1928-03-16

[Stage Direction]
The house in committee of ways and means, Mr. Johnston in the chair.
Customs tariff-522.	Rovings, yarns and
warps wholly of cotton not exceeding number twentv, not more advanced than singles: British preferential tariff, 10 per cent; .intermediate tariff, 15 per cent; general tariff, 20 per cent.
Mr. STEWART (Leeds):: When the house adjourned last evening I was endeavouring to address myself to this item and a statement of the Minister of Finance in connection with the tariff advisory board which he described as a fact-finding board. That is exactly what I think every hon. member would like to have. We would like to have the facts in connection with this and the other items that are associated with it. The minister said:	"The
evidence is on the table." That is quite correct, but it is very bulky and I am sure no hon. member could undertake to read it. When we have a fact-finding commission, surely it ought not to be the duty of hon. members to find the facts from a perusal of the evidence. The commission should discharge that duty, and particularly in connection with these controversial items we should have from the commission a sort of precis or review of the evidence and the proceedings taken before it, and a statement of what has been found, as a result of that investigation, to be the fact. Imagine a commissioner or a judge being asked to investigate and find facts and then coming into court or this parliament and putting the evidence on the table, asking us to assume that he had discharged his duties! For the minister's own protection and for the benefit of hon, members he ought to ask the board to make a short review or precis of the evidence and a statement of facts found in connection with each one of these cases.
We have established this board at great expense; it has set up machinery; it should be well equipped to discharge this duty, and if it does not do so, then we have set up a piece of machinery that is very expensive, that is to a large extent useless, and, worse still, that is dangerous, because these investigations may go on and all the information that the house is to have in connection with them is a statement of the Minister of Finance that he met the tariff board some time about two o'clock in the morning and discussed these items with them. Apparently when these items come before the house we can get very

little information in regard to them. This board was not intended to be a smoke-screen behind which the minister could hide, or behind which there could be private discussions and manipulations in connection with the tariff. What we expected was that we were to be furnished with findings of facts as ascertained by the commission, and; if the commission fails in that respect, then it fails entirely in the discharge of its duty. I know every hon. member desires to know the fact, and if we had the fact we would be relieved of a great deal of discussion, a great deal of this suspicion would be cleared up and we would be able to discuss these items intelligently. I suggest to the Minister of Finance that he allow these items to stand and ask the tariff board, even at this late date, to make a finding of fact for the information of the members of this house, as it was intended they should do in connection with all these items. This resolution covers many items. Some of them are not controversial; some of them, I believe, in no way change the existing tariff, and perhaps therefore we can dispose of them; but I do suggest that as to these important items which are undoubtedly controversial, and upon which the house desires information, the minister should procure a finding of fact and a report on the facts from the tariff board.


Mr. GUTHRIE:: Following on the suggestion of my hon. friend from Leeds, I confess my inability to appreciate the full significance of the changes in regard to the cotton schedules which the minister proposes in his present budget. I tried diligently last night for over three hours to gather from the discussion in this chamber just what the changes really were and just what they involved. I think I have a fair understanding of the matter now, but I may misapprehend the full significance of some of the changes. It is evident that in his effort to revise these cotton schedules the minister has not followed any principle; he has followed neither the principle of free trade, nor that of tariff for revenue, nor that of protection. He has operated on a happy-go-lucky, hit-or-miss, absolutely haphazard system, and when he stated in this chamber that criticism proceeding from the opposition and from the Progressive sections of the house was not uniform, the answer is that it would be hard to offer any uniform criticism or make any uniform suggestions in regard to proposals which have no uniformity about them, and which are not based on any principle. If I am wrong in the conclusions which I have reached in regard to this matter, the minister will correct me.

Ways and Means-Customs Tariff
The new items 522, 522a and 522b all relate to the importation of cotton yams into this country, and my conclusion is that on these three items the tariff is increased. There is no doubt whatever that there is an increase in item 522, because the minister so stated in so many words last night. Item 522 covers "cotton yarns not exceeding 20's, single," and the new rates proposed are 10, 15 and 20 per cent.


Mr. ROBB:: What were the old rates?


Hugh Guthrie: I do not know.


James Alexander Robb: I will tell my hon. friend so that the country will have the record correct. My hon. friend has just stated that the new rates are 10, 15 and 20 per cent, and he does not know what the old rates were. The old rates were 15, 22i and 25 per cent.


Hugh Guthrie: Then the answer made last night by my hon. friend the Minister of Finance was incorrect.


James Alexander Robb: No, I told my hon. friend that there were some items that were practically obsolete.


Hugh Guthrie: The minister was asked if the duties in regard to item 522 were increased or decreased, and he said there was an increase. I take it that, having regard to the importations, there is an actual increase in the duty on that item.
Now I pass on to item 522a, which covers "cotton yarns exceeding 20's but not exceeding 40's, single," on which the new rates proposed are 12^, 15 and 22i per cent. Now I ask the minister, does that involve an increase or a decrease as compared with the former rates?


James Alexander Robb: The old rates were 15, 22J and 25 per cent.


Hugh Guthrie: What was the number of
the old item?


Mr. GARLAND (Bow River):: There is
another item, 534, which came in free.


James Alexander Robb: Answering one at a time, the old item was 520, and that has been split into two or three items.


Hugh Guthrie: Apparently there is a reduction of 24 per cent on that, although my view is, on consulting the former tariff, that cotton yarns exceeding 20's and not exceeding 40's came in free. The minister tells me that the old rates were 15, 224 and 25 per cent, and the new rates proposed are 124, 15 and 224 per cent. Apparently on that item there is a 24 per cent reduction.
Then item 522b, which is the large item, covers " cotton yarns exceeding 40's, single," on which the new rates proposed are 74, 10 and 15 per cent, while the former rate was free, free, free. The importations under item 522b are so far beyond the importations under the other items that one must conclude that there has been an increase in the protection afforded under these three items. I do not think there is any doubt about it; you can prove it to a mathematical nicety; you can demonstrate it absolutely. I think we may take it for granted that the object of the minister in granting increased tariff protection under these three items was, as he said last night, to give the manufacturers of cotton yarns some of the protection which the cotton trade enjoys. That, he says, was the government's reason for making these changes. I do not take issue with him on that point. I think it is a proper principle, and I hope he will continue to follow that principle in regard to the other items in the tariff schedules. He has already adopted the protective principle in regard to cotton yarns so that the manufacturers of these yarns in Canada may have some benefit from tariff protection, and he is giving this protection, he says, in order that the other manufacturers of cotton will not hog all the advantage of the tariff. I think we now understand the situation in regard to these three items. It is clear that an actual tariff increase is taking place. I hope my hon. friends from Manitoba and Saskatchewan who sit on the other side of the house, and who are pronounced free-traders in their views, will realize the full meaning of the tariff changes in respect to these three items, and that is increased protection to give the producers of cotton yarns some benefit of the tariff.
I listened with great pleasure to the explanation volunteered last night by the Minister of Railways (Mr. Dunning). He realizes full well, perhaps better than any other member of this house, that these three items involve increased protection, and that it becomes necessary for him to offer some explanation to his people in Saskatchewan. Accordingly he enters upon a thoroughly ingenious and artificial argument, endeavouring to show that there is some distinction between manufacturer's items and consumer's items in the present tariff. After labouring considerably with his argument, he announced that the consumer would be benefited because the duty on the thread manufactured from these yams was reduced in the present proposals of the government. Now, how does that work out? Cotton yarns up to 40 and finer are now subject to a duty, when im-



Ways and Means-Customs Tariff
ported from Great Britain, of 74 per cent; up to the present time they have come in free. In the manufacture of thread these yams constitute 40 per cent of the cost. There is an increase in the protection of 74 per cent on 40 per cent of that thread, which, according to my calculation, is exactly 3 per cent increase on the thread. Then we turn to the subsequent item in the tariff and find that the government has reduced the duty on the thread by 21 per cent, with the net result that the consumer of thread will have to pay one-half of one per cent more in duty than he did the day before this tariff was brought down to the house. If there is anything wrong in my figures or in my argument or in my presentation of this matter to the attention of the government and the Minister of Finance, let the minister correct me now. Let me repeat. The duty on the raw cotton imported-and it is a large item of $2,500,000 -is increased by a stroke of the pen from free to 74 per cent. From that raw material is manufactured the cotton thread. Seven and a half per cent increased duty on the raw material, and the raw material representing 40 per cent of the finished product, a reduction of 24 per cent of the duty on the thread, leaves a net increase of duty to the consumers of this country of one-half of one per cent. If I am wrong I shall be glad to be corrected now.
I point this out again for the benefit of my hon. friend the Minister of Immigration and Colonization (Mr. Forke) and his colleagues from the province of Manitoba, and for the benefit of hon. gentlemen from the province of Saskatchewan who give to this government a slavish support on trade and fiscal matters. The truth is, this proposal has not been clearly laid before parliament. The government is not making readjustments upon any principle whatever. The criticism levelled against us that in one comer of the house we discuss this as a higher tariff and in the other as a lower tariff has some justification in fact. It is a tariff proposed I believe, simply with the idea of helping a particular industry here, or a particular industry there, upon no fiscal principle whatever, and at the same time intended to hoodwink that large body of supporters of the present government who live in the prairie provinces.
There is no doubt from the discussion last night, in fact we learned it from the lips of the Finance Minister himself, that this change in regard to item 522b was made at the instance of a single cotton company in this country. He says so. The Wabasso Company made the application. He stated

last night that that was the only company that he knew-[DOT]


James Alexander Robb: No, I said that company
made application before the tariff board.


Hugh Guthrie: I will read the minister's
exact words.


James Alexander Robb: That will be better.


Hugh Guthrie: At page 1388 will be
found this statement by the minister:
I admit that only one mill will he materially benefited by this change.


James Alexander Robb: Materially.


Hugh Guthrie: Yes, dwell on the word
if you like. Mine was a correct statement; there will be only one mill in Canada benefited. It is at the instance of a single mill in this country that a duty of 74 per cent is imposed on $2,500,000 of our imports. That is done for the benefit of a single industrial institution, and at the same time the minister is penalizing every other manufacturing institution in this country in the cotton line- unless he is consistent and raises his tariff on the manufactured products of the other industries. That would be the adoption of a principle in regard to fiscal legislation. But in this case the government picks out a single friendly institution, and for the sake of that one industry it penalizes the whole trade and the whole population of the Dominion to the extent of 74 per cent on $2,500,000 worth of imports. And then the Minister of Railways says: "Oh, that is only the manufacturer's item; wait till you turn to the consumers' item. Why," he said, "that raw yam is made into cotton thread which is used all over Canada. For the consumers we have cut the duty on the thread 24 per cent." In reality they have raised the duty from 24 to 3 per cent.
Now, this is tariff tinkering with a vengeance. I agree with my hon. friend from Leeds (Mr. Stewart) that the house has not before it information sufficient to deal intelligently with this question. It would be far better if the tariff board had made an intelligent report, stating the facts which they had found. They returned a mass of documents and a mass of evidence, which the minister has candidly stated he has not had time to read, and no one would expect that he would have time to read it unless he did so very, very casually. The information which was derived from these investigations is therefore not before the house. Very few hon. members have digested that evidence, and still we are asked to make a fairly radical change in regard to the cotton schedule with-

Ways and Means-Customs Tariff
out the minister having the facts at his finger ends or having the information which the tariff board gathered. I do not think it is a proper way of legislating. To my mind there is great force in the remarks of my hon. friend from Leeds, and those items should stand until the minister has given them further consideration. I do not think he knew until the last five minutes of my remarks that in the result he was going to increase the duty on thread. I am sure when the Minister of Railways spoke last night he did not realize it. But that is what the Minister of Finance has done. I ask the friends of the Minister of Railways from Saskatchewan, to take him apart and talk to him and see if they cannot straighten this matter out. It is as plain as can be; it can be demonstrated to a conclusion. I have no objection to the increase of 7j per cent on the raw material; I think that is proper; but I say to the minister and the government, if they adopt that principle of protection they must carry it through as a principle and give the other manufacturers their fair share of the protection in accordance with the increase of duty on the raw materials.


James Alexander Robb: Mr. Chairman, listening to
the observations of my hon. friend from Leeds and my hon. friend from South Wellington, I observe that they have had some of the same advice and from the same sources, maybe not directly, but indirectly, that has been pounded into me since the 16th of February.


Hugh Guthrie: Mr. Chairman, that is an insinuation. It was repudiated in this house last night. I never read the schedule and I never considered the matter before. All I know about it is from what I heard from the minister and his colleague last night.


Hugh Alexander Stewart: I wish to state
also, Mr. Chairman, that my information has been gained entirely from discussions in this house. All that I know about the matter I have learned in the course of this debate. Nobody has spoken to me on the subject.


James Alexander Robb: I will accept unreservedly the statement of my hon. friends and say that they have presented excellently the representations that have already been made to me by these different industries. Now my hon. friends have told the house what they think of the reclassification. I believe that both hon. gentlemen who have spoken have laid down the principle that the tariff board should present the facts and that upon those facts the tariff should be framed. If that means anything it means that we are taking away from parliament, comprising 245 members- 56103-901


Some hon. MEMBERS:: No.


James Alexander Robb: -and from the government of the day, responsible to the country, the right to frame the fiscal policy upon the lines submitted to the people in the campaign.


Hugh Guthrie: No.


James Alexander Robb: Well, that is my opinion.


Hugh Guthrie: It is far from the case; let us have the facts.


James Alexander Robb: I will place on Hansard a statement from the tariff board in regard to the items under consideration.
Mr. BENNETT'': Was this statement submitted to the minister before yesterday or has he received it since? If it was submitted prior to the discussion yesterday we should have had it for our information in return to the motion we made for papers.


James Alexander Robb: In the light of yesterday's debate I asked the officer to go into the records and give me a statement, and this is it. They informed us some days ago that there had been presented to them a report from representatives of the textile industry, but I did not deem it necessary at the time to have that statement; I did not think it was urgent to take up the time of the house reading it. This afternoon, hon. gentlemen having indicated what they think of the reclassification, I propose to disclose to the committee the feeling of the trade in this matter, so that the country may judge as between my hon. friends and the representatives of the trade.


Hugh Guthrie: I am not an advocate of the trade; I am speaking for the people of Canada.


James Alexander Robb: I did not say you were. Now this is the memorandum to which I refer:
Under the old tariff cotton yarns entered, mainly, under two items (520 and 532), but came in also under some six or eight vagrant items scattered throughout the schedules. There was no scientific structure, and practically no regard for "counts''. Under the new tariff, all cotton yarn items, seven in number, are grouped in a series, based entirely upon counts. It is almost impossible to compare any single item of the former tariff with any single item of the new. For instance, yarns entering formerly under the general item 520 may now enter, according to their fineness, under several new items; contrariwise, yarns that entered formerly under several items may now enter under one item. Thus, individual items are not comparable. The new yarn schedule must be treated as an entity, a series.
There were formerly three free yarn items; in the new tariff there is one. Of the two which have disappeared, one was practically obsolete, and the other was being misused.

Ways and Means-Customs Tariff
Customs appraisal based on "counts" was desired by the entire cotton industry, since all cotton yarns are bought and sold on that basis.
My hon. friends will find that in the evidence.
The "count" system is one thoroughly understood by government appraisers, and every item in the new schedule has been approved by the Department of National Revenue. The new tariff is now in operation, giving remarkably little difficulty, even in outlying ports.
That is the memorandum. What does the textile trade itself think of the reclassification? I quote now from the Textile Journal of February 23, 1928:
This is the first general revision that lias taken place since 1907 and in principle the proposed new schedule meets the changed conditions in the textile trade developed through these years. . . . There is no question that the division of the textile schedule according to materials is substantially correct and while we take very strenuous objection to the adjustment made in tariff rates, we believe that the reclassification will assist materially in efficient appraisal and administration of the tariff.


Hugh Guthrie: We agree.


James Alexander Robb: This is another item from the same journal, of February 23:
The outstanding feature of the new textile tariff schedule proposed by the Hon. James A. Robb, Minister of Finance, in his budget speech last week is a very thorough reclassification of tariff items to conform with the present day conditions in the textile manufacturing industry in Canada and the textile importing trade. To this extent the minister has succeeded in no small degree. It is unquestionably the result of deliberations of the tariff board in collaboration with the customs appraisal staff in an attempt- to facilitate the proper appraisal of textile imports. To this end the proposed schedule should be a decided improvement on the old.


Hugh Guthrie: The reclassification is all
right.


James Alexander Robb: A duty has been imposed upon fine cotton yams in order to remove the obvious anomaly in the former tariff whereby the coarse and inexpensive yams were quite heavily protected, while the very expensive, fine yarns bore no duty whatever. In devising a new scientific structure, it was obviously impossible to perpetuate this anomaly, hence the duty on the fine counts. The whole matter was thoroughly investigated at the public sittings held by -the tariff board, with all branches of the cotton industry represented. It will be observed that very low rates are maintained in the new tariff on fine cotton yarns, either single or ply, which enter into the making of particularly specified textile commodities, since such commodities are manufactured from fine yarn of a type which it may be difficult to secure in Canada. The

increase that is brought about by the imposition of duty on the very fine yarns is partially offset by the reduction in the duty on the coarser yarns, while all fine mercerized yams remain free as at present. All the yams above referred to are manufacturers' yarns, and in the ordinary way are not purchased by the consumer at all.
So much for that. Now what do the men who are really in the business think of the proposition? I have in my hand a letter from the Dominion Textile Company dated February 27:
Dear Mr. Robb:
Your recent tariff changes in so far as cotton goods are concerned apparently will be considered quite popular. I wonder whether you are aware that few of these changes are in accordance with the facts put before the tariff advisory board.
These gentlemen object to some of the changes.
The net results are that there is little reduction to the general public, but a very serious one to this company, amounting to something in excess of $600,000 annually.
That is what they say about it. The letter is signed by Mr. Daniels, the managing director.
I have another letter, I said yesterday that one company had complained that the result was a million dollar loss to them. I had that in mind, and I confess-


Hugh Guthrie: Before my hon. friend
goes on to a reference to the million dollar loss, I would ask a question regarding the company that complain of the 8600,000 reduction. Do the company who write him mean that it will cost them that amount by reason of the imposition of higher duties on raw materials?


James Alexander Robb: I imagine that is what they
are driving at.


Hugh Guthrie: It looks like a serious
rise then, does it not?


James Alexander Robb: I presume they are also referring to the result on the finished product.


Hugh Guthrie: We are speaking in relation to yarns.


James Alexander Robb: My hon. friends have been
arguing that the public is not benefited. Taking the two together, the company estimate a loss of $600,000.


Hugh Guthrie: They do not say so.


James Alexander Robb: And it is largely on the
fabrics. Now I have a letter from another concern and I want to say frankly at once that the letter of transmission is marked

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"personal", so that I am not in a position to table it nor to disclose the name. However, I shall have no objection to showing the letter to the official leader of the opposition.


Mr. BENNETT:: I prefer not to see it, thank you.


James Alexander Robb: This gentleman points out that the changes in the tariff-


Mr. STEVENS:: If the minister is going to read extracts from the letter he should read the whole letter, because as in the previous case the inference may be that there is a loss. The minister is at liberty to place that loss where he thinks it should go, but as a matter of fact, while I do not know what is in the letter, if it is to be read in part it should be read in toto.


James Alexander Robb: I think I will just read it all, then, but I cannot give you the name.


Henry Herbert Stevens: You are bound to give the name if we ask for it.


James Alexander Robb: It is marked private and confidential.


Richard Bedford Bennett: Then you should not.
read it.


James Alexander Robb: From the information contained in the letter it seems that the Dominion Textile Company will lose $650,000, Montreal Cottons $250,000 and Canadian Cottons $245,000. Those losses are made up as follows: Yarns, $14,000; woven fabrics, lumped together, $245,000. Now, having said that much I am bound to go a little further.


Edward Joseph Garland: The minister has not completed the statement. He says $650,000 will be lost by one company, $250,000 by another and $245,000 by a third, and in giving the details of that loss he has mentioned $14,000 on yam and $245,000 on woven fabrics. That is a small fraction of the entire loss.


James Alexander Robb: That is for one company.


Edward Joseph Garland: Which company was that?


James Alexander Robb: Canadian Cottons, I think. Now I have another letter which is not marked personal and which I will place on record, although it will take some time.


Edward Joseph Garland: Will it give us this information?


James Alexander Robb: My hon. friend will observe that as we go along. This letter is from the
office of the managing director of the Dominion Textile Company, and is dated February 27:
Dear Mr. Robb:
Your recent tariff changes, in so far as cotton goods are concerned, apparently will be considered quite popular. I wonder whether you are aware that few of these changes are in accordance with the facts put before the Tariff Advisory Board?
Apparently this gentleman thought he was the only man to place any facts before that board.
The net results are that there is little reduction to the general public, but a very serious one to this company, amounting to something in excess of $600,000 annually, which amount you propose to distribute through the medium of increased protection to seven other cotton companies, five of whom are producing coarse gray cotton goods, previously more fully protected than the lines of gray cottons produced by this company, when considered in the light of labour and cost of production.
Based on this year's production to date, we will, at the end of our year (March 31), have produced approximately 41,500,000 pounds of gray cloth and yarn. Of this quantity, approximately 4,600,000 pounds of yarn, averaging coarser than 20's and sold as single, will receive a reduction of four and a fraction per cent, equivalent to about $64,000. Approximately 750,000 pounds, sold in ply yarns, are unaffected.
The bleachery processed 16,256,000 yards, weighing 4.889,000 pounds, approximately one million pounds of which receive a reduction of 3 per cent under the preferential, from which its competition mainly comes. The balance of the bleachery production is unaffected in this tariff, but it has been seriously affected for many years, as this department has not averaged four days' operation per week owing to the already utterly inadequate protection of 15 per cent under the preferential tariff.
The remaining 31,000,000 pounds of gray cloth production is cut 2J per cent under the general tariff, and has only 12J per cent protection under the preferential.
In addition to this some 32,000,000 yards of printed cloths will receive a further reduction of 24 per cent. As the margin for printing is= to-day barely sufficient to cover costs, this reduction will affect the print works to the extent of making it impossible for it to meet its comparatively small proportion (allotted to it) of the common and preferred dividend requirements.
What appears to be, and is most unfair, is the fact that prints receive a protection of 2| per cent less than yarn and raw stock dyed fabrics, notwithstanding the fact that to produce the above quantity of prints will require buildings and machinery in excess of $2,500,000 more than will be needed to produce a similar yardage and value of yarn and raw stock dyed fabrics, and, at the same time, requires a much larger number of operatives with skill and technical knowledge not needed in the other plant.
We have recently spent rather more than one million dollars, and will not have completed changes and additions to the program, started last summer at the print works, before the end of this year, solely with the view of giving

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service to the public as, owing to the altered conditions of trade in the method of buying, forward purchasing is almost a thing of the past, and we do not expect, owing to the extremely small runs or yardage processed at any one time, to be able, on the twenty-four printing machines, to produce as great a quantity as we processed on twelve machines five years ago.	.
The reason for this is that the quantity ordered at one time is so small that a much greater time is occupied in setting up a machine to print a design, than is required in the actual printing.	_	.
By comparison with England, in our basic rate for printing we ask a customer to give us an order for 3,600 yards to be coloured in three different sets of colours, or 1,200 yards per colouring, whereas in England the basic rate is for 12,000 yards, or 4,000 yards per colour.	.
Approximately two hours and fifteen minutes is required to set up a printing machine and make the two changes in the colour boxes, and one hour and thirty minutes running time, or a total of three hours and forty-five minutes to print 3,600 vards. To print 12,000 yards a total of five hours and fifteen minutes is required. We can produce only about 10,000 yards daily against 24,000 yards in an English works. Our labour and overhead cost is more than doubled. A great many of our orders are for 200 yards.
This reduction of 5 per cent m the general and 21 per cent in the preferential, bringing the British prints to an 18 per cent rate, will have a most serious effect on the print works and the town of Magog with its population of over 5,000 depending entirely upon this company. In addition to this a large farming community finds a very satisfactory home market for its products in this district.
As shirts and clothing are sold at set prices, it is most unlikely that the $1.50 shirts, for instance, will be sold at $1.47, the difference represented by the reduction in duty.
Coming to the companies that have been benefited, the three tire duck companies and the two duck companies, producing more than 20 000.000 pounds, receive a straight increase of 21 per cent upon their entire production, and no reductions.
The Wabasso Cotton Company, at Three Elvers, -which was started after fine yarns were put on the free list, receives 71 per cent preference and 15 per cent general protection jtn single fine yarns, and 15 per cent preference and 25 per cent general on fine ply yarns, all of which is an increase. They also receive an increase under the preference of 5 per cent on such cloths as they fabricate in which artificial silk is used, and which, I understand, represents about one-fifth of their looms.
They receive no reductions with the exception of 3 per cent under the preference on the negligible quantity of made-up sheets and slips which they produce.
In their Shawinigan yarn plant at Shawinigan Falls, Quebec, spinning yarns, they will receive the same reduction as we do, but Mr. Whitehead made the statement to Mr. Moore and myself that he had never made a cent in the Shawinigan plant, and that if he got a protection on fine yarns he would convert this plant to spin fine yarns. The Hamilton Cotton Company receive reductions and increases that offset one another.
[Mr. Robb.3
On the face of things, it would appear that the tariff in very unfortunately framed against the company that has been honestly, efficiently, and economically operated, and should receive greater consideration.
Under proposed conditions, there is no question but that this company, and its more than seven thousand operatives will be seriously affected, and the latter, at least, are worth your reconsidering the proposed schedule.
Hon. gentlemen opposite will observe this:
Nearly one hundred million lineal yards of cotton cloths were exported to this country last year, in almost equal quantities, by Great Britain and the United States, plus imports under French and intermediate rates. At least sixty per cent of these imports directly affected this company.
We have also to accept orders for large quantities of cloths, subject to drawback rates, in order to keep occupied.
There are a great many points not touched upon in this letter that I would be glad of an opportunity to discuss with you if you will be good enough to give me an appointment.
Sincerely yours,
F. G. Daniels,
Managing Director, Dominion Textile Company.


Henry Herbert Stevens: Would the minister just
at this point answer a question, if he will be so kind:	Taking this as a presentation
of one side of the case, what other facts influenced the minister to disregard all this and make these reductions which are complained of?


James Alexander Robb: 
Henry Herbert Stevens: The minister has not
given the explanation he promised. He said he was going to take the house into his confidence and tell hon. members what facts induced him to disregard the other set of facts which he has so ably read, but he has not done so. Now he says that we rejected the advice of the tariff board. Why the tariff board has given no advice whatever.
Mr. ROBB-:	Yes, the advice of the tariff
board in relation to these particular items is coming to the house through the minister. This is what they suggested as a fair reclassification of these items so that the yam people would enjoy a share of the protection. I realized at the time just what we were running into and that there would be some opposition, and I am going to keep out of trouble hereafter.


Henry Herbert Stevens: The minister said a
moment ago:	I have tendered to the house
the findings of the tariff board and my hon. friends opposite-meaning us-have rejected their advice. We are not rejecting it, because there is nothing to reject. Here is what we find in this remarkable report. I shall not read it all but they start with about two pages of a dissertation, upon the tremendous load that has been placed on their shoulders. For instance the report says this:
It is probably safe to say that a greater mass of work has never fallen, within the same space of time, upon a commission.
They are looking for sympathy. Then the report goes on to say:
The board may be regarded as still in process of organization.
That statement has been made although the board has been organized for over two years. Then further the report goes on to point out that the board thinks there should be a change in the method of procedure. A change in the method of procedure referred to came about through the dependence of one reference upon another. It has taken them two years to find out that the tariff is an interrelated structure which every schoolboy knows from the time he can write. Everybody knows that the whole tariff structure is interrelated. Then follows about a page intimating that, to the amazement and surprise of the board, they found1 that when they came to the rubber schedule it affected the cotton schedule, as if it was not known that cotton went into the manufacture of rubber goods. And so it goes on, and the recital takes two or three pages. Then the report says this:
There is just a question whether the present method of making applications is suited to thorough efficiency in enquiry.
They doubt whether the methods of procedure are suited to a proper kind of enquiry. Then they go on to say further that the board have no power to compel the production of financial statements and documents, but they do not ask for the power because they say they have been accorded all the courtesy that is necessary from the various manufacturing concerns. Then after two or three pages more of just such stuff as that, we come down to the last couple of pages of the report wherein they make their findings. These are their findings. They recite the reference and they go on to say:
Little difficulty has been experienced as to the duty of enquiry.
That is they do realize that they must make enquiry; that part is clear to them:
Possibly we might have succeeded better proceeding under a set of questions stated by you-
That is addressed to the Minister of Finance:
-outlining the scope of the investigation, but we believe that on the whole our duty of enquiry has been discharged with reasonable satisfaction.
They say that although the minister confesses that there is not a single fact found. He says that he has repudiated the whole thing and will depend upon his own judgment. Then the report goes on to say this:
Difficulty, however, exists as to determining the nature of the advice we are presumed by order in council to tender to the minister.
They do not even know what they should advise the minister upon. They have not the faintest idea of the nature of the advice they should return to the minister after operating for two years and after hearing over one hundred cases. I think there are 98 recited in the report and there are doubtless a good many more. Then the report goes on:
Reports of the enquiry into the major references. and some of the minor as well, are lengthy, and at times somewhat involved, usually containing valuable statistical matter. To present the evidence in precis form, possesses the advantage of brevity-and the disadvantage of incompleteness.

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They do not attempt to prepare a precis of the evidence or even to summarize it. The least they could have done was to summarize the evidence and to submit it to us for judgment. The report goes on to say that there would be a hearing at great length and then someone would appear before them whose evidence would disturb the quasi decisions already made, making it necessary to reopen the case and call back the witnesses again. Yet the minister constantly twits us with negligence dn our part in not going through this involved mass of evidence and sifting one part from another, although he admits that he has not done so himself. They say:
Reports of the inquiry into the major references. and some of the minor as well, are lengthy, and at times somewhat involved.
They say, as I have already stated, that there is a disadvantage in preparing a precis and therefore they prepared no precis. Then we have some further observations:
The transcripts contain the arguments of the applicants and their opponents, which, in our opinion, cannot be satisfactorily summarized.
Thus we have Mr. Moore and his board, a board that has been organized for two years, telling us that the arguments of the applicants and their opponents cannot be satisfactorily summarized, and yet we members of this house are asked to take this half ton of evidence and understand it fully without the assistance of even a single expert. This is not a haphazard decision on their part. They say:
After mature deliberation we have concluded that to attempt a summary would be not only unfair to those who have argued before the board, but as well would render to you

The Minister of Finance.
-and to parliament an incomplete service.
Therefore they attempt no summary. After reading this report I am inclined to agree with the minister that his decision was perhaps the right one, namely, to kick them out lock, stock and barrel and go on his own.


James Alexander Robb: I did not say that.


Henry Herbert Stevens: That is virtually what he said. I was rather inclined to compliment him on his decision.


James Alexander Robb: I did not say that. I cannot accept the compliment.


Henry Herbert Stevens: He said that he was going to use common sense instead of the advice of the tariff advisory board. This is another statement 'by the board that is worth considering:
-but as well would render to you and to parliament an incomplete service. The obvious 
intent of argument is to influence those who have authority over the matter under discussion.
Therefore they should make no summary, make no finding for fear they would influence those who had to decide the matter, that is parliament or the minister. This board was set up and heralded throughout the country as a solution of the great question of the tariff that had been bothering the government for years. They said:	We, the great Liberal
government, have now set up an advisory board and the whole question is solved. Yet this board, through the Minister of Finance, tells parliament that because argument which is made before it, is intended to influence those who have authority to judge the matter, therefore they refrain from summarizing, finding on, or even making a precis of the argument.


Mr. ADSHEAD:: Was the tariff advisory
board not inaugurated with the consent of both parties?


Henry Herbert Stevens: Not this one.


James Alexander Robb: It is the personnel of the
board my hon. friend objects to, I imagine.


Richard Bedford Bennett: No, it is what the board does.


Henry Herbert Stevens: I have always believed
a board of experts, acting under the leadership of the government for the purpose of investigating and assembling facts in a properly organized form, would be of inestimable value to the government and to parliament. A business man or any person having to make a decision on any subject can certainly make that decision very much better if all the facts are assembled, properly organized and placed before him in sequence. In the presentation of a case on the tariff there must necessarily be involved arguments and an array of facts brought forward in an unorganized form. Any group of individuals can sit and listen; but what a tariff board is for-and there is not one atom of reason for their existence if they do not do this- is to winnow out of what they hear some of the kernels of wheat of argument and present those to the house, and to disperse the chaff, leaving the chaff for us to winnow through if we want to, and if we suspect the wheat has not all been winnowed out. That is the secret of success in connection with any tribunal. This is the way in which the board think they have discharged their function. They say:
We have deemed it our duty to pass on to you the transcripts containing the records of our public proceedings with only explanatory comment.

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As a matter of fact there is not even explanatory comment. Let us not forget what they said a moment ago, that so involved was the hearing that they did not dare to make a precis. Yet they have the temerity to come to parliament and say:
We have deemed it our duty to pass on to you the transcripts containing the records of our public proceedings with only explanatory comment.
We realize that in so doing we may not be rendering all the service you expect from us, but it has seemed to us that the precise way in which we may be most helpful will in course of time be developed by experience.
Can anyone imagine a report of that kind being presented to parliament? It is an insult to the intelligence of this parliament, and I do not blame the minister for casting it aside and using, as he said a moment ago, his common sense in the formation of this tariff. It is perfectly clear from this report why it is that we have before us a tariff revision which the minister finds difficulty in explaining. There is in the realm of economics nothing more complicated than a tariff, nothing that requires more accurate and detailed knowledge, and the minister should not be saddled with the responsibility of presenting this tariff in all its details to the house. What they should have done, for the benefit not only of the minister but of the members, was to make a precis of these revisions with an explanation based upon the facts presented to the board and the reasons for the changes. Let us take, for instance, the letter which the minister has just read, a letter from Mr. Daniels of the Dominion Textiles. I am just recalling the contents of it, having heard the minister read it. In that letter this company, a large company with a very big investment in Canada, makes the statement that as a result of this revision it is going to be penalized in certain respects and there will be a serious loss to its business. The company points out that it is in competition along certain lines with other firms which in some measure are receiving assistance whereas this company is suffering a reduction. It does not matter what we may think of the principle of protection or free trade, the fact remains that the country owes it to our business men and organizations to deal with them equitably. I would appeal to my hon. friends who may stand for a principle of no tariff, or low tariff, or whatever you like; at least let us stand on the principle of equitable treatment to all parties alike. It would be infinitely better to put in a flat reduction than to pick out one firm here for special, favourable treatment and another firm there to be penalized.
As I intimated in my question which the minister has very great difficulty in answering-and I understand the difficulty now that I have read over this report-in view of the facts presented by the Dominion Textiles in that letter, what other set of facts warranted the changes that the minister has made? I am not saying that these changes are wrong. It may be that the case of the Dominion Textiles is not really a case, but we are not in a position to judge. We have one side of it presented by the Minister of Finance, and the other side is in half a ton of evidence which we are invited to go and look over. So I say to the Minister of Finance that the revision presented to us to-day is one that we cannot with confidence support; and not only that, we cannot with confidence pass it through this house without the most careful scrutiny and without a great deal of anxiety for fear that industry will be injured.
I met a gentleman down at the hotel this morning who, while not in the cotton business, is in the textile business and knows a good deal about it, and I asked him this question. Let me say first that it was not a question of lobbying; I am not afraid of this talk about lobbying, because I believe that any respectable and responsible business man has a perfect right to come to a member of parliament and tell him his case, if he so desires. I know nothing about the cotton industry myself; I am not supposed to know anything about it; it is not my business; and how am I going to learn anything about it if I do not get the information from these various sources? I met this gentleman and asked him, "what about the cotton schedule? Is it a satisfactory schedule? How do you view it? What criticism do you make of it?" He replied, "I venture this statement, that there is not a man in Canada, in the business or out of it, who understands that cotton schedule-not one." And, Mr. Chairman, I venture this statement, that there is not a member of the minister's staff who understands it, and we in this parliament are going blind on this question right at this hour. I predict without the slightest hesitancy that within the next three or six months the minister will be faced with incontrovertible evidence calling for some changes in the tariff that he is presenting to us to-day, or else of allowing serious hardship and loss to ensue to business in this country. We are asked to approve of this tariff, which is not a tariff that has been carefully thought out and prepared. It is true the minister may have slaved as he said yesterday, and spent sleepless nights worrying about it until the small hours of the morning. It is utterly absurd

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to ask the Minister of Finance to sit up night after night revising the tariff of Canada or of any other country. The thing is preposterous; it cannot be done, that is all. There is not a minister of finance either in past history or now living in any country who could do that work. He may, over a period of two or three years, but by the end of that time the whole thing would be obsolete.
The thing I am complaining of, and it is something which the house ought to resent and condemn, is the presentation to the house of a report such as this from the tariff board. There was only one possible alternative for the tariff board, if they were to escape the just condemnation of this house and of public opinion, and that would have been to remain silent, simply saying: We are unable to report.


Mr. RYCKMAN:: And send in their resignations.


Henry Herbert Stevens: Yes, send in their resignations. My point is that there is no responsible body of citizens, tariff board or any other group, that has any right after two years service to present a report like that to parliament.


An hon. MEMBER:: What is the date of the report?


Henry Herbert Stevens: The letter addressed to the Minister of Finance accompanying this report, which is sessional paper 132A, is signed by Mr. W. H. Moore, chairman of the board, and dated January 5, 1928.
I repeat, this thing is more serious than merely the question of a difference of opinion over the tariff, because when we find this on a few cotton yarns, just one little item in the tariff, what are we likely to find in the rest of it? I gave an illustration last night, a most striking illustration. I do not know whether it is corrected in the schedule or not; I am waiting to see. A couple of years ago a designing individual, looking for the advantage of an American firm that he represented, by subtlety or suggestion or in some way or other secured the introduction into a tariff item of certain words, and the words were simply "when imported by the manufacturer." They sound very harmless, but what was the effect of those words? Their effect was to penalize the British exporter over five per cent as against the American exporter. The item dealt with cotton manufacturing machinery, and it ran into a large amount. The insertion of those words made all the difference between the British firm continuing business or not. It actually drove them out

of the market, and in a most unfair way, as I will show. The British manufacturer desired to supply parts in Canada for his machines that had been purchased in this country, and he opened a warehouse in Montreal, where he kept his parts. That was a desirable thing, but because he did that, he was penalized 5 per cent customs duty more than his American competitor who kept his plant in Boston, and shipped his parts into this country one at a time. I mention that only to illustrate how words can be introduced into a tariff item that may not only penalize but jeopardize the very existence of an industry in Canada in favour of a foreign competitor. So we speak with some degree of warmth, and I think we are justified in saying indignation, when we aTe asked as an opposition, and when the house is asked as a representative body of men, to deal with a revision of the tariff based upon a report such as that presented by Mr. Moore and his colleagues.


Mr. EVANS:: Having listened to the discussion yesterday and again to-day, I do not think the house is yet seized of the importance of these new duties in the cotton schedules, particularly items 522a and 522b. The cotton industry has been amply protected in the past. The hon. member for Vancouver Centre said that all tariffs constitute argument. It seems to me that this one constitutes much more; it constitutes bargaining, simply bargaining. Here is a new tax imposed by the Liberal government, which professes to be against tariffs altogether.


Mr. CANNON:: The government never
claimed that at all.


John Evans: Many of its supporters were elected on a free trade platform. I would simply remind the hon. gentlemen of the free trade propaganda that was sent out throughout Saskatchewan at the last election. Why does not the minister take us into his confidence and tell us the reason for these changes? I am going to give a reason of my own, and I shall not be blamed whether my inference is right or not. It is certainly bad enough when privilege is given to one class at the expense of others, but under item 522b it divides even the Canadian manufacturers one against the other. Why? A certain company make their own yafns, and the minister said plainly yesterday that this change is made in the interest of that company, because certain other companies were hogging all the protection already given. Now let us see what is the effect on this certain company which will benefit, and which make their own yams presumably. Those that

Ways and Means-Customs Tariff
cannot make their own yams are penalized up to 15 per cent on their raw material. They will have to pass that on to the consumer; there is nothing else for it. What, then, is the effect on the company that can manufacture their own yarns? It simply means that they are placed in the position where they can add to their profits the whole of the trade penalty which the other companies have got to pay. The Minister of Finance was very much amused yesterday at having, as he thought, set this free trade party against the protectionist party in this house. To-day it has been amusing to me to see the row among the protectionists themselves, and to my mind it has established the fact for once before the people of this country that parliament is one great system of group government. Both the government and the opposition are to-day serving one group. There is no other conclusion to be drawn from the facts we heard yesterday and to-day. I repeat, they simply serve one group, and although they have described it as such an evil, we are in the midst of it. All this free trade party is trying to do is to counterbalance the power and influence of that one group which stands behind the whole protectionist element in this house to-day. I cannot help thinking that this change in the cotton tariff is one of the most barefaced bargains that any one government favorite has ever been able to make.


James Alexander Robb: Mr. Chairman, when my hon.
friend gets through his speech we are going to show our appreciation of that company by reducing the British preference item to free.


Henry Herbert Stevens: Which item is that?


James Alexander Robb: That is the item my hon.
friends complain about.


John Evans: 
Mr. CAMPBELL:: Do I understand the
minister to say that he proposes to eliminate the tariff under the British preference on this item we are discussing?


James Alexander Robb: No. The complaint of my
hon. friends opposite, particularly the official opposition, has been directed against the change in the tariff item 522b, yarns and warps wholly of cotton exceeding No. 40, not more advanced than singles. Under that there were reductions on the coarser. When we come to that item I propose to move that "7$ per cent" be struck out and the word "free" inserted under the British preferential tariff, thus enlarging the policy of the British preference and diverting the business to the mother country. I hope all sides will agree with that announcement, because I understood that that is what all my hon. friends opposite were arguing for yesterday.


Mr. CLARK:: How is that enlarging the
British preference if there was no duty before?


James Alexander Robb: Because there will be a tariff against other countries of 10 per cent intermediate and 15 per cent ge'neral, while formerly it was free in all schedules. Does my hon. friend understand that?


John Arthur Clark: I must confess I cannot
understand how. if you apply a tariff where none existed before, and then remove it, it makes any difference or enlarges the British preference.


James Alexander Robb: Let me repeat, formerly it
was free under all schedules, now it will be free under the British preference only.


Richard Bedford Bennett: If they bought their
yam in England before, and buy it there still, there will be no change.


James Alexander Robb: I should like to have my
hon. friends opinion of that when we get to the item.


Hugh Guthrie: Mr. Chairman, in any
remarks I made in regard to 522b I did not oppose the imposition of the 7i per cent. I approved it, provided the principle of protection were adopted all along the line, as it should be. But what concerns me at the moment is item 522. Within a moment of time the minister said that the new item was a reduction from the old item. That is quite different from what he stated in this house last night. Just before the sitting closed

Ways and Means-Customs Tariff
the hon. member for South Toronto (Mr. Geary) was addressing the committee. I am quoting from page 1400 of Hansard. He said:
Do these figures enable us to say whether item 522, cotton yarns, not exceeding 20's single, 10 per cent, 15 per cent and 20 per cent, constitutes an increase or a reduction in the tariff?
Mr. Robb:	A number of the items are
obsolete. It is chiefly a reduction.
Mr. Geary:	I am directing my attention to
No. 522.
Mr. Robb:	If my hon. friend picks out 522
alone-
Mr. Geary:	That is the one we are discussing, according to the chairman.
Mr. Robb: We have been discussing the items generally. I do not know whether my hon. friend wants to get on the record at this late hour all the facts bearing on the matter. In this particular item alone there is an increase.
Mr. Guthrie: There is an increase in item 522?


James Alexander Robb: In the noise I must have
thought it was 522b. That is where it comes in.


Hugh Guthrie: As I read it there was
an increase, whether there was any noise or not.


James Alexander Robb: No.


Hugh Guthrie: Formerly all goods under 522 came in under item 534, under which yarns were free, free, free. Now they come in under item 522 subject to a tariff of 10, 15 and 20 per cent. The statement of the minister last night was correct; it is an increase. At the time he made it I marked in the margin of my copy "increase in this item." Last night he was correct; I submit that to-day he is incorrect. Let him take time to consider it, and I think he will come to the conclusion that he should change his statement and say that 522 constitutes an increase over what it has been hitherto.


Milton Neil Campbell: Mr. Chairman, I congratulate the minister on making the slight change in 522b, but I think it would have been better appreciated had he done it before the effect was pointed out from this side of the house. As to whether it is an increase or not, I wish to quote an article from the Financial Times. At page 24 of that journal appears the following:
Some relief has been given the Canadian linen industry under the new Robb budget. The Financial Times is advised prior to February 17th yarns for the manufacture of linens were free of duty no matter what the source. Under the budget effective February 17th yarns imported from countries subject to British preferential rates only, are free, the intermediate tariff now being 10 per cent and the general tariff 15 per cent. Recognition has

been given the much larger wage costs incidental to linen manufacturing as compared with cotton _ and some additional protection given accordingly.
I understand that the yams covered by 522b are used in the linen industry, so presumably that is the item to which The Financial Times refers.


James Alexander Robb: We are discussing cottons
now. We will discuss linens when we come to the item.


Mr. KENNEDY:: The minister read a few letters, and while I did not catch all they conveyed I understood that the communication from the Dominion Textile Company intimated that the reductions would not mean much to the consumer but did mean a good deal as between the various manufacturers using yarns.


James Alexander Robb: Not yarns, no. They claimed that they would lose $600,000 per annum of which about $64,000 would embrace yarns. The rest represented a loss in protection on their product.


Donald MacBeth Kennedy: We shall see in Hansard just what the letter says. Has the minister received a letter from the Wabasso Company
complaining about these changes?


James Alexander Robb: No.


Donald MacBeth Kennedy: My objections yesterday were based largely on the added1 protection given the Wabasso Company. I also stressed the argument in regard to forties and finer which previously were on the free list and are now made dutiable in the rates the minister proposes. I believe they were to be 10 per cent under the intermediate and 15 per cent under the general.


James Alexander Robb: And free under the preference.


Donald MacBeth Kennedy: 
Herbert Bealey Adshead: As one who was a new
member last year and who was under what was perhaps a delusion, that the tariff was going to be taken out of politics and that the tariff advisory board would bring in something concrete and definite whereby we might arrive at some conclusion, I must say that I am disappointed in the work of that body. I have a great deal of sympathy with the minister in his attempt to do all over again the work which the board has done or ought to have done, and I have much more sympathy with myself and others who are trying to wade through the mass of evidence which has been taken and to do over again for ourselves what the tariff board should have done. Last year when the tariff board was under discussion I suggested that we should have a sort of Hansard of the board's proceedings. The hon. member for Weybum (Mr. Young) supported that suggestion-and he belongs to the party opposite. The Minister of Finance said that this could not be done, but he did promise that if any hon. member wished to have a copy of the evidence submitted regarding any particular item or application it should be available. A number of us applied for the evidence and we waited patiently in the expectation that between sessions we might study it so as to be able to come to some conclusion as to what should be done in relation to the tariff. One objection to the proposal I made was lack of money, and for that reason we could not get a satisfactory report of the work of the tariff board. It seems to me that the suggestion made by my hon. friend (Mr. Stevens) is a reasonable one, that at least a precis or synopsis of the proceedings of the board should be given to members of the house, even if we have not a statement of the board's conclusions. This, I think, is due the house, and I trust the minister will take the matter into serious consideration. Such a synopsis would enable us to consider the question intelligently, as we cannot do at present. I am sure I cannot now arrive at a very definite conclusion without wading

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through all this evidence, even after following the example of the Minister of Finance and sitting up until eleven o'clock at night for weeks as he sat up until two o'clock in the morning for months.


James Alexander Robb: Mr. Chairman, yesterday the
hon. gentleman opposed these items from two different angles. The item as submitted to parliament was what might be termed the fact finding of the board; it was their suggestion that this change should be made in the tariff, on the ground that these finer counts were a good deal more expensive to manufacture and that they should be placed in a position equal to that of the less expensive yams.


Henry Herbert Stevens: Where are we to find that recommendation ?


James Alexander Robb: I am telling my hon. friend
now as a member of parliament, on my responsibility as a member. After having consulted officers of the department, that was the representation made to me. I passed that representation on to my colleagues and have their authority to present it to parliament.


Henry Herbert Stevens: I am asking the question
because there is no record of it. I am not questioning my hon. friend's word at all.


James Alexander Robb: My hon. friend is quite right; there is nothing in print concerning it. There were some three 'hearings held in connection with this cotton inquiry, covering several weeks; witnesses from all sides came before the board, those who advocated higher protection as well as others. Hon. gentlemen must remember that the mills all asked for more protection; I think I make no mistake in saying that. If you look at the evidence you will see that most of the mills urged that they should have more protection. There were also those who thought they should not have more protection, and indeed representations were made that the protection already existing should be reduced. At the conclusion of that inquiry a statement was made by Mr. Daniels, whose letter I read in which he stated that his company will lose over $600,000 yearly largely through the reduction of the duty on the finished fabric. On November 22, Mr. Daniels made this statement, which may be found at page 964 of the evidence taken before the board at the November hearing:
I appreciate very much the way in which you have received our application, and the very fair-minded way in which your criticisms have been handed out. ... we will be very glad to let you have any information of any kind that will help you reach an equitable decision.
[Mr. Adshead.i
On that point we have every confidence in the board, and you can count on our whole-hearted support.
Hon. gentlemen yonder protest against this increased protection, but the rates under consideration are all reductions. The very rate we are now considering, item 522, is a reduction ; item 522a is a reduction also. After listening to my hon. friend the leader of the official opposition yesterday I saw the difficulty in connection with item 522b, and he more than any person else protested against this protection. When we reach that item I am going to move that this be made free under the British preference, so why are we delaying?


Hugh Guthrie: Can the minister tell
me where the importation comes from?


James Alexander Robb: I am told that in the past
about one-third has come from Great Britain and under the proposed change it is reasonable to assume that most of it will come from the mother country.


Donald MacBeth Kennedy: I have here the figures
of the importations of yams number 40 and finer, up to March 31, 1926, and I find that we imported in that year from the United Kingdom 789,393 pounds of this material, while from the United States in the same period of time we imported 1,942,456 pounds.


James Alexander Robb: That is nearly half.


Mr. BOIVIN:: What was the value in
dollars and cents?


Donald MacBeth Kennedy: We will take the year 1922. In that year we imported from Great Britain 1,125,451 pounds of this material valued at $1,115,769, and from the United States 1,240,100 pounds valued at $1,266,305. From 1922 to 1926 there is a steady increase in the importation from the United States with a corresponding decrease from the United Kingdom.


James Alexander Robb: While my hon. friend is on his feet I would remind him that during that period they were all on the same basis, and now it is proposed to make it free under the British preference to give the business to the United Kingdom.


Donald MacBeth Kennedy: Does the minister suggest that the importations will not be practically all from the United Kingdom to the exclusion of the United States?


James Alexander Robb: I contend that very naturally that result will follow, because Great Britain will have a preference.

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Donald MacBeth Kennedy: I cannot understand why the tendency should be towards a gradual increase in the importation from the United States. There must be something else in addition to the tariff.


James Alexander Robb: There is the question of the proximity of the United States. A small concern using these yarns and receiving a rush order might telegraph to the New England states and have the goods in their shop in twenty-four or forty-eight hours, if they were sent by express.


Donald MacBeth Kennedy: Of course the United
States will still have the advantage of proximity.


Richard Bedford Bennett: I understand the Minister of Finance now says he proposes to withdraw the duty of 7i per cent on one item and that he is doing so because of certain observations I made yesterday. Am I correctly informed?


James Alexander Robb: My hon. friend convinced me yesterday that that was a reasonable thing to do.


Richard Bedford Bennett: I am so glad the minister is amenable to reason, and particularly to that form of reason which deals with his own argument rather than the log-rolling of interested individuals, because certainly I am not one of those. I merely took the case as I found it on the books and presented it to the minister, and I hope that hereafter neither he nor those who support him in the country will say that there was any merit either on his own behalf or on behalf of those who surround him which induced this change.


Edward Joseph Garland: The difficulty I still find in determining to whom should be given the credit for the reduction is this: The hon. member for West Calgary (Mr. Bennett) now takes credit to himself-


Richard Bedford Bennett: No, no.


Edward Joseph Garland: -while the hon. member for South Wellington (Mr. Guthrie) said just a moment ago that he was not in favour of such a reduction and wanted the protection maintained.


Hugh Guthrie: I agreed with the argument which was advanced by the minister yesterday and which will be found at page 1417 of Hansard. There he stated:
Now, it is reasonable to suppose that this product was imported and used to manufacture a fabric that had protection; and it is also reasonable to suppose that whoever produces the yarn should share in that protection.
That was the language of the Minister of Finance twenty-four hours ago. He was correct in this attitude yesterday. What has
caused him to change? Has he been called down by a supporter from Saskatchewan? Because he certainly has climbed down. It is not a change of principle at all. It is only a change to suit some of his followers who will not stand for the declaration of policy he made in this house twenty-four hours ago.


Mr. FANSHER (East Lambton):: Is there not a possibility that the application of the British preferential tariff to goods containing not less than 50 per cent of empire labour and materials will at certain times preclude importations from Great Britain at the preferential rate and that importations will then fall under the general tariff?


James Alexander Robb: We will deal with that provision when we come to it. I am not sure that there is anything in the resolution referred to which will affect the items we are considering. The provision in question was a notice to the world that we intended to proceed on that basis. For some years it has been represented to us by our sister dominions, Australia, New Zealand and South Africa, that there should be a change in regard to the material and the labour to qualify for the British preference, and it was suggested that the figure should be 75 per cent instead of 25 per cent. Canada took the position that 50 per cent would be fair. When the change is made it will be made by order in council, and we will make the same reservation that now exists so as to enable these products to come in from the mother country. We had the officers of the department inquire very carefully into the matter and we concluded that if we adopted the larger figure, our own industries using imported yarns might not be able to qualify. I hope my hon. friends will give us credit for possessing sufficient intelligence to be able to look after our own industries.


[Stage Direction]
Item agreed to.
Customs tariff-522a.	Yarns and warps
wholly of cotton exceeding number twenty, but not exceeding number forty, not more advanced than singles:	British preferential tariff, 12J
per cent; intermediate tariff, 15 per cent; general tariff, 22J per cent.
Hugh Guthrie: Is this an increase or a
decrease? Let us get it straight this time.


James Alexander Robb: The rates proposed under the budget are 12J, 15 and 22J. The former rates were 15, 22i and 25.


Hugh Guthrie: I am informed that
formerly these items all came in under 534 and were free of duty under all tariffs. Am I correct in that?

Ways and Means-Customs Tariff


James Alexander Robb: I am informed not.


Hugh Guthrie: Under what item did they come?


James Alexander Robb: 520.


Donald MacBeth Kennedy: There is something wrong with the printed list of comparative rates if the statement which the minister has now made is correct. In 522a there are really two items, 534 and 520. In the old item 534, cotton yarns were free in every case. Under the old 520, cotton yams, etc., n.o.p., the rates were 15, 22i and 25. In coming to a determination as to what the effect of the change is, we should be given the importations under the three previous dutiable items, so as to determine whether there has been a reduction or an increase of duty. I should like the minister to read into Hansard the figures showing what the imports were of cotton yarns under item 534 which previously came in free and are now dutiable, and the imports under 520 where the rates previously were 15, 22| and 25.


James Alexander Robb: I cannot give my hon. friend the importations under those items. In the item 522 which we have just had there is a reduction. In 522a there is a reduction, and when we come to 522b I will move for a reduction there.


Edward Joseph Garland: The minister is simply making a statement that there is a reduction and the figures I hold in my hand do not support him in that. If he could give us a statement as to the loss of revenue that would be entailed as a result of the application of the new schedule, we should be able to form an accurate opinion. I cannot agree with the minister that there is a reduction in this item.


James Alexander Robb: These particular items were
spread over three items formerly. In the one case the importations amount to 5149,627, and in the other to $141,212, or a total of $290,839. But the second item, yarns for shoelaces, was taken advantage of.


Edward Joseph Garland: The fact
still remains that there is an increase in duties.


James Alexander Robb: There is no increase in duty
for that business. An item is being included which was 534 under the old schedule and under which these articles came in free under all tariffs. Now there are rates of 12J, 15 and 22|.


An hon. MEMBER:: Shoelaces.


Donald MacBeth Kennedy: It is not shoelaces.
They come in under item 522.


Henry Herbert Stevens: The difficulty is this:
The minister is in a sort of corner which he naturally finds it not easy to get out of, and it is not one that he voluntarily got into.


James Alexander Robb: Oh, no.


Henry Herbert Stevens: Certain importers entered their goods under item 534 of the tariff where yams were imported for shoelaces, and he has just read to us the statement that there were importations to the amount of $141,000 under that heading when there were no yarns imported for shoe laces.


James Alexander Robb: I made that statement.


Henry Herbert Stevens: Therefore it must be that the class of yarns we are now talking of here have been coming in under that item improperly.


James Alexander Robb: I made that statement.


Henry Herbert Stevens: They came in free under item 534 and now they are dutiable.


Mr. VENIOT:: Because they are imported for another purpose.


Henry Herbert Stevens: It does not matter. The long and the short of it is the importers ought to be penalized or the officers of the department ought to be fired, one or the other. That is the situation. They made false entries, if you like to use such a strong expression-that is a term used in the department-these goods coming in under 534 whereas they should have entered under 520. The point is that they have been coming in free and now they are dutiable. What the minister should have done, to accomplish what be is professing to do, was to have carried the items forward in the way in which they appear in the old tariff.


James Alexander Robb: Itemized.


Donald MacBeth Kennedy: I find by the Trade of Canada for the year ended March 31, 1926, page 168, that the imports of "yarn, cotton, polished or glazed when imported by manufacturers of shoe laces for use exclusively in the manufacture of such articles in their own factories," were 66,702 pounds valued at $52,764. I understood the minister to say there were no imports under that item.


James Alexander Robb: That was placed under that
item but there was no importation of glazed or polished.


Donald MacBeth Kennedy: In view of this printed list of proposed changes in the tariff there is an increase. You have one item free becoming dutiable at 12^ per cent, 15 per cent and 22| per cent.

Ways and Means-Customs Tariff


James Alexander Robb: Will my hon. friend add to this item the letters " n.o.p."?


Henry Herbert Stevens: I am always sceptical about adding these words without an explanation. The addition of " n.o.p." makes an absolute change in the item and I want to know why that change is made. It cannot be put in without its being moved.


Mr. MALCOLM:: It distinguishes between 522d which is mercerized and is already provided for.


Henry Herbert Stevens: The Minister of Trade
and Commerce will appreciate this. I know exactly what it means but I do not know what the effect is. It may mean that a dozen other articles are affected.


James Alexander Robb: No.


Henry Herbert Stevens: Let us know exactly what it means.


James Malcolm: Item 522d provides for mercerized yarn, but it takes the place of the yarn for the shoe manufacturer who formerly imported a cotton yarn free under item 534. Item 522 is the exception.


Henry Herbert Stevens: I am usually inclined to agree with the Minister of Trade and Commerce in matters of this kind because he knows the business perhaps better than I do, but 522b specifies a certain yam:
Exceeding number forty, not more advanced than singles.
That is a specific article. Therefore " n.o.p." is out of place and should not be added, because " n.o.p." is used when you are describing a general article covering a miscellaneous group of items, and " n.o.p." means simply to eliminate from that others which are already provided for. This is a specific item and should not have " n.o.p." added to it at all.


Richard Bedford Bennett: The minister is adding it to 522a.	"
Mr. STEVEN'S : The same thing applies.


Hugh Guthrie: To which item is it proposed to add " n.o.p."?


The CHAIRMAN:: Item 522a.
Item as amended agreed to.
Customs tariff-522b.	Yarns and warps
wholly of cotton exceeding number forty, not more advanced than singles: British preferential tariff, 71 per cent; intermediate tariff, 10 per cent; general tariff, 15 per cent.


James Alexander Robb: I beg to move that the following be substituted for item 522b.
Customs tariff-522b.	Yarns and warps
wholly of cotton exceeding number forty, not 56103-91
more advanced than singles: British preferential tariff, free; intermediate tariff, 10 per cent; general tariff, 15 per cent.


Edward Joseph Garland: The old
item reads:
Cotton yarns not exceeding forty, singles.
The minister has a number of new words inserted. What does it mean?


James Alexander Robb: Not more advanced than
singles. This is for administrative purposes. The present item includes all counts over forty,
singles.


Hugh Guthrie: The proposed item does not include forties, does it?


James Alexander Robb: No.


James Malcolm: But they used to import two-twenties in evasion.


Richard Bedford Bennett: The minister was good
enough to say a moment ago, in connection with the amendment he proposed by which, under the preferential tariff, this item will be free, that he had been convinced by the reasons that had been urged. No reasons were urged why it should be changed. His attention was directed to what the facts were and it is a great compliment to the minister's perspicacity that when he once sees the facts, he makes the change. There are those who recall the words of the hon. member for South Huron (Mr. McMillan) last night who said he was going to see that something was done, and I judge by the complacent look upon his face this morning that he is like the cat that has just returned; he is very happy and he feels he has accomplished his purpose.
May I venture also to point out that on the 13th March last the Daily News Record of New York, which is the authoritative journal in connection with textiles in the United States, carried an article under this heading:
Change in Canadian tariff might make that country better customer.
This possibility stimulates investigation of goods market conditions in United States by importers from Dominion-operations more speedily accomplished here than abroad.
It states that the effect of the tariff changes will be against buying from Great Britain and towards buying in increased quantities from the United States. That is the purport of that article which, I doubt not, the minister has had his attention directed to.


James Alexander Robb: The change will rather check that.


Richard Bedford Bennett: I am coming to that
point. He may have in mind that perhaps this will do something towards accomplishing that end, but how far will depend on the

Ways and Means-Customs

Tariff
extent to which we are now purchasing from Great Britain and the United States. I think the minister was incorrect in his statement as to the relative quantities purchased from Great Britain and the United States.


James Alexander Robb: I was.


Richard Bedford Bennett: What are the figures as the minister makes them now?


James Alexander Robb: They are as
year ended 31st March, 1927:
Country
United Kingdom	
Switzerland..
United States
follows for the
Imports $ 662,113 71
1,573,735


Richard Bedford Bennett: Is that the duty paid
or the value of the goods?


James Alexander Robb: The value of the goods. There was no duty on them then, but under the change we are switching that business to another item.


Mr. GEARY:: I have no idea who Wabasso is, but I was interested in the figures that the hon. member for Peace River put on Hansard a few minutes ago as to the position of that company and was curious enough to look at the book from which he was reading. I do not think a company which is paying four dollars a share on its common stock-


Richard Bedford Bennett: They are split shares.
This means eight per cent.


George Reginald Geary: -and is setting aside, out of net profits after paying dividends, only $36,000 a year, should be a mark for any particular attack. It does not seem to me that the company is doing so well as to be an imposition on the community. You might pick out other cotton companies that would be a good deal more striking in their profits.


James Alexander Robb: I quite agree with my hon. friend that the Wabasso Company is a good and well-managed company. In their pioneer days they have had some hard sledding. I have a memorandum before me which indicates that they are not the only company affected, but I think I have already placed that on Hansard.


Richard Bedford Bennett: They said they were the only company materially affected.


James Alexander Robb: They make a specialty of this line of goods.


[Stage Direction]
Amendment agreed to.
Donald MacBeth Kennedy: Is the minister going to lay down the principle that any company that has had tough sledding in the past is going 	;
to have his most favourable consideration when it appeals for assistance? There are very few individuals or companies who cannot establish a case of that kind, and I do not think it is any justification for this company to say that it must have this assistance just because it has had tough sledding in the past. We have all had that.


James Malcolm: I think my hon. friend wants to be fair, but he may have left a false impression with regard to the statement he read as to Wabasso. I do not know the company particularly well; I never owned a dollar of stock in it, and I do not know its principals. It is in the province of Quebec; I would know more about it if it were in Ontario. My hon. friend must remember this general condition which may obtain in a company. The common stock of Wabasso went down for several years; there was no rise in Wabasso common stock during 1922, 1923 and 1924. It is a low interest-paying stock, and its price fairly represented its value. When a company is able to pay 4 per cent, its stock will float around 60 or 70; an increase of 1 per cent will raise the price of the stock to between 80 and 90; another 1 per cent will drive it above 100; and if the company can make 7 per cent, its stock is liable to jump to 135 or 140; so an increase of about 75 points in a company's stock may only represent an increase of 3 per cent in its earnings, and it is hardly fair to assume that the company has doubled its total value because its common stock has doubled in value. When a company after years of successful operation retires its bond issue and its senior or junior securities, and stands in a comfortable position, and pays dividends on its common stock, the common stock becomes valuable, but that is not necessarily an indication that the company has made a tremendous profit, which is the impression I think my hon. friend left on the house. I do not think he wants to be unfair.


Donald MacBeth Kennedy: I do not want to be unfair, but I am representing people who do not get this kind of consideration from this government or any other government.


James Malcolm: They do indeed.
Mr. KENNEDY':	I was up against a
Liberal candidate Who in the last election had this to say:
Tariff reduction:	I can see no advantage
whatsoever to anyone in western Canada in having a protective tariff. By it you pay more for everything you or your family wear or consume, yet in everything we sell we meet the world in open competition. Is it fair to us?

Ways and Means-Customs Tariff
That was the statement of Mr. Clarke to the electorate of Peace River in the last election. If the *party across the way has come to the conclusion that they must protect this industry, they have men in that party - throughout Canada who are capable of defending that position clearly before the electors, and they ought to do it. It should be impossible to go to the country on a platform that practically calls for the annihilation of all tariffs, and then come to the House of Commons and bring down a budget that, so far as I can see, is very largely framed on a protective basis. It is so with this item, and that is the reason I am protesting. I want to revise my opinion if I find that it is wrong on the facts and figures as presented to the house by the Minister of Finance. If I do not revise my opinion, I shall go throughout my constituency next summer and present to m:y electors the facts, but if the minister can convince me that I am wrong I shall be just as earnest in presenting the facts to my constituency. I have never advocated the complete wiping out of all tariffs; I have never advocated free trade as a practical policy for the Dominion.


James Alexander Robb: There is not much difference,
then, between my hon. friend and myself I am not a high protectionist; I have never advocated the wiping out of all tariffs. But I have been attacked-I am case-hardened now because the attacks have been coming every year since 1924-on the ground that I am ruining industry; I was attacked in the budget debate this session for ruining industry, and the only fault I find with my hon. friend is that he lines up with the men who are attacking me.


Edward Joseph Garland: The minister's last statement shows that he has the peculiar political point of view that other parties have expressed on a question of this kind. We were not lined up with our friends to the right. We were opposing the principle in the budget this year, the principle Of the reduction in the income tax chiefly, and also the principle of protection in the fiscal policy of the country. We were not lined up with hon. gentlemen to our right. It just happened that on that ocpasion we. voted with them against the budget, but we might just as well be voting with hon. gentlemen opposite tomorrow or to-day on another proposition; we do not know yet. But when we do vote with hon. gentlemen opposite, we shall not be voting for the party of my hon. friend the minister; we shall be voting for the particular point of view which the particular case represents.


John Evans: I should like to ask the
Minister of Trade and Commerce if he really meant that the paying of dividends depends upon the amount of tariff protection that a company engaged in the cotton industry receives.


James Malcolm: Not at all.


John Evans: The minister left that impression.


James Malcolm: The impression I was
trying to leave was this: The Wabasso Company has been discussed under this item, and my hon. friend from Peace River went on to show that that company was doing rather well, and that they probably did not need an increase in the tariff. The impression he left on the house as to the company's position was in my opinion rather extravagant. I only pointed out in a general way that the Wabasso Company, which I am not interested in at all, has not had such remarkable success as the price of its common stock would indicate. I am not discussing the principle of protection, but this company is the chief manufacturer of this line of goods, and is very much interested in this item. The minister has changed the item, making it free so far as Great Britain is concerned, and dutiable from the United States, which would transfer a lot of the business to England.


William Russell Fansher: A great many companies in Canada have a lot of water in their stock. Is this one?


James Malcolm: I do not think so.


Edward Joseph Garland: The statement just read by the hon. member for Peace River shows that the new stock issued by this company this spring was issued on a bonus basis of $13 per share.


James Malcolm: I do not know about
that.


Edward Joseph Garland: It is all
in the Financial Post.


John Evans: Returning to the statement
of the Minister of Trade and Commerce, he said that they not only needed protection to pay dividends-*


James Malcolm: No, I did not.


John Evans: -but that they deserved
protection because of the hard sledding they had had in the past. We have all had hard sledding, and I would ask if this house exists to give protection to industries by the sweated labour of men, women and children on the farms of Canada and the consuming public in general.
1422	COMMONS
Ways and Means-Customs Tariff


Richard Bedford Bennett: It would be very _ unfortunate if the observations of the Minister of Trade and Commerce (Mr. Malcolm) were allowed to go unchallenged. The fact is that the Wabasso Cotton Company made an application to the tariff board to increase the tariff. That application was heard by the board. The board made no statement of facts at all upon which this house could arrive at a conclusion; but it did make a report to the minister, which has been traversed by my friend from Vancouver, and which was very generally referred to the other day. Now, it is incorrect to say that objection was made in this house to one feature of it or the other. It is true that an application was made to increase the tariff.


James Alexander Robb: Or to create one.


Richard Bedford Bennett: To create a tariff where
there was no tariff. It is true the minister created a tariff, of 7\ per cent against Great Britain, and higher against treaty and nontreaty countries. Now he has withdrawn that 7i per cent duty, and he says he did so because of the facts presented to him in this house by the groups that sit to the left of the Speaker. Surely he does not mean that.


James Alexander Robb: I did not say facts were presented. I said my hon. friends convinced me.


Edward Joseph Garland: No, no.


Richard Bedford Bennett: Does the minister mean that he proceeded without facts?


Edward Joseph Garland: Mr. Chairman, may I interrupt? The hon. member for West Calgary is absolutely correct. The minister did say that he was convinced by the arguments of the groups to the left of the chairman.


James Alexander Robb: Particularly my hon. friend.


Edward Joseph Garland: The hon.
minister included the groups on this side of the house.


James Alexander Robb: I wanted to give my hon.
friend some credit for it.


Richard Bedford Bennett: Now, Mr. Chairman, we are getting to What really might be called the Machiavellian hand of the Minister of Finance. He is not a very great diplomat, but, on the other hand, he is not unskilled, and the Machiavellian touches that he sometimes reveals in this house are such as to assure us that he is not quite as innocent as he would sometimes have us believe. Those of us who have watched him in his handling of tariff items in particular are not unaware of that fine touch which would do credit to the great Italian writer's description of his Prince.
	' _ V
Let me go a step further in relation to it, if I may. Last evening the hon. gentleman was very very strong in iiis position; to-day he has changed that position. Last evening he asserted that these gentlemen affected were not his friends; now he says he is going to change this item-thereby, we assume, to have revenge upon those who are not his friends. Is that the inference?


James Alexander Robb: Oh no.


Richard Bedford Bennett: Is that the fine Italian
touch?	*


James Alexander Robb: No.


Richard Bedford Bennett: That is the only inference that can be justified.


Lucien Cannon: Are they friends of my
hon. friend?


Richard Bedford Bennett: I said that I had not
the privilege of knowing them. But they seem to have been great friends of the chairman of the board. At least one of them, a director of the company, seemed to be very well known in political circles and has a splendid reputation as a very generous supporter of the cause of Liberalism-for which he is to be much admired among those who accept that brand of politics.


James Alexander Robb: This is the first I have heard of it. He has managed to keep it a secret from our followers in that part of the province.


Richard Bedford Bennett: Now then we have the reason why the change has been made to-day.


James Alexander Robb: No.


Richard Bedford Bennett: Oh yes. I am glad we have it, because last evening the minister desired to evade giving information by asserting that the gentlemen concerned were friends of ours, not his; and he said he was almost provoked to exclaim, Save me from my friends! Those were his friends. I said that I could quite readily understand the minister so exclaiming having regard to his sometime associations. This afternoon he comes in and says: Ah! well, we will drop that altogether and put the item on the free list, because these groups to the left of the speaker have convinced me. But his conviction arises from the fact that after investigation he has discovered that their supporter in the locality finds this gentleman not friendly to him. He tells us that to-day for the first time.


James Alexander Robb: I only heard that after the item was put through. I am told the member for that county is quite satisfied.

Ways and Means-Customs Tariff


Richard Bedford Bennett: Meaning, that not to
have accorded him the protection recently promised satisfies his- supporter. That is all. Now the minister has certainly put himself in a rather embarrassing position. I find it rather difficult to believe that one with his sense of equity and fairness, with his desire to use his common sense against the technical knowledge imposed by his tariff board, would adopt such a course. In Winnipeg he spoke so learnedly about that technical knowledge; to-day so slightingly. He is mow going to pit his common sense against their technical knowledge; and his common sense tells him this fact-Three Rivers was not favourably disposed towards him politically. Am I to gather then that, if the item had remained as it was, they had assurances that Three Rivers would be favourably disposed towards him politically? Is that the inference?


James Alexander Robb: Not at all.


Richard Bedford Bennett: Now, knowing as we do the little pilgrimage into Huron by the Minister of Trade and Commerce (Mr. Malcolm), and his interviews with the manufacturers there, and the certain promises made that free coal would take the place of dutiable coal-


James Malcolm: My hon. friend knows better than that.


Richard Bedford Bennett: I know promises were given.


James Malcolm: No, they were not.


Richard Bedford Bennett: Well, we will not say "promises". He did not sign any document. Let me put it this way: He told them that this time his request of the Minister of Finance would not be as fruitless as in all those lean years gone by.


James Malcolm: It was never even discussed.


Richard Bedford Bennett: Perhaps my hon. friend talks in his sleep in view of what took place in Huron, because certainly there must have been some ground for the extensive advertising in the riding that all the industrial leaders were supporting the Liberal candidate. Then we remember with what haste the minister was rushed from the ship's side to the constituency to indicate how much free trade would do for this languishing land. He recalls the circumstance. Now the Minister of Trade and Commerce tells us that for years he was trying with the former Minister of Finance, Mr. Fielding,-


James Malcolm: And the present one.


Richard Bedford Bennett: As well as the present
Minister of Finance, but unavailingly. But all of a sudden the other evening new light had come to the Minister of Finance.


James Malcolm: Not all of a sudden;
it was pretty hard work. He had a good representative to support him.


Richard Bedford Bennett: From the way in which
the minister looks to his colleague in the Department of Agriculture, apparently he thought there was a necessity for free salt, or the salt had lost its savour.


James Malcolm: There is free salt for
fishermen and farmers.


Richard Bedford Bennett: I put this to the Minister of Finance:	Does he offer his observations this afternoon to this house as to why he dropped the 7i per cent tariff and substituted the word "free" in the British preferential tariff as a fair and proper statement?


James Alexander Robb: I thought I was meeting the
wishes of my hon. friend. Surely he is not going to chastise me now for having done what he advocated yesterday.


Mr. MOTHERWELL:: What does my
hon. friend object to?


Richard Bedford Bennett: What is this distant
rumbling? It is said of the volcanoes on the coast of South America that they are not extinct, but that now and again there may be a sudden outburst and a flowing of lava down the crater sides. I think I hear a little rumbling that makes me believe the Minister of Agriculture still lives.


William Richard Motherwell: Two hours and a
half to put through a British preference item!


Richard Bedford Bennett: How delightful 1 Two
hours and a half to put through a British preference item.


William Richard Motherwell: And one hour
yesterday makes three and a half hours. A real nice story to tell back home. Make it another hour; it will help us.


Richard Bedford Bennett: Three hours and a half
-and the Minister of Agriculture is as innocent of what we have been talking about as when the discussion commenced; even now he is not certain whether we have been speaking of flax, cotton or butter. But I do not think the Minister of Finance is fair to himself or to this house when, having asserted that the industry affected was unfriendly to him politically, thus inducing the house to believe that he was thereby doing a great and generous favour, he now comes back, after his own friends have indicated
1424	COMMONS
Ways and Means-Customs Tariff
what their attitude was in respect of the increased duty of 74 per cent, and says: The responsibility must rest with you for having done this, and these are your friends. That, Mr. Chairman, I think is ungenerous and unkind.


James Alexander Robb: Yesterday my hon. friend in an eloquent speech, not only once but a number of times, stated that this change was made solely in the interests of political friends of mine. I repudiated that statement; I said they were not political friends. My hon. friend insisted that they were and I said, " The Lord deliver us from our friends ",


Richard Bedford Bennett: That is right.
Item as amended agreed to.
Customs tariff-522c. Rovings, yarns and warps wholly of cotton, including threads, cords and twines generally used for sewing, stitching, packaging and other purposes, n.o.p.; cotton yarns not more advanced than singles, wholly or partially covered with metallic strip, generally known as tinsel thread: British preferential tariff, 15 per cent; intermediate tariff, 22J per cent; general tariff, 25 per cent.


Henry Herbert Stevens: This item covers ordinary sewing thread, does it not?


James Alexander Robb: Some of it would come in under that classification.


Henry Herbert Stevens: It is used for sewing,
stitching, packaging and other purposes. That would include common sewing thread used in every household. Is that correct?


James Alexander Robb: As my hon. friend knows, a good deal of thread comes in banks. The present rates are 174 per cent, 224 per cent and 25 per cent. A small proportion of imports comes under a classification with duties of 5 per cent, 74 per cent and 10 per cent, while some is free. The total importations for the year ended March 31, 1927, were $745,055. Of that amount $20,000 came under 734 which is free, and $30,000 under 721.


Mr. FRASER:: What was collected in duty under the old item?


James Alexander Robb: Five thousand dollars.


John Anderson Fraser: That was the amount collected?


James Alexander Robb: The estimated reduction; it
breaks about even in the reclassification.


Henry Herbert Stevens: What I want to know is whether this item includes sewing thread used for household purposes.


James Alexander Robb: Yes, and sewing thread shows a reduction.
fMr. Bennett.]


Edward Joseph Garland: This is the item to which the Minister of Railways (Mr. Dunning) referred yesterday as the consumers' item.


James Alexander Robb: This is one of them.


Edward Joseph Garland: The Minister of Railways spoke of this as the sewing thread item.


James Alexander Robb: Spool thread.


Edward Joseph Garland: Spool thread, if you will, under which the consumers were to get an advantage. Now I gather that the minister says there is no advantage; the situation is as it was before. The hon. member for Vancouver Centre and the leader of the opposition now tell me also that the duty is doubled. Will the minister be good enough to make it perfectly clear just what has happened to the consumer of spool thread?


James Alexander Robb: Will my hon. friend tell me how he figures out that the duty is now doubled?	f


Edward Joseph Garland: Two hon.
gentlemen who have made a study of the question and who have been listening to the minister so informed me. I did not understand it that way. As a matter of fact I do not know what has happened and I should be glad if the minister would tell me.


James Alexander Robb: I did not hear the hon. gentlemen make that statement. If they did they are misinformed. The principal importations came under the rate of 174 per cent, 224 per cent and 25.


Edward Joseph Garland: There has
heen a reduction of 24 per cent under the British preference.


James Alexander Robb: The proposed rates are 15 per cent, 224 per cent and 25 per cent.


Richard Bedford Bennett: In the Wabasso Cotton
hearing the Coates company appeared and stated that they got their material free. They gave the item under which their material was brought in and which I read last night.


James Alexander Robb: This is another item. The
Coates people manufacture in Scotland.


Richard Bedford Bennett: Here is the statement;
at page 631:
Mr. Bain:	Mr. MacKay, our understanding
of this paragraph in your brief is that you do not intend your application to interfere or be in conflict with the interests of the thread makers. You produce letters approving the quality of Wabasso yarns. They were from knitters and other users and none was from thread-making concerns. If that under-

Ways and Means-Customs Tariff
standing is correct, we have no quarrel, but I find it necessary to direct attention to a misapprehension on the part of the Wabasso company making that statement. It is true we import cotton thread in hanks under tariff item No. 535.


John Frederick Johnston: At what rate of duty? 71,
10 and 10?
That is the evidence given-71, 10 and 10.


James Alexander Robb: That is not under consideration now.


Richard Bedford Bennett: The report continues: Mr. Bain:	Yes, but we would emphasize the
fact that the bulk of our materials consists of single yarns. 40's and finer, which are free of duty. If therefore the provision for the
feneral free entry of these yarns be removed rom clause 532, it will be necessary, in the maintenance of our existing tariff position and situation, to make special provision for the free admission of these yarns for thread-making purposes.


John Frederick Johnston: What is your protection
now ?
Mr. Bain:	We have 71 per cent protection.
That is exactly where this tariff is going to be left, and that is what I desire to bring to the attention of the minister:


John Frederick Johnston: Under item No. 536?
Mr. Bain:	No. 536-171 per cent less 10
per cent discount.


John Frederick Johnston: When you say "less 10 per
cent", why did you not remind me that No. 535 was also less 10 per cent?
Mr. Bain:	No sir. The 10 per cent discount
applies only to items rated over 15 per cent. The Chairman:	It applies on the valuation.
Mr. Bain:	That is our position.


Edward Joseph Garland: That would indicate that most of the material coming in now comes in at 71 per cent, and the minister is putting it up to 15 per cent.


James Alexander Robb: No.


Pierre-Ernest Boivin: Item 535 remains as it
was.


Edward Joseph Garland: Item 522c
is raised to 15 per cent.


Richard Bedford Bennett: Once more I refer to page 631. Mr. Mackay was speaking for the Wabasso Company, together with Mr. Aird:


John Frederick Johnston: You have no competition from the southern states?
Mr. MacKay:	Just on the coarse.
Mr. Aird:	The 40's, 50's and 60's mentioned
a little while ago are coming from the southern states also.


John Frederick Johnston: But mainly from the
northern states?
Mr. Aird:	They are going into the spinning
of the finer counts. .	.	.


John Frederick Johnston: Yes, that is true.
Mr. MacKay:	The Canadian Spool Cotton
Company, which is a branch of Coates, bring their yarn in under a special clause, 535
"Thread, cotton, sewing in hanks", 71 per cent, so that this class of work will apparently not be affected by our request.
Mr. Bain:	May I speak at this stage? I
just want to put a question to Mr. MacKay.


John Frederick Johnston: Speaking for the board, I
would like to have Mr. Bain's statement at this point if you have no objection.
Then I turn to page 652, to which I referred last night, where the Canadian Spool Cotton Company made their answer to the application of the Wabasso Company. I do not want to read that at any great length, but they submitted that there should be no change.


James Alexander Robb: The position of the Canadian Spool Cotton Company is that they will still
get their finer than 40's in free under item 522d, and they will still have their hanks come in at 71 per cent under item 522e.


Richard Bedford Bennett: But that was 71 per cent before.


James Alexander Robb: Why should we change it?


Richard Bedford Bennett: There has been no change in it.


James Alexander Robb: What does my hon. friend
advocate?


Richard Bedford Bennett: Here is what Mr. Bain
says on that point, at page 658:
Mr. Bain:	Our position to-day is this: We
have free yarn in respect of probably over two-thirds of our business. We pay 71 per cent duty on the rest of our raw material. There is a duty under the preferential tariff of 15 per cent on cotton yarns coarser than 40's. We have protection under the preferential tariff from Great Britain of 15j per cent on our total output-171 less 10 per cent.
What is that 10 per cent? Does that prevail here?


James Alexander Robb: Only over 15 per cent.


Richard Bedford Bennett: 
James Alexander Robb: Yes.


Richard Bedford Bennett: If manufactured, what
change is there?


James Alexander Robb: In spools; it will be 15 per
cent, 22^ per cent and 25 per cent, where formerly it was 17-J per cent, 22J per cent and 25 per cent.


Richard Bedford Bennett: Item 522c reads:
Plied yarns and threads, n.o.p., 15 per cent, 22J per cent, 25 per cent.
Is there not an item with respect to spool cotton?


James Alexander Robb: No, this is the item.


Richard Bedford Bennett: Is my hon. friend sure
of that?


James Alexander Robb: Yes, the officers of my department assure me of that. This has been very carefully checked by the officers of the department, working with the Customs department.


Edward Joseph Garland: If there
is any change at all it is a change of 2jt per cent in the British preference on item 536. There is an increase in everything else which comes in under item 522c now, and which formerly came in under items 534, 520, 721 and 734. The only place in which there is any reduction at all is in the British preference under item 536; that was formerly 17i per cent and is now 15 per cent.


James Alexander Robb: The department suggested
that for administrative purposes these be made into one item, and I will repeat that the total importation under these five items amounted to $745,055. Of that $695,055 came in under item 536, where there is the reduction in the British preference.


Edward Joseph Garland: Out of that $695,000 which came in, how much will now come under item 522c and how much under items 522d and 522e? There is where we get into a tangle on this whole business. The Minister of Finance says that the total importation amounted to about $745,000, and of that some $600,000 came in under item 536.


Henry Herbert Stevens: How was that composed?


Edward Joseph Garland: That is
exactly what I want to know; how much was mercerized, how much was hanks and how much was spool thread? If we find out how much was spool thread we will find out if there is a reduction or an increase.


James Alexander Robb: I do not think I can give you that information, but I can tell you that all the spool thread comes in under this item.


Richard Bedford Bennett: I think my hon. friend
from Bow River was misled, as we were, by the fact that in the original tariff items as submitted there was no item 522e, which is now being added. If my hon. friend will observe what the hon. member for Vancouver Centre (Mr. Stevens) and myself were looking at, this comparative rate statement on page 5 shows that cotton sewing thread in hanks came in under a duty of 7i per cent, 10 per cent and 10 per cent, while the new rate is 15 per cent, 22$ per cent and 25 per cent, or twice the old rate. I do say, however, that you cannot properly claim a reduction in the tariff on spool cotton unless you have some knowledge of the quantity which came in, how it came in and the effect this new tariff will have upon those importations.


Edward Joseph Garland: In other
words, the minister is unable to tell us whether the householders, my wife and his wife and the women of this country generally, will obtain a reduction in the duty or an increase. He cannot tell us that until he can tell us how much spool thread came in last year under item 536.


[Stage Direction]
Item agreed to.
Customs tariff-522d. Yarns and warps wholly of cotton, mercerized, number forty and finer, imported by manufacturers for use exclusively in their own factories:	British
preferential tariff, free; intermediate tariff, 10 per cent; general tariff, 15 per cent.
Richard Bedford Bennett: That is a new item, is
it not?


James Alexander Robb: I intend to move an amendment to the item. I beg to move that the following be substituted for item 522d:
Customs tariff-522d. Yarns and warps wholly of cotton, mercerized, number forty and finer, imported by manufacturers to be further manufactured in their own factories: British preferential tariff, free; intermediate tariff, free; general tariff, free.


Richard Bedford Bennett: What is the change here?


James Alexander Robb: The rates as brought down in the budget were: Free, 10 per cent, 5 per cent. Now they are to be free under all three tariffs.


Richard Bedford Bennett: There is a change in the British preferential rate.


James Alexander Robb: As compared with the budget resolution.


Henry Herbert Stevens: Does the minister propose to make all three tariffs free?

St. John River Storage Company


James Alexander Robb: Yes, when these materials are imported to be further manufactured.


Henry Herbert Stevens: As I understand it, the
majority of that material comes in from the United States. That will mean that the United States will get an advantage over the British preference.


Donald MacBeth Kennedy: What is the difference
between item 522d, reading:
Yarns and warps wholly of cotton, mercerized, number forty and finer, imported by manufacturers for use exclusively in their own factories.
And item 522b, which reads:
Yarns and warps wholly of cotton exceeding number forty, not more advanced than singles.


James Alexander Robb: These are mercerized goods.
At six o'clock the Speaker resumed the chair and the house took recess.
After Recess
The house resumed at eight o'clock.



BUSINESS OF THE HOUSE

Lucien Cannon: I would suggest, with the unanimous consent of the house, in order to expedite business, that before considering the private bills in committee we might take up the bills starting from order No. 34 to the end of the list and have them read a second time so as to provide work for the private bills committee next week.


Richard Bedford Bennett: I should think that would be highly desirable in the public interest.


Lucien Cannon: I beg to move:
That the house do now proceed with order No. 34 and following.


[Stage Direction]
Motion agreed to.


[Stage Direction]
Sir EUGENE FISET (Rimouski) moved the second reading of Bill No. 17, respecting the St. John River Storage Company.
Richard Bedford Bennett: Explain.


Sir EUGENE FISET:: The object of this
bill is to secure the approval of parliament to two enactments passed by the Quebec legislature and known as chapter 117 of the provincial statutes assented to on April 3, 1925, and chapter 100, assented to on April 1, 1927. These two enactments are contained in schedules A and B, which form part and parcel of this bill. Chapter 117 authorizes the
government of New Brunswick to purchase or construct certain dams or other works in the counties of Kamouraska, Temiscouata and Rimouski in order to regulate the flow of the St. Francis and Madawaska rivers and their tributaries. Chapter 100 authorizes the government of New Brunswick to transfer to the St. John River Power Company all the right vested in the government of New Brunswick in accordance with chapter 117 of the provincial statutes. The St. Francis and Madawaska rivers fall into the St. John river, which is an international stream, and the only purpose of this bill is to eliminate any douibt that may exist as to the validity of these two acts. The hon. member for Temiscouata (Mr. Pouliot) has agreed to postpone any remarks he has to make on the bill until it comes before the private bills committee.


Richard Bedford Bennett: It was for that purpose that I desired the hon. member to make the explanation. I assume that the attorneys 'general of Quebec and New Brunswick are satisfied that this legislation should be enacted, because primarily it concerns New Brunswick.


Peter John Veniot: I was the one who asked the government of Quebec to pass the legislation in 1925, and I know that the present attorney general of New Brunswick is in full accord with this enactment because it is for the hydro development in that province.


Hon. C. A. DUNNING (Minister of Railways and Canals):: There is a point in connection with this-I am sorry I have not the documents with me-that might be considered when the bill is before whatever committee it goes to. I understand that certain expropriation powers are contained in it, and some question was raised by the railways as to whether in such a bill power should be given to expropriate railway property.


Eugène Fiset: I understand this
question is to be debated when the bill is before the private bills committee.


Charles Avery Dunning: All right.


Mr. POULIOT:: Then we shall be able to discuss the matter when the bill comes up for third reading.	.
Motion agreed to and bill read the second time.



BRITISH EMPIRE ASSURANCE COMPANY

[Stage Direction]
Mr. W. T. GOODISON (for Mr. Edwards, Ottawa), moved the second reading of Bill No. 40, respecting the British Empire Assurance Company.
Private Bills
Mr. SPENCER:: May we have some explanation of this?


Mr. GOODISON:: The applicants in this
matter are officials of the British America and Western Assurance companies. These two companies have their head offices in Toronto and are two of the oldest companies in Canada. The purpose of the bill is to incorporate a new and subsidiary insurance company. It contains all the provisions of, and is subject to, the Insurance Act. It has been approved in its entirety by the insurance department.
Motion agreed to and bill read the second time.



SECOND READINGS

[Stage Direction]
Bill No. 48, respecting the Calgary and Fernie Railway Company.

Mr. Gershaw.
Bill No. 50, to incorporate the United Theological College, Montreal.-Mr. Cahan.
Bill No. 57, respecting the Edmonton Dun-vegan and British Columbia Railway Company.-Mr. Kennedy.
Bill No. 58, to incorporate the London and Port Burwell Railway Company.-Mr. Taylor.
Bill No. 59, to incorporate the Federal Loan Company.-Mr. Lang.
Bill No. 60, respecting the Canadian Surety Company.-Mr. Hocken.
Bill No. 65, respecting the Canadian Pacific Railway Company.-Mr. Jelliff.

[Stage Direction]
Mr. W. T. GOODISON (for Mr. Edwards, Ottawa) moved the second reading of Bill No. 41, respecting the Imperial Guarantee and Accident Insurance Company of Canada.
Motion agreed to and bill read the second time.
On the motion of Mr. Goodison to refer the said bill to the committee on banking and commerce:
Lucien Cannon: With all deference, I think these insurance bills are generally referred to the private bills committee.


Richard Bedford Bennett: No.


Lucien Cannon: They were last year. I
remember the Sun Life Insurance bill was considered by the private bills committee.


Mr. CASGRAIN:: It went to the banking
and commerce committee.


Richard Bedford Bennett: They sometimes go to
both committees, but it seems to me the banking and commerce committee would be the proper place for this bill.


Lucien Cannon: It does not make any
difference.


Mr. SPEAKER:: I must say that the
Chair was advised by that old and experienced officer, Mr. Todd, who has been fifty years looking after these bills, that primarily they must go to the banking and commerce committee, and if necessary they may later be referred to the committee on private bills.


[Stage Direction]
Motion agreed to, and bill referred to the committee on banking and commerce.

[Stage Direction]
Mr. F. W. GERSHAW (for Mr. Thorson) moved the second reading of Bill No. 49, to incorporate the Canadian Credit Institute.
Richard Bedford Bennett: Perhaps the hon. member would give us an explanation.


Mr. GERSHAW:: In the absence of the
hon. member for Winnipeg South Centre (Mr. Thorson), I might explain that this is a bill to enable the Canadian Credit men to carry on their work in regard to standards of skill and competency, and to put them in about the same position as chartered accountants.


Richard Bedford Bennett: This raises a question of
some importance, as doubtless the hon. Solicitor General (Mr. Cannon) has observed. The question of the parliament of Canada exercising this jurisdiction as distinguished from the provincial legislatures is a matter of very considerable importance. The provinces have exercised this jurisdiction in most instances, especially the western provinces, to create various organizations, that of accountants, for instance, and one other which does not occur to me at the moment; and I think the effect of this bill would be very greatly to limit, if not entirely to destroy, the usefulness of these associations. The bill should be looked into very carefully before it is passed by the house, and if the Solicitor General or the law officers of the crown have not had an opportunity of doing so, I should like them to do it before we give the bill its second reading.


Lucien Cannon: I suggest to my hon.
friend that we allow the bill to go before the committee, where I can assure him that that point will be looked into carefully. When the bill is considered in committee we shall endeavour to safeguard the rights of the provinces.
Motion agreed to and bill read the second time.

Sun Life Company



CANADIAN PACIFIC RAILWAY COMPANY

[Stage Direction]
Mr. ALFRED SPEARMAN (Red Deer) moved the second reading of Bill No. 52, respecting the Canadian Pacific Railway company.
Some hon. MEMBERS:: Explain.


Mr. SPEARMAN:: The object of this bill is to empower the Canadian Pacific Railway Company to construct two lines in Alberta. With regard to the line mentioned in paragraph (a), this is to construct a branch of the Canadian Pacific railway from a point at or near Acme, and running thence in a northerly and northwesterly direction towards the town of Red Deer. The territory to be traversed lies between the Calgary and Edmonton, a branch of the Canadian Pacific railway, and a branch of the Canadian National. The distance between these two lines is about thirty-five miles, and from an examination of the map I find that the proposed line will fairly divide that territory without encroaching upon the territory already occupied. The construction of this line has been urged for a great many years by the settlers. The district is very closely settled, and will produce a good deal of freight.. The line will provide a very much needed service.
Motion agreed to and bill read the second time.



MANITOBA AND NORTH WESTERN RAILWAY COMPANY OF CANADA

[Stage Direction]
Mr. MALCOLM McLEAN (Melfort) moved the second reading of Bill No. 53, respecting the Manitoba and Northwestern Railway Company of Canada.
Mr. HEAPS:: Mr. Speaker, may we have an explanation in reference to this bill?


Mr. PARENT:: Generally questions are
asked on the first reading; we are now on the second reading of this bill. I have no particular objection, of course, but an explanation should have been asked for before.


Lucien Cannon: I understand that the bill seeks an extension of time; otherwise the charter would lapse.
Motion agreed to and bill read the second time.



SUN LIFE ASSURANCE COMPANY OF CANADA

[Stage Direction]
Sir EUGENE FISET (Rimouski) moved the second reading of Bill No. 56, respecting the Sun Life Assurance Company of Canada.
Henry Elvins Spencer: I was not in the house when this bill was read the first time. Will the hon. gentleman explain its purpose?


Eugène Fiset: Mr. Speaker, there are three objects sought by this bill: One, to amend the present act respecting the Sun Life Assurance Company of Canada so as to bring it more into conformity with the Consolidated Insurance Act, 1917; second, to increase the capitalization from $2,000,000 to $5,000,000; third, to reduce the par value of the stock to $10. May I say that since a similar bill to this was introduced last session there have been numerous conferences, and a great deal of correspondence has been exchanged, between the officials of the company and the Department of Insurance with a view to adjusting the differences existing between the two parties. They have succeeded to such an extent that at present there are only two points at issue: one the amount of increased capitalization, and the other, the proportion of subscribed value to be paid per share of the new restricted class B shares to be issued. The whole of the correspondence exchanged between the company and the Department of Insurance, as well as further evidence sufficient to prove the case, will be submitted to the committee on banking and commerce.
Motion agreed to and bill read the second time.



PEACE RIVER AND MACKENZIE DISTRICT RAILWAY COMPANY

[Stage Direction]
Mr. P. F. CASGRAIN (for Mr. Hay) moved the second reading of Bill No. 67, to incorporate the Peace River and Mackenzie District Railway Company.
Richard Bedford Bennett: Mr. Speaker, in view of the fact that the Edmonton, Dunvegan and British Columbia Railway operates through a considerable territory in northern Alberta, I think something should be said with respect to this bill. An additional railway charter might add to the railway difficulties already existing there and might not be in the interests of the Canadian National Railways or the Edmonton, Dunvegan and British Columbia Railway. I do not know whether the Minister of Railways (Mr. Dunning) has looked into this bill.


Charles Avery Dunning: I have looked into the
bill, but I was reserving my comments- which are similar to those my hon. friend has just made-until the bill is before the railway committee. I did not understand that we were accepting the bill by allowing it to go to the committee. Other bills have been similarly referred without our being committed to their adoption.
Private Bills


Richard Bedford Bennett: That is what I thought.
Motion agreed to and bill read the second time.
NORTHWEST CANADA CONFERENCE EVANGELICAIi CHURCH
Mr. J. L. BROWN (Lisgar) moved the second reading of Bill No. 68, to incorporate the Northwest Canada Conference Evangelical Church.


Hugh Guthrie: Is this bill printed, Mr. Speaker?


Hewitt Bostock: I am informed by the
clerk that it was printed this afternoon.


Hugh Guthrie: We have not had a chance to look at it.


Henry Elvins Spencer: Explain.


Mr. BROWN:: This is an ordinary church bill sought by a company of people who desire to secure legal sanction for carrying on the business that is incidental to every church.


Hewitt Bostock: Is it the pleasure of the house to adopt the motion?


Richard Bedford Bennett: Mr. Speaker, it is only
a, question of order. Is it not a rule of this house that unless a bill has been marked "E. F." it is not proper to read it a second time? This bill was only circulated relatively a few hours ago, and my hon. friend from South Wellington (Mr. Guthrie) has not his copy of it. I only mention that, not for the purpose of interposing any difficulty, but on the question of order.


Hewitt Bostock: Certainly; the objection
is well taken. No bill should be read to the house a second time unless it is printed in both languages.


Lucien Cannon: In this particular case I
understand that my hon. friend is not pressing his point. It is quite true that on the order paper it does not appear as if the bill were printed in both languages, but we have it on our file.


Hewitt Bostock: In both languages?


Lucien Cannon: It is printed; it is here.
In order to expedite matters, and seeing that it is printed, I think it might be sent to the committee. There would be no harm in doing so.


Richard Bedford Bennett: I am not rising to interpose any difficulty.


Hewitt Bostock: The point is well taken.


Richard Bedford Bennett: What I say is that the
bill should not be called at all, not having been marked "E.F." on the order paper. Some day some important bill not so marked may be called and the same situation may arise. My point is that the clerk should not call the bill unless it is so marked.


Hewitt Bostock: I am responsible; I called it .myself. The matter stands.
Motion stands.



INTERPROVINCIAL AND JAMES BAT RAILWAY COMPANY

[Stage Direction]
Mr. GEORGES PARENT (Quebec West) moved the second reading of Bill No. 69, respecting the Interprovincial and James Bay Railway Company.
Mr. BRADETTE:: Will the hon. member
explain the bill?


Georges Parent: The bill merely seeks an
extension of time for the construction of a certain line. It is familiar to hon. members, having had its first reading, and the only explanation I could give would be to read the bill itself. I do not think it necessary to do so unless it is the pleasure of the house.


Joseph-Arthur Bradette: This bill affects a part of my constituency and I believe a similar measure was before the railway committee last year.


Georges Parent: I have no objection to the hon. member reading the bill himself.


Hewitt Bostock: Is it the pleasure of the
house to adopt the motion?


Some hon. MEMBERS:: No.


An hon. MEMBER:: It is not on the file.


Georges Parent: It is on the file; I have
the bill.


Edmond Baird Ryckman: There are at least
twenty members who have not the bill on their file. There is no objection to offer for the simple reason that there is no bill before us to object to.


Hewitt Bostock: Stands.
Motion stands.



BELL TELEPHONE COMPANY OF CANADA

Pierre-François Casgrain: Mr. Speaker, before we proceed to
the consideration of other bills I would ask, by leave of the house, to revert to Order No. 38 for the purpose of moving the second reading of Bill No. 43, respecting the Bell Telephone Company of Canada. When this order was called I should have moved it, as I in-

Patent oj William, H. Millspaugh
tended to do in the absence of the hon. member for St. Hyacinthe-Rouville (Mr. Morin), but my attention was withdrawn to other matters and the order escaped my notice. The hon. member who has charge of the bill is away at present, and on his behalf I may explain it. It is very simple. The purpose is to authorize the company to increase its capital, provided:
_ That the total capital of the said company, including the present authorized stock, shall not exceed one hundred and fifty million dollars ($150,000,000).
Another section of the bill repeals certain legislation. In order that the matter may be given proper consideration I move that it be referred immediately to the committee on railways, canals and telegraph lines.


[Stage Direction]
Motion agreed to, bill read the second time and referred to the select standing committee on railways, canals and telegraph lines.

[Stage Direction]
The house in committee on Bill No. 15, respecting a certain patent application of William H. Millspaugh-Mr. Jacobs- Mr. Johnston in the chair.
On the preamble.
Richard Bedford Bennett: Were any changes made in the private bills committee?


Pierre-François Casgrain: I may explain that the hon. member in charge of this bill, my hon. friend from Cartier (Mr. Jacobs), has been ill for some time and as he has been obliged to go away he has asked me to take charge of it for him. A change was made at the suggestion of the commissioner of patents, amending section 1, as originally printed, to read:
The commissioner of patents may, upon payment of the fees prescribed by section forty-three of the Patent Act within three months from the date of the passing of this act, restore the said forfeited application of William H. Millspaugh, and provided the provisions of the said act are otherwise complied with, grant a patent upon the said application, the said patent to date from the nineteenth day of November, 1925.
The commissioner's idea was to bring the bill into conformity with the act so that the rights of present applicant persons should not be greater than they would otherwise have been at the time to first application was made.


Richard Bedford Bennett: I have had occasion to
deal with matters of this kind and I submit that it is highly improper to date a patent back three years ago, for under our system applications of other persons may have been filed with the commissioner of patents, and
they will not be dealt with except in the order in which they are received. If there be any application similar to this that should be dealt with it follows that that applicant should secure his rights without reference to a party who has neglected his and forfeited his claim. In other words, the statute should read, in my judgment, when renewing an application of this character, "Subject to any rights that may have accrued to other persons in the meantime''. The patent should be dated as of present and not of the previous date, because by so doing you may work great injustice to those who have filed claims for patents in the meantime. In some instances they may have received their patents and now find a patent dated back over-riding their own. That is improper, and I submit we should not lightly place the imprimatur of approval of this parliament upon an application which was made three years ago, thereby granting a patent so antedated. We should make it subject to such rights as may have accrued to other persons in the meantime with respect to the same subject matter.


Georges Parent: This matter was very fully discussed before the private bills committee and the views just now advanced by the leader of the opposition then prevailed. Such rights as he has mentioned should be protected and I for one would support any amendment to that effect.


Henry Herbert Stevens: They are not protected.


Georges Parent: I believe that was the
idea.


Henry Herbert Stevens: I think it is clear that
they are not protected, because the bill says: .... restore the said forfeited application. . .
Subject to further explanation by my hon. friend who is chairman of the committee, the bill as it now stands would by an act of parliament restore the full rights of this patentee.


Mr. RINFRET:: I should like to explain
that the Department of State, which now has control over patents, is not over-anxious to allow any of these bills to pass; they are imposed upon us first by a private member introducing them and then by the committee on private bills which considers them, so we are in the hands of parliament. In this case the patent was granted in 1925, but the patentee failed to pay the fee. He is now offering to pay that fee, and that is why it is proposed to restore his patent. I may say that the commissioner of patents appeared before the committee, and I understand he makes it a practice to ascertain whether, in the inter-

Patent of William H. Millspaugh
vening period during which, the patent was suspended, other similar applications have been received. The reason for dating the restoration of the patent back to May 19, 1925, is because the duration of a patent is eighteen years. If we grant the patent dating this year the patentee would then have had the patent for a greater number of years than the act allowed.


Richard Bedford Bennett: I agree with what the
minister has said, but it should be subject to the rights, if any, which have been established by other persons in the meantime.


Louis Édouard Fernand Rinfret: If we reach the other bill my hon. friend will find that we have inserted a clause covering that point, but in this bill that danger would not arise.


Lucien Cannon: If my hon. friend will
allow me to say so, this bill does not restore the patent. When the bill came before the committee the objections taken by my hon. friends also arose in our minds, so the only right we granted was permission to renew the application before the commissioner, and the commissioner is at liberty either to grant or to refuse the application.


Richard Bedford Bennett: If there is no doubt about that, it is all right.


Lucien Cannon: Should the application be granted when the commissioner has looked into the particulars of the case, then my colleague the Secretary of State has given the reason why the patent will be dated from 1925, to expire in eighteen years. The bill itself does not grant the patent, but simply restores to the interested people the right to go before the commissioner and explain their case.


Edmond Baird Ryckman: Will the Solicitor General ot the Secretary of State tell us the excuse offered for the failure to pay?


Georges Parent: The fact of not having paid
the fee in time. That was all we had in view when the committee considered the bill.


Edmond Baird Ryckman: If that is the situation
I believe that under the former practice of the patent office, if it still obtains, the applicant would not be entitled to very much consideration. Mere neglect to pay is not an excuse for not paying. I can quite understand that if an applicant for a patent has not received advice, or if he has received incorrect advice; if he has been advised that he need not pay or that he has a longer time in which to pay, there has been interference, but where there has been mere neglect to pay I do not see that this parliament should concern itself very much.


Herbert Bealey Adshead: Did he have to pay
only $20, and could he not pay that amount in three years?


Lucien Cannon: That is a mere technicality. I understand the applicant followed the provisions of the patent act, but for some reason or other did not pay the fee. The only thing we did in committee was to grant permission for him to go before the commissioner to have his case examined, and the commissioner could give whatever decision he deemed fit provided the man paid the usual fee.


Louis Édouard Fernand Rinfret: Perhaps I might explain that the patentee has represented to the department that he omitted making this payment not because of his own fault but through the neglect of his attorney. I should like to emphasize the fact that we are not espousing these bills; they are thrust upon us and we are in the hands of parliament. So far as the department is concerned, we are not particularly anxious that the bills should pass.


Edmond Baird Ryckman: I thought the situation was probably due to the failure of the solicitor to look after his client, and in that case I think the patentee should receive consideration by this parliament.


Richard Bedford Bennett: Presumably this application would not be renewed unless someone else had made an application in the meantime. Is that the position? That makes a very serious situation.


Herbert Bealey Adshead: We cannot hear.


Richard Bedford Bennett: I say presumably an application must have been made by another party or this application would not have been renewed, and the Solicitor General said that was so.


Lucien Cannon: No, I did not; I did not so understand my hon. friend.


Louis Édouard Fernand Rinfret: I am informed otherwise by the commissioner.


Richard Bedford Bennett: The only difficulty I have is this: Why is this patentee here unless someone is interfering with what he conceives to be his rights?


Louis Édouard Fernand Rinfret: He has represented that
this situation arose through an oversight on the part of his attorney.


Richard Bedford Bennett: Why has he not made a new application?


Louis Édouard Fernand Rinfret: Because the other one has not been disposed of.

British Steel Piling Company


Richard Bedford Bennett: This bill will cost a lot of money. The patentee should have paid $20, but he has not done that. Why should we restore the application by an act of parliament unless someone is being hurt? Because otherwise he could pay $20 and make a new application instead of paying hundreds of dollars to get this bill through.


Lucien Cannon: I appreciate the point
raised by my hon. friend. I can quite understand that the applicant in this case probably thought his patent would be restored as from this year, but the only thing he secured from the committee was his right to renew the application.


Richard Bedford Bennett: As from 1925?


Lucien Cannon: Yes.


Richard Bedford Bennett: And he could have made a new application?


Georges Parent: The only trouble with this bill is that it does not seem to include a clause which we did intend to include, providing that if anyone started to manufacture or use this patent during the time this man was in default or this company was in default, the rights of such persons would be protected.


Lucien Cannon: But if my hon. friend will allow me, that point does not arise at all, because the moment the commissioner finds that such is the fact the patent will not be granted.


Edward Joseph Garland: The legal
gentlemen present may be able to keep cool during this debate but might I ask you, Mr. Chairman, to suggest to whomever is in charge of the ventilation of the chamber that the temperature is around 75 degrees and we cannot stand that very much longer. We would like a little air.


Mr. CANTLEY:: I should like to know why this bill is here at all. Why does not the gentleman who failed to pay the fee make a new application for his patent? There must be some reason why he has not done so, and I should like to know what it is.


Edmond Baird Ryckman: If I may be allowed to answer the inquiry of my fellow member, an inventor must within a specified time after he has invented any new and useful improvement, which I think is twelve months, make his application for a patent, and if that time has expired he cannot apply. He is out of court, and it is too late for anyone to apply for a patent in 1928 for an invention which he made in 1925.


Lucien Cannon: My hon. friend has the answer.


[Stage Direction]
Preamble agreed to.
Section 1 agreed to.
Bill reported, read the third time and passed.

[Stage Direction]
The house in committee on Bill No. 16, respecting certain patent applications owned by the British Steel Piling Company, Limited -Mr. Jacobs-Mr. Johnston in the chair.
On section 1-Authority to issue patents notwithstanding delay in filing applications.
Richard Bedford Bennett: Let us have some explanation with respect to this.


Pierre-François Casgrain: The bill is similar to the one just passed, and it stands in the name of the hon. member for Cartier (Mr. Jacobs). It was referred to committee, and after explanations had been given certain amendments were made. On page 2 of the bill, line 6, after the word "shall," the following words were inserted in the first section:
.... notwithstanding anything contained in the Patent Act, date from the seventeenth day of May, 1923, and the seventeenth day of May, 1924, respectively, and shall-
The second section in the bill has been struck out. In the third section an amendment, has been made, omitting after the word "has" the words-
-in the period between the seventeenth day of February, 1924-
These amendments were approved by the committee and the bill was ordered to be reported to the house.


Georges Parent: I did not quite catch what the hon. gentleman said. Did he say these amendments had been before the*committee?


Pierre-François Casgrain: I think they were.


Louis Édouard Fernand Rinfret: I might explain that the same reservation is made as in the previous bill. In this case the patents concerned were obtained in Great Britain by the holders but they had failed to register in Canada within the period of one year as required by the act. They are now coming to us to file their patents in Canada. We could not, however, grant the patents under the act; a special bill is required to enable them to obtain registration in Canada. The amendments that my hon. friend has mentioned are in the same class as those in the previous bill, the effect being to take the patents from the date on which application should have been made

Ways and Means-Customs Tariff
rather than this year. If any person has in the intervening period manufactured, used or sold in Canada the inventions described, then such person may continue to manufacture, use or sell such inventions in Canada. This is the customary clause, but our information in the department is that nothing of the kind has happened. Again I say that we are in the hands of the committee. The department as such does not. recommend any bill of the kind.


Hugh Guthrie: But the private bills committee did make these amendments?


Pierre-François Casgrain: Yes, the amendments which I read.


Hugh Guthrie: Because it is asserted they did, and the chairman apparently says they did not.


Lucien Cannon: I may say to my hon. friend that we made two amendments.


Pierre-François Casgrain: The amendments which I read.


Lucien Cannon: The first as to the date of the issue of the patent, and the second for the protection of the vested rights.


Richard Bedford Bennett: The amendment is being made to the section in the terms mentioned by the hon. member for Dorchester (Mr. Cannon) ?


Pierre-François Casgrain: Exactly.


[Stage Direction]
Section agreed to.
Sections 2 and 3 agreed to.
Bill reported, read the third time and passed.


[Stage Direction]
The house in committee of ways and means, Mr. Johnston in the chair.
John Frederick Johnston: When the house rose at six o'clock, we were considering item 522d.


Richard Bedford Bennett: Does the adding of this item in any way change the existing conditions? I understand it does not.


James Alexander Robb: It is just adding the word "mercerized".


Richard Bedford Bennett: Provided that the manufacturers manufacture it in their own factories.


Donald MacBeth Kennedy: Are the rates under this item the same as the rates under the original 522d?


James Alexander Robb: No, they are free in all three columns. We have added the word "mercerised".


Hugh Guthrie: What is the effect of this?


Donald MacBeth Kennedy: Does a different class oi manufacturer use the goods or what is the reason for the difference in the duty? Is it a question of protection to one manufacturer as opposed to another? My point is that manufacturers use both. Why then should one manufacturer be able to import 40's and finer, mercerized, free, and the other have to pay a duty if he imports?


James Alexander Robb: These mercerized yarns are
not widely made in Canada.
Item agreed' to.
Customs tariff-522e. Yarns wholly of cotton, exceeding number twenty, and not exceeding number forty, not more advanced than singles; cotton sewing thread yarn and crochet, knitting, darning and embroidery yarn, in hanks, composed of three strands or more, not bleached, coloured nor mercerized; imported by manufacturers who manufacture cotton sewing thread and crochet, knitting, darning and embroidery cottons only for use exclusively in their own factories in the manufacture of those materials: British preferential tariff, 7i per cent; intermediate tariff, 15 per cent; general tariff, 20 per cent.


James Alexander Robb: I beg to move that the following be substituted for tariff item 522e:
522e. Yarns wholly of cotton, exceeding number twenty, and not exceeding number forty, not more advanced than singles; cotton sewing thread yarn and crochet, knitting, darning and embroidery yarn, in hanks, composed of tw:o strands or more; all yarns specified in this item when imported by manufacturers for use exclusively in their own factories in the manufacturing or spooling of cotton sewing thread and crochet, knitting, darning arid embroidery cottons: British preferential tariff, 7J per cent; intermediate tariff, 15 per cent; general tariff, 20 per cent.


Henry Herbert Stevens: This item is a grouping of a number of items?


James Alexander Robb: It is a grouping of items 520, 525 and 536.


Henry Herbert Stevens: The minister will pardon me if I am not quite clear, but I will read the first part of item 522e:
Yarns wholly of cotton, exceeding number twenty, and not exceeding number forty, not more advanced than singles.
Item number 522a reads:
Yarns .	.	.	. wholly of cotton, exceeding
number twenty, but not exceeding number forty, not more advanced than singles.
Why repeat this in the composite item when it is provided for in item 522a? The reason

Ways and Means-Customs Tariff
I draw attention to that is this: In the old tariff it was pointed out by the minister that certain articles were entered under one item when perhaps they should have been under another; that this earned considerable confusion and that the change was supposed to clear it up. Now we have a repetition of two items with a difference in the rate of duty. If I am wrong I wish the minister would point out where I am wrong or make an explanation.


James Alexander Robb: This is a manufacturers' item. The other was a consumers' item.


Henry Herbert Stevens: Then the consumers' item bears a duty of 12| per cent, 15 per cent and 22| per cent, and the manufacturers' item bears a duty of 7j per cent, 15 per cent and 20 per cent. Is that right?


James Alexander Robb: Yes.


Richard Bedford Bennett: Is there no method of
overcoming the difficulty that has been experienced in the customs department with re-peet to articles that are imported for use of manufacturers only in their own mills and that are very often sold out of stock and used elsewhere? As the minister knows, there has been a good deal of discussion as to how the public can be safeguarded in connection with matters of that kind where you specify, as I said yesterday, the place at which the article is to be used and the conditions under which the usage takes place.


James Alexander Robb: That is effected by the different changes. The customs officials have approved this and they believe they will be able to work it out.


John Anderson Fraser: I notice the original draft reads, " three strands or more," and the present one reads, "Two strands or more." What is the object of the amendment?


James Alexander Robb: This is to broaden out the administration of the act.


John Anderson Fraser: I am asking why the minister is decreasing the number of strands.


James Alexander Robb: This allows them to get two strands or more. It was felt that to make it three strands was a little strict. The manufacturers have asked for this change.


Richard Bedford Bennett: What is the effect of it?


James Alexander Robb: I imagine the effect of it is to make it a little easier for the manufacturers to get the raw product they require. It was found that some of them were using two-ply and doubling them.


Donald MacBeth Kennedy: I understand we are discussing item 522e. The conversation across the floor has been in such a low tone that I could not hear it. I notice cotton yams were dutiable at 15 per cent. 22^ per cent and 25 per cent. This is about the sixth or seventh reference to item 522, and it looks as though we are getting a cut of about 7i per cent in the duty, but I wonder if the minister can give us any idea of the amount of imports that will be affected, that came in under the (wo rates last year. How much of a reduction is it-one per cent or a fraction of one per cent? V hat will be the possible loss of revenue?


James Alexander Robb: There is a portion under
several of the other items, and I cannot tell; but under item 535 the importations amounted to $636,628.


[Stage Direction]
Item agreed to.
Customs tariff-522f.	Yarns and warps
wholly of cotton imported by manufacturers of tapes, braids, webbings and woven labels for use exclusively in the manufacture of such articles in their own factories:	Provided that yarns and warps which are entitled to free entry or to lower rates than are mentioned in this item shall not be entered at the rate specified in this item: British preferential tariff, 7J per cent; intermediate tariff, 12£ per cent; general tariff, 15 per cent.
Sir GEORGE PERLEY:: Is this in order? We have before us the votes and proceedings of February 16, and in my copy there is no item 522f. Can we go on with it under those conditions?


James Alexander Robb: These are goods that are procurable in Canada and that are used by manufacturers.


Hugh Guthrie: The point is that the committee has had no notice of this.


James Alexander Robb: I do not Object to having it go on the record and letting it stand so that my hon. friends can examine it.


Edward Joseph Garland: Do I understand the minister to say that the item will stand?


James Alexander Robb: I have no objection, if the committee insists upon it.


Edward Joseph Garland: Perhaps the minister could explain something in the meantime. The item states:
Provided that yarns and warps which are entitled to free entry or to lower rates than are mentioned in this item shall not be entered at the rates specified in this item.
Does that mean that yarns and warps now entering free, if they come under the terms of this item, shall not be subject to this duty?

1436	COMMONS
Ways and Means-Customs Tariff


James Alexander Robb: If they are entitled to free entry under another item, they will still be free.


Edward Joseph Garland: I see, and it is only in ease of a higher duty under some other item that this change takes place.


James Alexander Robb: That is right.


Richard Bedford Bennett: There arises here a difficulty which I trust the Minister of National Revenue will consider. I have received communications of late with respect to the administration of the Customs Act and with respect to changes made by orders in council of which the public is not aware. A man buys goods, pays his duty, sells them, and then an order in council is passed by which the classification is in some sense altered, and he is called upon to pay additional duties sometimes exceeding the profit he madia with respect to the transaction. Then the old difficulty arises; he gets his friends in parliament or at Ottawa to work for him, while somebody else who is not so fortunate is left out in the cold. That actually happened in connection with a rather important transaction at one of the ports recently. The point made by the hon. member for Argen-teuil is very important here. If these amendments are to be made, from what date are they to apply? These are absolutely new items, as the minister was good enough to say. Will the importers who brought in their goods under the old items as they stood prior to the date of to-day or to-morrow, or whatever day the minister fixes, be called upon to pay under the new or the old item, and will they be entitled to a refund if they paid at a higher rate than is mentioned here? As it stands, of course, they all go back to the date of the budget speech, but these new items were not brought down until yesterday.


James Alexander Robb: My hon. friend will observe that it is governed by this provision:
This act shall be deemed to have come into force on the seventeenth day of February, one thousand nine hundred and twenty-eight, and to have applied to all goods mentioned in the foreging resolution imported or taken out of warehouse for consumption on and after that date and to have applied to goods previously imported for which no entry for consumption was made before that day.


George Halsey Perley: How, then, can the minister justify bringing in these alterations without notice, proposing to pass new items and have them take effect as if they had been brought in on the 16th day of February when he made his budget speech? How can he justify that without giving notice to anybody?
4,Vtr K. J. Garland.]


James Alexander Robb: That has always been the
procedure, and under alii governments, I think.


Richard Bedford Bennett: In the case of slight
amendments, but not new items.


James Alexander Robb: This is a reduction. As to
the point raised by my hon. friend a moment ago regarding increased duties, I do not see how that could possibly arise because, as he knows, the government cannot increase the duty by order in council.


Richard Bedford Bennett: I was speaking of classification, determining in what class a given article shall come. I will give my hon. friend a concrete case if he so desires. Only to-day while I was in the chamber a telephone message was left at the office saying that the Journals were not as full as they have been heretofore with respect to these items. I do not know what was meant by that because I was not there, but evidently it was these items that were in mind. My hon. friend should give notice so that the public will know exactly where they stand. As far as I personally am concerned, it is not a matter of importance, and as far as my friend from South Wellington is concerned it is not a matter of importance to him, but, after all, the public have rights, and I think we had better consider them according to the rules of parliament.


James Alexander Robb: In the administration of the
act the board of customs from time to time do reclassify goods.


Richard Bedford Bennett: And make the classification retroactive; that is the trouble.


James Alexander Robb: This is not a new procedure
at all. I observe, for instance, that in 1920 there were 25 changes made after the resolutions were brought down.


Richard Bedford Bennett: Some of them merely
typographical changes.


James Alexander Robb: I have not gone through
them, but that has been the procedure.


Hugh Guthrie: Will the minister inform
the committee what the practice is to be? The act comes into force and the new rates of duty are applied from the 17th of February. So far as the public are concerned, they have no notice of any changes or of any new items. New items can only be considered in the ordinary way, and notice should be given of them in the Votes and Proceedings. When will these new items take effect? Do they date back to the 17th of February or become effective from the day they are introduced?

Ways and Means-Customs Tariff


James Alexander Robb: Under the procedure that has always been followed in the past, from the day the budget is brought down the customs officers take all entries under the new items, subject to any amendments.


Richard Bedford Bennett: And subject, of course,
to rebate in case the duty is lowered, or a further charge if it is increased.


John Frederick Johnston: Shall the item carry?


James Alexander Robb: I do not object to its standing if hon. gentlemen insist upon it.


Edward Joseph Garland: It is a
decrease. I do not ask that it stand.


[Stage Direction]
Item agreed to.
Customs tariff-523. Woven fabrics wholly of cotton, not bleached, mercerized nor coloured, n.o.p.: British preferential tariff, 12§ per cent; intermediate tariff, 20 per cent; general tariff, 22J per cent.
Richard Bedford Bennett: Any changes here?


James Alexander Robb: There is no change. This is the resolution as brought down.


Richard Bedford Bennett: Is there any change from the old tariff?


James Alexander Robb: Yes. The rates proposed under this classification are 12^, 20 and 22J per cent. The former rates were, under item 521, 12J, 22i and 25 per cent; item 524, 15, 17i and 20 per cent; item 524b, 15, 17i and 20 per cent. The imports for the year ending March 31, 1927, were, under item 521, 1617,537 British preference; $6,557 treaty rates; $1,199,223 general tariff; item 524, $60,486 British preference; none under treaty rates; $501,894 general tariff; item 524b, $454 British preference; $446,987 general tariff. Hon. gentlemen will observe that there is considerable spread in the British preference.


Henry Herbert Stevens: And an increase in the general rate.


James Alexander Robb: There is an increase in the general rate on two items, but the importations were largely under item 521.


Donald MacBeth Kennedy: I would like to point out to the minister something that might help us in studying these matters. I have here the volume, Trade of Canada, and in a general way one can tell where a certain item comes in this volume but if it contained a column alongside the description of the various classes giving the number of the tariff item concerned, you could tell exactly under which item the imports were entering. As it is at present, the descriptions contained in this volume do not correspond with the descriptions in the tariff schedules, and no item numbers are
given. If the number of the item were included opposite the description of the goods, we could get from this volume a proper check of the imports.


James Alexander Robb: That is a very important
point, and I believe under the new classification they might be able to follow it more closely. I shall direct it to the attention of the Bureau of Statistics.


John Anderson Fraser: The minister said a few
minutes ago that there was a decrease from 15 to 12J per cent on these items under the general tariff. The amount of importations was about $6,500. There is an increase there-


James Alexander Robb: Before my hon. friend proceeds further I will give him the correct figures. The amounts under item 521?


John Anderson Fraser: No, items 524 and 524b.


James Alexander Robb: Item 524, $60,486, and item
524b, $4,054, under the British preference.


John Anderson Fraser: About $65,000.


James Alexander Robb: About that.


John Anderson Fraser: And under the general
tariff, which is increased 2i per cent, you have importations of $950,000. That certainly is decreasing the tariff!


James Alexander Robb: My hon. friend has not
observed that the policy is to divert as much as possible of that business to the United Kingdom. This will be sufficient to divert it to the British industries.


Richard Bedford Bennett: Surely my hon. friend
is not serious in that.


James Alexander Robb: What more does my hon. friend want?


Richard Bedford Bennett: Great Britain does not
produce raw cotton; the United States does. Great Britain is separated from Canada by 3,000 miles of ocean; the United States adjoins us. Yet he wants the committee to believe that a change of but 2\ per cent is going to divert the traffic to Great Britain from the United States, whence at the present moment we are getting $950,000 worth, as against only $65,000 worth from Great Britain.


John Anderson Fraser: All the afternoon I have
heard the argument about changing the British preference 2| per cent to increase imports from Great Britain. Now, my experience in mercantile business leads me to believe that it will do nothing of the kind. What controls the buying of goods more than anything else is quick turnover and proximity of market.

Ways and Means-Customs Tariff


Edward Joseph Garland: The minister admitted that this afternoon.


John Anderson Fraser: I say this change will not
divert the business to Great Britain because the American market is close to us. The object of all general mercantile business today is to increase its turnover. Naturally the closer your market the quicker you get your goods and the greater your turnover. When you come to the practical effect of this change, I say in my opinion it will increase business with the United States instead of with Great Britain.


Edward Joseph Garland: I do not
think there is the least doubt in the world that the statement of the last speaker can be supported by the figures given by the minister, as well as by a general consideration of the items. Let me put it to him in this way, and I am going to be even more severe than the hon. member for Cariboo (Mr. Fraser) :	Not only will the trade not be
diverted to England, but I think the minister's explanation is most insincere; I do not think he is under any delusion in the matter at all. If he is really interested in diverting the trade to British manufacturers, let him put this on the free list with Britain. Then we will believe the minister. But when he says there is a reduction of duty because of the 2i per cent increase in the British preference, well, he is asking the committee to believe a whole lot more than we are capable of. Will the minister consider putting it on the free list?


James Alexander Robb: No. It is thought that this
is a fair reclassification. It is also believed that the 2} per cent additional advantage is worth while to the British manufacturers.


Hugh Guthrie: The minister, I suppose,
realizes that the whole effect of the change is an increase in customs duty? That is the result that we will have.


Edward Joseph Garland: Absolutely.


Hugh Guthrie: On our large importations from the United States the rate is increased. On a comparatively negligible part of our imports, $65,000 worth, the rate is lowered 2J per cent, but on the aggregate under this item more will be collected by the department. The rate of duty is higher. That is the result of these tariff changes on this particular item.


James Alexander Robb: No. Had my hon. friend
figured it out he would not have made that statement. I have the figures here of the estimated changes in taxation based on the imports of last year. Under tariff item 521 there will be a decrease of $30,146; under

tariff item 524, an increase of $11,035; under tariff item 524b, an increase of $11,163-or a net decrease of $7,948.


Hugh Guthrie: I cannot understand it.


Richard Bedford Bennett: Not on the facts stated.


Donald MacBeth Kennedy: One of the previous
items, I think 522b, was given free entry under the British preference. I remember last night asking the minister about an increase in the intermediate and general tariffs on one of the other items, and he explained that the increase was due to the fact that they wanted to increase the rate proportionately under the intermediate and general tariff and still maintain the item free under the British preference. Under this item 521, cotton fabrics unbleached, according to the Trade of Canada, page 170, we imported from the United Kingdom 7,000,000 yards, and from the United States 13,000,000 yards. In this item there is a reduction of 2^ per cent in the general tariff applying to the United States; there is no reduction in the preferential tariff applying to the United Kingdom. There is a change in principle in that arrangement. Would the minister explain why there is no reduction in the British preference in this instance? I understood last night that he was anxious to maintain the British preference.


James Alexander Robb: 
Edward Joseph Garland: Good Lord! For a preferential rate 12i per cent is not a low, it is a high rate. The minister, I think, has not yet got the point of the hon. member for Peace River (Mr. Kennedy). The minister cannot really be serious. The United Kingdom exported to us 7,000,000 yards, according to the last trade figures; the United States, 13,000,000 yards. But uhder this item the preference remains the same, that is, the United Kingdom traders get no particular advantage; but there is a decrease to the American manufacturer of 2J per cent under the intermediate.


[Stage Direction]
Item agreed to.
Customs tariff-523a. Woven fabrics wholly of cotton, bleached or mercerized, n.o.p.: British preferential tariff, 15 per cent; intermediate tariff, 22J per cent; general tariff, 25 per cent.
Richard Bedford Bennett: What was the duty on
that item?


James Alexander Robb: There is no change.


Henry Herbert Stevens: Why not leave it alone?


James Alexander Robb: The word "mercerized" is
added.


[Stage Direction]
Item agreed to.

Ways and Means-Customs Tariff
Customs tariff-523b. Woven fabrics wholly of cotton, n.o.p.: British preferential tariff, 20 pfer cent; intermediate tariff, 25 per cent; general tariff, 27i per cent.
Henry Herbert Stevens: In the old tariff corresponding with 523a there are included tailors' hollands of linen and towelling of linen or cotton in the web, coloured or not. What becomes of that?


James Alexander Robb: Linen goes into the linen
item.


Henry Herbert Stevens: And "cotton in the web,
coloured or not"?


James Alexander Robb: In the next item.


Henry Herbert Stevens: I do not see it.


James Alexander Robb: We shall come to it; this is a
reclassification.


Henry Herbert Stevens: I want to see where the
different items are placed in the reclassification.


Richard Bedford Bennett: In some of the items that were formerly included in 523 there has been a slight increase and some decrease?


James Alexander Robb: 
Richard Bedford Bennett: The minister must realize how misleading these figures are; they have no relevancy at all. We have a new item in this tariff. We have fabrics wholly of cotton, n.o.p. That corresponds to the old item, which read "cotton fabrics n.o.p." As a result of this proposed tariff it will be impossible to institute any comparison at all inasmuch as the goods that will be affected by this item are entirely different from those affected by the old item. You may be providing for items that were not provided for in the old tariff and the real result is a substantial increase. Let me put it this way:	You have
cotton fabrics of all kinds and you specify the rates of duty at which, say, 90 out of 100 parcels shall be dealt with. The remaining 10 not having been specifically mentioned are dealt with under the n.o.p. provisions. Before this tariff was introduced you dealt with, say, fifty or sixty of the hundred articles specifically, while the n.o.p. clause applied to the other forty. I contend that you cannot institute any comparison between those forty and the ten to which I have referred. As I say, this item really amounts to a substantial increase in the tariff.


James Alexander Robb: My hon. friend is right when he says that there is a general reclassification, but we must consider these items all together. To-day, taking the total changes in the schedules, there will be an aggregate decrease of $1,119,560.


Richard Bedford Bennett: But you are comparing
different things.


James Alexander Robb: I agree with my hon. friend
that you cannot pick out individual items, but I have given the total decrease in taxation.


Henry Herbert Stevens: That is excellent publicity, but it is not very convincing. I have before me two items. Item 523b of the new tariff gives the rates as 20, 25 and 27i; under item 522 of the old tariff they are 15, 22i and 25.


James Alexander Robb: The former rates were 22k, 30 and 32i; they are now 20, 25 and 27|.


Edward Joseph Garland: The minister might be still more convincing if he would give us the total importations under item 638, buckram, and the possible difference in revenue. He might also give us this information in regard to 523. These are the two items that make up the present one.


James Alexander Robb: I have given printed cotton
fabrics, the total importations of which are 1,896,147, the reduction in taxation being estimated at $69,273.


Edward Joseph Garland: Those are general figures. Gam the minister give us the importations and the reduction in revenue under that one item, 638, buckram, which is now free of duty?


James Alexander Robb: I am not sure that I have it handy.


Edward Joseph Garland: If it is free of duty how do you get revenue out of it at all? Can the minister give us 523, cotton fabrics, dyed?


James Alexander Robb: That is the one I have been quoting. I gave the importations as $1,896,147.


Edward Joseph Garland: What would be the estimated loss in revenue as a result of the decrease under the joint item now called 523b.


James Alexander Robb: Buckram is one of the items
subject to the 99 per cent drawback.


Richard Bedford Bennett: That material is used only for bookbinding.


James Alexander Robb: Yes, and hats also.


Edward Joseph Garland: Is there or is there not an increase in the item?
1440	COMMONS
Ways and Means-Customs Tariff


James Alexander Robb: No, a decrease; I have repeated
that several times.


Edward Joseph Garland: What is the decrease in connection with buckram?


James Alexander Robb: There are two items that come under this one. One shows a decrease of $69,273, and the other a decrease of $184,695.


Edward Joseph Garland: Which is
which? I cannot understand that at all. The minister says there are two items, but certainly there cannot be reductions in both of them. How can that be when one is free?


James Alexander Robb: The buckram about which my hon. friend is speaking goes into another classification; it will be entitled to a drawback of 99 per cent.


Donald MacBeth Kennedy: There seems to be a mistake in this somewhere. If you look at item 523b and go right across the page you come to buckram; under item 523c, if you go right across the page you come to cotton fabrics, and there is a bracket which includes buckram and cotton fabrics, which is very confusing. If the minister will look at that he will possibly see the difficulty. Under the old schedules buckram and cotton fabrics did not seem to belong to the one item at all. That seems to be where we are all confused.


Richard Bedford Bennett: Yes, and I think if the hon. member for Peace River will look at item 1061 he will accentuate that point. The minister said buckram was being given a drawback, although heretofore it has been free. Item 1061 includes:
Woven fabrics for book binding.
On this item there is a drawback of 99 per cent, so there is an increase of at least one per cent, whatever else may be said of it.


James Alexander Robb: There is a drawback.


Richard Bedford Bennett: A drawback of 99 per cent.


John Anderson Fraser: How do you get a drawback on an article coming in free?


James Alexander Robb: The old item was:
Buckram, adapted for the manufacture of hat and bonnet shapes.
Under that classification it was free, but under the new item it is placed as a drawback item.


Henry Herbert Stevens: The minister is not quite right. The drawback is granted where this is brought in as bookbinding material only, unless you have another item.


James Alexander Robb: Also for hats and bonnets.


Henry Herbert Stevens: What item is that?


George Halsey Perley: Item 1012.


Donald MacBeth Kennedy: Is buckram a cotton product?


James Alexander Robb: Yes, I think it is in that classification.


Richard Bedford Bennett: It is not cotton at all; as a matter of fact it is linen.


James Alexander Robb: In answer to my hon. friend for Vanceuver Centre, (Mr. Stevens), when we come to it the new item will read:
When used in the manufacture of linings for hats and caps of in the manufacture of hat shapes and bonnet shapes from buckram.


Henry Herbert Stevens: There is an amendment to be made?


James Alexander Robb: Yes.


Richard Bedford Bennett: But what is the duty which will be imposed in order that the drawback way be made?


James Alexander Robb: If it comes in as an n.o.p.
article it may come as coloured linings or as coloured cottons.


Richard Bedford Bennett: And if so, there is a drawback of 99 per cent? Then an item which was free before you tinkered with the tariff is now subject to a drawback of 99 per cent; in other words the duty is increased by one per cent.


Donald MacBeth Kennedy: What is the advantage of making a free article dutiable and then handing back 99 per cent?


James Alexander Robb: For administrative purposes.


Edward Joseph Garland: If the minister will tell us how that is going to simplify matters I shall be tickled to death. It is now free; there is no administrative work in connection with it, but we are going to place a duty on it which will necessitate custom houses, inspections and appraisals, and then we are giving a drawback of 99 per cent which will require a staff to look after it. And the minister says it will simplify the work.


James Alexander Robb: The customs department asked for this change originally. I will be frank with my hon. friends; this is one of the items which, as we have been taught by experience, have been abused.


Mr. EDWARDS (Waterloo):: Will you not have the same difficulty whether it comes in free or whether it is taxed?


James Alexander Robb: 
Richard Bedford Bennett: One does not wish to
worry -the minister unnecessarily, but I put this to him faMy: He is going to increase the work of the people in the customs department, which means more employees and a greater cost to the people. The article must go through the customs; duty must be ipaid, and 99 per cent of the money must be returned. The unfortunate taxpayer is out his money; he has to pay the duty and then wait until he gets a cheque back for the drawback to which' he is entitled. Then, in the item as it formerly stood, buckram came in free and simply had to be passed through the customs. Now it wild be charged a duty of only one per cent, and considerable machinery will be required to do the additional work. That is the sum total of this change, and we are told that someone wants the change for administrative purposes. I never saw a chance to make another job, where the public service is affected, in which some person did not want to make the necessary change. I am sorry to say that is so.


James Alexander Robb: I will admit that that condition prevails more or less.


Richard Bedford Bennett: My hon. friend knows that; he has had more experience than I have had. I do not see why we should make this change, which will be an expense to the country, and which will only mean the collection of a duty of one per cent.


Pierre-Ernest Boivin: I think this item could be very well compared to that item which referred to shoe laces; there may be abuses of this item also. Buckram may be used for purposes for whioh it should not be admitted free. Now, hat manufacturers and bookbinders will receive a refund on the buckram they use while everyone else will have to pay a duty.


Donald MacBeth Kennedy: Then this is an increase in the duty.


Mr BOIVIN:: No. These other people h,we been getting it under false pretences.


Donald MacBeth Kennedy: How could they be
getting it under false pretences when it is free? How could there be any evasion of duty there? You are now specifying that only certain people will receive a drawback, and you reduce the principle of favoritism as between the manufacturers of different articles. That must be the purpose.


Pierre-Ernest Boivin: You will find a great difference if you ask for a drawback; you will deal with an expert who looks after these things. When you are simply clearing an article through customs you often deal with
men who have not a great deal of experience, who consider the invoice more than the quality of the goods.


Donald MacBeth Kennedy: Where could the abuse arise in connection with a free article coming into the country for commercial purposes?


John Anderson Fraser: My understanding of this matter is that buckram for the manufacture of hats and for use in bookbinding comes in free, but we must remember that buckram is also used in the manufacture of clothing. The effect of this tariff change, as I see it, is to put a duty on buckram used foi the purpose of stiffening for clothing, so that people who buy clothes wil have to pay the duty, while those buying hats will not have to pay it.


James Alexander Robb: My hon. friend has just proved the case; if he is right there has been an abuse. Under the old item it was not intended that the buckram should be used for anything except what was stated. Manufacturers of clothing have a certain protection, and they are entitled to pay for that particular protection. My hon. friends are wrong in saying that this comes in for bookbinding. Bookbinding is under another item.


John Anderson Fraser: If the material is for the manufacture of a suit of clothes it is probably dutiable.


James Alexander Robb: The manufacturer of clothes never had the privilege which my hon. friend says he has been using or abusing.


John Anderson Fraser: I did not say anything
about it. I say that under the old act it is absolutely free.


James Alexander Robb: No. Let me read the old
tariff and my hon. friend can place his own interpretation upon it. It is:
Buckram, adapted for the manufacture of hat and bonnet shapes.
The manufacturers may have brought it in and used it for other purposes but it never was intended that they should.


[Stage Direction]
Item agreed to.
Customs tariff-523d. Woven fabrics wholly of cotton, imported by manufacturers of cor.setry, for use exclusively in the manufacture of such articles in their own factories: British preferential tariff, 12J per cent; intermediate tariff, 17J per cent; general tariff, 20 per cent.
Richard Bedford Bennett: There is no change in that item, is there?


James Alexander Robb: The word "corsetry" is changed
to "corsets".


[Stage Direction]
Item agreed to.
1442	COMMONS
Ways and Means-Customs Tariff
Customs tariff-523e. Woven fabrics wholly of cotton with cut pile, n.o.p.: British preferential tariff, 17J per cent; intermediate tariff, 25 per cent; general tariff, 30 per cent.
Richard Bedford Bennett: Has there not been much discussion with respect to this? I should judge so from a trade paper that was sent me the other day. The minister might explain how many factories in Canada are affected by it.


James Alexander Robb: These are cotton plushes. My hon. friend was referring to mohair plush, which we will come to later on. The rates were formerly 17i, 32J and 35. The proposed rates are 17i, 25 and 30. The imports for the year ending 31st March, 1927 were $812,988. The estimated reduction in revenue is $16,519.
Mr. BENNETT; Apparently the imports come mostly from the United States.


James Alexander Robb: I have no memorandum showing where they come from.


Donald MacBeth Kennedy: This is another illustration of how nicely balanced this reduction is. Here is another case where there is no reduction in the British preference but there is a reduction of 7i per cent in the intermediate tariff and 5 in the general tariff. Now the imports of these velveteens from the United Kingdom amount to $747,398, and from the United States to which the general tariff applies the imports total $106,391. Here is another case where you are refraining from any reduction of the British preference but you are making a reduction in the general tariff, although the bulk of the imports come in under the preference. It is another case where the schedules being revised are so nicely balanced as to make an appearance of reduction and at the same time protect the manufacturers to the limit.


James Alexander Robb: We started out with the cotton schedule with the idea that 30 per cent would be the higher rate, and we have followed that, I think, with one exception. But the 171 per cent British preference rate is subject to a 10 per cent discount.


Donald MacBeth Kennedy: When coming in through Canadian ports.


James Alexander Robb: I think 90 per cent of the business comes in through Canadian ports.


Donald MacBeth Kennedy: That may be all very
well, but in this case the bulk of the imports come under the preference and there is no reduction of duty.


John Anderson Fraser: Is there any production of this class of goods in Canada?


James Alexander Robb: Quite a considerable amount, I think.


[Stage Direction]
Item agreed to.
James Alexander Robb: I beg to move that the following item, enumerations and rates of duty be inserted in Schedule A:
Customs tariff-523f.	Woven fabric of
cotton, not coloured, when imported by manufacturers of typewriter ribbon for use exclusively in the manufacture of such ribbon in their own factories; British preferential tariff, 10 per cent; intermediate tariff, 12J per cent; general tariff, 15 per cent.


Henry Herbert Stevens: No notice was given of this.


James Alexander Robb: This came in after the budget was brought down. It is represented to us that had there been no change this item would have gone into another classification-
Mr. BENNETT; -N.o.p.


James Alexander Robb: -which would have made it practically prohibitive for the manufacture of typewriter ribbons in Canada.


Richard Bedford Bennett: They are the same rates as before?


James Alexander Robb: The same rates as before.


Donald MacBeth Kennedy: The minister ought to give a reduction here because there has been a very strong propaganda carried on by the banks and other institutions for farmers to keep books. It has been represented that they should make themselves familiar with the typewriter so as to make the collection of the income tax much easier. It is worth while giving a reduction in the duty on typewriter ribbons so that we can encourage the1 farmers along that line.


James Alexander Robb: My hon. friend is springing a Scotch joke upon us.


[Stage Direction]
Item agreed to.
, Customs tariff-524. Seamless cotton duck in circular form, of a class or kind not made in Canada, for use in the manufacture of hose pipe: British preferential tariff, free; intermediate tariff, free; general tariff, free.
Mr. BENNETT; There is no change in this item, is there?
William Russell Fansher: Are the materials used in grain sacks imported under this item?


James Alexander Robb: The item specifies what it is for. There is no change in duty.


[Stage Direction]
Item agreed to.
Customs tariff-525. Sheets, pillow cases, diapers, tray cloths, quilts, counterpanes, towels' bath mats, wash cloths, table-cloths, napkins,

Ways and Means-Customs Tariff
dresser scarves, curtains, consisting of woven fabrics wholly of cotton, not further manufactured than hemmed or hem-stitched, not coloured, not embroidered nor otherwise ornamented: British preferential tariff, 15 per cent; intermediate tariff, 25 per cent; general tariff, 27i per cent.
James Alexander Robb: This item was formerly under 525' and 537. The rates under 525 were, 20 per cent, 27-t per cent, 30 per cent. The rates under 537 were, 25 per cent, 30 per cent and 35 per cent. The proposed new rates are 15, 25 and 27J per cent. The total imports for the year ending 31st March, 1927, of materials that will come under the new item, are not traceable. Available statistics show the importations of bed quilts to be $552,850, and of cotton towels $824,150. In the case of another portion of the item " manufactures of cotton " n.o.p." the importations amount to $1,765,611. A portion of this only is affected. The reduction in taxation will be $216,752.


John Evans: May I ask if this material is finished or unfinished, and does it need any processing after it is imported?


James Alexander Robb: It is finished material.


[Stage Direction]
Item agreed to.
Customs tariff-526.	Household blankets
wholly of cotton, not to include horse blankets, automobile or steamer rugs, nor similar articles: British preferential tariff. 15 per cent; intermediate tariff, 22J per cent; general tariff, 27J per cent.
James Alexander Robb: The former rates were 22| per cent, 30 per cent and 35 per cent. The imports for the year ended 31st March, 1927, were $252,154 and the estimated reduction in taxation is $19,061.


John Evans: This is an item which directly concerns every family in the land. Under another item we have made a kind of cotton duck entirely free. I do not see why the government should discriminate between one class and another all the way through this schedule. They say that the cotton industry languishes because there is not work. It languishes simply because the buying power of our working people throughout the country is being everlastingly curtailed by these measures Not only is the amount of duty added to the value of the goods, but at the same time about two dollars goes into the pockets of the manufacturer for every dollar that goes into the Dominion treasury. As I say, this is a commodity that is used by every family in the land and yet we maintain almost the highest rate of duty on it. It is a commodity that everyone that is working and producing for a living has to buy. This is
a most unfair and discriminatory principle from beginning to end and I wish to make that protest on this item.


Donald MacBeth Kennedy: Could the minister tell us why horse bankets are excluded? I have a vivid picture in my mind of something I saw about two months ago, of a farmer, when it was fifty degrees below zero, leaving for a twenty-mile trip with six horses and two hundred bushels of wheat. Anybody who has lived in western Canada and knows anything about pioneering, realizes how important a horse blanket is. It seems to me that some consideration might be given to the people who want to use horse blankets and who have to do the difficult pioneering work in which this commodity is used to such a large extent. If we are going to do anything about settling up the new districts, there will always be a big demand for horse blankets, and most of those who are dealing in horse blankets are doing pretty well.


James Alexander Robb: My hon. friend knows that horse blankets are not generally made of cotton. They are largely made of jute and they come under another item.


Donald MacBeth Kennedy: Why are they excluded from this item?


James Alexander Robb: Because this is household
blankets.


Donald MacBeth Kennedy: But cotton horse blankets would come under this item, or otherwise you would not have this specific reference excluding them. That is my point. There is just about as good a case in this item for the consumer in regard to horse blankets as there is in regard to the other blankets.


John Evans: All waterproof horse blankets are made of cotton duck and they should be included in this item. We are dealing with cotton. Horse blankets of jute are made for cold, dry weather.


James Alexander Robb: For administrative purposes this is a household blanket and there is a corresponding item in the woollen schedule.


Henry Herbert Stevens: But the item specifically excludes horse blankets.


Donald MacBeth Kennedy: Cotton horse blankets still come in at the high rate. The minister may not realize this; but when a homesteader or somebody away out on the frontier is doing a lot of camping out or travelling, he very often uses a fine horse blanket as a sleeping blanket, and I think the minister is really making a discrimination there.


James Alexander Robb: But he uses jute.
1444	COMMONS
Ways and Means-Customs Tariff


William Russell Fansher: I do
not know what they use in the Peace River country, but in the district I come from the cotton blanket is preferable to the jute blanket. The jute blanket is not close enough; it allows the freezing wind to penetrate. The cotton blanket is the one we need and the one we use. We also use jute blankets but they are not so serviceable in cold weather. The Minister of Agriculture, I think, is quite conversant with those conditions.


Henry Herbert Stevens: We would overcome all
this if the minister would indicate under what items horse blankets now come, cotton, woollen or jute.


James Alexander Robb: We will come to that when
we reach the jute items.


Henry Herbert Stevens: Under what item will the cotton horse blankets come?


James Alexander Robb: Under item 532.


John Evans: In the preceding item we
have placed a class of cotton duck for hose pipe on the free list. That is not a household article at all, so the minister's explanation is no excuse for not dealing with cotton duck for different kinds of blankets that require to be made of that material. We should insert an item at this point so that at least one class of consumers will not be so much discriminated against.


James Alexander Robb: I should like to consider that Let the item stand.
Item stands.
Customs tariff-527. Boot, shoe, shirt and stay laces of cotton: British preferential tariff, 15 per cent: intermediate tariff, 25 per cent; general tariff, 30 per cent.


James Alexander Robb: The old rates were 20 per
cent, 274 per cent and 30 per cent. The importations are not large, amounting to $20,080, and the estimated reduction in taxation is $1,615.


[Stage Direction]
Item agreed to.
Item 528 agreed to.
Customs tariff-529. Embroideries, lace, braids, bobinet, n.o.p., fringes and tassels; manufactures of lace; handkerchiefs and pillow shams; curtains, n.o.p.; all articles specified in this item to be wholly of cotton: British preferential tariff, 20 per cent; intermediate tariff, 27i per cent; general tariff, 30 per cent.
James Alexander Robb: I beg to move that the following be substituted for item 529:
Customs tariff-529. Embroideries, lace, braids, nets, nettings, bobinet, n.o.p.; fringes and tassels; manufactures of lace, nets, nettings and embroideries; handkerchiefs and pillow shams; curtains, n.o.p.; all articles specified in

this item to be wholly of cotton: British preferential tariff, 20 per cent; intermediate tariff, 274 per cent; general tariff, 30 per cent.
There is a change in the rates. The old rates were 25, 324 and 35 per cent, and the proposed rates are 20, 274 and 30 per cent. The imports under the former item were $3,899,425. There is no separate classification of cotton products thereunder except cotton handkerchiefs, amounting to $1,392,295.


Donald MacBeth Kennedy: What is the estimated
reduction in taxation?


James Alexander Robb: 


Richard Bedford Bennett: Once more the minister gives figures, but there is no specification in the old tariff similar in terms to this, and when he speaks of the decrease in taxation he is applying these figures to an aggregate importation which comprises, necessarily, goods that come within items other than this.


James Alexander Robb: The officers have worked that out.


Richard Bedford Bennett: If they have, well and good.


[Stage Direction]
Amendment agreed to.
Item as amended agreed to.
Customs tariff-529a. Lace and embroideries wholly of cotton, not coloured, imported by manufacturers for use exclusively in the manufacture of under-wear in their own factories: British preferential tariff, 124 per cent; intermediate tariff, 174 per cent; general tariff, 20 per cent.
Richard Bedford Bennett: What is the difference between the two sections of item 529?


James Alexander Robb: This is a manufacturers' item only, covering lace and embroideries imported by manufacturers for use exclusively in the manufacture of clothing in their own factories.


Richard Bedford Bennett: You will have to change the word "underwear," then.


James Alexander Robb: Yes. I move to substitute the word "clothing" for the word "underwear."


[Stage Direction]
Amendment agreed to.
Richard Bedford Bennett: Is this the same rate as
before?


James Alexander Robb: Yes.


Richard Bedford Bennett: The only change is
changing the word "underwear" to "clothing"?


James Alexander Robb: Yes.
Item as amended agreed to.
Customs tariff-530.	Socks and stockings
wholly or in part of vegetable fibres, but not

Ways and Means-Customs Tariff
containing silk, artificial silk nor wool: British preferential tariff, 20 per cent; intermediate tariff, 27J per cent; general tariff, 30 per cent.


John Frederick Johnston: The words "n.o.p." have been struck out,


Donald MacBeth Kennedy: How do vegetable fibres come in the cotton schedules?


James Alexander Robb: This item is to cover anything other than wool or silk.


Henry Herbert Stevens: Or artificial silk.


James Alexander Robb: Yes.


John Anderson Fraser: What were the importations under this item?


James Alexander Robb: The imports were $1,004,727.
The estimated reduction in taxation is $50,236.


Richard Bedford Bennett: What would the stockings be made of?


James Alexander Robb: They are made of cotton and other fibres. They might be made out of wood pulp, I suppose, 'but it is mostly cotton.


John Evans: This item covers socks and
stockings. This again is a workingman's article. The wage earner uses this very class of socks and stockings. It is a mistaken policy to try to build up industry in this country by bleeding the workingman. It is a fallacy in economics to tax the workingman for the sake of providing dividends for big cotton companies such as were mentioned this afternoon, which are already in a prosperous condition. If Canada is ever going to be anything, it will depend on keeping down the cost of living, and I submit to the government that it would be much better to lower the cost of living than to have our workingmen striking for higher wages all the time. This article is a necessity, one of the very necessities Of life, and why not begin here? Why tax the workingman for the benefit of the millionaire?-for that is what we are doing by this item. The working classes have to use this kind of socks and1 stockings, and there is no reason why we should put a 271 per cent duty on this article.


James Alexander Robb: My hon. friend will go this
far with me, that we are at least moving in the right direction. We have made a reduction of 5 per cent all round, and we are losing in revenue over $50,000, estimated on last year's business.


John Evans: It is only getting back to
about the pre-war rates.


Mr. STIRLING:: What is the home production in this article?


James Alexander Robb: I have not those figures.


[Stage Direction]
Item agreed to.
Customs tariff-531. Knitted fabric wholly of cotton, in the web, imported by manufacturers of rubber boots and shoes for use exclusively in the manufacture of such articles in their own factories:	British preferential
tariff, 10 per cent; intermediate tariff, 20 per cent; general tariff, 25 per cent.
Richard Bedford Bennett: What was the old rate?


James Alexander Robb: This is a manufacturers' item. The imports were $138,428. It is estimated this will mean an increase of revenue of $13,846 on the basis of last year's business.


Donald MacBeth Kennedy: I thought we were going the other way with the manufacturers most of the evening. Can the minister give us the particular reason why the general and intermediate tariffs should be raised in this manufacturers' item? The old rates were 10, 121 and 15 per cent, and the new rates are 10, 20 and 25 per cent. This will no doubt lead to dearer rubber boots and shoes, which most of our people wear in the fall and spring. What was the particular reason for the increase?


James Alexander Robb: The real reason was that it was following our policy of widening the British preference. There is no increase in the British preferential rate, but the other two rates are increased. My hon. friend will notice that there is more of a spread between the treaty rate and the general.


William Russell Fansher: Would
the minister give the imports that came in under these three tariff rates?


James Alexander Robb: I have not the separate
classification, but the total importation was only $138,428.


Richard Bedford Bennett: What was the domestic
manufacture, and what mills are affected?


James Alexander Robb: I have not that information.


[Stage Direction]
Item agreed to.
Customs tariff-532. Clothing, wearing apparel and articles, made from woven fabrics, and all textile manufactures, wholly or partially manufactured, composed wholly of cotton, n.o.p.; fabrics wholly of cotton, coated or impregnated, n.o.p: British preferential tariff, 22J per cent; intermediate tariff, 25 per cent; general tariff, 30 per cent.
James Alexander Robb: This particular item is a
reclassification, and comprises what were formerly seven items. The old rates were: 25, 30, 35: free, free, free; 10, 121, 15; 221, 324, 35; 20, 271, 30 ; 20, 271, 30; 20, 30, 35. The imports for consumption for the year ending 31st March, last were-British preference, $344,194; treaty rates, $245,942; general, $940,872. It is not possible to trace

Ways and Means-Customs Tariff
separately the cotton portions of the imports. The estimated reduction in taxation is $57,999


John Evans: Overalls are a class of
clothing which the wage earner, the homesteader, in fact all farmers, wear. Why keep this up to 25 per cent?


James Alexander Robb: The British preference is 221.


John Evans: The rates are 221, 25 and 30. Here is an article again that should be one of the lowest in the whole schedule. Every workingman needs to buy overalls. Rainproof clothing, hats, and so on, all come under this item. I think this should be reconsidered.


James Alexander Robb: This has been pretty carefully looked into. These are the items on which the textile people claim they are going to suffer a considerable loss.


William Russell Fansher: It looks like
an increase. Does the minister figure an increase or a decrease?


James Alexander Robb: I said the estimated reduction in taxation is $57,999.


Donald MacBeth Kennedy: The minister's figures are not very convincing because under the British preference the new item is 221. We had seven old items in the British preference, three of them are 20, one is 10, one is 221, one is 25- you have about the same distribution all the way through. It may be that according to the imports there is that reduction of taxation, but I do not think if you took the various items and struck an average you would find the old duties as high.


James Alexander Robb: The large importations are
under 575a, which is 25 per cent.


Henry Herbert Stevens: Will the minister indicate just what brand of science leads to the grouping of such items as apparently are brought together here? For instance, hammocks, tennis nets, sportsmen's fishing nets, oiled silk, oiled cloth, oiled tape and other textiles, India rubber coats, corsets of all kinds, linen and cotton clothing, window shade cloth, window shades cut to size, hemmed and mounted on rollers, and so on. Here are groups of items entirely dissimilar; they are now brought together under one item and the rates of duty fixed. Under all these other items there was a variety of rates ranging from free up to 35 per cent. The minister must realise the great difficulty we have of appreciating the effect of this tariff. To my mind, in the short time at our disposal it is an utterly impossible task. Some reason must have been furnished to the minister by his officers that will justify this grouping. He
[Mi. RobbJ
must acknowledge it is not sufficient to say that this is a reclassification. We know that without his saying so. There must be some reason for it. I think the committee is entitled to a very full statement.


James Alexander Robb: The officers who administer
the Customs Act in co-operation with members of the tariff board and the tariff commissioners in the Finance Department, worked out these rates, and I admit they are largely on their recommendation. I can give my hon. friend an item-he has just referred to it-window shade cloth. It is very hard to define, and they have represented to us that this reclassification will make the Customs Act easier to administer. On the basis of the importations of 'last year there will be a reduction in taxation, as I have already stated.


Henry Herbert Stevens: There may be a reduction, I cannot dispute the minister's figures. But I am not in a position to say whether these rates are fair or unfair. The fact remains that hammocks, lawn tennis nets, and so on, under the old tariff were 20, 271 and 30; here the British preference is 221 [DOT]-that is an increase-and the other rates are 25 and 30. On oiled silk and oiled cloth, oiled tape and other textiles, India rubber coats, and so on the old rate was 20 under the British preference and 221 under the intermediate: the new are 271 and 30 respectively. On corsets of all kinds, and so on, the rates were 221, 32 and 35: there is a reduction there, although the British preference stands exactly the same. As far as I can see that is the only reduction in the British preference. On window shade cloth, window shades, cut to size, hemmed and mounted on rollers, the British preference is 20 per cent under the old tariff, it is 221 per cent under this tariff. Then fillets of cotton and rubber, not exceeding 7 inches wide, and so on, free, free, free, under the old tariff; under the new, 221, 25 and 30.


James Alexander Robb: That will be a very small
item.


Henry Herbert Stevens: Quite likely; but I do
not like to see the minister get away with the broad general statement that he is making generous concessions to the consumers of this country. I repeat, with the exception of one item out of these seven, there is, I think, in every case an increase in the British preference, which is not extending its scope as the minister so frequently remarks.


James Alexander Robb: It is true there may be some
changes, but the big item is 537. That is down.

Ways and Means-Customs Tariff


Henry Herbert Stevens: 537 in the old?


James Alexander Robb: 575a.


Henry Herbert Stevens: It is the same exactly
under the British preferential.


James Alexander Robb: 537 is the large item.


Henry Herbert Stevens: It is exactly the same.


Charles Avery Dunning: 537 is down 24 per cent
under the British preferential.


Henry Herbert Stevens: There are several items
put into one and I have indicated that in every instance except one there is an increase. In one instance it is the same under the British preferential. The minister said that the largest item was 575a in which there was a reduction, but it is the same under the British preferential.


James Alexander Robb: The largest item is 537, but
575a is also considerable. While in 575a there is no change under the British preferential there is a reduction in the treaty rates from 324 to 25, find also a reduction in the general. In 537 there is a reduction of 24 per cent under the British preferential and a reduction of 5 per cent in the treaty rate as well as- in the general. These are the two large items. The others are small and are mostly sporting goods.


Henry Herbert Stevens: What were the imports
under 537?


James Alexander Robb: They amounted to $1,765,611.


Henry Herbert Stevens: How much of that would be under the British preferential?


James Alexander Robb: I have not the figures.


William Russell Fansher: This item,
which includes clothing, carries about the most uniformly high, rate in the whole cotton schedule, the British preferential being 224 per cent. There have been reductions in the others, some being free, some 74 and others 124 and 15. But there is no other as high as 224 per cent. Following out his line of reasoning, one would think that the minister would increase the preference here.


James Alexander Robb: My hon. friend (Mr. Stevens)
asked for the total involved, it is $1,765,611.


Henry Herbert Stevens: Under 537?


James Alexander Robb: $360,452.


Abraham Albert Heaps: Has the minister the importations under 532?


James Alexander Robb: The old or the new tariff?


Abraham Albert Heaps: The old.


James Alexander Robb: That is on record; I have
already given it. What relation has that to this item ?


Abraham Albert Heaps: Are we not considering 532?


James Alexander Robb: I have just given the information.


Donald MacBeth Kennedy: I notice there is an increase under the preference in oiled textiles. All through the revision, except in one or two instances, there is a sharp increase in the duties in oiled goods. I am anxious to have some information in this regard and perhaps it would be better to take the matter up on Monday.


James Alexander Robb: I will keep it in mind.


Donald MacBeth Kennedy: There appears to be a
general increase.


William Russell Fansher: Why does
the minister keep the rates so uniformly high on clothing, the preference being the highest of any in the list?


James Alexander Robb: I have several times stated
that the reduction estimated is $57,999.


William Russell Fansher: My point is
that these particular rates are abnormally high in contrast with the other schedules. One would not think that there would be these high rates on articles of clothing. Even if there were a loss of revenue there might have been a greater reduction in the rate than there is.


Donald MacBeth Kennedy: Would this explain the
situation? At page 176 of the Trade of Canada I find that the total imports of cotton products from the United Kingdom have been fairly steady from 1922 to 1926, amounting to over $300,000 annually. From the United States, which is the other large country of exports to Canada, our importations have dwindled from 1922 on, having fallen from $1,366,257 to a little over $500,000. It seems that where the imports are steady and competition keeps up, the rate is maintained under the British preference and lowered under the general, where the country from which we have been importing largely has been losing in business. There is a general tendency to balance things in that way.


Henry Herbert Stevens: Item 732 under the old
schedule is of considerable interest. It concerns coated and sized cloth, when imported by manufacturers for use only in their own factories in manufacturing sensitized blue or black print cloth. The old rate was 10, 124 and 15 per cent. The new rates will be 224, 25 and 30.


James Alexander Robb: Imports, 10,000.


Henry Herbert Stevens: What factories are making that in Canada now? What is the production in Canada?
1448	COMMONS
Ways and Means-Customs Tariff


James Alexander Robb: I have not that information.


Henry Herbert Stevens: The minister has presented a figure given him by his assistant.


James Alexander Robb: My hon. friend will admit that the rates are low enough.
Mr. STEVEN'S: Unquestionably this item is used by the wholesale manufacturers of clothing; it is a class of clothing very commonly made and considerably used, and there must be a large production of it. It is rather interesting to know what is produced in Canada if there is such a small amount imported.


James Alexander Robb: I will read the item, and then my hon. friend will understand. That kind of clothing would not be very good with the
weather twenty below zero:
Coated and sized cloth when imported by manufacturers for use only in their own factories in manufacturing sensitized blue or black print cloth.
That is for drafting purposes, I think,-the making of plans. I would not be surprised but that the importations represented by the $10,000 were used in making some of the plans for the new buildings we are putting up.


John Evans: Before we pass from this particular item I am going to make another appeal to the government to separate from it item 575a under the old schedule, covering cotton clothing. As I said before, this is a necessity to the working man, because khaki and blue duck all come under this heading. I do not see why we should place certain other kinds of cotton duck on the free list while the very kind used by the working man is under such a high duty. I would ask the minister to take item 575a out of that group and reduce it to say 5 per cent, 10 per cent and 15 per cent.


James Alexander Robb: That is the large item of importation; under that item we imported goods to the value of $1,531,008. The reduction is from 32i per cent to 25 per cent under the treaty rate and from 35 per cent to 30 per cent under the general rate.


John Evans: And an increase of 2^ per cent under the British preference.


James Alexander Robb: No, my hon. friend cannot get away with that; there is no increase.


William Russell Fansher: According to the figures given by the hon. member for Peace River, most of the goods imported come under the British preference, and in that there is no reduction. This seems to go to show that the tariff revision is made on ia protective basis,

or there would have been a reduction in the British preference, under which there is the largest importation.


James Alexander Robb: The hon. gentleman misquoted the figures; the large importation comes under the general tariff, and that is where we made the reduction.


Donald MacBeth Kennedy: The point is that the importation from Great Britain is steady, while the importation from the United States has been decreasing for the last five years, although it is still large.


James Alexander Robb: This will give them a better chance to come in, then; is that the idea?


John Anderson Fraser: In the last two items why do you increase the tariff on hammocks and window shades? Under the British preference the increase is from 20 per cent to 22J per cent, while the rate under the intermediate and general tariff is decreased. Is not that in direct contradiction to the statement made this afternoon that you were increasing the British preference?


James Alexander Robb: No.


John Anderson Fraser: That statement has been made repeatedly.


James Alexander Robb: Our policy is to increase the British preference on the large items, but this is a small and practically obsolete item.


John Anderson Fraser: What are the imports of window shades?


James Alexander Robb: I have not that information, but I am told it is very small.


[Stage Direction]
Item agreed to.
Customs tariff-532a. Shirts, not knitted, collars and cuffs, all of cotton: 20 per cent; 30 per cent; 32J per cent.
James Alexander Robb: The former rates were 20 and 22j per cent British preferential, 32J per cent and 35 per cent intermediate and 35 per cent and 37i per cent general. The estimated total reduction in taxation is $46,298.
'Mr. KENNEDY: Would any small percentage of silk in an otherwise cotton shirt place it outside this class?


James Alexander Robb: I think it would.


Donald MacBeth Kennedy: So many cotton shirts contain just a small percentage of silk.


James Alexander Robb: They would not come in this
class.


Henry Elvins Spencer: How does that effect a reduction in taxation? A reduction in the tariff does not necessarily mean a loss of revenue.

Cable Merger


James Alexander Robb: I gave my hon. friends an example yesterday. The result is shown in the reduction of the income tax; we took in more money.


Donald MacBeth Kennedy: When you consider the revision of the tariff, is it not largely done on the basis that there will be no increase of imports?


John Anderson Fraser: Why retain the duty on shirts at 32J per cent? That is the highest rate in the whole schedule. What is the
explanation of that?


James Alexander Robb: The explanation is that the shirt men think they should have that protection.


John Anderson Fraser: It is protection for the shirt men? That is all I wanted to know.


Abraham Albert Heaps: I wonder if the minister would not be good enough to satisfy our Conservative friends by lowering that item? He would thus satisfy the members in this corner of the house, and as the Liberal party stands for a lower tariff he would satisfy everybody.


James Alexander Robb: I would like to satisfy everyone, but I have not had much success in doing so.


[Stage Direction]
Item agreed to.
Customs tariff-533.	Sails for boats and
ships: 15 per cent; 22J per cent; 25 per cent.
James Alexander Robb: There is no change.


[Stage Direction]
Item agreed to.
Customs tariff-534. Certain candlewick.
James Alexander Robb: There is no change.


[Stage Direction]
Item agreed to.
Progress reported.
On motion of Mr. Mackenzie King, the house adjourned at 10.53 p.m.
Monday, March 19, 1928