VOL. 2 .... PRELIMINARY UNEDITED TRANSCRIPT HOUSE OF ASSEMBLY FOR THE PERIOD: 3:00 P.M. - 6:00 P.M. TUESDAY, DECEMBER 20, 1983 .. NO. 82

December 20, 1983 The House met at 3:00 p.m. Mr. S~eaker in the Chair. MR. SPEAKER (Russell): Tape No. 4160 Order, please! STATEMENTS BY MINISTERS MR . SPEAKER: SOME HON. !{EMBERS : The hon. the Premier. Hear, hear. SD - 1 PREMIER PECKFORD: I1r. Speaker, on December 9th I copied by telex a large number of persons and organizations on a telex I had sent the day before to the Prime Minister. My telex to the Prime Minister was with respect to the 1984 groundfish harvesting management plan.

In that telex I indicated that "the issuance of enterprise allocations from our Northern cod to independent trawler owners located in the other Eastern provinces is of major concern." I stated that these allocations left us "much. concerned about the fish needs of the new Newfoundland offshore company and the strong possibility that under the proposed harvesting plan there will not be enough fish in the offshore quota to ·keep various plants operating on a full-time basis.'!

It must also be realized that many communities not affected by the new Newfoundland offshore company but \vho depend on the resource-short plant programme are affected here as well. With more and more harvesters in on the Canadian offshore quota, there will be less and less fish for those Newfoundland communities who need and deserve it most. When I copied various persons and organizations on my telex to the Prime Minister, I asked them for their support of the Newfoundland position. To date, I have received expressions of support from the following: Lloyd Hillyard, the mayor of the town of Burgeo; Mr . A.

Best, President, Independent Fish Producers Association of Newfoundland and Labrador; Hr. Nilliam Lockyer, Mayor of 9312

December 20, l983 Tape No . 4160 so- 2 PREMIER PECKFORD: the town of Lawn; Mr. George Doyle~ Mayo r, to1m of St. Lawrence; Mr . Joseph Price, May or, to•-m of ~ortune and President of the Joint To~m Councils of the Burin Peninsula; Mr . Art Reid, President, Newfoundland and La~rano r Federation of Municipalities; Mr. Wayne Baggs, Mayor, town or Gaultois, Mr. T. ~1ell Snook, Mayor of Grand Bank; Mr. F.j. Little, Mayor of the town of Bonavista· Mr. Sandy Payne, Mayor , town of Ramea; MJr. Lou Bailey, ?<iayor, town of Burin; Mr .

Jerome Walsh, Mayor, t01-m of Marystot-~n; TotoJn Council of Trepassey; the Joint Counci ls of the Bonavista Peninsula; the bon. John Crosbie and the bon. James McGrath . SOME HON. MEMBE'RS : P'REMIE~ PECI<FORD: Hear, hear. Included 9313

December 20,1983 Tape No. 4161 ah-1 PREMIER PECKFORD: in the group copied,but noticable by their absence among the supporting respondents, are Newfoundland's federal Liberal MPs. MP Brian Tobin replied indicating only that he would not take a position on the matter at this time. SOME HON. MEMBERS : Oh, oh! PREMIER PECKFORD: The other Liberal MPs have not replied at all. MR.SPEAKER (Russell) : Order, please!

PREMIER PECKFORD: On Wednesday, December 14th, Newfoundland's members of the House of Assembly passed a unanimous resolution deploring the 1984 groundfish management plan with its attendant erosion of Newfoundland's share of the offshore quota. I must say that I find the silence from our government MPs very disturbing, so much so that I wired the five of them again on Friday past re-emphasizing the need for their support. The news is ever full of how MPs from .Nova Scotia and other Maritime provinces are looking out for the fishing interests in their ' constituencies.

The fact that Newfoundland has only five government MPs should make their efforts even more forthright and vocal. Yet, on this, as we have gotten on many other issues, all we get is silence. The Northern cod is the lifeblood of the Newfoundland fishery. The seasonal inshore fishery depends on the stock's migrations, and the seasonal plants depend on the stock's resource- short plant programme. The new Newfoundland offshore company depends for its success on getting a large enough share of the Canadian offshore quota. It is bad 9314

December 20,1983 Tape No. 4161 ah-2 PREMIER PECKFORD: enough that Mainland companies have been in on the Northern cod quota all along; it gets even more disturbing when the number of these Mainland companies is significantly increased. It is therefore imperative that Newfoundland as a society act united on this issue if we are to put a stop to the continuing erosion of our offshore cod quota. Many of our local organizations have done their

part 1 and the members of the Opposition as well 1 and this hon. House has done its part, on both sides, and for that we that we thank the Leader of the Opposition (Mr.Neary) and the members opposite. I again call upon our federal MPs to do theirs. After all, how can we expect the Prime Minister to heed our pleas if members of his own caucus are deaf to them? Finally, Mr.

Speaker, it is bad enough that we have to oppose the federal government in allocating a cod quota to other Eastern provinces, but matters are made even worse when we have to once again stand by and watch the federal government re-confir.m its long-term agreement (1984- 1987) with the EEC which involves more Northern cod, 9500 tons each year to be exact,and an additional 6500 tons from the 2GH region, coupled with 7000 tons of squid. We have opposed this agreement from the very beginning because there does not exist, Mr.

Speaker, any surplus fish for the EEC nations,just as there does not exist any surplus fish for other Canadian provinces. Newfoundland 9315

December 20, 1983 Tape 4162 EC - 1 PREMIER PECKFORD: can process all this fish and more. Secondly, we have never agreed with the federal government's practice of trading off -now this is very important - trading off a raw resource to obtain access to markets, in other words, to trade fish against fish. Markets for our fish should be obtained through the total Canadian marketing effort, and I have never understood why fish must be the only commodity that should be traded off against itself. SOME HON. MEMBERS: Hear, hear!

PREMIER PECKFORD: Moreover, how can it be explained that the federal government is r~newing its commitment to this long-term fisheries agreement with the EEC at the very time when. the EEC has placed a ban on the import of our seal pelts? Mr. Speaker, this agreement has all the ingredients of a cruel joke. In any event, the experience of last year has demonstrated how ineffective agreements of this nature really are in terms of providing market access for our fish products and I am not convinced that anything will change now. Still, Mr.

Speaker, if we continue to get the kind of representation we are getting from our federal Liberal MPs, there is every likelihood that Newfoundlanders will continue to be forced to 'hold their noses' while the federal government takes away an essential part of our livelihood. SOME HON. MEMBERS: MR. NEARY: MR. SPEAKER (Russell): Opposition. MR. NEARY: Thank you very much. Hear, hear! Mr. Speaker. The hon. the Leader of the Mr. Speaker, I believe everyone is aware of the Liberal Party position on the Northern 9316

December 20, 1983 Tape 4162 EC - 2 MR. NEARY : cod stock. Even thou gh we are told by the federal Deputy ~linister of Oceans and Fisheries that 85 per cent of the Nort hern cod stock is processed here in Newfoundland , we on this side of the House are still not satisfied. SOME HON. MEMBERS : Hear , hear ! MR . NEARY : We think that the total allowable catch of the Northern cod stock should be processed here in Newfoundland and Labrador. SOl-!E HON. !-!EMBERS : Hear, hear! MR . NEARY: Nm.r, having made that statement, Mr . Speaker, I have to point out to hon . gentlemen there opposite,and anybody who may be listening 93 17

December 20, 1983 Tape No. 4163 MJ - 1 MR. NEARY: to me,that it would be an oversimplification of the problem to state that we are going to achieve that objective in a very short time. And it would be an oversimplification also to talk about the European Common Market agreement that was just made that will allow a quota of fish to be caught in Atlantic Canada and in return that Newfoundland fish, Canadian fish, would have access to the European Co~~on Market and it would not have to be processed in these markets.

To play that down would be an oversimplification and to just dismiss it forthright is something that has to be looked at very carefully. Now, }!r. Speaker, let me say this to the han. gentleman who just read the Ministerial Statement. Last week we unanimously agreed on a resolution to be forwarded to the Government of Canada from this House. I regret very much that the hen. gentleman has now stooped to the level of playing political games and political trickery with this matter. T~at I will do now, Mr.

Speaker, to s~ow how genuine and sincere we are, I will not indulge in the political games that the han. gentleman just played~ I will invite the hen. gentleman to join with me, or I join with him, whichever way he wants it, and we will both travel to Ottawa and 1if necessary, meet the Prime Minister, certainly · we will meet the federal Minister of Fisheries (Mr. De Bane). Let us go up to Ottawa, both of us together, ~rr. Speaker, and instead of playing political games sit do;-m and try to talk this matter out with the federal government.

Now that would be the sensible and common-sense thing to do, never mind just making political statements and issuing press releases and calling upon members. I have got a letter here where the hen. the Premier says, 'I do not know how many caucus members have issued press releases on this matter,but it would 9318

December 20, 1983 Tape No. 4163 MJ - 2 MR. !ltE-2\..~: seem to me to be important for members to publicize this issue in thei r own districts through the local papers and radio stations covering their area. ' A memo from the ?remier 's office sent out yesterday,! believe it was. ~ow, Mr. Speaker, playing politic s with this issue is not going to get us anywhere so let us get down to brass tacks.

The hen. gentleman and I can talk about it, if he likes 1-re can get together and we can determine the time that we can arrange meetings in Ottawa , ''~e will both travel to Ottawa and put our cards on the table '"ith the ?rime f·tinister or with the Government of Canada . l~0\-1 that is t.,e only sensible way to approach it , Mr. Speaker . Now if the hen . gentleman doe s not go that \-Te can only assume then that he just \o~ants to continue fed bashing , he wa nt s to continue playing politics '"i th the Liberal MPs from Newfoundland and he is not interested in ge tt ing th is ma tte r r eso lved . 9319

December 20, ]983, Tape 4164 Page ] -- apb MR. NEARY: I throw that suggestion out for what it is worth and I invite the hon. gentleman to give it serious consideration. SOME HON. MEMBERS: MR. SPEAKER(Russell): the Opposition. MR. NEARY: Hear, hear! ORAL QUESTIONS The hon. the Leader of Mr. Speaker, there a couple of weeks ago the Minister responsible for energy in this Province made an announcement in this House that in my opinion was irnrnoral,to say the least, when he stated that there would be no increase in electricity rates this year.

Now we are told that the Newfoundland Light and Power Company will be making an application in the,early New Year for a substantial in electricity rates. Now, would the hon. gentleman get up and apologize to the people of this Province for misleading the consumers of electricity in this Province, for leading them t6- .believe that there would be no inc'reases in electricity rates this year? Would the hon. gentleman apologize to the people for making that misleading statement? MR. SPEAKER: The hon. the President of the Council. MR. MARSHALL: Mr.

Speaker, how one can twist words~ The statement which was made in this hon. House, which I made and which still stands, is that there would be no application by Newfoundland and Labrador Hydro in the ensuing year for an increase in the rates. The application that is now being made is being made by Newfoundland Light and Power Company, which is a private utility. The fact of the matter is, Mr. Speaker, that they are making it before a Public Utilities Board which this administration has supported and is strengthening,and has strengthened in the past/so that there can be a full 9320

December 20, 1983, Tape 416 4, Page 2 -- apb MR. MARSHALL: and complete e~amination of the books of the applicant company, Newfoundland Light and P·ower Company, so that they can pass on the reasonableness or otherwise, accept or reject the application. What is happening is, in summacy -r what I said was exactly c.orrect ~ there is no, and there will be no applications by Newfoundland and Lba:rador Hydro; the application is by the Newfoundland Light and Power Company and that application will be examined by the Public Utilities C9mmiSsion. MR. SPEAKER(Russell): The han. the Leader of the Opposition. MR.

NEARY: Mr. Speaker, what the han. gentleman did there a couple of weeks ago was obscene, in my opinion; the han. gentleman misled the people of this Province. Now, let me ask the han. gentleman,if the administration are genuine and sincere in wanting to see that there is no increase in electricity ' rates in this Province, will the administration consider placing a freeze on increases in electricity rates in this Province for the next year or so? 9321

December 20, 1983 Tape No.4165 SD - 1 MR. SPEAKER (Russell): The hon. President of the Council. MR • MARS Hl>.LL : ~r. Speaker, we would like to be able to place a freeze on the increase in prices of every commodity in this Province,including electricity,if we possibly could 1but we cannot control escalation in prices as a result of inflation and other factors. All I can say is that the government has provided a mechanism for examination of the application by the Public Utilities Board and that will be · scrutinized by the board very, very carefully and it will determine whether or not an increase is given. MR.

NEARY: Supplementary, Mr. Speaker. l-1..~. SPEAKER: Supplementary, the hon, Leader of the Opposition. l.I!R. · NEARY: Mr. Speaker, the only way that they have strenghtened the board recently was they put one o~ -- _ their party heelers on the board, Now that is poor co .n!;ola.tion to the consumers of electricity in this Province. Mr. s·peaker 1 would th.e hon. gentleman indicate if any consideration has been given or will I:le given. to freezing electricity rates in this Province for the next three years say? MR. SPEAKER: The hon. President of the Council. MR. MARSHALL : Mr .

Speaker , the Government of Nova Scotia did that a few years ago and ~..rhat happened to i=.he · GovernMent o~ Nova Scotia was it lost its credit rating. I think its credit rating came donw two notches as a result of it. If there is an increase,the cost- let us put it this way­ of providing electrical services has to be .paid by the public. Aside from the provisions made by the government in connection with the Power Distribution Districts in certain rural areas,, the pricniple that we have applied here is it is paid by the user. And, you know, that is the present position of the government.

Whzo .t the han. gentleman is advocating 9322

December 20, 1983 Tape No. 4165 SD - 2 MR. MARS HALL: is a road to sure disaster. Look, we might even be pre pa red to conside r f reezin g rates so metime in the future if we could get the rights to our resources and the hon. gentleman would support us :in such matters as the offshore and tha't. But in the meantime,the present position of this Province is that it is strapped, W(> are managing this Province and attending to its demands despite the limited resources available. And the Minister of Finance (Dr.

Collins) and the government are doing an excellent job; it has kept its credit rating and it l'i.as kept its credit rating because of policies like I have indicated in my answer to the bon. gentlerean. MR. NEARY: Supplementary, Mr. Speaker. MR. SPEAKER "(Rus·se "l"l}.: of the Opposition. 9323 Supplementary, the hon , Leader

December 20, l9B3 Tape 4166 EC - 1 MR. NEARY: Mr. Speaker, of course the hon. gentleman is aware that the Newfoundland Light and Power Company is recording record profits in the current year, in the past twelve months.

Because we own the electricity, because every kilowatt of electricity that is generated in this Province belongs to the people of this Province, would the han. gentleman indicate to the House - and that move was made by a Liberal administra­ tion when we took over the generating of electricity in this Province; otherwise, the hon. gentleman would not have Newfoundland Hydro - would the hon. gentleman indicate to the House if any consideration has been given to provincializing the Newfoundland Light and Power Company?

We own the electricity, we generate it and then we give it to a middleman to distribute to consumers and make record profits off the electricity that the people own. Would the han. gentleman indicate if any consider­ ation has been given to provincializing Newfoundland Light and Power Company, taking it over, not only the generating of electricity but the distribution of it? MR. SPEAKER (Russell): The han. the President of the Council. MR. MARSHALL: Hr.

Speaker, my understanding is that the only generators that the hon. gentleman assisted when they were in power were the generators in the Province of Quebec, the fiasco in the Upper Churchill. The han. gentleman is not accurate in his facts. He must recognize that Newfoundland Light and Power itself generates a certain amount of electricity. The answer to the question is the hon. gentleman is inviting us to spend hundreds of millions of dollars which we do not have at the present time, and even if we had it we would then have to weigh 9324

December 20, 1983 Tape 4166 EC - 2 MR. MARSHALL: the wisdom of a completely government-owned system in this Province for the provision of retailing electricity to consumers. So tl:le answer to the hon. gentleman is no, we do not have the money at the present time and,even if we did have the money, we would not necess .arily employ it for that purpose. 9325

December 20, 1983 Tape ~lo. 4167 HJ - 1 MR • t•Tli.RREN : .1-1r. Speaker. l1R. SPEAKER (Russell) : The han. the member for Torngat ~.fountains. HR. WARREN: Mr. Speaker, I have a question for the ~1inister of Finance (Dr. Collins) if he is in the back somewhere; if not I will ask it to the Pre~ier. Some timeago the Province of Quebec announced throu~h the Minister of Finance that they were going to make a reduction on the tax at the gas pumps per litre, I believe it was something like five or six cents per litre "at the pumps, and I understand that this reduction has done wonders in the Province of Quebec.

Apparently it has boosted the economy considerably. t-!ith this in view - ' I am asking the question to the Premier but if the Minister of Finance t•lishes to answer he can - is this government planning to follow a similar trend as the Province of Quebec did about a month ago? ~1R. SPEA..T{ER: The han. the Minister of Finance. DR. COLLINS: Mr.

Speaker, unfortunately I did not get in for the full question but I think I got the sense of the hon. member's question. r•y understanding is that he has asked if there is any move on the part of the provincial government to take the precedent in Quebec whereby they have a somewhat different tax structure in terms of gasoline in border areas. I understand that is the question.

We have had a number of approache~ about the tax problems that relate to border areas,and there are tax difficulties, they are not unique to our border areas, every border area in the world I suppose.has these same tax difficulties. ';-Te have had approaches in pointing out, for the individuals living in the ~reas and the businesses in 93 .26

December 20, 1983 Tape No. 4167 ~1J - 2 DR. COLLINS: areas , the .implications for them. We havehad meetings with them. As a matter of fact 1 the reason why I was a little bit late corning up to the House is because I had a meeting with the Chamber of Commerce from the Strait over this issue. They have given us valuable insight into the implications and they have offered a number of suggestions, and so on and so forth, and we said t.l.at we would take those under advisement.

Ne are aware of the situation whereby Quebec does make some allowances in terms of gasoline taxation in border areas and we have undertaken to get full details on that and to inform ourselves fully on it and we have undertaken that we will communicate back to these people who have brought up the issue. !·ffi. WA...lt."REN: ~1r. Speaker. 9327

December 20, 1983, Tape 4168, Page 1 -- apb MR. SPEAKER(Russell): The hon. the member for Torngat Mountains. MR. ·wARREN: Mr. Speaker, another question to the Minister of Finance(Dr. Collins) concerning taxes: If you go the department stores around town now there is a lot of confusion as it pertains to the little white slip that the salesclerk is supposed to fill in for children's clothing which is untaxed.

I understand the government in British Columbia has a similar tax imposed but they have a very straight, simple form where the individual purchasersjustsigns their names and addresses and it can be verified the same as the minister's complicated form that our stores have.

Has the minister given any consider- ation to doing away with this complicated form - not only is it complicated, but it is very time-consuming form which is causing checkouts to be blocked for some considerable time, especially during peak periods - to do away with this form and use a much simpler form or, in fact, do away with the tax on children's clothing altogether~ MR. SPEAKER: The hon. the Minister of Finance. DR. COLLINS: Mr.

Speaker, if there is one thing this administration hates to do it is impose a tax. we are always looking at our tax structure, with the hope and expectation, when circumstances allow, that we will either diminish or perhaps even abandon taxes altogether, and we would become,perhaps, the only part of Canada which is a totally tax free haven, something that even Alberta is not aspiring to at the present time. But more specifically on the point the han. member raised, I suppose it is,like beauty, in the eye of the beholder.

I have a daughter who is in that area, she is thirteen years old- sometimes she has children's clothing, sometimes she has adult's 9328

December 20, 1983, Tape 4]68, Page 2 -- apb DR . COLLINS: and I recently was in an establishment on a very busy day, it was on a Saturday evening, and I had to fill in one of these forms and it took no time at all . The saleslady who did it, she just did it; she was talking to someone else when she did it, it was almost automatic . So there was very, very little difficulty and I would think that when the bon. member says that this was causing blockages at checkouts and so on and so forth, there is probably a certain bias in his view of things. I am not saying there is not a bias in my view of things, but 9329

December 20,1983 Tape No. 4169 ah-1 DR.COLLINS: I thought it went very smoothly. I think it is probably somewhere in between~ The han. member is biased, I am biased but the general public seem to be able to live with it without too much difficulty. MR.SPEAKER (Russell) : The hon. member for Torngat Mountains. MR. WARREN: Mr. Speaker, a supplementary to the minister. I think the unfortunate thing is the stores will not accept anything but the MCP card and sometimes neither parent has it at hand.I think this could be eliminated, having to use the MCP card, the most difficult problem waul be solved.

However I have another question for the minister concerning taxes. I think it was reported by the Liquor Control Board that so far this year the revenue from the sales of liquor have been down something like 10 per cent or more. We are 'getting into the Christmas spirit, it is just a ~ew more days before Christmas, has the minister considered having a special on the sale of booze in the stores before Christmas? MR.NEARY: And South African liquor and wine. MR.SPEAKER: The hon. Minister of Finance. DR. COLLINS: Mr. Speaker, I am not very closely associated with, shall we say, the merchandising of liquor.

As the Minister of Justice (Mr.Ottenheimer) says, I am not very closely associated even with the consumption of liquors. But my understanding is that there are a 9330

December 20,1983 Tape No. 4169 ah-2 DR.COLLI NS: number of sales - I do not think they are the popular stocks, I think that every once in a while the Liquor Corporation has acquired a line of alcoholicbeverage that ultimately turns out to be a rather poor seller so that at some point in time they do put it on at diminished values or diminished costs. Now whether they do it at Christmas I do not know,but I will undertake to bring the hon. member's suggestion to the Chairman of the board and see what his reaction is. MR.NEARY: Mr. Speaker. MR.SPEAKER (Russell): The hon. Leader of the Opposition. Mr.NEARY: Mr.

Speaker, I have a question for the Minister of Transportation (Mr. Dawe) in connection with the Green Bav ferry fiasco, not Farley Mowat's Boat That Wouldn't Float but the boat that would not sail. Would the hon. gentleman inform the House as to what has happened to all the things tha~ were on board of that boat?Before she came here, as han. members know,she ;;as a cruise ship so there was an awful lot of valuable things on board that ship. ~ffi.MORGAN: She ~vas a fishing boat previously. MR.NEARY: No, she was a cruise ship. There were oak tables and chairs and all kinds of expensive furniture, and mirrors. 9331

December 20, 1983 Tape 4170 EC - 1 MR. NEARY: Mr. Speaker, vlOuld the hen. the Minister of Transportation tell the House what has happened to all these things that were onboard that boat? MR. SPEAKER (Russell) : The han. the Minister of Transportation. MR. DAWE: Y~. Speaker, I am afraid I do not have that sort of information right at my fingertips but I will certainly try to enquire as to whether in fact anything has been removed from that vessel.

My understand­ ing is that some of the fixtures that could be used in some of our other systems, like the chairs and the benches and those sorts of things,were taken off the vessel before she went to Marystown, but I will certainly check on the other items. MR. NEARY: MR. SPEAKER: Opposition. MR. NEARY: Mr. Speaker, a supplementary. The han. the Leader of the If these items, these fixtures and oak tables and chairs and so forth were taken off the vessel, surely the hen. gentleman must know where they are stored, whose possession they are in or whose care they are under.

Would the han. gentleman give us a little more detail about these items? MR. SPEAKER: The hon. the Minister of Transportation. MR. DAWE: Mr. Speaker, I have already indicated that I do not have that information. If the han. member would like to wait a half-hour or so, I can certainly check and have that information for him. MR. NEARY: MR. SPEAKER: Opposition. Fine. Mr. Speaker, a final supplementary. The hon. the Leader of the 9332

December 20, 1983 Tape 4170 EC ~ 2 MR. NEARY : If the hon. gentleman is ~oing to check on these matters, would he also check with his depot in Grand Falls to see if all the items -that were stored in his depot in Grand Falls,that he apparently does not know about,are still there? The oak tables and the chairs and the fixtures and the compressors and the mirrors and all things that were taken off that boat before she went to Marystown are very valuable and can be resold.

The hon. gentleman should give us an itemized list of where all these items are located and tell us if they are under better security than the guns that were down at the Plymouth Building a week or so ago. MR. SPEAKER (Russell) : Transportation. MR. DAWE: The han. the Minister of Mr. Speaker, I have indicated already that I will try to find the information for the han. gentleman and make it available to him within the next half-hour or so. MR. NEARY: MR.' SPEAKER: Opposition. MR. NEARY: Okay, that is fine, Mr. Speaker. The han. the Leader of the Could I ask the han. the Premier, Mr.

Speaker, if the council in Trepassey has yet been in touch with the hon. gentleman to discuss the status of the deep-sea fish plant in that community? MR. SPEAKER: The hon. the Premier. PREMIER PECKFORD: ! -think the council in Trepassey has been in touch with the member for the area, plus the Minister of Fisheries (¥r. Morgan) and myself, so I think they have been in touch with all and sundry and I think there is a meeting in the process of being arranged to talk to the people of Trepassey. Of course, that opens 9333

December 20, 1983 Tape 4170 EC - 3 PREMIER PECKFORD: up the whole question. It is not only the people of Trepassey who are going to be looking for meetings, and tbey just cannot g~ looking for meetings with the Province, they have to look for meetings with the three partners to the ne1.; company. Ne, as a Province, will not be able to provide full and complete answers to any of the areas • But that brings up the whole question of the Northern cod stock.

And the Ministerial Statement today, the long and short of it is that unless and until we are able to change this whole business of resource allocation, we are going to be into serious problems with being able to supply sufficient fish to fish plants around this Province, as we would want to do, to provide employment for 9334

December 20, 1983 Tape No. 4171 MJ - 1 PRE!IIER PECKFOPJJ: to provide employment for at least six or seven months of the year. So to a.ns\•rer the Leader of the Opposition's (Mr. Neary) question directly, yes, we have had representation fro~ the town of Tre~assey through their member and the Hinister of Fisheries (Mr. !~organ) and myself and a meeting is being arranged to talk to them. But,as I say 1I have to hasten to add that final answers will not be forthco~ing yet until we get some changes to the resource. Y~. NF..A..ll.Y: Hr. Speaker, a supple~entary. ~m.

SPEAKER (Russell) The hon. the Leader of the Oppositon. rm. NEARY: I·Tould the hon. gentlei!'.an inform the House if there is any foundation to the reports that this plant may be downgraded to a seasonal operation? MR. SPEAKER: The hon. the Premier. PREMIER PECKFOPJJ: To my knowledge there has not been any final decisions made on any plants yet in the Province.

The company ~~ not establishec but there is a co~i~tee in place that is monitoring the operations of the old companies, that is the Lake Group of Companies and Fishery Products Limited as well as John Penny and Son, and there has been no final determination of the status of any pla~ts. The whole idea,as the rest~~?t~ri?3 -~~r~e~ent saic, is to keep these plants open and to supply them with as much fish as possible.

The~e is supposed to be a resource utilization task force established to study how much stocks are available, and I will have more to say about that hopefully tomorrow, because we are strongly of the view,after looking this over 1 that there are some serious encroac~~ents upon the agreement that we signed only last September• That is being studied now and we will be cor:u!mnicating ~._rhat our oosition, as i_t relates to that agreement, in the next twenty-four hours. 9335

.;~ December 20, 1983 Tape No. 4171 MJ - 2 PR&~ER PECKFORO: But there has been no final determination of plant status,as I understand it 1of any of the plants yet. M .. ~. NEARY : !-1r. Speaker. MR~ SPEAKER (Russell) : ThP. hen . th .e Leader of the Opposition. f.l~. NBA..~Y: !1r. Speaker, could the hen. gentleman tell us the situation regarding the Burgee plant 1 which is not a part of the supercompany, althou gh that company is aboo1< to be restructured,as I understand it? As bon. members know 600 resi¢ients demonstrated Friday demanding that ~!ational Sea tell them when their r;>lant will reopen.

The plant has been closed since August,as hen. members are aware. NOt.,, ~1ould the bon. gentleman tell us if he has had any correspondence or any request from Surgeo for a meeting regarding the Burgee plant? could the hon. gentle .rnan enlighten the people of Burgee as to what is going to happen to the plant in Burgee , when will it reo pen,because these peo ple down there are demanding an ans~rer from somebody as to when their plant will reom m ? 9336

December 20, 1983 Tape No. 4172 SD - 1 MR. SPEAKER (Russell) : The hon. the Premier. PREMIER PECKFORD: Mr. Speaker, I have been talking to the Minister of Envi~onment (Mr . Andrews) about it and the ~1inister of Fisheries (Mr. ~lorgan). But as . the Leader of the Opposition (Mr. Neary) knows,or if he does not know he should know 1 the plant in Burgeo is owned by National Sea Products Limited,as is -~the plant in St. John's, the plant ,in Arnold's Cove and the plant in La Scie 1 and are all assets of the company National Sea Products Limited.

And .~ National Sea Products Limited ~·Tas part of a deal with Nicke-rson for the restructuring of those two companies to form a Nova Scotia based company. Now that hz.s not occurred and there has not been total agreement by" either the Nova Scotia gover~e~t itself nor by some of the shareholders of National Sea· ~o the final disposition of the whole Nova Scotia company and where National Sea will fit in or not- or fit out - and be still by itself, an independent, still remains to be determined.

So,therefore 1 there is no easy answer to what is qoing to happen or when the plant in Burgeo is going to open or when the other plant in St. John•s is going to open and so on. It is somewhat out of our hands in that sense. We are on top of it and getting the latest information on it. But because it seems some shareholders in National Sea are opposed to the Nova Scotia restructuring proposal,and because the Nova Scotia government has been opposed to what has been put on the table for the restructuring of both of those companies,there is no definitive answer to the question at this · point in time. · MR •.

NEli.RY: Final sup!_)lementary, Hr. S!_)eaker. MR •. SPEAKER; Final supplementary, the han. Leader of the Opposition. ~- NEARY: Mr. Speaker, in connection with the fish plant~ 1what about the Harbour Breton fish plant? Does the han. gentleman kno\..r anything a,bout that one, what might 9337

December 20, 1983 MR. NEARY: that plant might be opened? MR. SPEAKER (.Russell) : PREMIER PECKFORD: Tape No. 4172 SD - 2 happen in Harbc·ur Breton and when T.he hon. the Premier. Well,obviously I have already answered the question when I answered about Trepassey, because I said all the plants that are part of the restructured company in Newfoundland are in the same boat~ There has not been any final determination on them 1 when they shall open and so on.

As I indicated earlier 1 there is a monitoring committee,made up of the three partners to the agreement,which is dealing with the managers and dealing with the two old companies and are try±ng to put in place a plan for 1984. That plan has not yet oeen finalized or approved by anybody and they are still in the process of developing it.

So Harbour Breton is like all the plants that come under the restructuring process, The management of the two old companies, are meeting together and finalizing and formulating plans for all the plants for 1984 and the monitoring committee of th.e three partners is overseeing that process and in due cours·e 9338

December 20, 1983, Tape 4173, Page 1 -- apb PREMIER PECKFORD: will be reporting back on just what the disposition will be and when the plants and the various areas will be open. MR. SPEAKER(Russell): The han. the member for Torngat Mountains. MR. WARREN: Mr. Speaker, in the absence of the Minister of Culture, Recreation and Youth (Mr. Simms), I have a question for the han. the Premier. About a ·week and a half ago the Minister of Culture, Recreation and Youth issued a Ministerial Statement concerning the harvesting of the George River caribou herd.

The minister did not advise in his statement what time this harvesting would take place. Will it be taking place this year coming up, this hunting season, between now and March? PREMIER PECKFORD: MR. WARREN: MR. SPEAKER: PRE.. 1HER PECKFORD : March of this year? March of '84. The hon. the Premier. The Minister of Culture, Recreation and Youth is on a plane on his way back to St.' John's and should be here by four thirty. But the Minister of Development(Mr.

Windsor) is familiar with this, because I think it is a joint effort of both departments, and the Minister of Development might be able to give someef -the information that the hon. member is looking for. MR. SPEAKER: The hon. the Minister of Development. MR. WINDSOR: Mr. Speak~r, the proposal is one simply of once we have identified the exact areas where we see potential existing to establish outfitters' camps, then we will be inviting proposals for these camps; there may be four, maybe five, probably in the order of six camps that we think can be supported without any damage whatsoever to the herd.

These will be commercial operations which will be operated similar to the hunting 9339

.; December 20, 1983, Tape 4173, Page 2 -- apb MR. WINDSOR: and fishing camps that now exist within the Province and _that will employ, I think, upwards of a couple of hundred people and will undoubtedly bring - PREMIER PECKFORD: Will we have them by March? MR. WINDSOR: No. We still have a great deal of \·;ork to do in identifying the areas where we think we should locate these camps. It will not be done by March, but we will be inviting proposals then from interested groups. No doubt many persons in Labrador will be interested in getting involved in this activity. MR.

SPEAKER(Russell): The han. the member for Torngat Mountains. MR. WARREN: Mr. Speaker, a supplementary. The minister advised that he will be identifying areas. At the same time, will the minister be doing an environemntal study on the areas that will be selected before he goes ahead and gets the camps built, or invites the proposals and so on? Will there be an environmental study done on the whole area? MR. SPEAKER: Development. MR. WINDSOR: The hon. the Minister of Mr. Speaker, obviously the Minister of the Environment(Mr. Andrews) will make the final decision on that.

I doubt very much if a full environmental assessment will be required simply to establish a hunting camp. These will be small commercial operations similar to numerous ones that we have in this Province. Our concern, of course, is for the herd. That study has already been done~ we know quite well from the information and the scientific data that has been collected that the herd, indeed, can withstand a considerable amount of hunting activity, and that there is a strong potential there for developing a very viable and very valuable tourism industry based on that particular herd. What we 9340

- December 20, 1983, Tape 4173, Page 3 -- apb MR . WINDSOR: 'What we l-rant to identify are the optimal areas in which to locate the actual camps so that they are not in confli~~ -~ith .one another, and that they will be very viable operations on their own . .. .... . . .... 9341

I• December 20, 1983 Ta pe No. 4174 NJ - J. ~.m. NAR.REN: Mr. Speaker. t>m. SPEAKER {Russell) : The hon. the member for Torngat Hountains. MR. ~J.ARREN: ~1r. Speaker, the ninister is more concerned about the herd than he is for the people living in the area apparently. Mr.

Speaker, my supplementary to the minister is: If they are going to go ahead w·ith this operation,which no doubt '.;rould be very beneficial to Tourism, will the minister, before any further steps are taken on . ~he _ location of the various camps kindly correspond or negotiate or at least consult with th~ two nain native groups in Labrador,namely the Naskaupi Montangnais Innu Association and the Labrador Inuit AS!'lor.;:lr.:i .0Tl, t,rhich comprise about 70 per cent of the population of my district whe~e the herd is located? MR. RPEAKER: Develo EJment. NR. WINDSOR: The hon. the Minister of Mr.

Speaker, the hen. member indicates that the minister is not concerned about the people,yet he indicates that there is a strong potential for tourism development here. Well 1 he cannot have it both ·ways; either he is in favour of this proposal or he is not. The fact of the matter is that this Ministe~ is ~ery concerned both for the herd, undoubtedly we would not even be considering having a hunt if there were any question ·at all in the minds ?f the scientists and the people in the Department of Environment and of Culture, Recreation and Youth that there was any danger whatsoever to that particular herd.

Neither, I1r. Speaker, l'lill t•re allow a resource potential which exists,regardless of whether it is animals or trees or mines or oil and gas or whatever it is 1to go unexploited if there is an opportunity 9342

December 20,1983 Tape No. 4174 mj-2 MR.WINDSOR: to develop that resource and to create employment for the people of this Province and, most likely in this case, for the people of Labrador moreso than the people of the Island portion of this Province. So we will do everything we can to develop this particular resource in the best interests of the people of Labrador and the Province generally. If there are representations that the people wish to make from Inuit Associations or any association, Mr. Speaker, in this Province we would only be too happy to receive them. MR.WARREN: MR.SPEAKER(Russell): Mountains. MR.

WARREN: Mr.Speaker. The hon. member for Torngat Mr. Speaker, a final supplementary to the minister. I do not think the minister realizes, although he is the Minister of Tourism, that last year out of the caribou harvest in Northern Labrador only between 20 and 25 per cent of Labrador people were fortunate enough to have caribou meat. So why could not the minister, if he is going to harvest the.caribou meat, set up such a programme, for example, in the Nain area, where the local people could be employed?

By the way, Mr.Speaker, the government does have a retail store there, and he could have set up a butchering shop, he could have set up a marketing,outlet where the people are, because the George River caribou herd is in the center of Labrador.First and foremost the minister should look at making sure that the Labrador people are tended to first. That could be done by 9343

_.,- December 20,1983 Tape No.4175 ah-1 MR.WARREN: means other than corning out with outfitter camp setups and going in there and within four or five years maybe the Geo_rge Riv~r herd will be slaughtered the same as the Mealy Mountain~ herd. So would the minister consider setting up some sort of a commercial' outlet somewhere in Labrador so that first and foremost the Labrador people could benefit from the herd which is part of Labrador? MR.SPEAKER (Russell): The han. Minister of Development. MR. WINDSOR: Mr.

Speaker, first of all,it certainly was not the outfitters of this Province who are responsible for any damage previously done to the Mealy Mountain herd or the George River herd because we do not have any outfitters in Labrador at the moment. MR.WARREN: No, but the United States Air Force is up there. MR.WINDSOR: This is obviously a new ,_ ~ffort to establish outfitting operations based on sound, scientific data, Mr. Speaker. Obviously the people of the area will benefit. The han. gentleman says why do we not consider the people of Nain? We certainly will.

We do not kn~w exactly yet where those camps will be located,but they will be located wherever we can find the greatest benefit to the people of this Province that will still provide a very pleasurable hunt and make it attractive for tourists to come to this Province and pay,and pay very handsomely for the opportunity of participating in a big game hunt in this part of our Province. 9344

.. : ~ .. December 20,1983 Tape No. 4175 ah-2 MR.SPEAKER (Russell): Order, please! The time 'for the Question Period has expired. PRESENTING PETITIONS MR. SPEAKER: The hon.member for Eagle River. MR.HISCOCK: Mr. Speaker, I rise to present a petition on behalf of the teachers in Labrador West,signed by the teachers in the Northern Light Branch of the NTA which represents the area from L'Anse-au-Clair to Red Bay and there areapproximately twenty-five signatures.

In this petition,the teachersof Southern Labrador,in the Northern Light Branch of the NTA:support our colleagues in Western Labrador in this round of contract negotiations with the Government of Newfoundland and Labrador: In light of the agreement recently reached between both negotiating teams, we strongly urge, support and help to ratify a settlement about outstanding issues. Surely remembering last Spring's job action,government must realize that compromise is more beneficial than conflict. We find, Mr.

Speaker, the children in Labrador West are caught in the middle; they have had programmes discontinued, the teachers are working to rule. Even the regular Christmas Concerts and other programmes that the normal school takes for granted in the Christmas season have been dr~ppe~ this time because of the conflict going on. They have been over a year without a contract and one has to ask the question why is it that again the government is putting the teachers to ~he board? They,surely,last Spring should have realized how the students suffered . 9345

December 20,1983 Tape No . 4175 ah -3 MR .HISCOCK : Some of them were rather anxious about their Grade Xll and other levels and D0\'1 we find ourselves in the same situation again in Western Labrador . One has to ask the question why is it that the government negotiates in conflict and not necessarily in co -operation . I for one support the teachers in Western Labrador and am quite pleased 9346

December 20, 1983 Tape 4176 EC MR. HISCOCK: that the teachers in the Northern Light branch took the initiative, and I urge more branches of the NTA throughout the Province to add their support, to send similar petitions to government MHAs, Cabinet Ministers and the Premier, urging the Minister of Education (Ms Verge) and the government to get back to negotiating in good faith and making sure that the teachers in Labrador West get their just reward.

We learned that the f~d.er~l government were going to discontinue benefits of mine~~ in the Canadian North, and on hearing that, 1 it was not long before the member for Menihek (Mr. Walsh) - . . --· and others circulated a petition in Labrador. SOME HON. MEMBERS : Oh, oh! MR. SPEAKER (Russell): Order, please! MR. HISCOCK: We are quite pleased that, as a result, the matter has been put on hold indefinitely, the benefits will be continued, and we would hope that the Minister of Education ahd the school boardsand IOC realize - SOME HON. MEMBERS: Oh, oh! MR. SPEAKER: Order, please! MR. HISCOCK: Mr.

Speaker, I have only five minutes. Could the whale be quiet for a little while? We realize, Mr. Speaker, that the cost of living is extremely high ·in Northern Labrador and that should be taken into consideration when government and the school board and IOC are negotiating teacher contracts. I think what they are asking for is only fair and equitable. So, Mr. Speaker, I am quite pleased to be 9"347

... December 20, 1983 Tape 4176 EC - 2 MR. HISCOCK: able to present this petition on behalf of the teachers of the Northern Light branch and ask that by early next week we have this .matter settled. Thank you, Mr. Speaker. SOME HON. MEMBERS: MR. SPEAKER (Russell) : DR. COLLINS: MR. SPEAKER: Finance. DR. COLLINS: Oh, oh! Order, please! Mr. Speaker. The hon. the Minister of Mr. Speaker, I rise to support the right of the teachers in the Straits area to support their co~leagues in Labrador West. I think it is very. commendable of them to have this measure of collegiality within the Teachers 1 Association.

A few points, though, Mr. Speaker. With regard to the work to rule, I de not think anyone is very happy with that; certainly government is not very happy with it. We thought we had an under­ standing with the NTA that when that work to rule issue arose during the negotia~ions with the NTA for the Island part of the Province that when that issue was put to bed it would never arise again and that that tactic would not be used again to put pressure on the school boards or on government.

So we are very dismayed, actually, to see that it has arisen again, and we would certainly hope that in the not-too-distant future, if not immediately, the teachers in Labrador West will see that it really is not quite fair and I do not think it. even garners much public support for the children in the area to be prevented from having activities which may not be, shall we say, educational in the narrow sense of the term, but neverthe­ less, is very important for their development in the younger years of their lives. 9348

December 20, 1983 Tape 4176 EC - 3 DR. COLLINS: So we would hope that the work to rule issue as it applies to extracurricular activities will not persist and certainly will not be used by teachers in the future in any other area of the Province. With regard to the issues in the dispute between the teachers and the school boards in Labrador West, I would just like to point out again that it is not so much a dispute between the teachers and government.

There was a conciliation board report and the conciliation board report fully recognized that the arrange­ ment reached with the NTA for the bulk of the teachers in this Province, that is the teachers having positions on the Island itself, that arrangement really did have to apply insofar as government funding is concerned to the teachers in Labrador also. What · is at issue is the extra funding that goes to the teachers in Labrador West. The extra fundi~g is in two forms.

The first form is the Labrador allowances which go to any public employees in Laprador in recognition of the somewhat higher cost of living and perhaps some other factors in Labrador and government is responsible for that 9349

December 20, 1983 Tape No. 4177 SD - 1 DR. COLLINS: and g9vernment does give it to the teachers up there. If you are a teacher you get a certain Labrador allowance in addition to your usual salary,and if you are a public servant of some other sort you also get the same Labrador allowance,depending on whether you are single or married. And, you know, that is not in issue. What is in issue is the extra moneys that the teachers in Labrador West receive from the mining companies, from IOC and Wabush Mines.

When the companies were anxious to have people working in Labrador West and anxious that they should have services that would attract them to that area 1 one of the things they undertook was to qive extra funding to the educational system up there. That extra funding allowed the school boards up there not only to have a lower pupil/teacher ratio but also allowed them to give add-ons to salary scales and various things like that.

Nm" that the recession is having very marked efforts ·an ira~ ore companies in particular,and I .suppose the iron ore companies are some of the enterprises that have been hit hardest by the recession and have as yet to see any recovery from the recession, because of the recession the companies just feel that they have not the same means to give extra funding to the educational system in Labrador West.

So the school boards are faced with the situation that some of their funding is diminished and they are saying to their teachers, 'We will not decrease your salaries from what you got in the past,but we cannot give you increases that we would normally have given you if those · extra funds from the iron ore companies had not been diminished.' And, you knmv, the boardsr I think, have made an honest effort to try to keep their other expenses down to a minimum so that they would not be put in a position of having to actually decrease teachers' salaries.

And as I say, it is my understanding that they have " . - - not undertaken to decrease them, they have undertaken to hold 9350

·:: .. December 20, 1983 Tape No. 4177 SD - 2 DR. COLLINS: them level but not to give the increqses that the teachers wished. They have made an honest effort to hold their expenses down in other areas. They have made an additional offer recently to the teachers hoping that that would prevent a work stoppage but regrettably it was rejected by the teachers, they now have a strike vote.

I would hope that that ~ill not prevent further negotiations and I thi~k· that \'lith good 1.-rill on both sides there still is an area where there can be compromise and where the thing can be settled without a work stoppage which would be detrimental, of course, to the students involved. SOME EON. ME1-1BERS : He.ar, hear. MR. SPEAKE"R (}l.ylward} : The hon. Leader of the Opposition. to that petition. MR. NEARY: Mr. Speaker, I rise to support the petition so ably presented by my colleague, the member for Eagle River (~r. Hiscock11on behalf of his constituents who are supporting the teachers in Labrador West.

I was rather surprised ;to hear the Minister of Finance C.Dr. Collins). , }1r. . . Spea~er, and really what he was doing ~-;as not supporting the petition but. negotiat.ing in I?Ublic, negotiating i:n this House, and in the process gave the teach.ers of Labrador West a little flick on the wrist, That is what the hon. gentleman just did, Mr. Speaker. He said that he cannot understand the tactics being used because he thought that when they went throuqh. this dispute they had a year or so ago with the teachers that they would never again -the han. gentleman thought ~ work to rule.

Now why would the hon. gentleman think such a thing, Mr. S~eaker? MR. CARTER: You are getting into debate. MR .. NEARY: No, it is not debate. The hon. gentleman was debating, Mr. Speaker, and I guarantee you that 9351

_._ ,~ December 20, 1983 Tape No. 4177 SD - 3 MR. NEARY: his words in this House today will do the controversy, the dispute, between the teachers and the school board in Labrador West no good,- Mr. Speaker. The han. gentleman, 9352

December 20, 1983, Tape 4178, Page 1 -- apb MR. NEARY: in his pious way, a haloover his head, sort of gave the teachers a slap on the wrist. Mr. Speaker, they did not have to have the hon. gentleman get up in this House today and give us a lecture on where the funding carne frorn~everybody knows where the funding carne from. For a number of years, as hon. members know, they had the finest educational system in this Province in Labrador West.

I believe they were the first school in Newfoundland and Labrador to become bi-lingual, the J.R.Srnallwood Collegiate in Labrador City, and the pupil/teacher ratio was lower in Labrador West than in any other part of the Province. all known facts, Mr. Speaker, these are sowe did not need a lecture from the hon. gentleman on these matters. What the hon. gentleman should have told the House, and what he should have told the people in Labrador City and Wabush was that negotiations will continue in good faith and that they would carry on until this matter was resolved.

With what the hon. gentleman just did 1 he seems to have slammed the door in the faces of the teachers in Labrador West and his words will certainly do the cause no good. And I paid very strict attention to what the hon. gentleman was saying about the - dispute; he was scolding the teachers, giving them a little crack on the wrist for working to rule and, Mr. Speaker, it will certainly do the cause no good. MR. SPEAKER(Aylward) : Before we proceed with Orders of the Day, yesterday it was brought to my attention that there might have been some unparliamentary language used during the debate.

On checking with Hansard, December 19, tape no. 4428, I note the remarks attributed to the ·- --·· ... hon. the member for St. John's North(Mr. Carter), 'That is a lie. That is a lie.' These remarks are considered unparliamentary and I would ask the hon. member if he would withdraw. 9353

December 20, 1983, Tape 4178, Page 2 -- apb MR. CARTER: Certainly, Mr . Speaker, I was provoked beyond reason. I withdraw. MR. ·sPEAKER(Aylward): The han. member has withdrawn. ORDERS OF THE DAY MR. SPEAKER: Order 8, "An Act To Amend The Retail Sales Tax Act, 1978". I understand that the debate was adjourned by the han. the member for the Strait of Belle Isle(Mr. Roberts). Motion, second reading of a bill, "An Act To Amend The Retail Sales Tax Act, 1978". (Bill No. 87). MR. ROBERTS: Thank you, Mr. Speaker. Your understanding is correct, Your Honour. Mr. Speaker, there has been a lot said on this bill.

I hope the Minister of Justice(Mr. Ottenheimer) does not go too fara~ay. If he is indulging in one of his habits 1 I hope he is able to do it in public, because I want to address some remarks to this bill ' and I think they affect matters which are as much within the purview of the Minister of Justice as ·they are within the purview of the Finance Minister(Dr. Collins) in who~e name this bill, of course, stands.

Now I understand that yesterday my colleagues said they agreed with this bill, and I do not differ with that, but I will say to them that the Minister of Finance has been kind enough to give me the text of the amendments which it is proposed - he cannot move them,of course, one of his colleagues will - - ·• . . . ... . - . which it isproposed to move to this bill to deal with Sections 13 and 14 of bill No. 87. These are the clauses which deal with directors and with agents. I want to thank the minister 9354

December 20, 1983 Tape No. 4179 ~iJ - l MR. ROBERTS: for hi~ courtesy and his kindness 1 but I will say 1 having reviewed these proposed changes,! am not sure that we on this side should support them and I will try to deal with that in a minute or two, Mr. Speaker. Mr. Sneaker, these amendments in part have grown out of the ~rk of the Public Accounts Cornni ttee and the recommendations which the committee made in the report for the year ending 31 t1arch, 1981.

The 1982 report will be tabled I hope very shortlv before the House 1 when the committee have finished it.In 1983 report has not yet begun because the Auditor General's report for that Period was tabled only a few days ago here in the House • So these grow out of the most recent report which the PAC has made to the House, Mr. Speaker. A number of the amendments which the minister has asked us to ~d~~t in the House are __ "!e~_Y . technical. I shall have one or n.u questions but we will deal with those later. I want to direct my attention, though/to two points,one of which is in the bill and one of which is not.

The one which is not in the bill is a measure to deal with corpora te shams. The one which is in the Billare the Sections 13 and l4 1which deal with the question of what if any onus we shall lay upon directors, officers and agents.

And of course, Your Honour, we are all aware,I have no doubt,that directors, officers and agents are very different people._ Direc~ors_have one role and one function, officers have a different role and a different function, although you can be both a director and an officer, and an agent is a different relationship altogether; in fact 1 I think it is probably extremel y doubtful at law if one could be both an agent and either an officer or a director. The directors and officers act in the name of the 9355

December 20, 1983 Tape No. 4179 HJ - 2 HR. ROBERTS: company, the agents act as the company, the law of agency 1 but that is a point I '!'Till come back to. Let me talk first about the corporate sham situation. ~~d in doing that, Mr. Speaker, may I preface these remarks by saying that 99.99 per cent of people who are responsible for paying sales tax in this Province, and that 1 of course 1is every vendor because the act lays an obligation upon every retail vendor as defined, and that is just about everything, but 99.99 per cent of those people are honest.

I am not saying they ah1ays pay their taxes promptly_ the minister has got to go out and collect ~~e tax and that is fair enough, that is his job­ I am not saying they always pay without dispute- but t~ere is nothinq '•'T.'~"'"'' •11i th disputes; if they arise tc:ey should be resolved but "':h .ere is nothing wrong with them arisinc; -- but I' am talking about the people who deliberately set out to bilk the government 1 and there are such people in this Province. And one of the ways they do it, !1r.

Speaker, is to set up a co~oration which sounds impressive until you realize that any three people of age - you do not even have to be of sound mind -any three people of age in this Province can constitute a corporation by paying - I do not even remember the fee anymore - $115 or Sl2Q to the ~egistry of Companies here in this Province. That is all it takes. And then you can set up a body corporate, which at law is separate and distinct. So all you do if you wish to bilk the Province of the sales tax is you set up your corporation., run up your bili by not paying your sales tax.

The minister in the past, and for all we knm.; today, has been negligent in this regard. There have been cases where hundreds of thousands of dollars have been uncollected because the minister has not got out and collected it, and the 9356

December 20, 1983 Tape No . 4179 MJ - 3 MR. ROBERTS: Auditor General's report has documented that. I am not talking about the non-write-offs situations, I am talking about the matters on which the Auditor C~neral has reported where there have been cases where individual vendors have been allowed to run up astonishingly large amounts of tax. Then, when the minister cracks down eventually - somebody prods him into it - he cracks down and he goes in and the corporation has nothing in it.

Alright, you cannot get blood from a turnip, we are going to try to make directors, officers and agents liable to some degree, and we will deal with that in a moment, but let us carry through with the corporation; the corporation becomes defunct, either it is put into bankruptcy or it is liquidated voluntarily or it just dies of its own volition because the actions necessary to keep it alive under law are not maintained. SOME HON. MEMBERS: Oh, oh! MR. ROBERTS: Mr. Speaker, I have no quarrel with the Minister of Fisheries (Mr. Morgan) on this point at least.

If he wants to carry on a conversation I would be grateful if he could carry it on outside the chamber and I would ask Your Honour so to -- - ·- - remind him. Not only is it out of order,it is exceedinly -··- .. -- -··-. - rude, Mr. Speaker. MR. SPEAKER (Aylward) : Order, please! MR. ROBERTS : Thank you, Mr. Speaker. 9357

December 20, 1983 Tape No. 4180 SD - 1 MR. ROBERTS: The corporation has no money in it, it owes $15,000 or $20,000 or $30,000 in tax. The minister goes in and trys to collect it, is not able to because,in the words of the old adage, •you cannot get blood from a turnip'; the corporation collapses, the minister is left holding the bag and, of course, that means all of us are left holding the bag. And that is bad enough,but what makes it intolerable in my view is three or four weeks later the same guiding people, the same individuals · - r.1R. MORGAN: Form a new company. - - .... .. MR.

ROBERTS : - form a new c:ompany. The Minister of Fisheries (Mr. Morganl has got the point exactly. They then apply to the minister for registration ." The minister, we were told 1 a.nd I think there is legislative sanction for this, has authority to deny them registration. But now we are told at the most recent PAC hearings that some nameless gnome in the Department of Justice has told the minister he cannot do this. Now I quarrel wit!: . the legal opinion but, since w·e were n.ot shown it , it is difficult to quarrel other than with the result.

But I will say 1 quite simply 1 the legislature can stop that situation if we wish. We have that power at law. And when I see all the appallingly bad legislation which is brought in from time to time in this House 1 I wonder- · why we do not get some wonderfully good legislation,such as a

section in the Retail Sales Tax Act which would allow the minister to deny registration in a situation whereby the same people or substantially the same people come back into the business world. Now : ¥.~~ may say that is an arbitrary power,and I agree it is, but there is an appeal provided,as I read through the act. If the appeal process is not adequate, then let us provide a.nother appeal process. By all means let us provide a process by which the minister's decision may be tested by some rational standards. The government want to 9358

December 20, 1983 Tape No. 4180 SD - 2 MR. ROBERTS: try to end that in the case of the Labour Relations Board, they want · to try tc limit access to the courts, I opposed it there and would oppose it here. But what I am saying, Mr. Speaker, is that we have a situation in the Province whereby people who set out to bild the treasury could do : it.. There are very few of them but there are some, and they do it deliberately and t.hey do it ·time and time again. Many of these people are repeaters, there is a definite pattern , and we as a Legislature should stop it.

And I say to the minister that I am extremely disappointed in him that he has not brought legislative measures before this House. His officials told us at the PAC 1 and th .e evidence is there on the record for anybody to h7ar, anybody to read, that the power whlch the House thought it has vested in the minister had proven to be inadequate. The minister of Jus .tice lMr, Ottenhe.i:rnerL, of course, is responsible for the legal op:i:nions; he may or may not have given it, it does ·not matter which lawyer wrote th.e opinion 1 it is th .e minister t.o whom . we look as the chief law officer of the Crown.

So I would s.imply say to both ministers that this is an intolerable situation and one which should be stopped •. It not that the. amount of dollars is a.ll that excessive. I suppose on a sa .les tax yield of roughly $350 million a year, the Minister of Finance (Dr. Collins) getsitplus or minus $20 million - I tend to it more accurately .. - but on a sales tax yield as large as tv-e have a few hundred thousand more or less is not going to make or break the P.rovince.

Bet what counts, Mr, Speaker. is thi·s 1 that the ·sales tax collection process, like any taxation process we -have,depends upon most people complying with it voluntarily. If the income tax, these fearsome people who have vast authority in that Income Tax Act, if they were ever confronted with a situation whereby we all refused to file our returns on the 30th day of April, the whole system woulc collapse. If the Minister of Finance was ever confronted 9359

December 20, 19 .83 Tape No. 4180 SD - 3 MR. ROBERTS: with a situation where every retail sales tax vendor just flatly refused to co-operate, the whole system would 9360

December 20, 1983, Tape 4181, Page 1 -- apb MR. ROBERTS: collapse because we would not have enough person power to enforce it. So all these taxation system~ depend in large measure upon voluntary compliance, they depend in large measure upon most people being reasonably honest, and most people are reasonably honest. But when somebody who is reasonably honest sees some sleeveen beating the system-and I have just said it one way; I have hardly ··;. .. revealed anything new, it has been quite public for a long time- and getting away with it, it just puts the devil in everybody else around this Province.

So I would say to the minister that that is an area that he ought to address, and, in my view, if we need further legislative authorization we should get it. The minister should have the power to be able to refuse registration in a case where the same people, or substantially the same people come back in a different corporate veil, a different corporate form.

Piercing the corporate veil, which is the term the lawyers use for this process is not new, there have been any number of situations which have developed over the years where the courts have pierced the veil, and where they will continue to do so, and there is certainly no reason - SOME HON. MEMBERS: Oh, oh! MR. ROBERTS: If the lady from Gander (Mrs. Newhook) could please keep her voice down I should be grateful to her. I know she does not intend to be rude, but unintentionally she is. Mr.

Speaker, the fact remains that the corporate veil has been pierced many times at law, it can be pierced by this House and it should be. I do not want to go over the ground unnecessarily, but I will say that this is a deficiency in the bill which the minister brought in, and I will say to him that allowing this type of thing to continue without any effort to try 9361

December 20, 1983, Tape 4181, Page 2 -- apb MR. ROBERTS: to stop it is simply inviting a lot of people in this Province to down tools on the whole retail sales tax system, _and I would say to the minister that that is the biggest threat to this system that we could ever have. The crooks I do not mind. We will always have some crooks, and we will catch them sooner or later. What would destroy the system is if ever the great, the preponderance, the 99.99 per cent of the people who play the game, if ever they feel it is not worth their while to play the game and _down tools, then the whole thing will collapse. Mr.

Speaker, let me then move on to sections 13 and 14, and I propose to address myself not to the sections in the bill, because as I said in the outset, the minister has been kind enough - I gather he indicated to the House that he would be asking his colleagues to 'make amendments- MR. NEARY: He is going to change a few words , he paid. MR. ROBERTS: He has been kind enough to provide me the wording, and let me say, Sir, that I, for one, will not be supporting at least one of these wordings. His proposed amendment to

section 13 is a gigantic step back­ wards. In fact, we would be further ahead in this Province in our efforts to collect sales tax if the minister's proposed new

section 13 is not en~cted. His proposed amendment is not the one before the ~ouse~ it is 0ne which would amend

section 75 as it now stands by deleting four _ words.

Section 7 5 now, _. Mr. Speaker, in its entirety says, 'When a corporation is guilty of an offence under this act and an officer, director or agent of the corporation directed, authorized, assented to, acquiesced in, or participated in the commission of the offence,that officer, director or agent is party to and guilty of the offence and 9362

December 20, 1983, Tape 4181, Page 3 -- a,pb MR. ROB ERTS: is liable on

summary conviction to the punishment provided for in that offence whether or not the corpor·ation has been pros~cuted or convicted'. All it says then .is, if you authorize, direct, assent, acquiesce or participate in the conilll.ission of an offence yo_u c.an be made guilty to the same penalty. What the ministe .r proposes to do in his amendment is strike out the words 'assented to 1 and t.he words 'acquiesced in 1 , tho "se four words.

That then signif .icantly reduce .s the exposure of a director, officer or agent,and I think that is shameful, and r say to the minister that if he understands what he proposes 1 he should be ashamed of himself. What he is saying is th .at if a director acquiesces or assents in the commission of the offence he cannot be made liable to any penalty. And I cannot understand how the minister in conscience can recommend that to this House • . - ~- . . ..... A director 9363

December 20,1983 Tape No. 4182 ah-1 MR.ROBERTS: acquiescing or assenting in means you have knowledge of something, Mr. Speaker, and you do nothing about it •. And what this would mean is if a director had knowledge that a corporation was breaking the law by not paying its sales tax and did nothing about it·,that director has not committed an offence. Now I think this is an appalling piece of draftmanship. I think these amendments. I do not know who drafted them and I do not care because it is the minister who is responsible- are the worst drafted amendments I have seen.

Thirteen in the bill as it originally stood was an abomination and fourteen which is 79(1) was even worse. The draftsman should go back to law school if ever he was there, whoever wrote those sections, and I can give them the precedent. But I will say the new

Section 13 is shameful. The minister ought to be ashamed of himself if he sponsors that in Committee, because all he is saying now is that a law which now ~ays that if a director acquiesces in or assents to the commission of an offence he can be convicted of that offence, he is taking that out of the law and I just think that is an.astonishing step backwards.

I do not care who asked for it, I do not care if the Board of Trade asked for it,- I do not know if the~ did or not -I do not c~re if 1000 sounding angels asked for it, I cannot see.any possible justification for relieving a director, an officer,or an agent of a company from responsibility and exposure to a penalty where he has acquiesced or assented in an offence. Acquiescence or assentis

an act of volition, it is 9364

December 20,1983 Tape No. 4182 ah-2 MR. ROBERTS:

an act where he has done · something or 'he has not done that l,·rhich he ought to have done;to use the words-that are in the Book of Common Prayer. And so I say to the minister that he is wrong, I think the draftsman or his officials, I do not know who derives. these things_ SOME HON.MEMBERS: Oh, oh! MR.ROBERTS: If my friend, the member for Ferryland (Mr.Power) could keep his voice down to a duller roar it would be much appreciated. MR.CARTER: You are touchy today, boy. MR.

ROBERTS: No, I am not touchy a It is just that I am feeling the urge for a little Christmas courtesy and I am prepared to extend it even to my friend from St. John's North (Mr.Carter) in the spirit of the season,but I ask it in return. I am debating a very serious matter and I should have thought the gentleman from St. John's North, as a former Vice-Chairman of the PAC,would be the very first to pay attention to it raptly even if he cannot comprehend it. Now, Mr. Speaker, the point on the proposed new

Section 13 is that it is a gigantic step backwards. If the minister really understands it,then I invite him to try to give us a reason why we should remove a burden that the law has laid upon people in this Province for many years,and which in my view is a reasonable burden,that where you acquiesce or assent to an offence you are guilty of that offence as well. When you acquiesce or assent to an offence by a corporation,that you are liable to a penalty if you are charged before a court of law 9365

December 20,1983 Tape No . 4182 ah -3 MR.ROBERTS: and convicted. That is just .absolutely astonishing and I cannot understand how any official could recomrne~d it to the minister and I cannot understand how any minister could accept it and bring it before this House. Now the minister can either be pig -headed and bull -hea ded about it or he can look at it sensibly and rationally and take counsel qn it because I suggest that 13,as he has drafted the amendment is very bad policy indeed .

Section l4 1 which will replace the one in the draft, the proposed 75.l,in fact it adds a 75.1 and a 75.2. The 14 in the bill, the 75.1 proposed 1 will not see the light of day so I do · not need to speak about it. I have already advanced my opinion on 13 as it was originally drafted . It was an astonishingly inept piece of draftsmanship. But, Mr. Speaker, 9366

December 20, 1983 Tape 4183 EC - 1 MR. ROBERTS: the proposed new 75.1, the proposed new 14 which will add 75.1; in my view, is good law, with one exception. Once again, the minister has fallen into the acquiescence trap. I do not know who the minister listens to. I am not even sure he understand~ . it, to be candid. There is a perfectly valid precede~~ available ,to him, that dreadful beast with whom we all must live, the Income Tax Act of Canada. And when the Board of Trade get on their high horse and talk about new departures in law, they might want to realize that

chapter 140 of the 1980-81-82-83 Statutes of Canada added 1 as part of the income tax law of Canada 1 a personal liability upon directors, it is found in 227.1, and what it says is that'directors of a corporation at the time the corporation was required to deduct or withhold the amount or remit the amount, are jointly and severally liable together with the corporation to pay any amount that the corporation is liable to pay under this act.' And then it provides for defences p and it says,'where the director has exercised a degree of care, diligence and skill to prevent the failure that a reasonably prudent person would have exercised in comparable circumstances,' then he is let .off the hook.

Now, why the minister did not look to that, which says a director is liable unless - and a ~ery important unless - he can show that he has done what a reasonable and prudent man would do, and that is far better 'than this legislative abomination that we are now going to be asked to -deal-with . . Furthermore, I -da not know why the minister insists upon trying to bring officers and agents in under the same umbrella as directors. Directors, Mr. Speaker, occupy a very special place in law. The directors under Newfoundland and Canadian companies law 9367

December 20, 1983 Tape 4183 EC ~ 2 MR. ROBERTS: are responsible for the management and direction of the company. In a very real sense, while they do not own the company, they are the company. The shareholders of the company, the men and women or the bodies corporate, as the case may be, who own it, who are beneficially entitled to the property or the assets of that company or the proceeds thereon·, those shareholders do not run the company, the directors run the company.

And the law is well established that directors do not have to do what shareholders tell them to do, directors have their own minds and must use their minds. And here the minister tries to confuse them or does confuse them, tries to confuse us, I suspect, ·-by putting in officers and agents. They are not the same in law. Mr. S~eaker, on top of that ~ you may wonder why I am making such heavy weather of all this ~ let us remember the nature of retail sales tax moneys. They are trust moneys, the act declares them that.

Section 33.1 says 'A person who collects any tax under this act is deemed to hold the tax in trust for Her Maj·esty. ' We are not talking of a company's money, we are talking of the Queen's_money, the government's money. Right from the start, if Your Honour goes into the shop tonight and buys a glass for a dollar, Your Honour pays the shopkeeper $1.12. One dollar of that goes to the shopkeeper and twelve cents is in trust for the Queen. MR. CARTER: Would the member permit a serious question? M._~. ROBERTS: Yes, I would gladly_permit any serious question. 9368

Decenber 20, 1983 HR. SPEAKER (Avlward) : St. John's North by leave. MR. CARTER: Tape No. 418 4 MJ - 1 The han. the member for !-1r. · Speaker, I \vender \·TOuld the ;han. member address the question that I was posing yesterday. What about the case of a firm that goes bankrupt because of the non-payment of its bills by the people it has provided goods to? I am think,for instance, of a firm that say sells snowmobiles. No\or they have been sold on credit and if they are ·not paid for the firm has no choice but to go bankrupt, yet at the same time the sales tax becomes payable the moment the unit is sold. ~m.

SPEAKER: The hon. the member for the Strait of Belle Isle. HR. ROBERTS: Mr. Speaker, let me first of all ask if the House ~vould grant me bro or three m:i,nutes or four or five more because I have had the dreaded five minute note from the Clerk. MR. SPEAKER: Shall the han. member have leave to continue for a few minutes? SOME H8N. ME~!BEP.S: By leave. MR. SPEAKER: Leave is granted. M...~. ROBERTS: I thank hon. gentlemen. Let me then deal with the question, which is a very good one.

The most common way in which this arises I think would be in the case of a car dealer 1 because if you sell a car for $10,000- Hhich I am told is not much of a car these days;I rnean;it is not hard to buy a car that cost $10,000~ you are not buying Cadillacs or Mercedes Benzs or Rolls Royces at that price~ the $1,200 tax becomes payable immediatel y and in many cases the garage owner or the factor - I do not mean the factory, I mean the factoring, the factor - ·\.;ho buys the paper, usually recourse ~aper, the tax is paid immediately and then it ma y be the 9369

December 20, 1983 Tape No. 4184 MJ - 2 MR. ROBERTS: person who has that car, or a snowmobile equally 1 does not pay for it 1in which case the business goes up the spout. Well now, I think there are two comments, one would be a very practical one, you have to have an awful lot of defaults before a business goes up the spout, one snowmobile or a number of snowmobiles ..

But let me take it on a broader plain,which I think is where the member intended it to be,and that is the question of a business which goes bankrupt for whatever reason~ I mean, it has not collected its accounts, you can argue maybe they should not sell on credit, but that is not the point, the point is it has gone bankrupt. The Income Tax Act allows a due deligence defense.

I read this section, it is 227.1(3), "Where a director has exercised a degree of care, deligence and skill to prevent the failure", in this case . to remit withholding taxes, "that a reasonably prudent person would have exercised in comparable circumstances, there is no offense." Sq I would think if I were the director of a bankrupt company and I was charged, and ~ - I suggest charges would be laid only if there was some evidence that there had been something out of the ordinary 1 then I say to my friend from St. John's North (Mr. Carter) that 227.1(3) is the defense.

I could say, 'Well, judge, I have done what a reasonably prudent person would have done. I checked every month to make sure the sales tax was paid.' That kind of thing. l-1R. CARTER: These people can reappear in business within a month after the~ have gone bankrupt. MR. ROBERTS: They could. And there have been cases of that,as the member may know,in St. John's or in Newfoundland. That perhi;ipS a~dr.~s _ses . the situation with which I dealt earlier,where I have run a tavern and I have run up $10,000 in RST and I do not pay it, I go out of business and 9370

December 20, 1983 Tape No. 4184 ~1J - 3 MR. ROBERTS: next ,.,eek instead of Ed Roberts Liminted I incorporate Roberts Ed Limited, you know that kind of thing, make a mockery of ·the whole system. I do not think these amendments deal with that. These amendments deal with the question of whether we can go beyond the corporate structure ', the corporate assets, into the personal pockets of the directors and the new 75.1 which the minister wants is not good enough.

There is a perfectly good precedent in the Income Tax Act which applies to an analogous situation, there it applies not to income tax the company owes, it applies to income tax, the withholding tax,that the company has collected from its employees, it spells them out here 135.3 or 153 or 215 of the act. Here we are talking not of money which NEWCO,owes we are talking of trust money. It is our money right from the time, to come back to my example, Your Honour pays the twelve cents on the glass. It never belonged to the company. What happens is the companies take it and they put it in their own bank account.

I know people, some of them close to me, personally and in business, who financedhusinesses for years on the sales tax revenue, a free loan from the government. Well, the government are getting better at collecting it now. MR. ANDREWS : Terrible. MR. ROBERTS: Yes, it is terrible. What we are talking about here is trust money and what I am saying, the burden of the whole point of what I am saying is that onerous duty should be laid upon a director. Now somebody will stand and say as the Board of Trade in their stupidity .­ and it was stupidity on their part; 9371

December 20, 1983 Tape No. 4185 SD - 1 MR. ROBEP.TS: I am surprised that a group of ~ntelligent men and women with advice have taken this position - said there are peop~e who are directors ____ why should they be responsible Well, Mr. Speaker, - when we reform the corporation law in this Province,which I understand will -be done 1 directors are going to have to stand up and accept their responsibilities. I mean, it is shameful. lt is hard for anybody to say, 'Well , I am a director of a company but I have no interest in it'. If you have no interest in it you should not be a director. .

And everywhere else in North Ame~ica, every other province in Canada, federally in Canada under"CBCA, directors can be held personally liable if they do not act properly, not just for trust funds but for the whole affairs of the company; shareholders can sue, they do all the time. Your Honour and I are on a Select Committee, we were appointed by the House, to deal with the corporation law. ~he draft that was referred to the committee has that kind of standard into it,and I have no doub _t .. ~~t any report '"e bring in will have that kind of thing and any bill that comes in will have that.

That is the commercial norm across North America. And for a group of people i'n this day and age to stand up and say, 'Well,we are a director and we have no responsibility for the company', is shameful. T.hey have no business being directors , and tfie -·. government has no business allowing them to be directors if t~ ~ y wi~l not take the responsibilities. There is an old s~ying of whi ·ch. I am very fond because I believe it expresses . . - a grea ·t truth, • If you take the Queen's shilling 1 you carry the Queen•s rifle'.

You cannot have the profit of being a director without the responsibilities of being a ·director. And somebody said, ·~vhat about the lawyers?' La\oJYers do not need any help from this House. I \vill tell you 1 Your Honour ,that if all else comes . down the lawyers will _!Je _ .~k -~y. And I know .whereof I speak. I mean, I am one of that trade union. But the lawyers will be okay. Yo ; do not need to worry 9372

December 20, 1983 Tape No. 4185 SD - 2 MR. ROBERTS: about the lawyers. When all else ends 1 ~n judgment day there will be a lawyer there trying to collect a fee for asking St. Peter _to let somebody in and another lawy~r collecting a fee telling St. Peter not to let him in. You need have no fear of that. And if lawyers who act in the professional sense incorporating companies want to carry on as directors of those companies,then let them accept the responsibility.

And it would be shameful,in my view it would be a derelection of the ethical standards of the Bar if the lawyer said, 1Well,I want to be a director but be damned if I am going to accept any responsibility'. You know, there i.s a very famous saying by Stanley Baldwin,who was a Tory Premier of England- the Minister of ~ustice (.Mr.

Ottenheimer)_ would remember it because he is learned in these things, he has read histoJ:y- 'Power without responsibility used to be the sole prerogative of the harlot' ... -. _ it was in a fight he had with Beaverbrook and Rothermere - but how,he said, 'The press lords want to share that power without responsibility'. Well,I say that any lawyerJor an ybody else ~ho wants to be a director of a company and is not willing to accept the responsibility that comes with it, he too wishes to share the prerogative of the harlot , power without responsibility.

It is hot right, It is offensive in law, it is offensive in policy, And the minister's amendments unfortunately do not remove the situation. I say to the minister, and I will close this ~ortion- I have two or three ather very brief points - I will say to the minister that in spirit I am with _ his amendments. ·He is trying to do the right thing and the PAC had 'extensive hearings and recommended it. I have heard . \ 9373

December 20, 1983 Tape No. 4186 IB-1 MR. ROBERTS: no responsible voice against the principle. The Board of Trade quite properly has criticized the original draft. In fact,I share their view. The original draft, the one that was made public in this Bill 87 1 was a bad piece of drafting. I did not say so outside the :House because I knew I would have my turn in here, and the Board of Trade is right to criticize whether they are right or wrong anyway. Let them criticize, and the Institute of Chartered Accountants.

But I say to the minister that what he has now put before the House, or what he has told us he will and what he has given me ·the courtesy of showing me is bad law. He should look at the Income Tax Act provisions which work. They apply only to trust funds and they apply only to directors,and these are the people we need worry about.

And a director of a company must accept the responsibilities and I can hardly see a Conservative Government which believes in conservative principles not adopting what is after all a very sound principle and "also happens, I should think, to be a conservative as well as a small '1' liberal principle. If you have the power of being a director you have the responsibility. If you want the director's fees you take the director's responsibility.

And anybody who says, 'Oh, well,I am only a director so I get some legal work 1 or because of this or because . of that maybe I get a free pass or a free this or a free that', Mr. Speaker, that is just astonishing that anybody could· be allowed, not to advance it, anybody can advance what· they want, but that anybody could be allowed to take that seriously and to treat it as a foundation for policy. So I say to the minister that his heart is in the right place. It is his words that ar~ wrong, and I say that his words, as he has put them 9374

December 20, 1983 Tape No. 4186 IB-2 MR. ROBERTS: in 13 and 14, are not going to do the job. He should redraft them and he should look at the Income Tax Act-and I have _a photocopy of it here if he needs it to talk to his officials - and he should adopt the philosophy there,that directors are responsible persona~ly for trust funds unless they can show that they used a due diligence defence. And that is not a new principle.

All those downtown who were quite quick ' to jump on me saying, 'It is radical; because I dared to say what the PAC had said unanimously, that we should make directors personally liable, they all either do not know about the Income Tax Act or just ignore it. But that has been part of the law of Canada now for a couple of years. In fact it became effective on November 12, 1981. So for more than two years that principle has been in the Income Tax Act and thus part of the law of Canada.

And there have been prosecutions under it,and there have been some successful defences and there have been some successful convictions. Mr. Speaker, two other points, if the minister would, when he speaks either now or in Committee, could he tell us-and maybe he did in introducing the bill, I apologize for not having heard him •why are l (5) and 5 (

l) made retroactive to July l, 1978? If he looks at the bill,section 1, sub-section (5) and

section 5, sub-section (1), in each case of course of the bil~ he will find that the provisions are made retroactive to 1978. These have to deal with the -promotional situation. Have we been levying tax all these years and perhaps invalidly? Retroactive legislation is always abhorrent - l::ut there are situations I accept where it may be necessary, but to go back five years! MR. CARTER: Bills of attainder. MR. ROBERTS: Bills of attainder. Yes, the han. gentleman might have personal experience with those 9375

December 20, 1983 Tape No. 4186 IB-3 MR. ROBERTS: if we ever allowed them again. I think the Charter probably outlaws them. The member -can sleep easy at nights now. But, you know, to go back five and a half years is a long, long time. And changing the rules of the game in mid stream is a very dicey proposition indeed. Now there may be a reason, the minister may have told us 1 but if not I would ask him to consider that point. If we change the law from this day forward I have no quarrel. We tax everthing.

There is only one activity we do not tax in this Province, and if the government could find a way to do it they would. Mr. Trudeau once said, 'The state has no place in the bedrooms of the nation'. But I will venture to say if the Minister of Finance (Dr. Collins) could find a way to audit what goes on in the bedrooms of this nation he would tax that too. But short of that we tax just about everything, and we are now going to tax materials distributed . for promotionsl distribution - well and good t 9376

December 20, 1983 Tape 4187 EC - 1 ··- l-'!R; CARTER: He could al _~1a;y_s __ u~e t_h~ honour . system. MR. ROBERTS: It took the hon. gentleman a few minutes to come through to what I was talking about. The honour system may or may not be useful there. He may stand and declare his interest if he wishes. But, Mr. Speaker, making it retroactive is a dubious proposition and perhaps the minister could tell us why. Finally, and I think others have spoken on this,

section 7 confers extraordinarily broad powers upon inspectors. Must we really give an inspector the power to compel somebody to answer questions? I find that offensive. It think it is probably ultra vires. I think the Charter of Rights is going to strike down this and a lot of other bad legislation when it gets around to getting tested before the courts. But why should we make a man answer questions? It is a very fundamental principle of our law that you really have the right to remain silent.

In court, if you are compelled to testify, you can at least call upon the Canada Evidence Act or the Newfoundland Evidence Act and the evidence cannot be used against you. But, Mr. Speaker, it has been in the law all along but we are re-enshrining it. And I do not know why the Chartered Accountants -when they got all het up, did not look at that. It is on page 10, I.say to the minister. It is the new subsection 39 (2). We . are putting back the words 'answer any question relating thereto.' You know, we get an inspector, he could be semebody right out of high school with the dew wet 9377

December 20, 1983 Tape 4187 EC - 2 MR. ROBERTS: behind his ears, we give him a certificate signed by the minister and in he goes and he could make anybody answer a question! It·is just offensive and it is wrong in law, it is not necessary. If the Crown really feels that the person being questioned is hiding something,then let the person be hailed into court and let him answer. But this is just the Star Chamber and Inqui~~~ion rolled into one. You know, we do not need these clauses, they are all through our statutes. We do not need them, Mr. Speaker, and we should not have them here.

The Cro'~ has adequate methods to try to collect the taxes due to it without forcing people to answer questions. As I said, I suspect it is bad law anyway. I would like to. see a judge take a crack at it and doubtless one of these days somebody will raise it before a court of law and we will see what happens. Mr. Speaker, I thank the House for its indulgence. I say to the minister that I make these comments in the most constructive of senses because I believe he intends to try to do the right and proper thing; and I think this bill is important.

This is the bill under which the largest single source of provincial revenue comes in; the sales tax is the biggest single provider of cash to the Treasury from provincial sourcesr probably it will always.be so. And the legislation under which it is collected is of paramount importance. The points which I have made, I suggest to the minister, are well taken~ I believe they are well made. That is a matter for argument, of course, but they are well meant, they are well taken and I would say to the minister that the bill would be a lot better if he would consider these points.

There is no need to strike out the words 'assented to', 'acquiesced in'that . , 9378

December 20, 1983 Tape 4187 EC - 3 HR. ROBERTS: it is a step back that is encouraging people to become derelict in their responsi­ bilities, it is saying if you do not report you are let off the hook. That is just shameful, and the new 75.1 as proposed, a lot better than the one which stood in the original draft which, in fact, stood as sub (2) of old 75, to confuse everybody, but it is still not good enough. The parallel he should look at is the Liability of Directors

section in the Income Tax Act of Canada, which has worked. An d,finally, I say to the minister again that he should hav~ a look at the 'sham' situation; it is an open invitation to abuse and it is being taken up from time to time. Thank you very much, Sir. MR. WARREN: Mr. Speaker. MR. SPEAKER (Dr. McNicholas): The han. the member for Torngat Mountains. MR. WARREN: I will be very brief, Hr. Speaker. One thing I would like to say, Mr. Speaker, concerning the retail sales tax - and I believe yesterday my colleague from Eagle River (Mr. Hiscock) mentioned it briefly. I am just going to deal on one aspect of it and probably the minister when he is closing the debate 9379

. <· . December 20, 1983, Tape 4188, Page 1 -- apb MR. WARREN: could probably advise the House if there is ·going to be some means to get around it, and that is with themanyhundred~ of outlets, and I just do not have the Liquor Licencing Board book that the minister tabled there a while ago, I think there are several hundred retail beer outlets within the Province. And the reason I wanted to address this one, Mr. Speaker, is that I do not believe one of those several hundred will give any customer a case of beer on credit, without paying for it first. It is worth noting, Mr.

Speaker, that if you want your case of beer from the fellow who is selling beer in a corner store you have to produce your ten dollars and fifty-four cents, I believe it is. In order to get the beer you have to make sure you pay that guy. Now, when that fellow receives that ten dollars and fifty-four cents, or whatever the case may be, Mr. Speaker, he is doing two things: Naturally he is making a small profit for him- self, which he can pocket, he is also collecting money from the guy he sold the beer to, taxes for this government. Now, what does he do?

I am not saying all of them, but a percentage of them, first and foremost, IJ .presume, make sure that enough of that ten dollars is for his survival, then he will make sure that whoever he bought the beer from, the wholesaler we will call him, is going to _ be paid fa~ it, because if not he will not be able to get any from him next week. So those are the two things he has to make sure _of. The third thing he does not care about, the taxes. I forget now the exact amount of tax on a case of beer, maybe the minister can tell me. It is probably two or three dollars on a case of beer?

And what is happening to those dollars? He is using them also for his survival, your money, my 9380

Dec e.mber 20, 1983, Tap e 41 81, Page 2 -- apb MR . WARREN : money, the taxpayers' mone y. He is us ing that money and he keeps on goi ng mon th aft er month after month. Now, what happens? I know two individuals whose s~l1 stores were closed down because of _poor economic returns. They were forced to close their stores but, meanwhile, you could go into the store when you liked when it was open, and one of the fastest selling commodities in the store was the beer. Shortly after he sets up again, as the member for the Strait of Belle Isle 0-tr.

Roberts) just said, under another name, even though he owes the government several thousand dollars .in retail sales t~x. ·He has done that, Mr. Speaker ·, of five occasion~~ --~ -t once, not twice, not three times , not four times, but on five occasions within a span of six years. ~ow, how much taxes would you think those five companies owe the provincial treasury? I wrote a letter 9381

December 20, 1983 Tape No. 4189 IB - 1 MR. WARREN: to the minister a while ago, asking ~he minister if he could advise me. Naturally, under the Financial Administration Act the minister could not. But the minister should realize that this . is the taxpayers' money. This is money belonging to the taxpayers of the Province. Maybe the minister should seriously consider, especially when the Public Accounts meet, that the name of the individual - there are two ways to stop a crook: One way is, naturally, if you are smart enough to catch him in the act. That is one way. And the second way is to embarrass him.

If you embarrass him time and time and time again, finally he is going to give in. A few years ago, I believe through the Minister of Justice's department, you would see a list of the names published of those who had their licences suspended. You would see a list of names, Joe Blow from Timbuktu and so on, all of the different names were listed of those whose licences were suspended and so ·on.

I would bet that if the minister undertook for three consecutive months to let the taxpayers of this Province know that such and such a person, from such and such a place, who owns such and such a company owned the Province $7,000 in sales tax, Mr. Speaker, the minister would probably get some taxes back. I believe he would, Mr. Speaker. I belieye, Mr. Speaker, as the Leader of the Opposition (Mr. N~ary) said yesterday in speaking in this debate, that we have to use every means available to us to collect the sales tax. As to sales tax on beer, why could the minister not use this ·suggestion?

When the wholesaler delivers the beer to the retailer, as soon as that beer is delivered to him, the $2.50 or·whatever the tax is on that case of beer, why could it not be given to the deliveryman, given to the truck driver, the man who delivers it? Then, Mr. Speaker, the ;uy when he. sells .the 9382

December 20, 1983 Tape No. 4189 IB - 2 M.R . WA.RREN: beer does not have to remit his sales tax because it is already remitted . He should be compelled to remit that tax , because once he sells that beer he is going to collect the tax . And what does he do with it? Be just puts it in his pocket. And this is un£air, this is very, very unfair. So, the minister has the option of making it mandatory that the beer retailer in order to get his case of beer must pay the taxes first . Because one thing we k.now in this Province, as long as there is beer for sale in this Province beer will be sold. The beer will be sold . 938 3

December 20, 1983 Tape No. 4190 IB-1 MR. WARREN: So that is one way the minister is assured of the taxes. The retailers will not have beer in their stores not sold. Beer will always be sold. So that is one way the minister can make sure thP. r~YP~ are collected. Maybe the minister can tell us this in closing the debate 1_ what is the amount of retail sales tax not collected on the sale of beer? And I wou ·ld venture to say 1 if the minister would give'an honest opinion, and I know he will, that of the $14 million not collected several million, maybe $2 or $3 million of that is on the sale of beer alone.

So the minister should seriously consider that. It is a request and it is, I_. hope, __ a_ legitimate request to the minister to make sure that the retailers will make a tax deposit before takinq ------=-- ---. the beer over. In closing, Mr. Speaker, I believe that the minister could make some of those changes. And, as the member for the Etrait of Belle Isle (Mr. Roberts) said, 'The minister is bringing in changes but he is bringing in cbanges not necessarily in a proper way'. Mr.

Speaker, back in 1979 the Premier said, 'Let us go forward'• I would think if the minister would look at how much sales tax was outstanding in 1979 and how much is outstanding today 1 I do not believe the minister can really say he has gone forward that much. Thank you, Mr. Speaker. SOME HON. MEMBERS : Hear, hear! MR. SPEAKER (DR. MCNICHOLAS) : If the han~ minister speaks now he closes the debate. The han. Minister of Finance. DR. COLLINS: Mr. Speaker, I thank han. members for their comments on this bill. I think that even though taxes probably are not a matter that people, 9384

~ ;Jecember 20, 1983 Tape No. 4190 IB-2 DR. COLLINS: shall we say, are very enamoured about, nevertheless they are quite important. I know .that I get a fair number of comments and a fair number of representations from hon. members,which is their right and which is their duty in many respects, in regard to tax matters for their constituents. But I do thank them for the ·ir remarks. Now, before I start, though,I do have to make a comment about the hon. member for the Strait of Belle Isle (Mr. Roberts).

I am going to come back to his remarks a bit later,because he has to stand in line, there are other people ahead of him who made comments and I want to take their comments in order. But I do have to make this comment, that the hon. member for the Strait of Belle Isle is a good debater but he is very, very plausible sometimes. Now by .plausible I mean that he will make a case and he makes it in such I a way and uses such fine words, 'and .so on and so forth, you think it is gospel. But if you look at it it is full of holes,and not infrequently is just absolut~ and utter rubbish and nonsense.

And, you know, he does it so often I do not think hon. members in this House are taken in by it because they have heard it time and time again ad nauseam, but I think the press is often taken in by this plausible approach that the hon. member has. I am going to come back to his remarks, But just before coming back to them I would like to-point out one thing the hon. member for the Strait of Belle Isle did a little while ago. Remember when the Auditor General's report was due, the hon. member for the Strait of Belle Isle said, 'The Minister of Finance (Dr.

Collins) should table this report right away' and then he went on to say, 'because every other jurisdiction does it this way .. It is ridiculous that ±n ·Newfoundland they do not do what every other jurisdiction in Canada does' and so on and so forth. 9385

December 20, 1983 Tape No. 4190 IB-3 DR. COLLINS: Now, I was sure that that was a pile of rubbish. But,nevertheless,I took the time to do a canvas 9386

.:!!"· December 20, 1983 Tape No. 4191 IB-1 DR. COLLINS: of the federal government and of all the provincial jurisdictions and, l·1r. Speaker, it was totally a pile of rubbish. MR. CARTER: Manure. DR. COLLINS: Or, as my han. friend said, manure. Because with very, very rare exceptions the other provinces and the federal government just do what we do. They have a time limit before which the Auditor General's report has to be tabled if the House is not sitting, and if the House is sitting, a~ter the nouse sits there is a time limit of a matter of a week or ten days,or whatever.

So it is exactly what we do and quite the reverse of what the han. member for the Strait of Belle Isle (Mr. Roberts) said. But he said it in such a convincing, plausible way that everyone was scribbling, my,here is holy writ and all the rest of it. Now, ,as I say, I will come back to that later because many of the things thatthehon. member for the Strait of Belle Isle said, many of his comments today made in a very plausible, legalistic way, when you look at them they just have very little substance and in many cases they are a pile of nonsense. Anyway, I will now go back to some other members who spoke. The han.

Leader of the Opposition (Mr. Neary) made the point that vendors who are convicted under the act ?ecause of bankruptcy 1 or whatever, they are convicted of not rendering tax, that they are allowed time and time again to get a new vendors license either in their own names or under other companies that they incorporate in their names, they are allowed to do that repeatedly. Mr. Speaker, that is not so. We have closed that loophole. It is now no longer possible for that sort of thing to happen.

It might have happened in the past because of certain weaknesses in the· act, but we have strengthened up the act now where the minister has 9387

December 20, 1983 Tape No. 4191 IB-2 DR. COLLINS: the discretion to refuse licensing individuals who have been convicted under the act. So that is no longer the case. Mr. Speaker, I might just now make one point in this regard, that .. the han. member for the Strait of Belle . Isle (Mr. Roberts) stated that they were given some information in the PAC from officials of the Department of Finance that the act was weak and it could not prevent this. Mr.

Speaker, my information- and I made it my·business to find this out- my information is that is not the inforrr.ation that the officials of the Department of Finance gave to the PAC. The _inforrnation they gave was that if another company is incorporated by a relative of that person, not the person, by a relative of that person the act does not prevent them from doing that. Well, why should it? I hope this is a d~mocracy we live in. And just because I commit an offence my brother or sister or aunt or uncle or whatever,they should not ·suffer because of my'offence.

That is what the officials of the Department of Finance told 'the PAC, that if an individual is ~onvicted under the act and he himself cannot get a license but,say,his brother or his aunt or his cousin or whatever comes in and asks for a license we do not refuse them a license on that basis, and it would be quite undemocratic and I am sure against the Bill of Rights if we did so. And this is where the plausibility of the hon. member for the Strait of Belle Isle, the plausibility of his argument .come~ in, that sounds so great.

He says, "We were told that the officials of the Department of Finance said the whole thing is weak, in shambles and nothing works", and se on and so forth. It is a pile or rubbish. It is not what happened at all. 9388

December 20, 1983 Tape Ne. 4191 IB-3 DR. COLLINS: Now, Mr. Speaker, just going op with the Leader of the Opposition (Mr. Neary). The Leader of the Opposition made a point about'the Auditor General complaining in his report about access to the retail sales tax returns. And there is no doubt a.bout it he did that. Onfortunately,the Auditor General did not lay out in detail the substance of his request. The substance of his request to the Department of Finance was that as we now have this information on tape, in other words computerized, that he would like 9389

'-.. :: December 20, 1983, Tape 4192, Page 1 -- apb DR. COLLINS: to have a terminal in his department so that at any time he could plug into the files of the taxation division of the D~partment of Finance and they could be opened at any time without anyone knowing it, certainly without the Department of Finance knowing it. In other words, that would mean that we would be totally surrendering the confidentiality of retail sales tax returns to the Auditor General, or to anyone who worked in the Auditor General's office . Now, Mr. Speaker, in our view that would be totally irresponsible.

The Retail Sales Tax Act specifically prevents us from doing that. Only those who are named by the minister may have access to this information, and they may only have access to the information if it is required for the administration of the act. so it is a very restricted group. We co-operate totally with ~he Auditor General.

If he wants to know about a particular case and we are informed about it so ~'le know where that information is qoing, and if the information did ever leak out we would know it was not leaking out from the Department of Finance, but was rather leaking out f~om the Auditor General's office, we co-operate fully to that. But we are not in a position, and I would resist very strongly having the retail sales tax files put on a computer that would be available to someone who has not~ing to do with the administration of the act. Now, Mr. ~peaker, the han. the Leader of the Opposition(Mr.

Neary) a+so brought up the point about uncollected tax. I do not know if he did mention a figure, but I would now like to qive a bit of information to the House - MR. NEARY: That is all you can do with it. DR. COLLINS: Mr. Speaker, there is a 9390

Decemb er 20, 1983, Tape 4192, Page 2 -- apb DR. COLLINS: noise coming across the way. I do not know where it is coming from. MR. · SPEAKER(Ayl ward): Order, please! DR. COLLINS: I would just like to update the House on the arrears in retail sales tax: As of the end of November, 1983, arrears on retail sales tax amount to $18.3 million. Now, Mr. Speaker, that is an increase over a previous figure that was given this House, which was something of the order of $15 million, or whatever . I might say that that increase has come about because of increased audits.

We had an audit on a very large organization recently which amounted to $1.5 million. That was an appreciable part of that increase. I might say that that audit is subject to dispute, and, you k~ow, there is a legitimate difference of opinion on whether the retail sales tax is exigible in the form that we say it is, and so on. So I have no doubt that that will come to the courts. But that is partly the reason, and very sub~t~ntially the reason, for the recent increase in the outstanding arrears. The other thing I would like to point out, Mr.

Speaker, is that during the period when those arrears built up the Dep -artment of Finance collected $2 .22 billion. So if "you relate -the arrears to the total collection you will find that the non-collectible part of the tax amounts to about 1 per c~nt. Now, Mr. Speaker, that is the best record of all the provincial governments in Canada. _.

We have, probably out of necessity and so on and so forth, and probably because retail sales tax is so very important to us, it is a larger part of our revenue than anywhere else, but we have the best arrangement for collecting retail sales tax of any jurisdiction in Canada. That is the smallest percentage 9391

December 20, 1983, Tape 4192, Pag e 3 -- apb DR . COLLINS : of non- collecti 'ble ta:K, and I wou ld say that there are very few businesses in the private sector which has receivables to the extent of only 1 per cent. I would say that 5 per cent or 6 per cent, some figure like that is a more likely figure you would come across. There is another thing that should 9392

.· '· December 20, 1983 Tape No. 4193 IB-1 ·DR. COLLINS: be appreciated .about these arrears, And I would like to get back to my old friend from the Strait of Belle Isle (Mr. Roberts) on this. He talked about the taxes that are owing as being in trust, these collected taxes. Well,now, Mr. Speaker, that is not always true. In many cases much of this tax is not collected. In other words,when we do an audit we find that a firm should have collected it but for whatever reason, and there are quite a number of reasons, they did not collect it.

And it is only when we do the audit that the liability for the retail sales tax thrown up. MR. NEARY: Well,if you did not collect it, .they broke the law. DR~ COLLINS: Oh,yes. I mean,you should have collected tax 1but if you did not collect it you still did not collect it even though you should have collected it. Also ·some of this tax is due because of firms who actually consume materials. They use them themselves and they should have paid taxes on that, and that is a good part of the audit also. ·Mr. Speaker,another point that the Leader of the Opposition (Mr.

Neary) brought up was in regard to the direqtors issue. I would like to come back to that a little bit later because I want to comment in that regard to the member .for the Strait of Belle Isle's remarks. I think it was the member for Eagle River (Mr. Hiscock) who brought up the point about the counterproductivity of our present retail sales tax level. I think the Leader of the Opposition also might have commented on this. He either wanted to have a holiday 9393

December 20, 1983 Tape No. 4193 IB-2 DR. COLLINS: from retail sales tax, though~ that would be a good {dea, or that we should decrease the rate of tax. Well, firstly, on the rate of tax: The retail sales tax is a very regressive tax. In other words, no matter who you are, rich or poor, if you buy an item -you pay the same amount of taxes on it as anyone else. So it is regressive in that regard. It is not ~ike, say, the income tax where the amount of tax you owe is related to your disposable income. Now, we try to get over the regressivity of a tax like .that by having a lot of e~emptions.

For instance, food is exempt, fuel is exempt, children's clothing is exempt and so on. If you take the exceptions or the exemptions and relate to it level of tax,you will find that really over a broad range our tax is only about, say, 8 or 9 per cent. I think the 12 per cent is misleading if yo~ say that we collect retail sales'tax, 12 per cent,on everything, on.all purchases. We do not. There are many things that are exempt. So we are in effect, for the average person's purchases throughout a year, we are collecting something like 8 or 9 per cent.

If we dropped down, therefore, our rate of tax now,we would in effect be ~ropping it not from 12 per cent down to whatever, we ~auld be dropping it from 8 or 9 per cent down to whatever. And this Province, unfortunately, because our legitimate sources and means to develop have been obstructed and ·so on and so forth, unfortunately we need those revenues from retail sales tax. If we dropped it down we just ·would not get the revenues and we would not be able to carry out government services that should be carried out. Now, the argument is that if you drop it down you increase the voluma.

Now that is a spurious-argument because that has been done in other 9394

-' December 20, 1983 Tape No. 4193 IB-3 DR. COLLINS: places. For instance, it was done in Ontario, MR. NEARY: You are so negative~ DR. COLLINS: We have the information on Ontario. You know, we investigate these things because if it is a good dodge we would like to do it. We have investigated -- -- .. - in Cntario and we found that their returns did decrease. Granted the number of sales went up, but when they decreased their retail sales tax, nevertheless their revenues went down. Now, Mr.

Speaker, we are in a much worse condition than Ontario in that regard,because if Ontario stimulates sales by a decrease in retail sales tax they can often get benefits not only from retail sales,but they .can often get them from the manufacturing sector too because they manufacture many of the goods that they actually sell in stores. In our case,we manufacture almost none of these items ~o tha~ \ve do no~ get that benefit. S.o we would be even in a worse case than Ontario.

And Ontario found that there may have been a b~ief period whereby sales were promoted when they decreased the retail sales tax,bu~ ~fter a while that brief period, that burst of purchasing, shall we say, was over and done with and they went back to the previous level. So there they found they were at a previous level of 9395

December 20, 1983, Tape 4194, Page 1 -- apb DR. COLLINS: sales but a lower rate of tax, and, therefore, obviously, the ' retail sales tax revenues were down. Off the top of the head these may sound plausible enough, but when you look at them in detail, and that is what we have to do, they just do not work out in practice. Mr. Speaker, the hon. the member for Torngat Mountains(Mr. Warren) alluded to the fact that we do not pay commissions, and he also tied that in with the fact that sometimes retailers use monies collected for their own benefit. Now, in many cases one o