Transcript of an interview between CBC News' chief correspondent Peter Mansbridge and Prime Minister Stephen Harper, conducted in Ottawa on Jan. 16, 2012 and aired on CBC's The National that evening.

PETER MANSBRIDGE: Prime Minister, thank you for doing this. I want to start on the pipeline issue.

RT. HON. STEPHEN HARPER (Prime Minister of Canada): Sure.

MANSBRIDGE: And of course, talking about Northern Gateway, from the oil field of Alberta through the Rockies, to the Pacific coast of B.C. Your government has made it pretty clear that that pipeline is in the country's national interest. Does that mean it's a fait accompli?

HARPER: Well, I would put it a little differently, Peter. What I think I've made clear is that I believe selling our energy products to Asia is in the country's national interest. It is in our interests for all kinds of reasons, that we diversify our exports, particularly our energy exports. I think the industry will tell you we already pay a bit of a … we get a bit of discount because we're a captive supplier to the United States. So I think it's in our interests that we sell our energy exports to Asia, just as it is in our interests that we diversify our trade generally. You know, we look around the world, we see that our traditional partners, especially the United States, also Europe, have big economic challenges. The growth now and into the future is going to be in Asia, and we have got to take advantage of that, particularly in a critical area like energy. Now, I don't endorse specific projects. Obviously there's a regulatory process. We want that process to happen on a timely basis, but that process has to be thorough and it has to judge projects on their own merit.

MANSBRIDGE: Well, let me just get … first of all, on the regulatory basis, if that panel puts down an assessment that this is not a good route, and that it's not the way it should happen, does that necessarily mean you accept that recommendation?

HARPER: Well, obviously we'll always take a look at the recommendation. We take the recommendations of environmental reviews very seriously, and this government has in the past changed projects or even stopped projects if reviews were not favourable or indicated that changes had to be made, so we'll take a close look at what the conclusions are. My main concern, Peter, with the regulatory process, is that it be done on a timely basis. We can't have processes that are just filibustered endlessly. That is not in anyone's interests. It's not fair to the proponent, it's not fair to the country, and we're certainly going to make sure going forward that processes, while thorough, are done on a timely basis. That's an important part of the kind of economic reforms we're going to be looking at going forward.

MANSBRIDGE: Well, you've made it clear that the timely basis is … it's important to you. But also, that those who are, in your government's words, holding up the process, are running the potential of doing that, are "radicals," funded from the outside, outside our country. How many are we talking about? Are you talking about all those who oppose?

'Just because certain people in the United States would like to see Canada be one giant national park for the northern half of North America, I don't think that's part of what our review process is all about.'—Stephen Harper on the pipeline environmental review process

HARPER: No. Of course, there is … obviously there's people who oppose things for various reasons, but I am concerned, the government is concerned that our processes are subject to extraordinary delay, and they're increasingly vulnerable to foreign money coming in for the sole purpose of delaying the process. And I think ultimately because it's Canadian jobs that are at stake, that Canadians have to be the ones who make the decisions.

MANSBRIDGE: But you're not necessarily against foreign money being represented at the table when these proposals were being discussed.

HARPER: Well, you know, I personally prefer to see the process be a Canadian process. I don't know that it would necessarily be very easy to stop all foreign money coming in anyway, but I certainly want to make sure that the process is thorough, and is being done in the interests of Canada and Canadians.

MANSBRIDGE: But there is a lot of foreign money on the other side of the table. You know, proposing this, wanting this. The Chinese own an enormous amount of … or a significant amount of the oil businesses in Alberta, increasing all the time, billions of dollars invested in the last three years. They very much want this pipeline.

HARPER: Well, look, we encourage, we encourage foreign investment, not just in the energy sector, but in the Canadian economy generally. But we want to be sure that when we have a review process and make a decision here in Canada, that that decision is made by Canadians, for Canadian reasons.

MANSBRIDGE: But you don't see a double standard, though …

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Harper: The right decision is obvious. (CBC)

HARPER: No, I don't.

MANSBRIDGE: … in kind of targeting the environmental groups who may receive some foreign money and, while on the other side …?

HARPER: No. Look, I think, Peter, it's one thing in terms of whether Canadians, you know, want jobs, to what degree Canadians want environmental protection. These are all valid questions. But just because certain people in the United States would like to see Canada be one giant national park for the northern half of North America, I don't think that's part of what our review process is all about. Our process is there to determine what the needs and desires of Canadians are.

MANSBRIDGE: You would agree that Canada spent a lot of money in the United States lobbying on behalf of the Keystone XL pipeline, the other pipeline.

HARPER: Absolutely. Absolutely.

MANSBRIDGE: That was OK.

HARPER: Yeah. No, look, I don't object … I don't object to foreigners expressing their opinion. But I don't want them to be able to hijack the process so that we don't make a decision that's timely or in the interests of Canadians.

MANSBRIDGE: Let me ask one more question about the whole issue …

HARPER: And by the way, we said, of course, in the United States, ultimately the Americans have the right to make the decision they make. I think it's pretty obvious what the right decision is, not just from an energy … not just from an economic and environmental standpoint, but from an energy security standpoint. When you look at the Iranians threatening to block the Strait of Hormuz, I think that just illustrates how critical it is that supply for the United States be North American. So that's a point we'll continue to make, but we respect the fact the Americans have a right to make their own decisions.

MANSBRIDGE: And, you know, that decision now appears to be at least a year away, if not a little longer. The push towards Asian markets would be happening whether the Americans had already approved Keystone XL or not, right?

Community Reaction

The CBC community reacts to Harper's conversation with Mansbridge. What's your take?

HARPER: … I think what's happened around the Keystone is a wakeup call, the degree to which we are dependent or possibly held hostage to decisions in the United States, and especially decisions that may be made for very bad political reasons. So I think that just … it puts an emphasis on the fact that we must perform our regulatory processes to get timely decisions on diversification of our markets.

MANSBRIDGE: All right. Last point on this whole issue of diversification to foreign markets: there are some people who are puzzled by the fact that a good chunk of Canada itself is still dependent on foreign oil, whether it's Atlantic Canada or Quebec, whether it comes from the North Sea, depleting resources there, or from the Middle East, vulnerable oil markets as you've already just suggested. Does it not seem odd that we're moving oil out of Western Canada to either the United States, markets in the United States, or new markets to Asia, when a good chunk of Canada itself does not have domestic oil?

HARPER: Well, look, Peter, on a certain level, I agree with you. It does seem odd, and I do think there are people out there in the marketplace looking at dealing with that particular sensitivity or insecurity. That all said, the fundamental basis of our energy policy in this country is essentially market driven. You know, we made the switch some 25, 30 years ago, and it's served the country well. As a market-driven supplier, we're now the only — in the developed world and in the stable world — we're really the only supplier that is secure and is increasing its production. So I think it's served the country well. It's served government revenues well. It's served creation of jobs well. But it is fundamentally a market-based decision. We don't dictate pipelines go here or there.

MANSBRIDGE: I saw in an interview in the last couple of weeks when you were talking about Iran. You said that in your view, they want nuclear weapons, and they would not be shy about using them if they had them.

HARPER: Yes.

MANSBRIDGE: I found that interesting, because one of the last times we talked, you suggested that one of the concerns you had about the past, about decisions you've made in the past, was that you took, perhaps, too much belief in intelligence reports that you got, and we talked specifically about …

'I think there is some real evidence that the sanctions are biting, that the sanctions are having some impact, certainly on the regime.'—Stephen Harper on sanctions against Iran

HARPER: We were talking about Iraq.

MANSBRIDGE: …Iraq, yeah. But on this one, to say what you've said, are you confident in the intelligence you've seen to be convinced that A, they want nuclear weapons, and B, they would use them if they had them?

HARPER: Well, Peter, on the first question, I think the evidence is just growing overwhelming. This is not, as was the case of Iraq, merely now the opinion of allies. I think the International Atomic Energy Commission, if you look at its work, it's … there really is no secret that Iran's nuclear program has, as one of its purposes, the development of nuclear weapons, and that, I think, is just beyond dispute at this point. I think the only dispute is how far advanced it is, and how far off it will be until they actually develop those weapons, and develop the capability of delivering those weapons.

MANSBRIDGE: So they're lying when they say they're not.

HARPER: I think there is absolutely no doubt they are lying. Absolutely no doubt. On the second question, you know, that's obviously, Peter, more a matter of judgment. I mean, I've watched and listened to what the leadership in the Iranian regime says, and it frightens me. You know, these are … in my judgment, these are people who have a particular, you know, fanatically religious worldview, and their statements imply to me no hesitation of using nuclear weapons if they see them achieving their religious or political purposes. And that's, you know, that's, I think … I think that's what makes this regime in Iran particularly interesting.

MANSBRIDGE: Well, if you believe that and it scares you, why is no one doing anything about it? I mean, I understand …

HARPER: Well, I think as I said in the interview … the interview you're citing, I think, as I've said, I actually think there's a growing consensus, at least privately among world leaders that this is the case. 

MANSBRIDGE: Well, what does that mean? I mean, trade sanctions we tried haven't worked.

HARPER: Well, I wouldn't say they haven't worked. I think there is some …

MANSBRIDGE: The goal still seems to be the same.

HARPER: Look, I think there is some real evidence that the sanctions are biting, that the sanctions are having some impact, certainly on the regime. They may in the short term be making them more desperate, but I don't think there's any doubt they're having some impact. They're not dissuading them from the nuclear course at the moment. Whether they're delaying them or not I think is a matter of debate, but I think the truth of the matter, Peter, is that while there's I think a growing belief of a number of governments that my assessment is essentially correct, I think there's still big uncertainty about what exactly to do. Trade sanctions are something that, you know, just about everybody agrees on at some level, and everybody is doing at some level, but beyond that, these are not easy questions for the world.

MANSBRIDGE: Do you talk about, when you're having these discussions, do you talk about military action?

HARPER: I can … well, look, I think as you know, [U.S.] President [Barack] Obama's said all options are on the table, and I can certainly tell you that when we talk about these issues, we talk about the full range of questions around these issues. But there's certainly no consensus on, you know, ultimately how to deal with this matter.

MANSBRIDGE: Do you have a view on how it should be dealt with?

HARPER: My view, Peter, is that on matters like this that are of critical concern to the global community, it's important that Canada work with its allies. I've raised the alarms. I think I've raised the alarm as much as I can, but obviously I don't advocate particular actions publicly. I work with our allies to see if we get consensus on actions.

MANSBRIDGE: I want to move the topic to  health care. As you know, while we're sitting here, the premiers are sitting in B.C., trying to deal with the funding situation that you placed in front of them, long-term funding, a significant amount of money with no strings attached, for them to sort out as they wish.  Health care: two points. This morning, some of those same premiers seemed to say they'd like to see more money from you, not in that fund, but in a separate fund, an innovation fund. What do you think of that?

''Rather than fighting bogeymen, we should concentrate on the actual challenges that are before the system.'—Stephen Harper on health care

HARPER: Well, you know, I know the provinces will always ask for more money. The fact of the matter, Peter, as you know, this government has increased health transfers more than any previous government in history. They've risen from $19 billion when we took office to $27 billion today. They're going to be at $40 billion by the end of the decade. In fact, our transfers on  health care, according to projections, are going to grow more quickly than provincial spending on  health care. So look, the reason we made our announcement was to make it clear that there will be, you know, predictable, stable, growing transfers in the future. What I think we all want to see now from the premiers who have the primary responsibility here is what their plan and their vision really is to innovate and to reform and to make sure the health-care system's going to be there for all of us. So I hope that we can put the funding issue aside, and they can concentrate on actually talking about health care, because that's the discussion we need to have.

MANSBRIDGE: I take that as a no on an innovation fund.

HARPER: I'm not looking to spend more money. I think we've been clear what we think is within the capacity of the federal government over a long period of time.

MANSBRIDGE: The other point is raised, as you know, by some who are fairly well versed in the health-care debate, and have been involved in it for a long time, that the whole issue of the federal government saying no strings attached ensures that there will be no national standards. Some would argue there aren't national standards now. But nevertheless, that case is being made.

HARPER: Well, look, Peter, we have the Canada Health Act, and the Canada Health Act sets out some basic values of the health-care system, including, obviously, the ones that are most important: a universal system of public health insurance, where no one will be denied  health care because of inability to pay. You know, in my experience, this is a principle that all of the provinces strongly believe in themselves. Now what they're wrestling with is how to make that system effective, how to lower wait times, and you know, they're the ones who deliver the service. They're the ones who are responsible. So I think that, you know, we don't just trust them, we understand they have the responsibility, and we want to make sure that we work with them. We're not … we made it a point, as you know, as a federal government, of not pointing the fingers at the provinces and trying to blame them for problems in the health-care system, but trying to work with them to see how we can make it better, and I think that's been a better method than in the past trying to pretend there is some overarching national standards, and then wave the finger at them for perceived slights. I don't think that's been effective. I think what we're doing is more effective ….

MANSBRIDGE: Your government's about to embark on a major program of cuts, relooking at different projects, programs, national programs when the budget comes down in another six, eight weeks time. I don't imagine you're going to lay it all out here for us now, and perhaps it's not all ready yet, but there are a couple of things you keep saying. You keep talking about a major overhaul of programs affecting Canadians, and I'm wondering if we can tackle one of them, and that's the issue of public service pensions. Are you taking a hard look at changing the way public service pensions are offered?

HARPER: … This government has already taken some measures to ensure that public servants pay a greater percentage of their pension. I think we raised that percentage from 30 to 40 per cent. There are others out there in the private sectors, you know, who argue that that should be at least 50 per cent.

MANSBRIDGE: Well, that's what I'm wondering. Are you on that side of the fence?

HARPER: We haven't taken any decisions on that particular issue.

MANSBRIDGE: So that's still very much …

HARPER: We're very much examining all of these things. What we do know is that, you know, as we face an aging workforce, not just in the federal government, but the country at large, that over the next generation, we want to make sure that our pension plans are affordable, and that we also have the labour in the marketplace necessary to create jobs and growth. One of the big challenges this country faces, Peter, and we have immediate challenges now because of the global economic situation. But you know, the other thing we're turning our mind to are the challenges that will confront us very soon after we resolve the immediate challenges, and those are the challenges of an aging labour force. We're going to have in Canada, as in other Western developed countries, a situation where more and more people are retired, and fewer and fewer people who are working. That is a serious economic challenge for this country, as it is for all Western countries, and we're going to look at ways to make sure that we can sustain our standard of living over the next generation.

MANSBRIDGE: Well, you know the argument on the public service pensions that is especially put out by those who oversee the whole pension process, but especially those who are concerned about private sector employees, many of whom who have no pensions, who see it as unfair that public servants get a pretty good pension plan. They would argue, of course, that it's because they're giving up opportunities in the private sector to work for the country. Where are you on that debate?

HARPER: Well, look, I'm … I agree with both, Peter, if I could be frank. Look, the pension plans of public servants have to be fair to taxpayers. At the same time, as an employer, we have to have a pension plan that is reasonable and attractive to get people into the public sector, but it should not be significantly more generous than what would be available in the private sector.

MANSBRIDGE: Do you think it is now?

HARPER: You know, as I say, we haven't taken any final decisions. We've made some changes to bring it closer to private sector norms. We're examining this issue. As you know, it also raises the issue of pensions of parliamentarians, and that issue will have to be looked at at the same time.

MANSBRIDGE: We're almost out of time. Last question …. A week from now, you sit down with Shawn Atleo and other members of the First Nations communities of this country, and what do you hope to achieve on that day?

HARPER: Well, look, I think … I'm hopeful it will be a very positive dialogue. What we have is a meeting in Ottawa of representatives of both the federal government and various First Nations, and that meeting will be paralleled by a series of regional meetings across the country of a similar nature. And there will be a number of sessions and tables, discussing very specific aspects of things like economic development, labour opportunities, challenges in housing and services to governance. I think this government has a record where we've made, you know, significant, incremental, but significant, incremental progress in a number of areas, and really, it's to try and bring together people who've been leading that kind of progress, and talk about how we can get to the next steps, and how we can continue to move forward.

MANSBRIDGE: Does significant change need to happen to reach those next steps?

HARPER: Look, significant change, the obvious answer, Peter, is yes, significant change needs to happen. Aboriginal people in this country are not anywhere near where we want or need those communities to be. That said, my own experience is that it will not be grand visions and declarations that achieve these things. It will be moving forward one step at a time, as we've been trying to do on things like water, investments in education, obviously building of trust, you know, as we've done through the residential school apology, and endorsement of the Declaration of Aboriginal … of Indigenous Rights. So I think, you know, we're trying to find a way of getting willing partners, and continuing to move forward. But there's a lot of work to be done. This is a long-term challenge.

MANSBRIDGE: So we shouldn't expect a major step forward in the next …

HARPER: I hope what we will say coming out of this is increasing consensus on the next steps that are necessary in these areas, and what are the models to follow, which models are working. We have some aboriginal communities in this country that are very successful, that over the past couple of generations have made magnificent steps forward, and I think we need to have a greater understanding of how those examples can be replicated across the country.

MANSBRIDGE: Prime Minister, thanks for your time today.

HARPER: Thanks for having me.