature have access to those three copies or other documents of the Auditor's report that apparently is public information today, before the House closes for this session--(In terjection)-­ We haven't seen it yet. MR. SPEAKER: The Honourable Member for Wolseley. MR. ASPER: Mr. Speaker, my question is to the Minister of Mines. Could he indicate the price of Manitoba crude oil that will now be in effect taking into account the provincial tax arrangement that has just been made to increase the tax? MR. SPEAKER: The Honourable Minister of Mines. MR. GREEN: Mr.

Speaker, there is no legislation yet with regard to increasing the taxes but there will be. I couldn't off the top of my head give the price of Manitoba crude oil but I'll get it for the honourable member. MR. ASPER: Mr. Speaker, my question is to the same Minister. In view of the cutback in production that has fallen in the Saskatchewan oil industry because of price will the pricing and tax structure take into account the requirement for sale of the product outside of the Province of Manitoba to remain competitive? MR. GREEN: Mr. Speaker, there is no problem of the price being competitive outside of Manitoba.

I believe that if a problem arises it arises because the Government of Saskatchewan and the Government of Manitoba and the Government of Alberta have imposed greater taxes on the industry itself; the export tax was imposed by the Federal Government. The tax that the Province of Saskatchewan imposed - and I put this very superficially - deals with the increased price that is paid for Saskatchewan crude in the Province of Manitoba and sold to the Province of Ontario, the same with Alberta.

And the complaint of the producers is that that price should go to them and if it doesn't that there will be decreased activity. That is a phenomenon, Mr. Speaker, that applies to hog producers, applies to mining companies, applies to lawyers, applies to carpenters, applies to anybody who says that if the

May 30, 1974 4l19 ORAL QUESTIONS (MR. GREEN cont'd) ..... price is not high enough I will not sell my service. And if one responded every time that type of complaint was made there would be, Mr. Speaker, absolutely no rationale to an economic system. The economic system is based on a price which is estab­ lished by one person wanting to pay less and the other person trying to get more . . . MR. SPEAKER: Or der please. MR. GREEN: ... and as the Honourable Member for Wolseley well knows the law of business is buy cheap, sell dear, and everybody wants to do it and that's why you have a prob­ lem. MR.

ASPER: To the same Minister, Mr. Speaker. Has there been or is there an indi­ cated cutback in per day oil production in Manitoba? Does he anticipate that there will be any as has occurred in Saskatchewan? MR. GREEN: Mr. Speaker, there has been from time to time wells in Manitoba that have stopped production because they were not profitable at the price at which oil was sold. There may be wells that will stop production because they are not profitable at the new price at which oil will be sold, or could be sold, even though that price may be two times what it was a year ago.

If a government responded by saying that they have to raise the price every time some­ body said that they wouldn't produce unless the price was maintained at a higher level there would be no end to where the price would go. And, Mr. Speaker, that is not the way the com­ mercial world works. MR. SPEAKER: The Honourable Member for Ste. Rose. MR. ADAM: Thank you, Mr. Speaker. My question is for the Minister of Mines and Resources. In view of the reply he gave us on the level of Lake Dauphin, could he advise if the Mossey River Dam is fully open. He can take that as notice if he will. MR.

SPEAKER: The Honourable Member for Pembina. MR. HENDERSO N: Thanks, Mr. Speaker. My question is for the Minister of Mines and Natural Resources. Is there any recourse for victims in the Carman area who have had dam­ ages estimated by local tradesmen as high as $4, 500 and have only been offered $1, 600 by the Flood Control Committee? MR. SPEAKER: The Honourable Minister of Mines. MR. GREEN: Mr. Speaker, if there is a limit to what the Flood Control Committee pays, that is the limit.

It has not been the position of the Province of Manitoba that public funds will be used to compensate every single person at whatever damage cost that he has lost. That would be, Mr. Speaker, a form of socialism that not even this government can accept but apparently the Member for Carman thinks is a good idea. MR. SPEAKER: Pembina. The Honourable Member for Portage la Pr airie. MR. GO RDON E. JOHNSTON (Portage la Prairie): Mr. Speaker, I direct my question to the Minister of Agriculture.

Could the Minister obtain some answers from the Manitoba Hog Marketing Commission as to why the phone line is always busy, why there's up to a two-week delay between the time of appointment to bring in hogs and the actual date, as to why some independent truckers are not receiving the co-operation to be able to fill their truck completely with a load from several different farmers? MR. SPEAKER: The Honourable Minister of Agriculture. HON. SAMUEL USKIW (Minister of Agriculture) (Lac du Bonnet): Mr.

Speaker, I would have thought the Member for Portage would have known the answers to those questions as apparently do members opposite who have been asking similar questions in the last two or three weeks. MR. SPEAKER: Order please. MR. USKIW: So, Mr. Speaker, I would simply indicate to the Member for Portage that the Marketing Board is under control of the people who have elected it . . . A MEMBER: Oh brother. MR. USKIW: ... and that they are in constant communication with those people and that the district directors indeed are communicating with the board on a daily or weekly basis as to their pleasure.

And that I'm sure the decisions that are being made by the Board are in accord­ ance with the wishes of the producers. MRo G. JOHNSTON: Mr. Speaker, I direct my daily question to the Minister that he took as notice, that he said that he would try to obtain the price differential between the hog market­ ing in the United States as compared to the hogs sold by the same Board in Manitobao Can he give the House that information now?

4120 May 30,1974 ORAL QUESTIONS MR. USKIW: I indicated yesterday I believe that I had asked the Chairman of the Board to bring forward all the information that was available to me. He indicated to me that the board is not meeting until some time next week and so I expect to have a report after they have met. MR. SPEAKER: Order please. The Honourable Member for Lakeside. MR. ENNS: Well, Mr. Chairman, just as a supplementary to the question asked by the Honourable Member from Portage la Prairie.

I want to indicate to the Honourable Minister, and my question is that I still have a deep and burning interest about the price of hogs sold to Japan and if the Board is meeting next week ... MR. SPEAKER: Question. MR. ENNS: ... perhaps as he is bringing him the information about the price of hogs that are being sold in the United States he will also tell me about the price of hogs that are being sold in Tokyo. MR. SPEAKER: The Honourable Minister of Agriculture. MR. USKIW: Mr.

Speaker, that's a very good point because also one could add Canada Packers and Swifts and Burns and Okay Packers and a complete breakdown . . . MR. SPEAKER: Order please. MR. USKIW: ... of all the prices paid by respective purchasers should be desirable. Obviously my honourable friend knows that that is not normal practice of any corporation pri­ vate or public and certainly not any marketing board past or present. MR. SPEAKER: Order please. The Honourable Minister of Health . HON. SA UL A. MILLER (Minister of Health and Social Development) (Seven Oaks): Mr.

Speaker, this morning the Leader of the Opposition asked a question with regard to social allow­ ances. I took it as notice. He asked whether social allowances are being reduced in the case where there is a pensioner and where the spouse is under age 65. I have checked and I'm informed that the social allowances are not being reduced to reflect any indexing at the federal level. MR. SPEAKER: Orders of the Day. The Honourable House Leader. ANNOUNC EMENT MR. GREEN: Mr.

Speaker, I'd like to indicate that if it's convenient to honourable mem­ bers we could call a meeting of Public Accounts on Monday night to run concurrently with the meeting of Industrial Relations Committee. I believe that the Minister of Finance has some­ thing to say relative to that this evening. MR. SPEAKER: The Honourable Minister of Finance. MR. CHERNIACK: Mr.

Speaker, I was wondering if I could ask members of the House, or members of the Committee of Public Accounts, whether they consider it advisable or neces­ sary for me to have my own accounting staff, which normally consists of half a dozen or more people, present at that meeting or whether the meeting is more likely to deal with the recom­ mendations of the Auditor, his report and the method of estimate rather than the Public Accounts themselves. If it is felt that we would be dealing with the Public Accounts that were printed and filed then of course I have to have my staff present and will do so. MR.

SPEAKER: The Honourable Leader of the Opposition. MR. SIDNEY SPIVAK, Q. C. (Leader of the Official Opposition) (River Heights): Mr.

Speaker, in response to the Minister of Finance, and because it's likely this will probably be the last meeting before the conclusion of the sessionlof Public Accounts, I would indicate that it would be our intention to deal with the recommendation as well as with Public Accounts; but I also would like to inform you that I think it will be necessary to deal with some explanation from the Provincial Auditor with respect to the audit of the Lottery Commission and the information that now has come into public view. Having said that, I would hope that we would be able to cover both.

ORDERS OF THE DAY - ADJOURNED DEBATES MR. SPEAKER: The Honourable House Leader. MR. GREEN: Mr. Speaker, would you please call the adjourned debates on second readings. MR. SPEAKER: Thank you. Bill No. 64. The Honourable Leader of the Opposition. MR. SPIVAK: Stand?

May 30, 1974 4121 ORDERS OF THE DAY MR. SPEAKER: The Honourable Leader of the Liberal Party on Bill No. 64. BILL NO. 64 MR. ASPER: Yes, Mr. Speaker. Mr. Speaker, the position of the Liberal Party on Bill 64 is that we ask the government, we appeal to the government to withdraw the bill, and we are going to exercise whatever influence we can and whatever techniques we can in order to per­ suade the government to adopt that course and abandon a very bad piece of advice they have obviously acted upon. Mr.

Speaker, there is virtually no demonstrable need; there is virtually no evidence before this House, and we suspect that there is evidence to the contrary which is in the hands of the government, to support this bill or the enactment of a Treasury Branch system of any kind owned by the Government of Manitoba. Now in

summary our position is that, (

a) The bill is unnecessary. The establishment of Treasury Branches in Manitoba is quite unnecessary. (

b) It is unwanted. There has been no need or request or demonstration of a desire from the people of this province to see this system come in. (

c) The bill is negative in the sense that it threatens the continued growth and existence of financial institutions in the private sector; financial institutions that have had a very long history of public service, even in areas and remote regions where those institutions have lost money in order to provide the service. And it is a betrayal by government of those institutions that in order to give fuller service got into communities where they cannot possibly break even but in order to keep an integrated service have done so.

And again I fear on this point that it threatens existing structures, that there will be a resulting abandonment by many of those struc­ tures of less profitable communities should the government create a Treasury Branch system that takes over those more lucrative communities and then of course will be forced to go into the rest. (

d) It is our position based on the evidence that we have of government operations in the financial field that we create a very dangerous political weapon for any government to abuse when we put government into the banking business. And make no mistake, Mr. Speaker and honourable members, this is a banking, this is not a treasury branch system, this is banking. Because it can do, the Treasury Branch or the 90 percent of the people of this province who use the banking system, the Treasury Branch con­ cept covers 90 percent of their banking needs.

So this is not treasury branching deposit and lending operations but rather for the most of the people, the vast majority, this is a full bank­ ing service proposed. We do not accept the government's statement that we just want the power; we just want the legislation and then we'll take a task force and decide what to do with it. Do the task force first we say. Do your homework first and then come to the Legislature with a real plan, not a permissive plan.

And finally in terms of our reasons for objecting so strenuously, we believe and we believe Manitobans will feel that with this government's record in finance, in handling the lending of money and the business dealings all of which show nothing but ready losses, we have no reason to be optimistic that the government will have the ability or the capacity to run a treasury branch system any more profitably than they currently run the Manitoba Development Corporation which is a banking instrument or the Manitoba Communities Economic Develop­ ment Fund, which is banking, which is a losing proposition, or the Manitoba Agricultural Credit Corporation, or the variety of financial instruments that the government presently has.

Mr. Speaker, this morning the government, or the First Minister indicated that he wasn't so sure that the credit union movement whom we fear will be severely injured and who have served this community admirably during drought, depression, hard times, good times, belonging to the people of this province, what could be more appropriate to this government if this government was truly committed to its own principle that the people, the ordinary people, should have an opportunity to control their own destiny economically. A quarter of a million of credit union members, Mr.

Speaker, have just had a bucket of ice thrown in their faces with the introduction of this piece of legislation. When this government encouraged the credit union movement to establish the first regional bank for Manitoba, North Bank, whose application for incorporation was presently before the House of Commons when the House dissolved - I'll have more to say about that, Mr. Speaker, but my point here is that let it be very clear that it is not

4122 May 30, 1974 BILL 64 (MR. ASPER cont'd) ..... some rump group as the First Minister tried to lead us to believe this morning, of the credit unions that disagree with this, or that it's some dissidence, it is the organization itself. I want to read into the record a telegram we have just received from the Co-operative Credit Society of Manitoba. Not some individual credit union, Mr. Speaker, but the total organization.

It says as follows: "The Co-operative Credit Society of Manitoba representing 163 credit unions and their branches and one-quarter of the population of Manitoba, is opposed to the intention of the government to establish treasury branches in the province. We are con­ vinced that the existing financial institutions and credit unions are capable of meeting the finan­ cial requirements of the people of Manitoba. In our view, treasury branches not only are an unnecessary innovation but are sure to be detrimental to the credit unions of Manitoba. Signed, B.

Martin, Secretary of the Board, Co-operative Credit Society of Manitoba. " Mr. Speaker, the Liberal Party wishes to associate itself with those sentiments and wishes to support them because that is our position and we are delighted to find that the credit union movement itself has very clearly said to this government that it is not a group of mav­ ericks or some in the movement but the movement itself that opposes this foolishness. Mr. Speaker, --(Interjection)--Mr. Speaker--(In terjection)--Mr. Speaker, I have a lot of time, I have unlimited time under our House Rules and I'll take whatever time is required. Mr.

Speaker, there's an even greater danger associated with this; something that doesn't have anything to do with Manitoba. Has to do with Canada. Under the Constitution of this country banking for very good reasons has been reserved to the Federal authority because we do not want ten fiscal policies in this country; we do not want ten monetary policies. But in order to maintain a position in world markets and in the world monetary system it is essential that the Bank of Canada be the only financial source, the only financial regulatory authority for banking. MR. SCHREYER: Of course. Of course. MR.

ASPER: I hear the First Minister saying "of course", he agrees with that. Now we have found agreement on the basic point. Mr. Speaker, until the Bank of Canada was formed we had a banking chaos in this province, in this country, and it was only after the crash and destruction of many of the financial institutions, including the Bank of Western Canada back in the thirties, including the Bank of Manitoba that crashed ... MR. SPEAKER: Order please. MR. ASPER: .•.

Oh, the Finance Minister is not aware that the Bank of Manitoba failed and had to be merged ?- -(Interjection)--During the thirties, I'm not sure of the date. If he will look at the Bank Act of Canada, if he will look at the Bank Act of Canada he will see one of the dissolved banks referred to in the Bank Act is the Bank of Manitoba, among other banks that tried before we had central banking authority. Mr. Speaker, when we got central banking we finally brought order to the fiscal chaos. Now, that does not mean that there is no room in Canada for regional banking. In fact, Mr.

Speaker, the Liberal Party for four years now has said very clearly that one of the answers to the complaint of Western Canada is in fact regional banking; not state banking, Mr. Speaker, regional banking in the normal sense. And the First Minister I believe in some interview when this bill was being discussed, or perhaps it was the Minister of Finance, shrugged when asked, why is the government going into state banking, and he said well there's nothing really so radical or untoward about this, after all the Province of Alberta has treasury branches. Mr.

Speaker, the Province of Alberta went into treasury branches many years ago, I think it was in the middle thirties. That was part of a very very strange thing. We had the Social Credit monetary theory, we had a great depression, we had a banking system that was not yet centralized, the banking system of Canada was in fact not working; and then Mr. Aberhardt, the Social Credit theorist, I think it was Major Douglas, said we cannot institute our funny money policy without having control of the banking system.

So they tried and the Supreme Court said no, so they found that near banking they could do, and the treasury bran­ ches were set up. Mr. Speaker, a solution of the 1930s to a problem of the 1930s is not particularly rele­ vant in the 1970s in a different province. There were no credit unions, the movement hadn't started. It was just getting under way at that time. And today we have a fully integrated

May 30, 1974 4123 BILL 64 (MR. ASPER cont'd) ..... financial package. I'm not saying that it doesn't require improve­ ment, but this is the technique for destruction. This is the technique that will be detrimental to further progress in our financial institutions in Manitoba.

The Alberta experience was satis­ factory for its day, but I can tell you as a matter of fact that only a matter of months ago the First Minister of Alberta conceded that there was no--this was a private, it's not on the record, you will simply have to take my word for it--that he has conceded that there is no longer in fis­ cal terms in Alberta a need for his treasury branches.

And in fact entered into discussions, and I don't know how far they went but it's true that he entered into discussions with another financial institution with a view to possibly taking over the Alberta treasury branches which no longer had a great relevance in Alberta fiscal needs. A MEMBER: You're not serious ... MR. ASPER: Well, Mr. Speaker, the Fi rst Minister is expressing doubt as to that. All I can tell him is the discussions took place. Mr. Speaker, that isn't even germane to the thrust of what I'm trying to say.

I'm just saying that a solution concocted by some funny money theorists in the middle 30s, in the heart of a depression, at a time when there was no credit union movement and where there was no central banking authority may have had some relevance, but it has no relevance in Manitoba in 1974 at a time when we are blessed with a very sound and popular credit union movement that encompasses a quarter of a million people and also is part of a banking, trust company, invest­ ment community deposit-taking community that is the best, per capita, the best in Canada. And one that can still be improved. Not this way.

But can still be improved. We are the head office of Investors Group which is one of the biggest deposit taking and the biggest lending agencies in Manitoba. We are the Head Office. We are the head office of two of the major Canadian life insurance companies which are in the habit of taking deposits and making loans, deposits being through premiums. We are the head office of several small trust companies and these are deposit taking institutions and lending institutions. Apart from that, we have one of the most, in the world, the highest per capita branching system of the banks.

And I'm not suggesting that there isn't room for regional banking; in fact, Mr. Speaker, I make that case very strongly. There are major improvements required but this is not the solution: State banking, state ownership of the banks! Mr. Speaker, let's go through the basis of our disagreement. One, if all of the provinces of Canada do what the Province of Manitoba wants to do you will destroy the central banking authority of Canada. You will have no fiscal and monetary control exercised as one country. I'll give you an example.

The Bank of Canada makes a decision; it says we have got inflation-­ let's take that as a hypothetical case--and says in order for the kind of inflation we're suffering we wish to restruct the money supply to business to curtail expansion or to the consumer to cur­ tail consumption. Whatever the economic medicine required may be. And so, Mr. Speaker, using the central bank system that is done. The banks of this country are legally required to follow the direction and respond, and if they don't the Parliame nt of Canada will move.

And has and did in the proposed budget of the House that just dissolved, that would have increased by approximately one and a half percent the taxable income which amounts to tens of millions of dollars of the banks in order to take money from the banking system. Now, Mr. Speaker, if you have a treasury branch system in all ten provinces--and after all if the Government of Manitoba is successful and makes money with this venture then why wouldn't all the provinces do it. But if you have that, Mr.

Speaker, and the Federal Government moves through the central banking authority to control inflation, but this Government whoever it may be, the government of the day says no we don't agree with that economic medicine, so we will increase the monetary supply, we will increase it through our Treasury Branch system. And so we say to the consumers the federal banking authority is wrong, you can get money from us. Or we say to industry the Federal banking authority is wrong we will increase loans to business at a time when the central authority says it is wrong. Mr.

Speaker, this country will break very quickly if we get into ten monetary systems, ten banking systems, with a central authority being destroyed, or at least severely weakened. Now, Mr. Speaker, every province during some period has established some sort of a monetary system or some sort of a near banking system but not state owned. Even the Province of Quebec which under the constitution of this country was permitted to have its own independent banking system, provincial banking system. They're not state owned. They are

4124 May 30, 1974 BILL 64 (MR. ASPER cont'd) ..... individually owned. They are very close to the Caisse Populaire movement and they even share in some of the small villages of Quebec, accommodation, banks and credit union concept. There has been no need for state banking. Now, Mr. Speaker, I, and certainly the Liberal Party has never been a party that says there is never, never, never any opportunity or right or need or propriety for state interven­ tion into the commercial sector. We do not say that. We say there are circumstances under which the state can, should and even must intervene. But, Mr.

Speaker, those are very finely defined. First of all, the state must prove need, public need, not state need but need of the people. Not a need for power, not a need for control over money, not a need that the govern­ ment says - and this is the political danger we see in any kind of a state owned banking or near banking system - the power of government to make loans to its friends, to deny loans to its enemies and to bring politics, partisanship, into the monetary system. And don't think it hasn't happened.

Don't think there haven't been scandals throughout the years where the more governments have control over the lending. That's just human nature. In the Communities Ec onomic Development Fund we've had charges and substantiated charges of friendship being the guide, political friendship being the guide to lending policy. -- (Interjection)--Well certainly that have satisfied me and other Manitobans. Mr.

Speaker, the danger of this government, this particular government, being given the power to lend money in the business and consumers world on a vast scale as could arise, and would surely arise if the Treasury Branches were acceptable ,or successful, frightens us, frightens anyone when we see how this government has abused that lending power through the Manitoba Agricultural Credit Corporation, through the Communities Ec onomic Development Fund, and unwisely used it in the MDC. So, Mr.

Speaker, even on pure practical grounds we do not believe that this government should be entrusted, this particular government, should be entrusted with that kind of lending power. Now, Mr. Speaker, I said that there are times when government should intervene in the economy and establish industry, including financial institutions. One, when there's a need. Two, when that need has not been fulfilled by the private sector or the private sector has been requested and refused to fulfill the need.

And third, when the study, objective study by govern­ ment indicates that that is the best way to achieve a desired result that the community desires. And finally, after the government has interceded with the private sector and again offered incentive to the private sector to do the job and the private sector has failed, at that point it becomes necessary for government to enter the economy. Mr.

Speaker, that simply means that if there is a community that is uneconomic to serve, whether it's in Mafeking, or Killarney, or Wabowden, then there is a very much simpler way to have that service rendered to the people of that community rather than set up an elaborate patronage infested bureaucracy of the Treasury branches. That is simply to go to the local credit union in Thompson and say open a branch in Wabowden and we'll subsidize your losses.

Because it's a lot cheaper, a lot more inexpensive to go to a non-profit organization like a credit union and say "You render the service and should there be a loss because it is socially desirable that the people of Wabowden receive this service, we will as a cost of government subsidize the service". Just like we do with telephones, just like we do in remote regions with stores. We build roads that aren't economical. We subsidize--( Interjection)--Mr. Speaker, the First Minister is bellowing from his seat we will not subsidize any private agency. That's true. Yes, that's exactly what he said.

We will not subsidize any private agency. Mr. Speaker, that marks the great difference between ourselves and the Government of Manitoba. Because we say that it is sometimes more intelligent, if one is not enslaved by some dialectic or doctrinaire position, it's sometimes just smarter, Mr. Speaker, to let somebody else do it, it's a lot cheaper, a lot cheaper.--( lnterjection)--Mr. Speaker, I am hearing calls from the government side of the most incredibl e 1933 Regina Manifesto calibre. Robbing the poor to give to the rich and so on. Mr.

Speaker, we see that we have a difference of opinion as to when government should intervene. MR. SPEAKER: Order please. MR. ASPER: I would simply want to put our position on the record. Mr. Speaker, let's look at the question of is there a question of need, necessity. The Treasury branch system means that the government will go and offer interest to people who will deposit money. Okay. That's what the banks do, that's what Investors Group does, that's

May 30 , 197 4 4125 BILL 64 (MR. ASPER cont'd) ... what the trust companies do , that 's what the new Credit Union North Bank will do , if this government doesn't destroy their chance . That 's what the total financial community does, the credit unions . -- (Interjection)-- Mr. Speaker , I refuse to be drawn into a debate with the Minister from his seat, the First Minister . However , I hope we 'll get a chance to debate this. Mr. Speaker, those institutions pay people for giving them deposits , just as the Trea sury Branch will.

And they pay them the highest the market will bear tied to two things,(1) the cost of administration; (2) the amount they can lend the money out for , and of course lea ving a profit factor . Now the credit unions don't even do that , Mr . Speaker . The credit unions do not make a profit because any profit they make is distributed to their customer s. And , by the way, Mr.

Speaker , just in case the First Minister challe nges, challenges the Liberal Party for taking this position, let it be remembered that it was the Liberal Party of Douglas Campbell that brought in the legislation enabling credit unions to be establi shed in Manitoba. It has always been our position on a voluntary basis that people should be free to band together in self help whatever way, including credit unions and including co -operatives. Mr .

Speaker , that is what ha s happened and that movement has flourished, and we will read into the record the kind of flourishing that has taken place in the non-profit credit unions and the kind of service they've been able to render , without subs idy, without ass istance from government , and com­ peting in the free market , without state banking becoming something that stains our law books . Mr . Speaker, Mr . Speaker , let's go back-- (lnterje ction) --Mr . Speaker , my colleague suggests we should first ask who will be the Minister in charge of the trea sury branche s.

That poses some very interesting--pre sumably he will be also the bagman for the New Democratic Party as well , and then he 'll be the person who negotiates with those ca ndidates under Bill 7 who are allowed to be bagmen while they are candidat es . Oh yes , Mr . Speaker . We don't say these things in a menacing way, we say them as genuine dangers . When government becomes the banker s to the nation - and I am not going to be comforted by any statement that we are exaggerating , from government, that we are exaggerating the concern because all they want is the power to do it .

We're really not going to do it; there's going to be a task force . Well , Mr . Speaker , no . The power is in the bill and we must deem and as sume that power given will be power exercised , and that we'll have the trea sury branche s. Well , going back to necessity, the Trea sury Branch will offer to pay the depositors interest and they will lend money and they will have to be competitive because otherwise they won't be able to get their money out. They will have to be competitive with the Manitoba market1 the Canadian market, the world market.

And that means a spread of, at the very most , one­ quarter of one percent on deposit or on loans . Now , Mr . Speaker , is it worth, for one-quarter of one perce nt difference in interest rate, to set up another monolithic bureaucracy ? Mr .

Speaker , I was allowing for losses and bad debts and that sort of thing, and I agree with my honourable friend from Minnedosa , who is a bank er , that you cannot make money on one-quarter of a point, you need two points gross difference between deposit- -(lnterjectio n) --No , I' m saying the net benefit to the people of Manitoba in borrowing power will be a quarter of a per­ cent difference between that and other lending agencies . Now, Mr . Speaker, it's pos sible that the government will stand in this House and pledge; "We will guarantee that our prime lending rate will be one percent below the banks . Mr .

Speaker , if they do say that , all they will be saying is that we'll subsidize it . We'll buy political favours. We will politically pay off the people of Manitoba and buy votes by saying,"We'll sub­ sidize the borrowing . We'll be one percent below prime ." Well, that 's fine . The people of Manitoba will in one hand pay taxes to subsidize lower interest loans . If that 's something the government wants to do , let 's talk about that . Let 's talk about loan subs idy, interest rate sub­ sidy, because the Federal Government is saying the same thing, that we are going to have to go that route .

Great Britain has gone that route , but they didn't go into the trea sury bank system , they subsidized interest rat es . But the First Minister says, "We will not subsidize private" - I' m not sure whether his word was private enterprise or private sector or private institution, but each one of us individuals is a private institution . Mr . Speaker , there are dozens of ways the government can lower interest rates if it really said this is what its objective is, but I don't think it even pretends that it will do that , and we'll reserve further comment on this bill until we hear what the government intends.

Let 's ass ume, let 's as sume that they want to lower the interest rates on loans. Well , Mr . Speaker,

41 26 May 30, 197 4 BILL 64 (MR. AS PER cont 'd) . . . once again , if you lower your lending interest rate you must lower the rate you pay on deposit, because there's nobody can print money and so it is not possible; it cannot be done . And nor is it done in Alberta where there is a trea sury bank system . So then we have to assume that the government's objective is not to save the borrowers money and it is not to put more money, interest, into the hands of the depositor .

Let 's ass ume that its real motive, as we've been able to disc ern so far, is to provide service where service is no longer being provided or is not being adequately provided . Let 's as sume that there is no bank in Nelson House so the government says we're going to establish a Trea sury Bra nch in Nelson House . -- (Interject ion) --Well that's right . The Trea sury Bra nch will be under 10 feet of water of course, but it'll be on a barge , that's right .- -(lnterjectio ns) -- MR . SPEAKER: Order please . MR . AS PER: I' ll be back, I want to have a cigarette . MR. SPEAKER: Order ple ase . MR .

ASPER: It 's your turn . Well, Mr . Speaker , the only--Mr . Speaker , if that's the motive then we have something to disc uss . I think we generally do have something to discuss . But our difference will still exist because we will say this is not the route to take . Because a Treasu ry Branch can only in effect take depo sits and lend money . They ca nnot effect commer ­ cial transf ers , they can't be part of the Canadian cheque -cleari ng house system , so that they are of very limited use . Take money in, lend it out.

Well on the grounds of necessity, the only necessi ty that can be pointed to is that there are some communities that are under- served . Most of the communities, the vast, va st, vast majority of communities in this province are well-serv ed , and over-served as a matter of fac t. Competition is indeed fierce where they have at least one credit union , sometimes more .

Even the smallest center s, two banks corn­ peting for business, sometimes only one , but there are more branch banks per capita in Manitoba than the economic s dictate , and that's because the banks - and I' m no defender of the banks ; as a matter of fact, Mr . Speaker , I am regularly denounced by banks because of my insistence on regional banking as one of the terms of renegotiation of Confederation . The banks don 't like that and , as a result, I maintain that position , because banking should be regional but it should not be state banking, again . Now, Mr .

Speaker , let 's go to that small community, whether it's Nelson House or whether it's Wabowden or whether it's some village that doesn't have adequate financial service s. The government's obligation is first to determine whether it can support any kind of financial service or should the community be prepared to drive eighteen miles, which is 15-20 minutes, to the next town for banking, just as it takes me 15 -20 minutes to get to my bank ? Or should we put the institution in the town? A ME MBER: You should see the way he drives . MR. ASP ER : Mr .

Speaker , if a determination is made that there is ground for es tab ­ lishing some sort of financial agency in the town, that still doesn't require treasury branch es . How did we get along for a hundred years without trea sury branch es ? How did we manage to survive for 38 years since -I think it's 38 years since the Bank of Canada was established and the credit union movement got start ed. We managed to survive without treasury branche s. And, Mr . Speaker, Mr . Speaker , I condemn, I condemn and have done it publicly on many occasio ns, the lack of development capital available in Manitoba .

But this will not create five cents of capit al . Not five cents . Because , Mr . Speaker, the only time we get development ca pital in this province, net, is when somebody in Ontario deposits money in his bank or trust company in Ontario and that bank lends the money here . Mr .

Speaker , I can see legislation, I can see all kinds of things , and I would support aggressively any legislation that prevented institutions in this country from taking more out of a province than it puts back in, whether it's our insurance compan ies , whether it's our investors' groups, but there is no evidence yet - as a mat ter of fact there is evidence to the contrary, that that is not happening . But if it were demonstrated that that is happening, then, Mr .

Speak er, what we require is federal legislat ion and insistence by this government, in­ stead of spending its time talking to Finance Minister Turner and saying, "Mr . Turner , we want to have the right to own 20 perc ent of a bank," if that 's what the Finance Minister spends his time with Mr . Turner saying , not 20 percent , maybe 50 perc ent or 100 percent , but that 's how his time is spent . At no time did he say , "We want legislation requiring the financial in­ stitutions that are federally licensed to be required to leave in investment cap ital in a province,

May 30 , 1974 4127 BILL 64 (MR . ASP ER cont'd) ... as much as they receive in deposits in that province . That would have been productive . That would be a valid use of provincial barg aining power with the federal authority. --(Interjec tion) --Mr . Speaker , there's a question from the Finance Minister . I' ll take it later . Now, the necessity, if ever demonstrat ed , will be found to be very minute . It may exist, but it will be found to be the exception rather than the rule . And so there is nothing before us that warrants the establishment of a new structure .

What the government should do to eliminate those needs that it may have perceived, and I haven 't seen and no member has seen any evidence to suggest the government is right, then it must put that information before us and show us the alternative solutions that differ from this, such as saying to the credit union movement, "Go into this community and serve it," if it's not being adequately served now.

If there is a community where there isn't adequate competition for deposit and lending rat es, let 's create that competition; but there is no need for state -owned banking in this province for the other rea sons I' ve already said . Now, Mr . Speaker , there 's more . We oppose this because it threatens existing structures. Mr . Speak er, there is no way in the world that this government is going to only es tablish trea sury bra nches in those communities which are uneconomic to serve .

They will then come and argue , well , if we 're going to serve Mafeking , we 're obviously entitled to put a branch into Winnipeg to make profits in Winnipeg to subsidize our Mafeking operation . Mr . Speaker, we will have a province-wide trea sury bra nch system, with all the abuses that that open up, if this legislation pa sses , and I don't accept the cooing of the Minister who's suggesting that no , this is permis sive legislation; we are not requiring ourselves to do it; We are entitling ourselves to do it , that 's all . I don't believe that , and I don't believe anybody on that side really believes it .

There will be a trea sury branch system . Now, if the people of Ma nitoba are fooled by these gestures that are perhaps intended to calm their fear s, then there's nothing more the Oppos ition can do, Mr . Speaker . All we can do is focus attention on this and the Liberal Party intends to do that . Now I have said that the institutions are unwanted, that there' s been no demonstration of desi re . Mr . Speak er , we have had a province for a hundred and some yea rs; we have had a credit union movement, a trust company structure. We have a banking structure.

We have a deposit savings and loan system , life insurance and so on . And I have yet to see , ever , a suggestion that there should be trea sury branche s. I have in four years as leader of my Party never received a letter , and perhaps maybe the Leader of the Official Opposition , the Honour­ able Member from River Heights, maybe he 's rec eived a letter , maybe the Minister of Finance has received some letter s, but we have a pretty good intelligence system . We often get carbon copies of the letters that each of us receive and , Mr .

Speaker, I don't think they have seen a demonstrated request, demand, from anyone for trea sury branc hes , except some bureaucrat who said, "Ma ybe I can get to be treasurer of a Trea sury Bra nch ."- -(Interjectio n)-- Well , Mr . Speaker , I suppose when you've got a Cabinet , and some of whom may be defeated in the next provincial elec tion , perhaps they may be looking for a new preside ncy as was found for the former Minister of Tourism ; I suppose that kind of thing, cr eating branch manager s. Tremendous job control .

After all, to open 40 trea sury branches you've got to have at least 10 people per branch . You've got a presi dent now, now you've got a board of directors , and now you've got a manager . Mr . Speaker , the manager has got to get $20 ,0 00 a year or $15, 000 a year . I can see merit in political patronage terms for the government . But, Mr. Speaker, the reason I raise this is because that is the pattern of whatever else it does.

So, as ide from the demonstrat ion of no requests from the public for this service , no condemnation by the public of the existing institutions , and again particularly, the most vul­ nerable of all , the credit union movement, who stands to be endangered because it doesn't have the res ources of the banking system or the trust companies of this co untry, and this is a uniquely Populist kind of institution noted in the prairies, the cre dit union; and, Mr . Speaker , when I say that those institutions are threatened, I can demonstrate that .

We have been trying for , how long - 10 year s, 1962 - 12 years ? to get one bank, one new, regionally locally­ owned bank to locate with head office facilities here in Winnipeg. And we have not got it. This is a very thin financial market and , Mr . Speak er, there was one abortive attempt , the Ba nk of Western Canad a. It might have gotten off the ground, might have provided the base of a regionally philosophically-oriented kind of a bank, and it failed - for no valid reaso ns, I

41 28 May 30, 1974 BILL 64 (MR . ASPER cont'd) . .. might say, but it failed. And only the credit union movement has had the courage that they will do it . And I don't think thAv1d come to the government and said , "Subsidize us . We'll establish North Bank." I think they've said , "We're prepared to establish a regional Manitoba bank." And for that they should be congratulated and saluted.! don't know where the First Minister got the idea that he expressed from his seat that we would not support North Bank. The idea is excitin g, Mr . Speaker, one that we endorse fully.

And I would ask the First Minister to reconsider, allow North Bank to be incorpora ted, subsidize North Bank if necessary to go into the communities that cannot be served, and we will get, we will get genuine regional banking in Manitoba . Nobody else had the coura ge to do it. The private sector didn't do it and they ought to have done it . They didn't have the courage to have enough faith in this province to establish a head office banking operation here, and unfortunately we went for many years without the proper kind of bank.

Now the credit union movement says, "We'll do it, " and I hope they'll make shares open to the public .l .hope it will be a publicl y-owned bank, and certainly members of this House would be doing patriotic duty, in my opinion, to invest in that kind of an institution . But, Mr . Speaker, that is not state banking. That is fulfilling a need that this province urgently faces, of more sentimental, more philosophically­ tuned banking structures that know us , understand our economy.

Now that kind of thing this government would have adopted small "I" liberal approach ; not doctrinaire sociali st approach , but liberalism , which says "where there 's a need pause it to be filled ." The last resort is government operation . The first attempt is to get the private sector to take the risk to put up the money, we 'll get our share through taxes. It's just plain smart, Mr . Speaker. If the thing goes bad, let the private sector take the loss . If the thing goes well, we get our piece without a risk through the tax system . That 's just smart , and that 's what we should be doing. Now as well, Mr .

Speaker, we fear that once the Treasury Branch system comes in there will be proliferati on. There will be proliferation , because empire builders will head it. And that's what happens to the Civil Service , that 's what happens to every single government pro­ gram. No government program is ever stopped or turned back. No government program ever does anything but expand. And so now, on that hig hly motivated thing of putting a Treasury Branch into some unserviced area - and now we want one in Killarney, now we want one in Minnedosa, now we want one in N eepawa . MR. G. JOHNSTON: Stay out of Portage . MR.

ASPER: The credit unions of those areas will dry up unless , unless, Mr . Speaker, the government operates at a loss, gives greater interest rates or lower charges for loans and asks the taxpayers of Manitoba to pick up the subsi dy. If that 's the case , then let's say so , tell the people that , tell the credit unions that , let them orderly wind up their affair s, buy them out , let them go home .

Because if you want to replace them , don't knock them out of business , take them over, they're nice people , they're ordinary people; they're not evil capitalists , they're not looking for big gougy profit s, they're entitled to a greater consideration from this government. And don't tell us what you've done for the credit union system. I don't know what they've done for the credit unions . I don't know what they've done that warrants the righteousness of the First Minister saying in the House earlier today what great things this government has done .

They've advanced the system , they've advanced the system some­ what - to their credit - and then with this bill, threaten the very existence of the credit unions. Now , Mr. Speaker--(Interjections) -- MR. SPE A KER: Order please . MR. ASPER: Ah , Mr . Speaker, now we 've heard the reason from the Honourable Minister responsibl e for Au topac as to the government's view of why I am taking my position -w hy our Party is. He 1 s saying that we are using the credit unions as a front to defend our real client, the chartered banks . Now , Mr . Speaker, Mr .

Speaker, the greatest restraint in the world prevents me from saying something that the First Minist er knows as to what kind of support the banks give the Liberal Party in Manitoba and what kind of support the banks give the New Democratic Party . Mr . Speaker , it 's only restraint . What a silly thing for the Minister of Au to­ pac to suggest. The day our Party came out in favour of regional banking was the day that we were denounced publicly and in print by the banking system of this country . Because they have a monopoly. And Mr.

Speaker, it was we who questioned and urged the Minister of Industry and Commerce to go to the maverick bank in this country, Unity Bank , and try to get them to locate their Head Of fice here because that was a bank in search of a home . That was a bank that went

May 30 , 1974 4129 BILL 64 (MR. ASPER cont'd) ... from Manitoba , Saskatchewan , Alberta and finally located its Head Office in Toronto with 20 some branches . We could have had that . And no offer was made to Unity Ba nk to locate their home here . So this government. . . A MEMB ER: ... that 's a real concern . MR. ASPER: I' m not sure why I have a real concern for the Unity Bank . I don't own any shares in Unity Ba nk . --(Interjection) --Mr . Speaker , the First Minister says that I have never mentioned credit unions in our debate on regional ba nking . No .

Last year we were talking about regional banking, and we still say that we want regional banking , and that in no way negates the credit union position . But only, this plan --(Interjection) --Ye s. Yes . Yes , this do es . Well, this plan of the government competing against a non-profit organization in those areas where the government does not have to make a profit and therefore can compete effectively - the credit unions will tell you that they are not afraid of the banks , they can beat the banks in competition and have - reason ? - the banks have to make a profit, the credit unions do n't.

And that 's why the credit union movement is safe , completely safe from the banking competition . But to compete against the Treasury Branches that don 't have to make a profit that . .. Well ,M r. Speaker , Mr. Speaker , -- (Interjectio n) -- MR. SPEAKER: Order please . MR. ASP ER: Mr . Speaker , the credit union movement has submitted a brief to the government, and we suggest that the government read the brief very car efully, and we suggest all honourable members of this House be given copies .

We asked for the document to be tabled; it was not tabled, and so we went to the credit union movement and as ked for a copy of it and got it . But I don't know whether all members have read it, and I urge them to read it, because the credit union system feels threatened . Now if we're wrong - and we'll always allow the possibility, not like honourable members opposite -t he Liberal Party will admit that it's pos sible that we're wrong. The government doesn 't seem to be prepared to admit that it's pos sible that it's wrong.

But in any event , since th ere 's going to be a Task Force, we ask the Government to withdraw the bill , put the Task Force to work, submit it's paper and then we'll make a judgment on this bill next year . There's no rush on this . We've lived 105 years without this . It will take the government in any event a year or better to set up the machinery to implement a Treas ury Bra nch system . Mr . Speaker , who will get the Trea sury Branche s? Those committees that elect ND P members ? Or those who don 't return govern­ ment member s?

Because maybe that will be interpreted as being malicious , not elec ting an ND P member so you don 't get a Trea sury Branch . I don't know. Mr . Speaker, we want to see the justification for this Treas ury Branch system . We want to see it in cold black and white terms , we want to see it by objective studies, and we don't want to accept the government's word that take our word for it - trust us, it's good.

If the government is sincere in it's belief that it can make a case for this, then we urge that they do their Task Force study, they let the Legislat ure - before we take this new step that could lessen the number of financial institutions in this province , that could see a reduction in the number of financial institutions if this plan is implemented - before that 's done , before the government creates another vacuum py its threa ts , which it then rushes in to seize and fill , and say , "See, the private sector didn 't serve it we had to take it over . "Mr . Speaker , that 's a well known device .

As a matter of fact the Honourable House Leader has used it . When we talked about mining, he said, "We 're introducing this kind of tax; if this tax scar as the private sector and they leave , good, we'll move in and fill that vacancy ." Well , Mr . Speaker , this is the same thing.

Government is saying, we'll create the power for state banking, another state run co rporation , and we'll go in here and here and here and here , and if the private sector then says - whether it's the credit unions or the trust compan ies , or the agents who take deposits for the savings and loan ass ociations - they sa y, well , we'll move out of Gimli or we '11 move out of Portage .

So the government will say , ''Don 't you worry, we '11 move in, and in five years or in ten years we will have state banking on a mas sive scale ." And the government will have succeeded in driving out, if not this government , perhaps another govern­ ment, can have used this legisla tion to achieve that objective . And so we will not support the legisla tion .

We again ask the government, if it's so sure it can make its case , let it do the study, let it put the study on the table , let there be public hearings , let people make submiss ions and represe ntations , let us find out how many Man itobans want this , and then we 'll make a

4130 May 30, 197 4 BILL 64 (MR. ASP ER cont 'd) . . . judgment a year from now. And the government can have all its machinery in place ready to go , if it really wants to do it. If you 're serious that you can make your case , start behind the scenes putting your machinery together . It'll take you a year . Do your study, and one year from now bring in your legislation if you've proved your case , and then the day after you 're already into it . If the government is sincere that it is not a grab , that it's not a takeover , that 's the course it will take .

And we will judge the government by the re sponse we get on this bill . Mr . Speaker , in any event there are many things i:J. the bill that require change even if the government is bent on proceeding headlo ng . And we will look - should this pass to commit­ tee - and it surely will not pass to committee with our support - we ask the government to think of the 163 credit unions that have made their case through this brief; we ask the govern­ ment to reconsider the position, and should they fail , then we will again raise this matter and exercise every bit of energy we have to see this bill defeat ed . MR.

SPEAKER: The Honourable Attorney-General . HON . HOWARD PAWLEY , Q. C. (Attorney-General) (Selkirk) : Would the honourable member submit to a question ? The honourable member referred to possible partisa n activity on the part of Trea sury Bra nches if they were formed . I wonder if he would describe the recent activity announcement in British Columbia , that the Presi dent of the B .C.

section of the Bank of Montreal was engaged in attempting to organize the three opposition political parties in B .C . to run as one against the government political partisan ac tivity. MR . ASP ER: Mr . Speaker , the question is incomprehensible . I don't un ders tand what that 's got to do the fact that a member , that a person who works for a bank ... A MEMBER: It's all right there, but not ... MRo AS PER: No, no , no just a minute . I don't understand how a member , a person who works for a bank, the President of a bank, should be denied the civil liberty of taking

part in politics. That isn't what we're talking about . We're talking about the lending policies . You can't distinguish. You think there 's some comparable situation when a member of a bank staff runs for the NDP, or runs for the Conservative s, or the Liberal s, and that dictates lending policy ? Mr. Speaker , that 's a red herring that isn't worthy of even discussi ng . If you can bring some evidence that the Bank of B .

C ., or the Bank of Montreal , or any other bank makes its lending policies favour a political party , or makes its deposit interest rates favour a political party , then I suggest you take that information to the Finance Minister of Canada and demand the revocation of that license . But otherwise don't throw that kind of a red herr ing into the Chamber . MR . SPEAKER: The Honourable Minister of Mines. MR. GREE N: Well , Mr . Speaker , the honourable member wants to have a cigarette, and if he does, he'll enjoy the cigarette and he 'll be spared my discourse . Yes . Now, Mr .

Speaker I listened very car efully to the honourable member who was very caref ul to say throughout his speech that the Liberal Party would not trust this government to go into Trea sury Branch . And I heard him say that , Mr . Speaker , four or five times, that he kept saying this government . Well the Honourable Member for St . Boniface says that he didn't say it . Then I want the Honourable Member for St .

Boniface to read the honourable member's speech tomorrow , and if he is correct, I' ll do what I' ve offered to do on many occasio ns , I' ll buy him a drink; but if he is wrong, then he 'll have to buy me a drink. And he referred, Mr . Speaker , to this govern­ ment, espec ially this government -I think he even used that word , although the word "especi­ ally" I will not bet on yet . -- (Interjection) -- MR . SPEAKER: Order please . One speaker at a time . MR. GRE EN: Mr . Speaker , the Honourable Leader of the Liberal Party is in a very difficult position .

The Honourable the Leader of the Liberal Party has taken the position, and has indicated today that the ba nks don't like him , that they single him out as an enemy be­ cause he has called for western regional banking - and that he believe s- -(Interjection)--P ardon me ? Well , I don't know if he gets primer rates or not .

But that he has called for western regional banking, that he believes that the eastern banking system does not concentrate on the development of regional problems within the west, and that therefore his position is that the banking institutions of Canada do not do justice to the west and that there is need for a regional banking system . Now having es tablished that need , as the honourable member has done , he is in the difficult position of now arguing as to why that need should not be filled publicly, because

May 30 , 1974 BILL 64 (MR. GREEN cont 'd) ... he has used every argument against the public being involved in banking, except the one legitimate argument . 4131 Now , Mr . Speaker , I have to now sort of become somewhat of an individual, because the New Democrat ic Party is coming forward with a program of enabling legisla tion to es tablish Trea sury banking systems in the Province of Man itoba . And there are mixed motives for the movement in that direction , just , Mr .

Speaker, as there were mixed motives for the movement with res pect to the establi shment of a Ma nitoba Public Automobile Insurance Corporat ion . There were many member s to whom it was most important that the best thing that can happen with a public automobile insurance is that the rates co uld be reduced, and that the reduction in rates and le ss expensive service was the single most important reaso n for going into automobile insuranc e. I indicated at the time , Mr .

Speaker , that I felt that thepublic could operate a more efficient service, that the public could operate a fairer system and that the public could operate a less expensive system .

But I said that , having established that that is the case , my belief was that the most important reaso n for the public bec oming involved in automobile insuranc e, is so that the $30 million in premium money as it then was , 30 to 35 million dollars in premium money, in investment capital , which up until that time was directed and invested and utilized at the discr etion of a whole series of private businessmen acting in private corporate board rooms; that am ove from that situation to a public situation with a more efficient service, would res ult in that investment capital being invested by the public through its repre sentatives and those represe ntatives re sponsible to the public .

And , Mr . Speaker , I made it quite clear that that was my most important reaso n . I think that people have said in this room that I let it slip , that it somehow came out as an involuntary admi ss ion . Mr . Speaker , at no time did it slip . I indicated during the elec tion campaign that that was my belief. I indicated when I spoke in this House it never was an accide ntal position . It was the guiding position as far as ... pardon me ? A MEMB ER: You were mistaken . MR . GREEN: Well ,M r. Speaker , the honourable member says that I was mistaken .

Now, I don't wish to debate at this point, because that opens up a new story . All I' m indicating is that- -(lnterjectio n) --Well , Mr . Speaker , all I' m indica ting is that that was my principle reaso n for the involvement in public automobile insuranc e. Now Mr . Speaker, the honourable member said , the Honourable Member the Leader of the Liberal Party says that there is a need for a regional banking institution that will be directed towards regional needs and whose investment policy would re spond to the aspirations of those people whom it is serving . And I 8gree with him .

I think that that is a very very legitimate purpose and , Mr . Speaker , that would be my , and I stress "my" individual , most important reaso n for the public being involved in Trea sury Branc hes . Not that they will fulfill a need in Wabowden - and I' m not suggesting that they won't they could, just as the regular financial institutions do ; not that they will lend interest out at lower rat es, although they could , but that is a competitive feature , and as far as I' m concerned that will remain competitive.

But that the public , through its represe ntatives would involve themselves in the financial institutions of this province, and having so involved themselves in the financial institutions of this province that the people of the province through their elected repre sentatives would have a modicum addition to their economic power. Is that such a terrible thing? Is it really the fact that the people of this province would not like to have a modicum of an addition to their ec onomic power a very small add ition to their economic power ? Beca use, Mr .

Speaker , the scales are still weighed heavily in favour of the private institutions, the private financial institutions . And you know, the Honourable Leader of the Liberal Party spoke of them as if the institution itself, you know the building and the stock share ce rtificates or the debenture and the currency were something inherently good in themselve s. Well , Mr . Speaker , you know, it's an interes ting thing that all that those securities do in terms of wealth crea tion is give confidence .

If somebody knows that if a security is in existence and will be recognized , that he is able to act in a certain way, knowing that his actions will not re sult in him losing what he has in­ vested in terms of that security . But the security itself, the paper has no value . If they all burnt, the war ld would not be less wealthy than the day before they burned. It 's true . The situations would cause problems as to what one person owed another , and I think that is very important and I' m not suggesting that that not be very important .

But I do not look with the honourable member, the Leader of the Liberal Party , who seemed to think that a number of

41 32 May 30 , 197 4 BILL 64 (MR. GREEN cont'd) . . . financial institutions and the greater the number the greater the wealth of the community -I would say if we could do the same with one financial institution, we would be wealthier than having numerous financial institutions all over the place doing nothing but exchanging paper with one another . And that does not make the community more wealthy, it does not put food into anybody's belly , it does not put a shelter over anybody's head and it does not put clothes on anybody's back .

The confidence of a currency situation, which I agree is necessary and I' m not trying to underrate it, does those things . But if it could, if one could envisage it being done by one bank, you know, on the corner of Portage and Ma in. You go down Portage Avenue and you will see numerous financial institutions; you see the trust companies , the Royal Bank, the Ba nk of Nova Scotia , the Bank of Montreal , numerous others which I have not yet mentioned - and are the institutions in themselves inherently crea ting wealth ? What are they doing ? How much food are they producing ?

How much material goods are they producing ? How much housing are they producing ? They are providing a machinery whereby that is created . And- -(Interjection) -- Well , I agr ee , I agree and I' m not trying to undersell them, but if it could be done in one building would that make us poorer ? If it could be done in one building rather than in - and that the labour thus freed did other things, would that make us poorer ? I would say it would make us richer .

But nevertheless, that is not the point that I' m making - and I' m glad that the Leader of the Liberal Party has now returned and has enjoyed his cigarette s, because I was trying to indicate to him that my reaso ns , my individual reaso ns , and I stress "individual", because there are mixed reasons ... MR. ASPER: I heard every word you said . MR . GR EEN: All right. Fine . Then the honourable member has heard . My individual reasons are his reasons . His reaso ns , Mr . Speaker- -(Interjection) --Dh, but that doesn 't matter . The fact is that a- -(lnterjectio n)-- Mr . Speaker , the real reaso n is now out.

My real reason is now out . Mr . Speaker, have I sort of let a cat out of the bag ? It is perhaps the case - Mr . Speaker , the Minister of Finance, the Minister of Finance believes in Treasury Br anche s. He believes that they perform a certain servi ce . I believe in Trea sury Bra nches . I believe that they form that service and other s, and we therefore both believe in Treasury Br anches . Now what's wrong with that ?- -(lnterjection) --Ab solutely . MR . SPEAKER: The Honourable Leader of the Liberal Party . MR . ASP ER : Thank you, Mr . Speaker .

I want to as sure the Minister that I heard all of his speech while I was out of the room , and I wanted to ask him about what he--(lnterj ection)-­ yes, that 's right -I want to ask him, if I understood him correctly to have said , that what he really wants is the funds, the use of the funds; and if he said that , is it not a fact that he can get as much of that money as he wants in the competitive market by offering demandab le , ca shable savings bonds , as the Government of Manitoba has just done ? MR . GR EEN : Not at all , Mr . Speaker .

If I believed that , then I would disa gree with the honourable member who wants a regional western ba nk . and I happen to agree with the honourable member that there should be a regional western bank - because the honourable member could just as well say that he doesn't need a regional western bank, .he could issue saving certificate s. Now, Mr . Speaker , you know, you can agree with me or you can disagree with me - and I' m not as king the Leader of the Oppos ition to agree with me , we happen to have different opinions .

I am merely stating my pos ition , that as far as I' m concerned it is not unholy, it is not bad, it is not foul, it is not a horrendous thought for me to feel that the people of the Province of Manitoba whom I represent, who other members in this room rep re­ sent, have the additional economic power of being the owners and controllers of their own bank.- -(lnterjection) - -The honourable member says a credit union. Now, first of all , I find it difficult for somebody to say to me that you shouldn 't own a bank . You know , I don 't see the bank owners saying that you shouldn 't own a bank.

The bank owner s, they like to own banks , and , Mr . Speaker , I am one of them . I have shares in the honourable member 's ba nk, I have shares in the Royal Bank of Canada , and I think that it's a good thing . I think that the shares not only have enhanced in value but I think that they are a good security .

I think that they will pay dividend s, and my only problem in understanding members like the Honourable the Leader of the Liberal Party , the Leader of the Conserv ative Party .- -(lnterjection) --1'11 get your question in a minute - is why they think that there shouldn't be share cert ificate s; owners of a bank, the people of the Province of Ma nitoba , why they shouldn 't own a bank.- -(Interjection) -- Well , I have two questions . The Leader of the Opposition first .

May 30, 1974 4133 BILL 64 MR . SPEAKER: The Honourable Leader of the Opposition . MR . SPIVAK: Ye s, I wonder if the Honourable House Leader would indicate whether he's prepared to have the Royal Bank whose manag ement obviously has produced benefits to him, manage the Trea sury Bra nches so at least it'll make money . MR . GREEN: Mr .

Speaker , I will go to the Royal Bank, and I will try to find their best man, and I will say , "How much are youmaking?" And if he says , "$5 0,0 00, " I will say, "I will pay you $5 0, 500 , come and manage the bank of the people of the Province of Ma nitoba ." Ab solutely no doubt that I will do that ,absolutely no doubt, Mr . Speaker , and he will come . He will come . There will be no problem . Now let me continue, Mr . Speaker -- (Interjectio ns)- -they are using me up, and I want to continue . -- (Interjections) --Well, plea se, please . Well , Mr .

Speaker, let me continue with my remarks , and then when I am concluded maybe the honourable members will give me time to continue to go further , because they will be so ha ppy to hear me that they will want me to answer more questions . But, Mr . Speaker , you know, the Honourable the Leader of the Liberal Party , the Leader of the Conse rvative Party , and various people in this community are now using a very very interest ing technique, which has been used before . They are sort of putting up the children in front of the army saying, here are the people that you are shooting .

You know, and it's been done , especially in the taxation field . And I urge the honourable member to read a book called "The Rich and the Super Rich" , maybe he has read it, which is a book Mr . Speaker , which always demonstrates that when real power is in trouble--( Interj ection) --Yes. Right. When real power is in trouble , they don 't go fight for power - the insurance industry didn't fight., they put up the children , they put up the agents . Now I know, Mr . Speaker , that those agents , given time , the insurance industry was going to put out of existence.

The insurance industry was going into direct sell , the insurance industry was eliminating as fast as pos sible the agents because they would like to , and they did , they would like to operate without agents . But when it came , when it came to a fight the insurance industry didn't want to stand there, the big tough industry, so they put the children in front and said , look who you are hitting. The banking institutions know that they can't go to the people of Man itoba and say, the government is trying to hurt us . So the credit unions are made like the victims. Now, Mr .

Speaker , I belong to the co -operative movement . I belonged , and still belong to the co -operative movement, and I say that the credit unions ,M r. Speaker , were formed under the following circumstan ces . . . . . . . . .

Not entirely, but •....... that there were people, ordinary citizens such as we have in this Chamber , who said that the banking institutions are making it difficult for us to get loans when we need them; we don't have the proper security, we don 't fall into their ca tegories; that the banking institutions have too much control of our society; that we have to have something to deal with the problem of the banking institutions, of financial ins titutions which are in control by a financial elite . They were mostly people who wanted the public to go into the banking institutions .

They were people who said , this is something that the public should do, this is something that the government should do . But the Government wouldn't do it . And therefore they became a self-help group, who said that if the government won't do it , we will organize as many people as we ca n to build up a co -operative movement to protect ourselves in some way from the power of the banks . They did it, Mr . Speaker , . . • . • . . on the basis of the fact that no government would do it .

Now they re institutionalized - and I don 't criticise that, I think that they deserve all the credit in the world for having fought that fight . But their real fight was for public ownership , involve­ ment in and control of financ ial inst itutions . And if the government of those days when they started to form had performed that service , the credit unLons would never have come up . The Honourable Member for Lake side is shaking his head . In the province of Alber ta, there are very few credit unions . There is a Treas ury Branch system . Now do you think, Mr .

Speaker , that the credit unions did not grow in the province of Alberta because the people were any different in terms of wanting to perform a public function ? Not at all . The reaso n was that the entire repre sentation of the public was involved in the creation and involvement of Trea sury Branc hes .

Now the Honourable the Leader of the Liberal Party pushes forward the credit unions as his shield, as his line of attack to protect the major financial institutions in this province, who he indicates he wants to protect or paves the way for a western regional bank, which I have no disa greement with; I prefer a public bank to a

41 34 May 30, 197 4 BILL 64 (MR . GR EEN cont'd) ... private bank, that 's the difference between he and I, that 's legitimate . But that is his real interest, and he feels that if there is a Treas ury Branch system established in Manitoba - and we are quite a ways from it, all we are doing is setting up a permissive bill . That that public institution , that that public institution-- (Interjection) --Well , the honour­ able member thinks that if I have said that in a way in which the honourable members thinks I 'm trying to pacify people , let me tell him that the opposite is true .

I am sorry that we are not further ahead . That when I talk about setting up permissive legi slation for Treas ury Bran.­ ches, then the honourable member is quite right. It's because I want to be involved with the public in the financial institutions , not because I want to have a permissive piece of Legislation . He's quite right. So I' m not trying to cool anybody off. If anything I would like to inspire you, yes . I believe that the public should be involved to a greater extent than they now are in the ownership and control of their financial institutions .

And I do not see that the people of Alberta are less free , are less dignified , are less capab le , are less somehow citizens of the world because they happen to be owners of banks . As a matter of fact, Mr . Speaker , they like it. The Leader of the Conservative Party of the Province of Alberta wouldn't think of undoing the Trea sury Bran ches .

At the Western Economic Conference he said, here I am the one island of capitalism in the sea of socialism of the west and I am the only one who has a 270 million -I think he gave the figure, although that may be wrong - institution which is operating on a very profitable basis . And has that made the people of Alberta le ss in control of their dest iny or more in control of their destiny? I say more . Now, Mr .

Speaker , the Honourable Member the Leader of the Liberal Party would have you believe that this is some type of doctrinaire, ideological hangup, and I tell the honourable member that as far as I am concerned it is a question of sheer pragmatism . Am I better off if there is a share of the economic institutional investment power which I am able, through the instrument of government to bring into the hands of the people; and through their elected re­ prese ntative , provide a service on the same basis as it is being provided and still have the use of the investment capital that that therefore accrues to me ?

Am I some way worse off than I was before ? If the honourable member - here is a key question - if there was a Bank of Manitoba, if there was a bank- -(Interjection) --look, you can give it whatever label you want to -i f you want to call it state cap italism -I will say what it is, I will say what it is, look, I will say what it is . I believe that it is the people organizing themselves in such a way that they are able to own, control and manage a financial institution which serves their needs and gives them economic power.

If you want to call that capital ism , state capita lism , call it state cap italism ; if you want to call it sociali sm , call it socialism; if you want to call it communism call it communism ; if you want to call it fascism , call it fascism . I say that it serves a useful purpose , and on that basis you pick whatever name you want . Now, the honourable member suggests that it does not serve a useful purpose .

I indicated to the honourable member that some months ago I went down to the State of North Da kota-- ( Interjection) -- Well, you know, every time you show a fact which throws the lie in the face of the honourable member, he sort of swoops it up and says "oh" . Now the fact is that the-­ (Interjection) --You tell me in what case I' m not giving an

interpretation . You tell me in what case this fact is not true . The people of the State of North Dakota through their government own a state bank ,a nd I would like the honourable member to tell me what part of that is inter­ pretation and what part of this is fact . The honourable member now says that what I said would be fact and he said would be

interpretation is fact, because that 's all I was going to say . I was going to say , Mr . Speaker , that I went down to the State of North Dakota and when I came there I met the manager of the Chairman of the Board of Directors of the State Bank. You know this is red Bol shevik North Dakota . The State Bank of North Dakota is totally owned by the people of North Dakota . It does not sell shares to the public . You know, that's an in­ tere sting dec eption, that the honourable member says he hopes there will be a western regional bank and it'll sell shar es to the public and it'll be publicly owned . Mr .

Speaker , on that basis everything is publicly owned. Some are owned by one shareholder , some are owned by a thousand sharehold ers, some are owned by two thousand share holders. But the honour­ able member knows that . . . MR . SPEAKER : Order please . MR . GR EEN: The honourable member knows that the best estimate will be that five percent of the public will own 95 perc ent of the shares of that financial institution. Because,

May 30 , 1974 41 35 BILL 64 (MR. GREEN cont'd) ... Mr . Speaker , that is the consi stent statistic with re gard to what he calls publicly owned. Wherea s, Mr . Speaker , the fact is that with regard to the Ma nitoba Hydro , which is publicly owned, we are all equal sharehold ers . With res pect to the Manitoba Telephone System , we are all equal shareholder s.

With regard to Polymar Corporation , which apparently has followed the thesis of the honourable member, I used to be an equal shareholder , but that member 's government has decided that they're going to transfer my property to another corporat ion for half of what it's worth and they are then going to sell 90 percent of the shares to strangers -- (Interject ion) --Well they are stranger s. I don 't know who the . . . Mr . Speaker , all I know is I have just been done out of half my company which has been sold - oh yes , I can buy one of the shares but I already owned it before they did me out.

Why do I now have to buy my way back in thro)lgh having been done out ? Now that• s what the Liberal Party in Ottawa has declared that they are going to do . That 's what they have declared - and this is the publicly owned bank that the honourable member is talking about . The honourable member 's definition of "publicly owned" is that they issue share ca pital and that this share ca pital is available to the purcha sers .

Now you know, we have 57 people in this room , and I venture to say- -(Interjectio n)-- well 57 people in the Chamber -I 'd venture to say , I' m going to take a wild guess, that not half of them own shar es in any corpor ation . That they are not shar e­ holder s. And certai nly of the million people in the Province of Man itoba- -(Interjection)-- the honourable member says they don 't want to be, and I suggest to you, I suggest to you, Mr.

Speaker , that the real rea son that they don't want to be, as he has put it, is that they don't really have spare cash lying around to buy shar es . -- (Interjection) --Well , Mr . Speaker , the honourable member says lend me the money . . . MR . SPEAKER: Order please . I wonder if I can appeal to the honourable members that we have a ... Order ple ase . A MEMB ER : Sorry . MR . SPEAKER: Thank you . I wish somebody else would be sorry now and then too . There's just too much interruption . The debate is not proce eding properly . I have a most difficult time following the honourable gentleman . MR . GR EEN: Mr .

Speaker , I do believe that I kept silent throughout the honourable member's speech because I was very interested to see how he was going to get out of his dilemma . And really his position was finally, you know, that the real problem vis-a- vis the public owning and controlling its own bank is that they are going to advance money to their friends on low interest rates and that they are not going to advance money to their enemies . Now , Mr .

Speaker , I believe that that kind of corruption, you know, that the honourable member is speaking of is not unheard of; you know, I will concede the point and probably he knows more about it because he may be more acquainted with people who do it . Maybe that 's the way he thinks that he would act if he was in government.

The honourable member says that that 's how I act and I say to the honourable member that I want him to go to the Manitoba Development Corporat ion or the Communities Economic Development Fund and get any suggestion from any person on the Board of Directors of either of those two places that I influenced or directed a deci sion with regard to the advancing of money. And then, Mr . Speaker , I will answer that . You know, the honourable member has had a habit of making a statement and then inferring that something occurred , saying that it did occur and then leaving . . . I' ll show. you on several times , Mr .

Speaker , the honourable - I regret to go back to these things but they have bothered me ,I remembered them . The honourable member said that St. Jean' s Sportswear was not in the Manitoba Development Corporation sta tement and why wasn't it there. I was shook. I thought why wasn' t it there. I under­ stand that they went into receivership over a year ago. So I got up and I sa id, I don' t know maybe they're not losing any money on that, maybe they got good security al though it didn' t seem reaso nable, we don' t have that good se curity on some of the other things. Well, Mr.

Speaker, I then picked up the Manitoba Development Corporation statement and there in the list of places under receiversh ip with an allowance for bad debts was St. Jean' s Sportswear. So I got up and I said - members of the House I have an apology to make: I apologize that I took it for granted that when the honourable mem­ ber said that St. Jean' s Sportswear wasn't in the statement that it wasn't there. I now see that it is there. The honourable member did this: he got up, said, "M r. Speaker, this is not the time nor the place to deal with this matter. I will talk about it tomorrow.

" I have sat here waiting, Mr. Speaker, waiting for tomorrow and it has never come.

4136 May 30, 1974 BILL 64 (MR. GREEN cont'

d) The honourable member went out of this House , he called me a liar from his seat and I resp onded in the way in which I learned to re spond when I grew up, and that that kind of thing happens . The honourable member went out of the House . The press said , " Why did you call Mr . Green a liar ?" And he said , "We have reaso n to believe that Mr . Green lied when he said that he had no knowledge of the -- "the Liberal Party has reaso n to bel ieve" -t hat 's you guys , "has reason to believe that Mr . Green lied when he said that he was not aware of the activities of R & M Construction ." Swell, Mr .

Speaker , if the honourable member had reaso n to believe that I lied , which he went outside and never told them what this rea son to believe was - the Leader of the Liberal Party - then he owed an obligation to come into this House and say that a Minister of the Crown has lied and here is the basis upon which we have reason to believe . But it was enough for him that the papers carried a story that the Liberal Party has reason to believe that I lied; because he called me a liar and he had to just ify it. So that was his po sition and we never heard any more about it since then .

The honourable member got up in this House , and I' m going to do it again - and it annoys me - the honourable member , we were talking about Versatile and he said that he has infor­ mation to release regarding that matter , that if I were to waive the lawyer 's privilege, which I since went to a lawyer and as ked if I said anything wrong and he said no that I didn 't, that he would be able to tell all kinds of things about how he advised this government and that he was going to send a letter to the Premier getting confirmation from him - that 's whathe told the pres s, appeared in the paper - getting confirmation to him that my release of privilege was also the Premier 's release of privilege because he had many things to tell about this govern­ ment .

And that made the press . The premier never ever got the letter . No letter was ever sent. But the honourable member makes these statements then ha s to extricate himself, ex­ tricate himself ... MR . SPEAKER : The Honourable Leader of the Liberal Party state his matter of privilege . MR . ASPER: Yes , Mr . Speaker , point of privilege. What I said was that I would seek the advice of counsel as to whether I would be breaking profess ional ethics in disclos ing the in­ formation that I obtained as counsel to the government. That advice was obtained, Mr .

Speaker , and I was advised that it would be perhaps within the rules but would be considered unethical by the profess ion if I were to disclose the information I received, and I have therefore , to my very great regret, been unable to disclose the information that the Minister of Mines and the First Minister gave me as profe ssional . MR. SPEAKER: Order please . Order please . Let me first of all indicate that it was not a matter of privilege, it was a personal explanation on behalf of the member .

Secondly, let me ask the Honourable Member for Radisson if he cannot restrain himself to kindly take a cup of coffee in the coffee room and contemplate until he ha s some self control, then he's entitled to come back again . The Honourable Minister of Mines . MR . GR EEN: Mr . Speaker , you know we've heard the honourable member 's point of privilege, we all saw what occurred in the House , what I did to waive it, what then appeared in the paper what he advised us , we could have saved millions of dollars and a letter was going to the Premier , and I will produce that for him in the paper as well .

But nevertheless, it is not as if I want to carry this matter to any degree; all I'm indicating to the honourable member is that he should not proceed by way of innuendo , that if he has something to say then it's better off that he say it because then we will be able to debate it. He would prefer to pretend some mystery exists , but never revealed the mystery . I suggest that it would be better off for all of us if he revealed these mysteries . Mr . Speaker, I want to get back on the track with regard to Trea sury Bra nches. The Honourable Leader of the Liberal Party says that a regional bank is neces sary .

The Honour­ able Member of the Liberal Party says that that regional bank should be publicly owned. The Honourable Leader of the Liberal Party says that if there was a publicly-owned regional bank in the Province of Manitoba that it would not hurt the credit unions; the honourable member said that if there was a regional publicly-owned bank in the Province of Manitoba that would,not hurt the credit unions , that it could operate in such a way as to meet the as pirations of invest­ ment capital in the Province of Manitoba . He said all of those things ... MR . SPEAKER : The Honourable Leader of the Liberal Party .

MR . ASPER : On a point of privilege. The Minister is misquoting me and stating the

May 30, 1974 4137 BILL 64 (MR. ASPER cont'd) ... reverse of what I said . What I said , and if he will rethink what he just said ... MR . SPEAKER: Again I appeal to the Honourable Member for Radis son . MR . ASPER : What I said, Mr . Speaker , was that the regional bank that was proposed for Manitoba was in fact going to be owned by the credit unions and therefore it could not hurt the credit unions. And the credit unions and co- ops who would own it I hope would make shares available to all members of Ma nitoba , those included who didn 't belong to the movement .

But I did not at any point suggest that a privately-owned bank would not hurt the credit unions on a regional bas is. MR . SPEAKER: The Honourable House Leader . MR . GR EEN: Then I suggest that the honourable member 's position is even weaker than I thought it was , because it is my impressi on, and perhaps I' m wrong, that this business of a regional bank owned by the credit unions is a distinct after -thought; that when he was talking about a western regional bank , when he was discus sing it, the times that we have heard about it , years ago, that he didn't mention credit unions .

Do you know why he mentioned credit unions today ? Because he 's got a wire from the credit unions and that he needs the support of the credit unions . But, Mr . Speaker , he says that he then hopes that this regional bank which would be owned by the credit unions would issue share s, so that all of the public in the Province of Manitoba would be owners of the bank . And I think he said all of the public . Now , Mr .

Speaker , what is the best way of insuring that all of the public , everybody - the Indian at Nel son House , the farmer at Minnedosa , the pulp and paper worker at Abitibi, the dock worker at Churchill , that not only that they all own this regional bank which will do a service to the people of Manitoba, but they own it as equal partners. Mr .

Speaker , what I am suggesting is that I will carry the honourable member 's logic through towhat would appear to be the most ideal conclusion from his point of view , because if he says all of the people of Manitoba should own, I as sume that he believes that the more people of Manitoba who own the better , and that the greatest number of people would be all of the people . And that if they all owned this bank - and Mr . Speaker , the best way of determining whether it is voluntary or non voluntary, is through the democratic process to find out whether they indeed want to own a bank .

And I' ll tell the honourable member something. He says he received no letter . There is no iss ue on which I have rece ived more sort of unanimity without argument , than that the public should own its own bank . You know on this particular position, I have the support of New Democra ts, I have the support of whatever social credit is left in the Province of Ma nitoba. And Mr . Speaker , I say the average man on the street is not offended by the fact that the public would own its own financial institution.

And I agree that there are people within this group who say that it's a service that should be there to fill in the gap that is not being offered now by the chartered banks . That 's what the honourable member wants to hear , that there are people within this group who believe that that is the reaso n for going into banking.

I want to make myself perfectly clear , that as far as I' m concerned , the bigger and more financially in­ dependent the people's bank becomes through the operation of the best of busine ss, and not merely the leftovers that, no - that my honourable friend the Member from Minnedosa will not take and therefore become the property of the private bank is what I would desire . I would like to have the best, most active , busiest , best turnover , most efficient bank in the Province of Manitoba - and that can't be done by filling in the gaps . Do you know what filling in the gaps does , Mr . Speaker ?

So you know what filling in the gaps does ? Filling in the gaps means, that you take the worst, you take what nobody else will take , you run a loss - you run a loss and then the Leader of the Liberal Party says, look how stupid the government is, they're running at a loss . You know they have a law , and do you know that the Manitoba Development Corporation has a law that they can't take a loan unless it's been refused by everybody else .

I wonder , let the Member for Minnedosa say , what if the Royal Bank of Canada in Minne­ dosa, or my branch , had a law that they couldn't loan money except that the borrowers came and showed that everybody else refused them, what would your loan portfolio look like ?- ­ (Interjection) -- Pardon me ? Mr . Speaker , he says they'd go broke . So then don't blame it on inefficiency . Blame it on the thinking . Blame it on the thinking.

The honourable member says they'd go broke , and I' m glad that he admitted it -o r not admitted it , because it's not an admissi on , he 's stating a fact, that the Manitoba De velopment Corporation set up as it is , is not losing money because of some public inefficiency . The Manitoba Development Corporation

41 38 May 30 , 1974 BILL 64 (MR . GREEN cont'd) ... shows its figures as they are , because that's the way it was de­ signed. It was designed by a Conservative administration - I don't fault them for this. It has been continued by us , yes , 11 ll concede that- and under my responsibility, yes. It has been continued on the basis that it will go into those ventures that every private investor has already refused. And if you have to do that with lOO percent of your portfolio - the honourable member said - you 1ll go broke. And I say, Mr .

Speaker, that the Manitoba Development Corporation has done remarkably well under the circumstances. It has not shown the inefficiency that likes to be pointed out by members who say that somehow when the public is involved in some­ thing they are inefficient. Mr . Speaker, I've worked in both areas, and many in this room have . I' ve worked in private concerns and I' ve worked in public concerns . And I say to you, Mr .

Speak er, that the people of Manitoba publicly have every right to claim and have been able to prove as much efficiency, as much effectiveness , as much competence as any private agency; that as between public operation and private operation, that there is nothing for the people of the Province of Manitoba collectively to run away and hide for . And they will do better. The fact is that the situation is moved, so that it was Conservative administration that had to go into the Manitoba Development Corporation; it is a conservative (small

c) administration that had to set up an industrial development bank in Ottawa. It is a conservative administration (and I use small

c) that gives out $98 million per year in direct grants to private enterprise , and don't have the courage to show it as a loss on their balance sheet. And why have they done that? Because the public has failed ? No , because any system which idealogically depends solely on the notion that the public cannot run their own aff airs is doomed to go broke, the same way as any other system that shows idealogy as the sole characteristic by which they would govern their affairs . And Mr . Speaker, I believe that it is - I'll conclude my remarks in a minute , Mr . Speaker, I think I was interrupted several times . MR.

SPEAKER: I allowed for it. MR . GREEN: I' ll conclude my remarks, Mr. Speaker - the honourable member has a question to ask me -b y saying this, that I believe that the public of this pfovince have nothing to lose , and everything to gain by being to some extent , greater extent, involved in the con­ trol of some of their financial institutions . I believe, Mr .

Speaker, that the public of the Province of Manitoba have everything to gain and nothing to lose by following the lead of the Province of Alberta, by following the lead of the people of North Dakota, and deciding that to some extent they are going to - and the Honourable the Minister of Finance tells me that Ontario has Treasury Branches, although I don't think they operate as commercially - perhaps they do as the Province of Alberta. --(Interjection)-- Well, then the lead of the Government of Ontario - and Mr. Speaker , the first one who would agree with that, is the Leader of the Li beral Party.

Would the Leader of the Li beral Party if he was the Premier of the Province of Alberta dismantle the Treasury Branches ? They would hang him in effigy , Mr . Speaker , if he did that. And the only therefore difference as to whether you are effective or whether you are not effective , is that we have not begun, and they have proved themselves . Now Mr. Speaker , I do not pretend that in the next two or three years that the Province of Manitoba is going to make enormous gains in the operation of their Treasury Branches . But, Mr .

Speaker, I go with Eugene Debbs; Eugene Debbs made a statement which I find very closely as sociated with the Jewish religion which believes in a Mess iah which is not a human form but which is state of condition of mankind, which represents the closest thing