CANADA

The Tory revival plan

MICHAEL ROSE, June 1 1987
CANADA

The Tory revival plan

MICHAEL ROSE, June 1 1987

The Tory revival plan

CANADA

June may be the most important month for the Mulroney government since the election that swept it to power in September, 1984. It will certainly be the busiest. Deeply troubled by their lastplace position in opinion polls, Tory strategists are planning a series of sweeping policy announcements aimed at convincing Canadians that the government knows both where it is headed—and how to get there. Said a senior aide to Prime Minister Brian Mulroney: “When you’re at 25 per cent in the polls, you have to do something dramatic.”

The month’s crowded agenda includes initiatives or announcements in five areas: tax reform, regional economic development, international trade, research and development and child care. At the same time, the longawaited white paper on defence, scheduled to be tabled in the House on June 5, will outline the government’s future plans for the Armed Forces, including expansion of Canadian reserve units. And next week the Prime Minister and the 10 provincial premiers are expected to sign the formal agreement to bring Quebec into the Constitution. Many elements in the June package are not new; they were included in the government’s speech from the throne last October and have simply complet-

ed their “gestation period,” in the words of a senior Mulroney aide.

At one stage, senior government advisers considered promoting the package of measures as Mulroney’s bold vision of Canada in the 21st century. That idea was rejected in favor of more indirect salesmanship. Explained one staffer at the Prime Minister’s Office: “I don’t think we will have to play up June—it will do that by itself.” Still, officials are hoping the barrage of policy initiatives will be comprehensive enough to launch the government on a trajectory of recovery.

Opposition spokesmen were predictably skeptical. Said Liberal House Leader Herb Gray:

“They’re trying very hard to lift themselves in public esteem, to regain some momentum.

But when the fundmentals aren’t right, all this thrashing about doesn’t make any difference.” Mulroney himself is expected to fire the first shot in the political offensive this week. On May 26 the cabinet will put the finishing touches on the Atlantic Canada Opportunities Agency, the throne

speech’s promised answer to complaints that the existing department of regional industrial expansion (DRIE) does not address local needs. The Prime Minister will likely announce the agency’s creation in Moncton, N.B., at the end of the week. In the days following will come a second announcement: the Western Economic Diversification Initiative, aimed at reducing the West’s traditional dependence on resource-based industries. A pet project of Deputy Prime Minister Don Mazankowski, the western initiative, according to Mazankowski’s press secretary Tom Van Düsen, “is an octopus with z tentacles all over the 3 West. Every federal degi partment that spends I any money there wants y to have a say in it.” Those twin developments signal the wholesale revamping of DRIE, as designed by two senior Mulroney aides, Charles McMillan and Privy Council adviser Dalton Camp. By summer the new agencies will all but eliminate DRlE’s regional development functions, clearing the way for its transformation this summer into the department of technology and industry. The June agenda also includes establishment of a Canadian space agency, which will oversee about $150 million annually in space-related R and D.

Senior finance officials, meanwhile, are working nights and weekends to ready Michael Wilson’s tax reform proposals for a June 18 deadline. The white paper, potentially the most explosive of the government’s new initiatives, will detail Wilson’s plan to reduce or eliminate tax deductions and exemptions for companies and individuals. It also will outline how the money saved by the treasury will help lower rates for all tax brackets. But already, strong opposition has been voiced by consumer and smallbusiness groups. Said Mark Daniels, a tax expert with the Ottawa lobbying firm Public Affairs International: “Clearly, there’s a large gap between what officials see as necessary versus what cabinet and the political system see as digestible.”

Potential trouble also looms for another element in the June package: free trade. The rough outlines of a draft agreement were expected to be presented to the June 22 meeting of first ministers in Ottawa (page 40). But Canada’s free trade negotiator, Simon Reisman, said last week that having even a rough agreement in shape by that date is unlikely. Said Reisman: “We still have a lot of work to do.”

The Mulroney government is not the first to use a major legislative thrust to kick start itself back to popularity. In the fall of 1976, also faring poorly in the polls, the Trudeau government devised a series of reforms, including stiff new conflict-of-interest rules —never passed—and the broadcasting of parliamentary debates. By the following summer the Liberals were doing so well in the polls that Trudeau considered calling a snap election. Dissuaded by his caucus, he waited two years, and then lost to Joe Clark in 1979.

The Tories’ reluctance to sell the June measures as a bold pew start may be explained by the fate of earlier attempts. Last January, just as rejuvenated Tory MPs returned from their Christmas break to debate a new federal budget, the Oerlikon affair forced the resignation of cabinet minister André Bissonnette. Another attempt, in the autumn of 1985, collapsed with the tainted tuna scandal. This time Tory officials are discouraging suggestions of an orchestrated attempt at a fresh start. The basic question is whether the new offensive will reverse the government’s fortunes and pave the way for a recovery in the next election.

MICHAEL ROSE,

HILARY MACKENZIE

MADELAINE DROHAN

MARC CLARK