1932-05-02

Right Hon. R. B. BENNETT (Prime Minister):: Mr. Speaker, I move, seconded by Mr. Guthrie:
That it is expedient that parliament, do approve of the international convention for the supervision of international trade in arms and ammunition, Geneva, 17th June, 1925, signed on behalf of Canada by the Honourable Raoul Dandurand on the 22nd September, 1925, and that this house do approve of the same.
It might be that the leader of the opposition (Mr. Mackenzie King) would desire to say something about this motion. Therefore it can stand until to-morrow, and this can be treated merely as notice of motion.



UNEMPLOYMENT AND FARM RELIEF

Hon. W. A. GORDON (Minister of Labour):: Mr. Speaker, I desire to lay on
the table of the house orders in council 1022 to 1025, inclusive, 980 to 994, inclusive, 1006 to 1011, inclusive, 1013 to 1017 inclusive, passed pursuant to the Unemployment and Farm Relief Continuance Act. All these orders refer to payments of money.



COMPANIES ACT AMENDMENT

[Stage Direction]
Hon. C. H, CAHAN (Secretary of State) moved for leave to introduce Bill No. 69, to amend the Companies Act.
Mr. MACKENZIE KING:: Explain, please.


Mr. CAHAN:: Mr. Speaker, at the present
time all Canadian companies which are incorporated under letters patent issued under part 1 of the Companies Act, all banks incorporated under the provisions of the Bank Act, and certain other companies, such as the Canadian Pacific Railway Company, are authorized by law to maintain outside of Canada registers in which may be registered transfers of stock. The government, after listening to the representations of a number of other Canadian companies which are incorporated by special statute, and companies to which part II of the Companies Act applies, have deemed it advisable to facilitate the transfers of shares in the capital stock, as well as registered bonds and debentures of Canadian companies, by authorizing all companies within the legislative jurisdiction of the parliament of Canada to maintain registry or transfer offices outside of Canada as well as in, with this safeguarding provision, that immediately the entries shall be transferred to and entered in the books of registry kept at the head office of the company in Canada or at its chief place oi business. I think the measure when it is printed will appear very simple and advisable, in view of the fact that companies complain that transfers of their stock, in England particularly, are delayed for weeks sometimes because they have not the facilities which other companies have of maintaining at some bank or trust company in England a branch registry in which transfers may be registered and become legally effective.
Motion agreed to and bill read the first time.

Questions



DEPARTMENT OF INSURANCE

[Stage Direction]
Hon. E. N. RHODES (Minister of Finance) moved the first reading of Bill No. 66 (from the Senate), respecting the department of Insurance.
Motion agreed to and bill read the first time.

[Stage Direction]
Hon. E. N. RHODES (Minister of Finance) moved the first reading of Bill No. 67 (from the Senate), respecting foreign insurance companies in Canada.
Motion agreed to and bill read the first time.

[Stage Direction]
Hon. E. N. RHODES (Minister of Finance) moved the first reading of Bill No. 68 (from the Senate), respecting Canadian and British insurance companies.
Motion agreed to and bill read the first time.

[Stage Direction]
(Questions answered orally are indicated by an asterisk).

Mr. WOODSWORTH:: 1.	How	many	cords	of	pulpwood	wereexported from Canada at the port of Sault Ste. Marie in the years 1929,	1930	and 1931?2.	How	many	cords	of	pulpwood	were
exported from the ports of Fort William and Port Arthur in the same years?
3.	How	many	boats	cleared from	Fort
William and Port Arthur loaded with pulpwood ?
4.	For what ports did they clear?
5.	To what firms were the cargoes consigned?


Mr. RYCKMAN:: 1 and 2. Exports of pulpwood through Sault Ste. Marie, Fort William and Port Arthur during the fiscal years ended March 31, 1930, 1931 and 1932:
1930	1931	1932Cords	Cords	CordsSault Ste. Marie..	..108,896	113,194	65,423Fort	William.. ..	.. 25,850	35,600	18,805Port	Arthur.. ..	.. 130,287	129,799	121,237
3. Information is not available from returns compiled in this department but could be furnished after being obtained from ports.
4 and 5. It is contrary to the established practice to give information that would disclose the business of any private concern.


CAP ST. IGNACE POSTMASTERSHIP
Mr. FAFARD:: 1.	Was the position of postmaster of Cap St. Ignac, Quebec, vacant in 1932?
2.	What are the names and occupations of all those who applied for the post of postmaster?
3.	Was any one appointed temporarily?
4.	Was any one appointed permanently?


Mr. SAUVE:: 1.	Yes.
2.	Name-occupation:
Joseph Henri Bernier, store clerk, unemployed; Romeo Bernier, unemployed; Miss Camille Bossinotte, assistant postmistress; Joseph Bossinotte, acting postmaster; Joseph M. Dube, storekeeper; Omer Fortin, unemployed; Ernest Fournier, unemployed; Jean Louis Gamache, unemployed; Adrien Guimond, unemployed; Mrs. Aurore Marois, housekeeper; Andre Ouellette, not known.
3.	Yes.
4.	No.


EUROPEAN IMMGRANTS-1929, 1930
Mr. EDWARDS:: 1.	What was the number of European immigrants who came to Canada in the year 1929 and the first six months of 1930?
2.	What was the total number of European immigrants who came to Canada in the year 1930?


Mr. GORDON:: 1.	65,808.
35,597.
2.	46,915.


CREECE AND ROUMANXA-OUTSTANDING INDEBTEDNESS
Mr. JACOBS:: 1.	What is the outstanding indebtedness to
Canada of the following governments:	(a)
Greece; (b) Roumania?
2.	When was the said indebtedness incurred?
3.	What sums were originally owing?
4.	Was the indebtedness funded, and if so, in what years?
5.	Have the countries in question ceased payments on account of principal and interest, if so, in what year or years?
6.	If the countries in question are in arrears of payment, what steps have been taken to obtain payment?


Mr. RHODES:: 1.	Principal amount: Greece $6,525,000;
Roumania $23,969,720.
2.	Under agreements made in 1919.
3.	Greece, $7,521,300.67; Roumania, $20,449,104.49.
4.	Greece, 1923; Roumania, 1922.

Unopposed Motions jor Papers
5 and 6. Roumania has made payments to date. In the case of Greece, principal and interest of $283,125 due 31st December, 1931, has not been paid, the postponement which applies to reparations and inter-governmental war debts having been made applicable to this debt at the request of Greece.


TRANS-CANADA HIGHWAY
Sir EUGENE FISET:: 1.	What is the total amount authorized to date by the federal government for works on the trans-Canada highway to be executed by the provinces under the authority of the Unemployment and Farm Relief Aot?
2.	What amount of money has been expended to date by each province on this project?
3.	What amount has been paid to date by the federal government to each province in connection with this trans-Canada highway?


Mr. GORDON:: 1. The total estimated cost of works to be carried out on the trans-Canada highway under the Unemployment and Farm Relief Act, 1931, approved to May 2, amounts to $9,996,972.71, of which the dominion government has agreed to contribute fifty per cent
or $4,998,486.35.
2.	No information.
3.
Prince Edward Island..	Nil
Nova Scotia	 Nil
New Brunswick	$	60,376 66
Quebec	 Nil
Ontario	
1,875,000	00Manitoba	
251,934	99Saskatchewan	
NilAlberta	
102,429	75British Columbia	257,427	92



$ 2,547,169 32 QUESTIONS PASSED AS ORDERS FOR RETURNS WAR MUNITION PURCHASES

Mr. DORION:: 1.	Did the Canadian government purchase between 1920 and August, 1930, war ammunition or other war material from any foreign country ?
2.	If so, when, in what quantity, for what amount, and from what country?



PENSION PAYMENTS-1931

Mr. MACKENZIE (Vancouver):: What was the amount paid out in Canada last year for pensions, as follows:	(a) judges
and civil servants; (b) war pensions; (c) North West rebellion; (d) militia; (e) civil flying; (f) war veterans' allowance; (g) old age pensions?



VERCHERES BREAKWATER

Mr. RHEAUME:: 1.	Since November, 1931, to date, what amount was assigned to the village of Vercheres, in the electoral district of Chambly-Vercheres, by the federal department in charge of unemployment relief, for the construction of a breakwater or any other work?
2.	How' and where were the amounts assigned for such purpose expended?
3.	What was the name of the superintendent and foreman of said w-orks, the wage or salary of each: (a) per day; (b) total salary?
4.	What was the reason for the dismissal of the superintendent and foreman of said works, Octavien Grenier, of Vercheres, and Jaeques-Emile Cartier?
5.	Were these two men replaced, if so, by whom and at w'hat salary or wage?
6.	What quantity of stone was purchased for the construction of the said works, from whom, and at what price?
7.	What was the total cost of said works up to February 15, 1932?
8.	What are the names and addresses of the persons employed on the work in connection with the said breakwater in the village of Vercheres, and what work was done by each of them ?


Mr. STEWART (Leeds):: Mr. Speaker, I suggest that this question stand as an order for return and that it be consolidated with No. 7 on the notices of motion for production of papers, as to a certain extent the two overlap.



UNOPPOSED MOTIONS FOR PAPERS


Mr. GARDINER:: For a return showing the amount of the tender of the Dominion Bridge Company for the construction of the Montreal harbour bridge, with particulars of all extras, and by whom authorized, and the dates of meetings of the harbour board authorizing these increased expenditures, together with the names and amounts paid to sub-contractors for material supplied; also list of properties purchased for this public improvement with the names of owners and the amount paid to each for these properties.


Richard Bedford Bennett: In the absence of the acting Minister of Marine (Mr. Duranleau) I merely wish to remark that some of the information asked for may be rather indefinite. I have found, from personal investigation, that this may be so, but such information as the harbour board can furnish will be made available, though it may take some time to have it brought here from Montreal and prepared.

Unopposed, Motions for Papers



DEPARTMENT OF INTERIOR EMPLOYEES

Mr. MUNN (for Mr. Ahearn):: For a return showing:-
1.	The total number of permanent employees of the Department of the Interior who were compulsorily retired between the 1st of January, 1931. to date;
2.	The total number of such employees who receive or will receive superannuation allowances;
3.	The total number of such employees who were transferred to other permanent positions in the federal government service at salaries equal to the salaries they were receiving on retirement;
4.	The total number of such employees who were transferred to other permanent positions in the federal government service at salaries less than the salaries they were receiving on retirement;
5.	The total number of such employees who were transferred to temporary positions in the federal government service, and who are still employed temporarily;
6.	The total number of such employees who received gratuities on retirement under the provisions of the Superannuation Act of 1924;
7.	The total number of such employees who received returns of contributions from the retirement fund;
8.	The average amount of money which will have to be paid annually to each of the employees superannuated on compulsory retirement from the Department of the Interior;
9.	The total sum of money paid to such employees from the retirement fund;
10.	The total sum of money paid to such retired employees as gratuities under the Superannuation Act of 1924.



ST. MAXIME DE SCOTT-PROTECTION WALL

Mr. MARCIIL (for Mr. Boulanger):: For a copy of all correspondence, letters, telegrams and other documents in connection with certain works and construction of protection wall at St. Maxime de Scott, Quebec, during the years 1931 and 1932, together with a copy of paylists and statements of moneys expended for the purchase of material and otherwise, and also showing the name of the superintendent of works.



GARNET WHEAT GRADING

Mr. MOTHERWELL:: For a copy of all correspondence, telegrams or other documents that may have passed between Mr. Short or any other officer of the Canadian Millers' Association and Hon. H. H. Stevens, Minister of Trade and Commerce, or any other member of the government or their respective deputies, on the subject of the grading of garnet wheat, since the seventh day of August, 1930.



LENNOX, N.S.-POSTMASTER

Mr. DUFF:: For a copy of all correspondence, reports, decisions and other documents, regarding the dismissal of Ronald H. McGillivray, as post-

master at Lennox, county of Antigonish, Nova Scotia, as well as a copy of the evidence taken by commissioner N. D. Murray, a copy of his report and also a copy of his account for remuneration and disbursements.



INDIAN OFFICE-REGINA

Mr. DONNELLY:: For a copy of all correspondence, letters, telegrams and other documents, since August 1, 1931, passing between the Superintendent General of Indian Affairs or his deputy and the Indian commissioners in Regina, Saskatchewan, dealing with: (a) the closing of the Indian commissioner's office in Regina, Saskatchewan; (b) the abandonment of the greater production farm near Regina, Saskatchewan.



RELIEF WORK-CIIAMBLY-VERCHERES

Mr. HURTUBISE (for Mr. Rheaume):: For a copy of all correspondence, telegrams, contracts, paylists and other documents in connection with the work done in each municipality of the electoral division of Chambly-Vercheres, Quebec, pursuant to the Unemployment Relief Act, 1930, from September, 1930, to date. Also a return showing in detail:	(a) the work in
connection with the enlargement or repairs to the shed located on the wharf at St. Antoine de Padoue. the reinforced concrete work on the shores of the Richelieu river in the said municipality. in connection with the retaining wall facing No. 92 on the registered plans of the municipality of St. Antoine de Padoue; (b) the names and addresses of superintendents or foremen of said works in each parish, the number of hours and days worked, and the salary or wage paid to each; (c) the names and addresses of the men employed on the said works, the number of hours and days worked by each and the amount paid to them; (d) the quantity of stone purchased in connection with the said works, the price paid and the name and address of the person or persons from whom purchased.



BUSINESS OF THE HOUSE


Richard Bedford Bennett: That when this house adjourns on Wednesday, the 4th of May, it stand adjourned until Friday, the 6th of May, instant.


[Stage Direction]
Motion agreed to.

[Stage Direction]
On the orders of the day:
Mr. J. L. BROWN (Lisgar):: I should like to ask the Prime Minister if he will lay on the table of the house a copy of the order in council which I 'believe was passed shortly after the last session of parliament, giving permission to wine growers to fortify their wines.


Richard Bedford Bennett: That would not be in my department; I think the Department of National Revenue dealt with the matter.

Eastern Bank oj Canada


Edmond Baird Ryckman: Any order in council relating to the matter mentioned by the hon. gentleman will be brought down.



CANADIAN NATIONAL RAILWAYS


[Stage Direction]
On the orders of the day:
Hon. E. N. RHODES (Minister of Finance):: Under the provisions of Bill No. 34, which enables the Canadian National Railways to borrow the sum of $61,500,000, the usual companion bill is necessary to enable the government to provide the funds. Notice of this resolution was handed to the clerk and will appear in the votes and proceedings to-morrow, in the ordinary course, but if we follow the ordinary procedure the matter cannot be taken up until Wednesday. Since the matter is rather urgent and a certain proportion of the funds is required immediately by the railway, I wish to give notice that to-morrow I will ask unanimous consent for the purpose of proceeding with this bill.



EASTERN BANK OF CANADA


[Stage Direction]
Right Hon. R. B. BENNETT (for the Minister of Finance) moved the third reading of Bill No. 65, respecting the Eastern Bank of Canada.
He said: As the Minister of Finance was absent because of illness when this bill stood for third reading, I promised the hon. member for Quebec South (Mr. Power) to obtain certain information, and as I have been familiar with the matter I am venturing, on behalf of the Minister of Finance, to move the third reading of the bill. The facts are that by resolution of the directors, passed on March 3, 1930, all the subscribers with the exception of Angus McLean were repaid the amount of their subscriptions, he being responsible for the liquidation of the accounts by an arrangement made with the subscribers. Mr. McLean settled the various outstanding accounts, so there were then no outstanding liabilities, and his subscriptions were not returned in full. At the time of his death he was the only one who had not been compensated for the money expended, and as a matter of fact he expended much more than the sum which is being returned. The sole remaining asset of the bank is the deposit of $5,000 made under the provisions of the Bank Act in the bank circulation
redemption fund, and it is this money which it is proposed to pay back to the estate. That can be done only by legislation, which is the bill now standing in the name of the Minister of Finance for third reading.
Motion agreed to, and bill read the third time and passed.	[DOT]

[Stage Direction]
Right Hon. R. B. BENNETT (for the Minister of Trade and Commerce) moved the third reading of Bill No. 62, respecting a certain trade agreement between Canada and New Zealand.
Motion agreed to, and bill read the third time and passed.


[Stage Direction]
Hon. C. H. CAHAN (Secretary of State) moved that the house go into committee to consider Bill No. 5, respecting unfair competition in trade and commerce.
Motion agreed to and the house went into committee, Mr. Hanson (York-Sunbury) in the chair.
On section 1-short title.
Charles Hazlitt Cahan: Just by way of introduction I may say that the international convention for the protection of industrial property, which was signed on behalf of Canada at The Hague on November 6, 1925, by a representative of the Canadian government of that day, was ratified by the governor in council by order in council P.C. 648, which was passed on April 19,1928. So far as Canada is concerned the convention came into force on May 1, 1925.
The original Trade Mark and Design Act of Canada was enacted by the parliament of this countiy in 1869, the second year after confederation, and it has remained upon our statute books since that time without material changes. By the British North America Act, 1S67, Canada is authorized to legislate for the regulation of trade and commerce, and under section 132 of that act Canada -can legislate also to give effect to treaties made with the British Empire, to which Canada is a party. Article 10b is of this convention to which Canada gave adherence provides that the contracting parties are bound to ensure the persons entitled- to the benefits of the union effective -protection against unfair competition:
Every act of competition contrary to honest practices in industrial or commercial matters constitutes an act of unfair competition.
Industrial Property

The following acts among others shall be prohibited:
1.	All manner of acts, of such a nature as to create confusion by any means whatsoever with the goods of a competitor;
2.	False allegations, in the course of trade, of such a nature as to discredit the goods of a competitor.
That is a general provision. The convention then provides certain obligations on the part of Canada with regard to respecting the trademarks of foreign countries which are in use in this country, and there is a reciprocal obligation on the part of some twenty nations to respect Canadian trademarks and Canadian tradenames.
This bill, after the second reading, was referred to a special committee of the house. I was selected by the committee to act as its chairman, and the committee had many sittings. It received and heard reports from various parts of Canada, on the measure, which really deals with trademarks and tradenames, and is a remodelling of the Trademark and Design Act of Canada.
I am very grateful for the cooperation of the various members of that committee who gave very serious consideration to the matter, and finally unanimously reported this bill in the form in which it now appears. There are, I find, one or two slight corrections to be made in the printing, but the bill as it stands is the unanimous product of the committee. After representations were heard, and after a full discussion, a number of amendments to the original bill were adopted. I therefore ask the cooperation of this committee in the consideration of this bill, which is the best that we can produce under the circumstances. It does provide one very essential thing-protection of trademarks in this country. Where duplicate trademarks have been in vogue in times past, entitled to equal rights, we have left the courts to decide such matters; but after this bill becomes law, trademarks which are registered in this country shall apply to all Canada and shall apply to Canadian products abroad.
During the consideration of this measure we received representations, very favourable indeed, from those who were dealing in Canadian products in foreign markets, highly appreciating the fact that we were proposing a measure which, so far as we were able to do so without making the legislation retroactive, would in future provide that the trademark on any Canadian goods sold in a foreign market would represent the goods which it purports to represent, so that those in this

country who produce goods of a high standard and quality will have the benefit in the foreign market of the reputation which their goods have really earned.


[Stage Direction]
Section agreed to.
Sections 2 to 22 inclusive agreed to.
On section 23-Present register of trademarks continued.
Charles Hazlitt Cahan: When the committee reported the bill it was unanimously agreed that wherever the word "figures" appears we should substitute the word "numerals." In the final printing of the bill, I find, some of these changes were omitted. The word "figures" has a dual meaning and the committee decided to use instead, throughout, the word "numerals." On page 11 of this bill, section 23, the word "figures" appears in lines 33, 36, 38, 43 and 47; by some inadvertence the word "numerals" was not used instead. With the unanimous consent of the committee I should like to amend the section by substituting the word "numerals" for the word "figures" in the lines I have indicated.


[Stage Direction]
Amendment agreed to.
Section as amended agreed to.
Sections 24 to 30 inclusive agreed to.
On section 31-Application to distinguish between word mark and design mark.
Mr. CAHAN; In line 20 the word "figures" should be struck out and the word "numerals" substituted therefor; in line 32 the word "described" should be struck out and the word "prescribed" substituted therefor. I beg to move these amendments.
Amendments agreed to.
Section as amended agreed to.
Sections 32 to 35 inclusive agreed to.
On section 36-Indexes of pending application.
Charles Hazlitt Cahan: Mr. Chairman, I beg to
move that in line 21 the word "figures" should be struck out and the word "numerals" substituted therefor.


[Stage Direction]
Amendment agreed to.
Section as amended agreed to.
Sections 37, 38 and 39 agreed to.

Companies Act
On section 40-Priority by foreign registration.
Charles Hazlitt Cahan: Mr. Chairman, I beg to
move that the period after the word "provided" in the twenty-ninth line be struck out.


[Stage Direction]
Amendment agreed to.
Section as amended agreed to.
Sections 41 to 45 inclusive agreed to.
On section 46-Notice of change of address of owner of registered mark.
Charles Hazlitt Cahan: Mr. Chairman, there is an
obvious transposition of words in line 28. I beg to move that the words "the to" after the word "given" in the twenty-eighth line be struck out, and the words "to the" substituted therefor.


[Stage Direction]
Amendment agreed to.
Section as amended agreed to.
Sections 47 to 54 inclusive agreed to.
On section 55-Registrar to transmit papers on request.
Charles Hazlitt Cahan: There is an obvious misspelling of a word in this section. I move that the letters "ot" after the word "relating" in the last line be struck out and the letters "to" substituted therefor.


[Stage Direction]
Amendment agreed to.
Section as amended agreed to.
Sections 56 to 62 inclusive agreed to.
Bill as amended reported, read the third time and passed.


[Stage Direction]
Hon. R. J. MANION (Minister of Railways and Canals) moved that the house go into committee on Bill No. 34, respecting the Canadian National Railways and to authorize the provision of moneys to meet expenditures made and indebtedness incurred during the calendar year 1932.
Motion agreed to and the house went into committee, Mr. Hanson (York-Sunbury) in the chair.
Sections 1 to 6 inclusive agreed to.
Bill reported, read the third time and passed.

[Stage Direction]
Hon. C. H. CAHAN (Secretary of State) moved the second reading of Bill No. 61, to amend the Companies Act.
He said: This amendment to section 85 of the Companies Act is intended to remove confusion which has prevailed since the passing of an amendment to section 63 of the Bankruptcy Act, which is chapter 11 of the Revised Statutes of Canada, 1927. The Bankruptcy Act provided that assignments of book debts should be void unless they are registered locally under provincial legislation in any province where legislation had been passed requiring such assignments to be registered locally. Since that date, every province which has a bills of sales act has amended its legislation so as to provide for the registration locally of those assignments of book debts. The banks and all other Canadian companies have complied with those provincial laws.
Recently the question was raised under section 85 of the Companies Act, which provides under section 85 (1) (c) for registration with the Department of the Secretary of State of a floating charge on the undertaking or property of the company, whether the registration of such floating charge did not include the registration of assignments of book debts, and since then some doubt has prevailed about the matter. Canadian companies which have been making such assignments believed they were fulfilling the letter of the law when they complied with the provincial statute. It has seemed to me unnecessary to provide that there should be sent to Ottawa and registered with the Secretary of State assignments of book debts which have already been registered in local registers throughout the length and breadth of the land. To do this involves greater expense, creates confusion and serves no good purpose. Therefore I have introduced this amending bill to provide, in effect, that this subsection of the Companies Act shall not apply to a floating charge created by a company, after the date hereinbefore in this subsection mentioned, on its accounts receivable or any of them.
The purpose of the bill is to avoid all confusion and to provide that the course which has been followed now for a term of years throughout Canada, namely, the registration at the local registry office, shall be effective, without duplicate original assignments having to be filed at the office of the Secretary of States.
Motion agreed to, bill read the second time and the house went into committee thereon, Mr. Hanson, (York-Sunbury) in the chair.
Sections 1, 2 and 3 inclusive, agreed to.
Companies Act
[Stage Direction]
On the title.
Mr. STEWART (Edmonton):: I do not
know whether the matter comes under this act or some other provision, but is it not possible for the federal government to exercise some control with respect to financing, issuing of stock, over companies that secure dominion charters? I know my hon. friend said the other evening that it was not possible, but it seems that under the provisions of provincial charters, provincial governments have some supervision over the sale of stock.


Richard Bedford Bennett: That is the sale, not the issue.


Charles A. Stewart: The difficulty that the provincial authorities experience is that they cannot interfere with stock sold under a dominion charter, and there does not seem to be any supervision; these stocks can be increased and sold apparently without let or hindrance, whereas if a company has a provincial charter, there are restrictions upon its activities in this respect. I do not for a moment mean to charge companies with doing this deliberately, but their stock gets into the hands of brokers who seem to be able, when there is a dominion charter, to carry on this practice without hindrance.


Charles Hazlitt Cahan: It is not control over the issue of a charter which the hon. gentleman deems desirable; it is control over the sale of stock by companies after they have been incorporated. I differ somewhat from the suggestion of the hon. gentleman because I think we keep a closer supervision over the issue of dominion charters than most of the provinces do over the issue of local charters. Time and time again, when we refuse to issue a charter with certain provisions which we deem objectionable, the applicants apparently find no difficulty in securing from provincial governments charters containing the very clauses which we consider objectionable.


Charles A. Stewart: Will my hon. friend specify a case?


Charles Hazlitt Cahan: Take the consolidation in connection with the company to which the hon. member for Winnipeg North Centre (Mr. Woodsworth) called attention the other day: they obtained a provincial charter which contained all the objectionable provisions to which the hon. gentleman referred. But in order to meet the situation, either last session or the session before, the Minister of Justice, who I notice is not in his seat, introduced an amendment to the criminal code which his department deemed sufficient to enable the
[Mr Cahan.J
attorney general in any province to take proceedings against those who indulged in those objectionable proceedings with respect to sales of which the hon. gentleman complains. This parliament amended the criminal code by introducing a new provision, and it was pointed out at that time to the respective provincial governments that, if they deemed this new provision of the criminal code inadequate, the Department of Justice was prepared to consider further amendments which would enable the attorneys general to prosecute offenders in connection with the sale of stocks of companies incorporated under dominion statutes. I have one remedy in mind, and although it may be a purely personal opinion, I have urged it continuously for the last twenty years: I think it is entirely objectionable that under our constitution the conduct and direction of prosecutions for offences under dominion statutes should be taken out of the hands of the attorney general of Canada, who is deeply interested in the maintenance of federal law, and in every case vested in the departments of the attorneys general of the provinces. I think sooner or later the time must come when by some amendment to the constitution, or by some other arrangement, provision may be made that the duty and responsibility for the enforcement of federal laws will rest upon the Attorney General of Canada, who is also Minister of Justice. Until such time I do not believe the condition in this respect will be satisfactory.


Mr. POWER:: Does the minister include the enforcement of the criminal law?


Charles Hazlitt Cahan: There is a wide division of opinion in that connection. The fact is, however, that attorneys general in the provinces do enforce the criminal law, and I think generally speaking they enforce it very well indeed. I have in mind, however, the passing of special enactments by this parliament involving penalties. It is very seldom-at least this has been my experience-that attorneys general in the provinces can be induced to undertake the enforcement of these specific federal statutes. I believe this is a matter well worthy of consideration.


Charles Gavan Power: I am discussing the point
only to obtain the benefit of the minister's experience. I am under the impression, however, that the federal government does appoint attorneys to prosecute under special acts passed by this parliament. Let us consider, for instance, the revenue acts, those measures concerning illicit stills. We know the federal government looks after such prosecutions. I

Companies Act
am under the further impression that certain offences against statutes concerning the Department of Agriculture are enforced by direct prosecution on the federal government.


Charles Hazlitt Cahan: Has my hon. friend ever
represented the federal government in any such prosecution?


Charles Gavan Power: No; I have been so long in parliament, compared with the time I have been at the bar, that I have not had occasion to appear in such prosecutions. I do know, however, that the federal authorities prosecute in matters concerning illicit stills, and the smuggling of cigarettes. I believe, also that the Dominion government prosecutes in connection with a bill which was amended in this house last year and which had to do with the quantity of fats to be found in milk. I am quite certain there are many such matters concerning which the attorney general of Canada appoints special prosecutors. I should like to ask the minister this question:	Where
would he make the distinction?


Charles Hazlitt Cahan: I was not attempting to
draw a close distinction, but I am of the opinion and my experience has taught me that the enforcement of federal statutes through attorneys or counsel appointed by the federal government is a matter not of right but of complacent acquiescence on the part of the attorneys general of the provinces or their representatives. I have never acted for the Dominion government in any case, but I have endeavoured by laying informations to enforce the criminal law for private parties. In every case, however-and I am speaking of my experience in the city of Montreal-the direction of such prosecutions was really taken out of my hands. The provincial appointee representing the attorney general of the province, would sit alongside me in the courtroom, and say, "I am authorized by the attorney general of the province to represent him in this prosecution. I should be very happy to have your assistance, and to cooperate with you most cordially." He would always add, however, "The responsibility is mine, and in the final result I must exercise my discretion."


Charles Marcil: I should like to remind
the minister that for many years the matter of the enforcement of federal laws has been under discussion. I can remember when this parliament passed legislation which had no effect whatever because it was not enforced by the provinces. I can remember when the observance of the Sabbath day was under discussion, and that in that connection there
was a wide difference of opinion between people in the province of Ontario and those in the province of Quebec. After the bill had passed in this house an amendment was added to it in the Senate, to the effect that the enforcement of the act would be left to the attorneys general of the provinces. There is no doubt that some dominion legislation comes more or less within the rights of the provinces, and that the enforcement of federal statutes must be left to the attorneys general of the provinces.


Charles A. Stewart: Mr. Chairman, while I am interested in this particular phase of the discussion, I must say that I have not received the information I wanted. In the provinces under what is known as the blue-sky law a company has to go to a board, and has to secure from it consent to issue stock. We will consider, for example, a company which has the right to issue stock to the value of a million dollars, and which has issued stock to the .value of only half a million dollars. To all intents and purposes the smaller sum is all the capital required for that particular business. Suddenly, however, they decide to issue the balance of the stock, and have to appear before the board and give reasons for their action. The board takes upon itself the responsibility of saying whether or not the company is entitled to issue additional stock for the purposes of its business. Not only that, but if a new company takes a charter and asks for a licence to do business in the province, it also must appear before the board and obtain a licence to issue stock up to a certain point or a certain given amount which it may require. I am not complaining about the precaution taken by dominion authorities in connection with issuing stock to the extent of $2,000,000 when only $1,000,000 is required. But I do think there is something further required, because it is evident that in two cases with which we are all familiar, an implement company and a packing company, the stock issued was altogether, beyond the capital requirements and as a result those two companies find themselves in serious difficulties to-day. I do not suppose anybody is to blame. The companies simply took advantage of their charters, but the unsuspecting public who bought stock are undoubtedly going to suffer. I must confess I could not persuade my colleagues that we needed something of this kind, but I have been asking for some supervision by the federal authorities to prevent the issue of stock beyond the actual requirements of the
Companies Act

business. It may be said that that is undue interference by government, but if we are to do business under private auspices I know of no other way of checking this practice.


Charles Hazlitt Cahan: You would provide a federal board?


Charles A. Stewart: I would provide a federal board from which every company with a federal charter should secure a licence to issue stock. Prosecutions are necessary undoubtedly, but I do want to see some control over the issue of stock by companies doing business under federal charters.


Richard Bedford Bennett: Mr. Chairman, it is now some twenty odd years since I first discussed this matter in this house. I had a very strong opinion with respect to the matter then, I have a very strong opinion now. But if the hon. gentleman's ideas are given effect to, it involves the creation of a board, or court, or commission, or tribunal, which shall have power to pass upon the necessity for each capital issue and upon the character of each capital structure. Against that was urged at the time by friends with whom I discussed the matter this objection, and it is a fairly sound one, that by setting up such a tribunal with the powers indicated, the granting authority to a company to issue stock or to create forms of securities as part of its capital structure would imply that we had given such company a certificate, which involves us in guaranteeing indirectly that it was a sound enterprise in which to invest. I will illustrate that point in this way. A little less than a year ago I made certain observations with respect to a company, and certain people said at once that the government had guaranteed that the shareholders in that company would be protected far beyond what they themselves had stipulated for; in other words it was going to make them better off than they made themselves, because we said we would protect them to the extent we endeavoured to do. That illustrates the soundness of the contention namely, that there is always danger if you set up any federal or provincial tribunal, and it authorizes a given step to be taken, that it thereby implies that that step is a sound one and that the securities issued are worthy of being purchased. We have to go further than that; it is not far enough-yet, it is too far.


Mr. WOODS WORTH:: Is that not already done in the case of insurance companies?


Richard Bedford Bennett: No. Insurance companies are incorporated, as the hon. gentleman knows, under a standard act, which pro-

vides that under certain circumstances they will be authorized to do business. Banks are another illustration. That is, if a certain amount of capital is forthcoming they shall be qualified to transact business. This is an entirely different matter from that to which the hon. gentleman is now referring.


Mr. SPENCER:: Are we not trying to do this very thing through the utilities commissions of the provinces?


Richard Bedford Bennett: I am going to mention that. In several provinces this method is being tried, and yet the greatest evils I know of in connection with the sale of shares, in one of the provinces at least, has come under these very circumstances, because the mere granting of authority to sell shares is not the cause of the trouble. It goes deeper than that. The representations made to secure the sale 'of the shares is what becomes of vital importance, and the circumstances under which the capital structure of the company is created.
I am going to endeavour for a few minutes, if it is not too tedious to the committee, to deal with the matter, both from the standpoint of the provinces and the dominion. Each province under a decision of the privy council has power to create a company that may carry on business not only within the province incorporating it, but beyond the province; but each province can restrain and control the sale of shares only within its own boundaries. It therefore follows that a company created in Alberta, and authorized by the utilities board to sell its shares at a given price, may go into the neighbouring province of, we will say, Saskatchewan, and the utilities board having a different view of the situation, or having the same view, the shares are sold there. You thus have sales in Saskatchewan, in Manitoba, in Alberta, in British Columbia, and in every part of Canada, it having been held by the privy council that a company might exercise all the powers practically that could be exercised by an individual, if each province passed a statute that had the effect of enabling the company created in one province to do business in another. I am not going into the technicalities of the law.
There is another illustration. The province of Prince Edward Island a few months ago passed a companies act which was intended to secure to the province additional revenue from companies. The province is said to be the Delaware of Canada. Delaware, as is known, is a very small state of the American union, and its company laws are so liberal that you will find thousands of companies

Companies Act
incorporated there doing business in New York. Not only are the company laws of the state of Delaware very liberal, but the authorities make no close inquiries with regard to the relation between capital issue and capital requirements. That situation prevails in Canada: the companies act passed by the legislature of Prince Edward Island is a very liberal one, and hon. gentlemen may recall that it is much more liberal than the company legislation of some of the other provinces. Then you have the other provinces each with its own provisions with respect to companies; in some they are incorporated by letters patent, in some by memorandum and articles of association, and in some by a combination of both methods.
Then you come to Canada. When I first began the practice of my profession we incorporated companies under letters patent under the Great Seal. Then there came an amendment to the law, and we have it now that the incorporation is issued by the Secretary of State under the seal of his department. We added to our companies act certain provisions of the English act which related to the memorandum and articles of association. It will be recalled that Mr. Asquith set up a commission to study the w'hole question of company law. The late Sir Frank Cust, who was regarded as the leading company solicitor in the kingdom, gave to this matter a tremendous amount of time and energy. The result was that they drafted as good a companies act as it was possible to secure. We copied part of that into our Companies Act. I think one remedy we might avail ourselves of that we have not thus far is with respect to provisions regarding the amount of capital that shall be paid up before a company begins to carry on business. As it stands now, what is done is done perfunctorilj'. The result is that the authority to carry on business is really no protection at all from the federal standpoint. With respect to the provinces, as I have said, the usual provision is that a company may carry on business when ten per cent of its stock is subscribed for and paid up; some merely require that it shall be subscribed. So you have capital structures created that vary from time to time in ways that I will not trespass upon the time of the committee to discuss.
The two cases to which the hon. gentleman has just referred are cases of reorganization. Shortly put, the methods of reorganizing companies are these: First, the assets of the company are valued, and very often the appraisal shows their value to be far in excess of the capital stock outstanding. In the second case, auditors report upon the average earnings
of the corporation over a period of years. For the sake of argument let us say they averaged 12 per cent. Then it might be an appropriate thing to recapitalize the reorganized company on a basis of twice the former capital, because with its former earnings the company would be able to pay interest at 6 per cent upon twice the amount of capital stock formerly outstanding.


Charles A. Stewart: Without any real necessity for new capital.


Richard Bedford Bennett: I am coming to that. The third point usually considered is the method by which the property is mortgaged to the hilt by a bond issue involving a minimum interest charge since bonds secured by mortgage constitute money loaned to the corporation, not money contributed as a partr ner but money loaned, which establishes the relationship of debtor and creditor. This is loaned at a low rate of interest, for the sake of argument we will say 5 per cent. Then the balance that remains enables a larger issue of common or some other form of stock to be made, and as the hon. gentleman just observed, as a result you have a very large issue of shares. When you have added to that the no par value provision, which I think has worked very badly in this country, if I might venture a criticism, and which is my personal opinion, has been injurious to the whole financial structure of the country, then you have the situation about which complaints have been made.
The question is how we are to remedy the difficulty. In the province of Alberta they passed a law which enabled them to charge with fraud those who made issues of capital stock, let us say, very much in excess of what was reasonably required. One case went to the privy council. It was felt on the one hand that this legislation constituted an interference with dominion powers, because the provincial officers could enter and search the premises and books and institute proceedings of a character peculiarly criminal. Nevertheless, the privy council sustained the action taken by the provincial authorities in that regard. That does not get us any further, however; that only enables the province to-shall I say-successfully raid the books of enterprises that have been promoted with an undue regard for the promoters and a disregard for the rights of the shareholders. That is not any good to the minister.
The other point of the hon. gentleman is that to institute proceedings does not get money back to the shareholders; they have lost their money. In my own view I differ from my hon. friend the Secretary of State. My
Companies Act

opinion is that the point urged so strongly in this house by the late W. F. Maclean is sound, namely that there should be soime machinery by which the federal government can maintain prosecutions for violations of federal statutes. As it stands now, none but a provincial governmental authority may prefer an indictment, which is made either in the name of the attorney general or the crown prosecutor, as the case may be. If he sees fit, for reasons good and sufficient to him, to file a nolle prosequi it follows that the case is not proceeded with. That question became acute in this house in the days of Sir John Thompson, when the prosecution of Connolly and McGreevy was under consideration. It will be recalled that the Dominion government employed very eminent counsel for the purpose of maintaining that prosecution, but the indictment had to be framed and the charge drawn and submitted to the grand jury in the province of Ontario through provincial governmental institutions and by the officials of the attorney general's department.
It will be recalled that in the United States they have federal officials and a federal marshal, the marshal of the United States. They have a federal court and also what amount to federal prosecuting attorneys, who carry on prosecutions for breaches of federal laws. That is a provision which the framers of our confederation avoided for two reasons. In the United States they have forty-eight different kinds of criminal law, and the difficulty of having each state make its own criminal law, in connection with extradition and other similar matters, made it highly essential in the judgment of the framers of our constitution that we should have a universal criminal law, as we have. The second reason was that the administration of justice was felt to be a local matter which local authorities were better able to maintain and carry on than would be the federal authority. So at the moment in this country we have a universal criminal code applicable to every province, but its administration is in the hands of the officials of nine different provinces.
Under those circumstances it is my personal view that we should have a combination of the systems prevailing in the United States and in Great Britain. In Great Britain the department of public prosecutions is undoubtedly the finest organization in the world for the administration of criminal law. Every junior official of the treasury, who is a barrister, who is appointed to a position in that department is a man of promise who, without taking silk, may look forward to being promoted to the bench. Two of the 
greatest of English criminal judges to-day, one the senior member of the bench and the other a more recent appointment, were public prosecutors who gained a very great distinction by reason of the prosecutions they carried on. If any of the members of this house have read the book by the late Sir Harry Poland, who was the oldest practicing member of the bar, they will recall his description of a public prosecutor. The public prosecutor decides whether a case shall be proceeded with, and no political considerations govern. The selection of the local prosecutor rests with him, and he is in control of the whole machinery. The law is put in motion and the matter is carried through to the end by the intervention of the public prosecutor. Sometimes I think that in connection with controverted elections, for example, the only way to get rid of many difficulties is to have an independent tribunal which will have no interest in sawed-off election petitions; this might get over the difficulties which have been experienced. If we had a public prosecutor charged with responsibility for the administration of justice as far as federal statutes are concerned, we might get over some of the difficulties I now see. I observe that my mind has not been working along the same line as that of the Secretary of State. As I have observed the difficulties in connection with the administration of justice with respect to federal statutes, and then realized that the entire power with respect to the administration of justice and the setting in motion of the machinery for public prosecutions rests with provincial officers, at times I have concluded that the method suggested is the one by which the matter can be best dealt with.
On the question of the capital structures of companies, to get back to what the hon. gentleman has been discussing, prosecutions do not serve the purpose he has in mind. I can recall that when I was much younger than I am now I thought the difficulty could be overcome by the setting up of a federal tribunal that might exercise powers similar to those which have been given the Board of Railway Commissioners. I thought possibly it might be a branch of one of our federal commissions. But a country must not be overcommissioned, and already there are some signs indicating that people think we have as many commissions now as are necessary, if not too many. It might be an adjunct of the tariff board, for instance, in the mind of my hon. friend from Weyburn (Mr. Young) and some of the other hon. gentlemen who think as he does, but the difficulties in the way of setting up a tribunal that gives its imprimatur, its approval and its authority for a certain

Companies Act
course of action to be taken, are not to be overlooked. I am sure, from what the hon. gentleman has observed in connection with other matters, that he will agree that this is an argument not to be lightly set aside. I am satisfied that we must devise some method by which to prevent the reorganization of enterprises as it has been going on in this country. About that I have not the slightest doubt in the world-not any. I am sorry to say-I think it was done inadvertently-that in 1930 we put a direct premium upon doing it. There were, I think, only two members in the house who observed it, and I know the government did not think it meant what it did; but it did permit the reorganization of every business enterprise in this country, if they wanted to do it. That was the effect of that statute.


An hon. MEMBER:: What was that?


Richard Bedford Bennett: The provisions of the statute that permitted the absorption of profits in reserve by reorganization of the capital structure. Perhaps the hon. gentleman will recall what took place. That brought about a tremendous amount of reorganization. The result was that where a company had a capital of 10,000 shares and reserves that would enable it to recapitalize and reorganize, and to issue
15,000	shares, it was done. And the results sometimes were very injurious to the whole situation.
I can only say this to my hon. friend. The life of a government is very uncertain. This is one of the matters to which, however, I have given as much thought as I could in the time I have had at my disposal during the last few months. I think something must be done in the way of federal legislation to prevent just the difficulty to which he alludes. The effect is this-and it does not require any argument, for every hon. member to follow it: A successful company that by reason of great care and thrift has accumulated large reserves, proceeds to capitalize them, with the result that the public, who might hope to get a cheaper product by reason of the company having no greater demands upon it for fixed charges, suddenly finds itself confronted with trebled, quadrupled, or sometimes-I do not know of the apt word to describe it-twenty times its former capital, and the necessity becomes apparent to everyone of providing earnings to take care of a dividend upon its shares perhaps twenty times as large as previously prevailed. This is what the hon. gentleman is aiming at, and whether it can be done without a conference with the provinces I am free to say I have grave doubts. My own conviction, if it is worth anything to the hon. gentleman, is this. If we ever get back to normal conditions, there are two things that are essential for the maintenance of our commercial life, and one is that so far as possible there should be uniformity with respect to the incorporation of companies as between the dominion and the provinces. When I say uniformity, I mean that a company denied incorporation on application to the Secretary of State's office here, should not go to some other office in a province and obtain all the powers and more, as is frequently the case, that were sought for in the federal department.


Charles Hazlitt Cahan: It has been done in every
case in which I have refused it.


Richard Bedford Bennett: To my knowledge, it is
done frequently. Secondly, and this is the more important, the reorganization of companies must be controlled where the public are as vitally interested as they are here. Where enterprises with small capital have been able to make great progress, they must be prevented from issuing enormous waterlogged securities upon which the public pay enhanced prices for the purpose of enabling them to retain those securities so that they shall be quotable or saleable in the markets of the world.


Mr. COOTE:: Hear, hear.


Richard Bedford Bennett: My hon. friend from
Macleod says "hear, hear." Well, it is easy to say "hear, hear," but much more difficult to say "there, there," when you try to do it; it is a matter of first rate difficulty. When I say that the question of watered stock is one that has engaged the attention of every legislature in the world since 1862 or thereabouts, when we first had our Companies Act,-and companies are merely partnerships with limited liability that create, by reason of the statute, an entity called a corporation rather than a partnership-one realizes how essential it is that some steps should be taken. It is all very simple to sit down and suggest that something be done, but it is very difficult to begin to take action, having regard to the fact that we have a federal constitution, under which the provinces enjoy certain powers and the dominion others. However, I should like the hon. gentleman to know that I am not only in sympathy with what he says but that I believe it must be done. I believe we must discover, by conferences between the provinces and the dominion, some means by which that action shall be taken; and if we get back to normal times during the period I am pri-
Companies Act

vileged to direct the government of the country, I propose that a conference between the provinces and the dominion shall discuss the question to see whether we cannot arrive at some conclusions that will prevent a repetition of the enormous injury that has been done the country as a whole, and the great losses that have been sustained by individual investors by reason of the circumstances to which the hon. gentleman has referred.


Mr. CAMPBELL:: Does not the Prime
Minister consider it possible to take steps to prevent the watering of stock in companies that have federal incorporation, even if the federal jurisdiction does not extend to companies incorporated in the provinces?


Richard Bedford Bennett: The Secretary of State
has alluded to the difficulty. The moment we undertake to impose such restrictions they at once say, "We will not incorporate with you at all but will go to the provinces," as in fact they do. That has been the difficulty to which the Secretary of State has directed attention. He says it is universal; when he refuses them, not being satisfied with the capital structure, or being of the opinion that they do not comply with the provisions of the law, they go to the province. Half a dozen sections in the Companies Act would remedy the difficulty. But that means that no companies would be incorporated here; and in support of that, you have the Secretary of State saying that in every case where he has refused them they have gone to a province and obtained a charter. That has been the real difficulty.


Charles A. Stewart: The Prime Minister will remember that after the board was appointed in Alberta the effect was in the opposite direction; they could not get charters there and if they did not they came to the dominion.


Richard Bedford Bennett: Exactly.


Charles A. Stewart: This is what I was complaining about to the former Minister of Justice during the past eight or nine years. I have only one difference of opinion with the Prime Minister, and it is this. This, of course, is a legal matter and I confess that I have not a legal mind; but if the federal authorities can control banks, insurance companies and large corporations of that character because it is in the public interest-perhaps control is not the proper word, but exercise some medium of control-then it does seem to me that the government would not be assuming any serious responsibility by setting up such a board as is suggested. This, after

all, would obviate criticism of the government in the event of some company, which had a certificate from the board, going wrong. With respect to most of the public business that is done in the country by companies, by whatever means they are set up, the government of Canada and the provincial governments must assume some control or we shall drift into another state of affairs which in my opinion will not prove a huge success, namely, the nationalization of all our public business; because I confess I am not yet convinced that we have arrived at the stage where that would be a desirable thing to have happen. I am convinced that we have arrived at the stage where governments must set up some authority which will prevent the manipulation which now goes on by private individuals and corporations. Legal gentlemen will know the difficulties to be overcome but I contend that if we are to prevent complete nationalization, and I wonder sometimes if it would not be successful, it is necessary that we have some power to deal with the evils which have crept in, particularly during the past few years.


Richard Bedford Bennett: Section 91 of the British North America Act, dealing with the powers of parliament, in part reads as follows:
-it is hereby declared that (nothwithstanding anything in this act) the exclusive legislative authority of the parliament of Canada extends to all matters coming within the classes of subjects next hereinafter enumerated, that is to say,-
15.	Banking, incorporation of hanks, and the issue of paper money.
16.	Savings banks.
17.	Weights and Measures.
18.	Bills of exchange and promissory notes.
19.	Interest.
20.	Legal tender.
21.	Bankruptcy and insolvency.
In connection with banks and other corporations, to which the hon. gentleman has referred, this parliament has exclusive jurisdiction to deal with the matter as well as with other matters affecting savings banks, bills of exchange, interest and legal tender. The courts have held that inasmuch as insurance companies may have provincial incorporation as well as federal there is no exclusive jurisdiction resting either with parliament, on the one hand, or the legislatures on the other. If we had exclusive jurisdiction with l'espect to all corporations, as we have with respect to banks, then there would be no difficulty. It has been held that insurance companies-one of the matters referred to by the hon. gentleman-do not require licences from this dominion to enable them to transact business in a province, and that their incor-

Companies Act
poration or licensing by one province will permit them, under proper conditions, to do business in other provinces. This illustrates the difficulties with which we have to deal due to the joint control of the dominion and the provinces. These difficulties have caused all our trouble up to the present moment although there is a way out which I have not ventured to express because it would not be the expression of a mature opinion on my part. I do believe that we can meet this difficulty and I promise hon. gentlemen that if it is not met it will not be because of any desire not to do so.


Charles Hazlitt Cahan: In reply to the criticism
offered by hon. gentlemen-


Charles A. Stewart: It is not.
criticism, it is information we are after.


Charles Hazlitt Cahan: I do not intend to cast any reflection upon my predecessors when I say that the administration of the Companies Act since August, 1930, compares favourably with its administration at any other time since the act was placed upon the statute books. It has been honestly and efficiently administered and-1 am prepared to refute any adverse criticism thereon. I do not think hon. gentlemen have realized the many ramifications of this subject. I, as Secretary of State, may refuse to grant a charter to-day; within forty-eight hours, an application may be made to London and a charter granted within sixty-four hours. Under the comity which exists between us and Great Britain, the company granted such a charter could carry on business in this country. I have seen that done time and time again when there were restrictions under our act to which the applicants did not wish to submit.


Charles A. Stewart: Would a company incorporated in London have all the powers and authority granted to one incorporated by the federal government?


Charles Hazlitt Cahan: There are extraordinary
powers granted under the English companies act which are not granted under our act.


Charles A. Stewart: My hon.
friend did not get the point of my question. Would a company organized and granted a charter in London under the English law have the same right to do business, in the province of Alberta for example, as a company organized and granted a charter iby the dominion?


Charles Hazlitt Cahan: Quite so. It simply makes formal registration and then proceeds to do business. Under the English companies act a
man may be incorporated to do in the name of a company almost everything that can be done by an individual. There would also be the greatest difficulty under the comity which exists between us and the United States. We could hardly declare that an American company could not come in here and do business unless its capital issues were subject to revision here. These companies come in by the hundreds and thousands and do business throughout Canada. They do not take out provincial or federal charters, they are incorporated in Delaware, New Jersey, New York or some other state and -they come into Canada and carry on their corporate activities without regard to the restrictions imposed upon Canadians by our Companies Act. There is a wide range to be investigated in undertaking remedial legislation.
I do not think the Prime Minister (Mr. Bennett) understood what I said about the administration of justice in the provinces, because I think my ideas are somewhat in accord with his. If there is any constitutional method whereby the agents or officers of this government can be authorized to enforce federal laws against over-capitalization and the breach of federal legislation in regard to companies and the government will authorize me to take action at the expense of the government, I shall see that such action is taken. The matter is rendered far more difficult by -the constitutional issue discussed by the hon. member for Quebec South (Mr. Power).


Mr. WOODSWORTH:: I recognize the difficulties with regard1 to jurisdiction but may I remind the Prime Minister (Mr. Bennett) that when it was proposed that we should have bank inspection it was argued that that would be dangerous 'because the dominion might possibly 'be forced to accept certain responsibilities which it would not want to accept. There was an instance in which there was absolutely no doubt that the dominion had exclusive jurisdiction.


[Stage Direction]
Title agreed to.
Bill reported.


[Stage Direction]
Hon. R. J. MANION (Minister of Railways and Canals) moved that the house go into committee to consider the following proposed resolution:
That it is expedient to provide for an extension of time from 31st August, 1932, to the 31st August, 1934, for the construction or completion
C.N.R.-Branch Lines
[Stage Direction]
of certain branch lines of railway of the Canadian National Railway Company, authorized by chapters 19, 20, 21, 25, 28, 29. 30, 32, 33, 34, 35 and 36 of the statutes of 1929.
Motion agreed to and the house went into committee, Mr. Hanson (York-Sunbury) in the chair.
Resolution reported, read the second time and concurred in. Mr. Manion thereupon moved for leave to introduce Bill No. 70, respecting the Canadian National Railways and to provide for an extension of the time for the construction or completion of certain lines of railway.
Motion agreed to, bill read the first and second times and the house went into committee thereon, Mr. Hanson (York-Sunbury) in the chair.
On section 1-Extension of time for construction.
Mr. CARMICHAEL:: What is the number of this bill?


Mr. MANION:: I am afraid the bill has not yet been given a number, 'because, with the consent of the house, we are making more rapid progress than is usual. The bill is merely for an extension of time for the building of various branch lines, twelve in number, that have not yet been completed. The bill introduced in 1929 permitted an extension for three years to August 31, 1932. As that time will run out on August 31 of this year, this is merely giving the railway a further extension of two years for the construction of these lines, without in any way saying that it will necessarily be two years before they are constructed. That is the whole purport of the bill.


Archibald M. Carmichael: I realize that is the purport of the bill and I am not sure whether the authority is absolutely necessary; possibly it is. I have, however, before me a protest from at least one part of our western community against this further extension in completing some of the work that has already been undertaken. Some of these branch lines have been carried almost to completion. The one about which the protest to which I refer has been made has had the grade constructed.


Robert James Manion: Which one is it?


Archibald M. Carmichael: The Hemaruka-
Scapa line in Alberta. The grade is constructed, the ties and steel laid, the crossings put in, the telegraph poles erected and the wire strung, but the line is left unballasted, and because of that there has been no movement of freight of any kind from the Drum-

heller coal fields or from Calgary distributing points to the residents living along that line. That road serves a large part of my constituency and the people there find it necessary to bring their coal and other freight eastward on the Goose Lake line to Saskatoon and then back by Biggar and Loverna, a distance of some 320 miles further, just because this line has not been ballasted; at least that is the excuse offered by western district superintendents. Last year I had the privilege of corresponding with the district superintendent of Saskatoon and again with the divisional superintendent at Winnipeg, and in each case the statement was made that the line was not ballasted and they could not carry our coal.
I have no great objection to this extension of two years, but if it is just a matter of stalling off the work for two years, I do not know whether it is worth our while putting this bill through the house. When so much money has been expended as has been the case in this particular instance, the matter of ballasting the line to carry our coal and other freight to needy settlers should be undertaken and completed. The total mileage of this line from Hemaruka to Scapa is some forty-one miles. The residents of Loverna district point out to me their whole difficulty would be solved if the line were ballasted at present from Hemaruka to the Youngstown-Coro-nation line. Then by coming north and crossing this line at a point about six miles west of Hemaruka they claim, if this were ballasted, their coal and other freight coming from Drumheller east could switch north from Youngstown to Hemaruka and move eastward to Loverna and surrounding districts. What I wish to emphasize in connection with this particular line is that the ballasting of the whole road should be gone on with if at all possible. I know the minister can use the argument that funds are not available. That may be true, but I would remind him that just the other night he had some estimates put through for improvements for the Trent and other canals that are not nearly so important, and in each of the several cases there was a considerable increase of expenditure over that of the previous year. Therefore the argument that funds are not available is not going to be very weighty in this case when one considers that ballasting a matter of six miles of line will provide for the residents of some hundred or more miles of territory a much cheaper commodity. I am informed by the residents of that district that their coal costs them an average of $1.60 a ton more if they have it brought in by Saskatoon, and as a result many of them go north on the

C.N.R.-Branch Lines
Canadian Pacific and get their coal at $1.60 a ton cheaper. Those living south of the line go south to the Goose Lake line and haul it from twelve to sixteen miles, thus saving the extra freight charges. I would like to impress upon the minister the need of completing, not two years hence, but immediately, such lines as this one which needs only a small expenditure in order to complete it and to give to the residents along there the service for which they have been waiting many years.


Robert James Manion: May I suggest to the hon. member that a refusal to pass this bill would not necessarily hurry, in fact it would delay, the completion of the line. It would mean that nothing could be done on this line after August 31 of the present year, so that supposing some time after August 31 we wished to do some work on the Hemaruka-Scapa line and this bill had not passed, we should be unable to do it because we would not have the necessary legislation. Therefore a refusal to pass the bill would not advance but would probably delay the matter.
I have not any quarrel with the hon. gentleman in regard to the completion of this line, but in this bill there are twelve lines which it is claimed are in exactly the same position. The balance involved in these undertakings amounts to $13,000,000, which under 'present conditions is quite a sum. As regards the line to which my hon. friend refers, the figures that I have show that the total expenditure plus 15 per cent, which is the leeway allowed, was to be $1,650,000. The amount spent is given to me as $806,000, which is just a little less than half of the total amount. I mention that merely in passing. Perhaps it may help the committee to understand the whole situation if I say what I have said many times before in regard to various branch lines which have been brought to the attention of the government and the railway, that the railway management at this time take the attitude that because of the very serious financial situation and the continually decreasing earnings, they do not believe any amount should be spent on most of these lines, that is the twelve different ones affected. If conditions improve I am sure the government would be quite pleased; certainly they would have no objection to helping the railways to make the extensions required. At the present time, however, there is the feeling that the Hemaruka-Scapa line is on all fours with other branch lines, some twelve in number, and involving an expenditure of abolit $13,000,000.


Archibald M. Carmichael: Does the minister
suggest that half a million dollars will be 41761-161
necessary to ballast forty-one miles of road? According to the figures submitted that is the distance remaining.


Robert James Manion: Yes; that is true according to the figures I have had submitted to me. According to those figures the total expenditure on the Hemaruka-Scapa line, allowing a fifteen per cent leeway, was $1,650,000. The expenditures to December 31, 1931, were $806,000. Hon. members will see that half the amount is still to be expended.


Robert Gardiner: Has the minister any information concerning the condition of that piece of line at the present time?


Robert James Manion: Yes, I can give my hon. friend the information that is before me which, I believe, is fairly complete. The distance in question is forty-one miles. The amount, without the fifteen per cent, was $1,435,000. Then the addition of the fifteen per cent made up the figure I have given. The line has been completed with the exception of the ballast, the buildings and the fences. Up to December 31, 1931, $806,000 had been expended, of which $255,990 was expended during the year 1931, details of which are given in an attached statement. Those details would not be very useful to the committee, as they enumerate details concerning engineering, grading, bridges, ties and so on. I do not think that information would be of any particular use to the committee. The statement I have before me does not give the details of the amounts still to be expended, but I have given the figures.


Robert Gardiner: I appreciate the situation in which the Canadian National Railways find themselves, but I should like to know if the minister has any information concerning the possibility of having coal drawn on that line, even if it has not the ballast. In the early days of western Canada lines went without ballast for a period of two or three years, yet despite that fact trains ran on them. The people living in the district to be served by this road feel some service should be given so that they may be saved some very substantial amounts of money.


Robert James Manion: I cannot give the hon.
member any definite information in that connection. I shall be very happy, however, to bring his comments to the attention of the railways, and if there is any way in which they can assist, I am sure they will be only too anxious to do so.


Robert Gardiner: The statement by the
hon. member for Kindersley is quite correct. Probably the minister has not the information before him to the effect that the Youngstown-

C.N.R.-Branch Lines

Coronation line is just about six miles west of Hemarulca. If the railway company could put a switch in there the people to the east would be served; I refer to those people six miles west of Hemaruka. If the railway could help, those people would receive a very much needed service.


Robert James Manion: I shall be very happy to
draw the hon. member's remarks to the attention of the railway authorities.


Mr. GARLAND (Bow River):: I am wondering if any action will be taken. I think the remarks of the hon. members preceding me have been both moderate and fair. We know about the practice of railways which in the past have constructed lines to certain points, and then left them for long periods of time. That condition requires no rehearsing. In the past it has been a serious scandal in such districts as the Lethbridge district, and others throughout western Canada. In the present instance we have a very striking illustration of the attitude of the railways towards requirements of districts. When the hon. member for Kindersley said that a back haul of about 160 miles was necessary he was understanding the facts-but perhaps wisely so. I find that at the present time to supply Little Gem, Naco, and points east of there, coal is run from Drumheller to Saskatoon, from Saskatoon west to Biggar, and from Biggar west to points of destination, a distance of 370 miles at a charge to the purchaser of about $3.80 a ton. That coal could be laid in there at about $2 a ton if the suggestion of the hon. member for Acadia (Mr. Gardiner) were adopted, and if it were drawn over the now almost completely constructed line, lacking only ballast. From my experience in the western provinces and from my knowledge of the territory, I am satisfied the base upon which the ties are laid is for the most part sufficiently level to enable the hauling of fairly substantial loads without great risk to the lines.
I support the contentions of those hon. members who have preceded me, and in that connection merely wish to say that I have been in communication with the Western Canada Fuel Association, the Drumheller coal operators, the board of trade of Drumheller, the Board of Railway Commisisoners, and the railways. To date I have not been able to get any satisfaction from the railways. The matter however, is still under consideration, and if the minister will add his voice to ours I am satisfied that collectively we may be able to secure some justifiable and satisfactory solution. The conditions at present are grossly unfair. Canada has paid for the line;

the line is ready for use; the people need the service, but through lack of ballast they are being deliberately held up. I hope the minister will join with us in protesting to the railways.


Robert James Manion: I shall bring the hon.
member's remarks to the attention of the railways.


Mr. BOTHWELL:: I should like to speak
to the minister concerning the Neidpath-Swift Current branch of the Canadian National Railways. There is a rumour that it is not the intention of the Canadian National Railways to put that line into operation until the year 1934. If I understand the situation correctly the road has been built, the steel has been laid, and ballasting is partially completed. I should like to find out from the minister what additional expenditures must be made in order to put that road into operation. That particular line has been agitated for the past fifteen years, and it seems to me it is in shape to give service to the district.


Robert James Manion: The remarks I made in
connection with the Hemaruka-Scapa branch are applicable to the Neidpath-Swift Current branch. The Neidpath-Swift Current branch line was, to cost $1,380,000, and up to the end of the year 1931, $937,000 had been spent. Therefore there is a balance to be spent of about $450,000. I can say only this, that it is in the same position as the other branch lines, of which there are twelve in all. In fairness to the railways may I add that pressure of financial conditions is responsible for the action they have taken.


Charles Edward Bothwell: Included in that figure is a considerable amount for station, grounds and so on. Would it not be possible to get the railroad in operation without that expenditure by simply putting in a loading platform or something of that kind? This expense would be very small and would give real service.


Robert James Manion: Again I do not care to offer any technical opinion, I am not qualified to do so; but I shall very gladly do for my hon. friend what I have promised to do for other hon. members, that is, draw his remarks to the attention of the railway management.


Mr. CANTLEY:: When does the minister propose to complete the Sunnybrae-Guys-borough road? As I understand it, 72 per cent of the construction work is already done. If the government are looking for some relief for unemployment, I do not know anything that will give more employment and at the

C.N.R.-Branch Lines
same time carry out the original -purpose of the government than the completion of this road. The minister may tell me that he has not got the money, but my understanding is that he is spending about a couple of million dollars in the Hudson bay district on the completion of some work there. I do not want to offend my friends on the other side, but my impression is that that route never will be worth much as an outlet for their grain.


Some hon. MEMBERS:: A wrong impression.


Thomas Cantley: We have been told how popular the route is and how much grain did go out over it last year when through the minister's efforts a few thousand bushels of wheat were shipped from Churchill. Owing to good fortune and an abnormal season he was able to get two boats into Hudson bay, but it may be doubted if the same conditions will occur again in the next fifty years.


Some hon. MEMBERS:: Order.


Thomas Cantley: All right, read the history of the Hudson's Bay Company and their experience with the route and the history of the navigation of James bay for the last hundred and twenty or thirty years; after doing so some of you may change your minds in regard to the possibility and the practicability of that port. We have spent fifty million dollars on it. How much has been spent on railways in the maritime provinces in the last twenty years?


Mr. BEAUBIEN:: We spend eight million dollars a year under the Maritime Freight Rates Act. I have no objection to it.


An hon. MEMBER:: What about the
elevator at Halifax?


Thomas Cantley: The railway mileage of the maritime provinces as compared with that of the other parts of the dominion is practically infinitesimal.


Charles-Philippe Beaubien: But the railway deficit on the maritime province lines is equal to that in the rest of Canada.


Thomas Cantley: We built and paid for most of our railways before confederation; that mileage and other roads we gave as a gift to the dominion. All that we ask is that they maintain and operate them. To-day the railway department is not doing that. The situation is not satisfactory to the province of Nova Scotia.


James Shaver Woodsworth: What about wharves and breakwaters?
41761-161J


Thomas Cantley: I appeal to the minister
to do something to complete that road. Seventy-two per cent of the construction work has been done. Why not go on and complete the road and put it in operation? If the road were put through as originally intended it would save the department a very considerable amount of money, simply because the railway from New Glasgow to Mul-grave, a distance of eighty miles, is the worst section of road in Canada; the grades and the alignment are worse than any eighty mile section of road east or west. The operating losses on that section due to the physical condition of the road are and have been excessive. The gradients run from -8 to over per cent, and the alignment is unequalled in any similar length of road anywhere in the country. By continuing the railway from Guysborough around to Mulgrave you will be able to do away with the operation of that most expensive section, on which a large amount of rolling stock has been destroyed; and only about 25 per cent of a normal load can be carried over it. I think the minister's department should consider this practical suggestion. What I am anxious about at the moment is to get some understanding from him that he will complete the section of the road, 72 per cent of the construction of which has already been done.


William Duff: I have very much pleasure in supporting the hon. member for Pictou (Mr. Cantley). He has covered the ground very well, and as we are anxious to get through the session, I need not make a speech on the Sunnybrae-Guysborough railway. I notice the minister in his remarks gave as one particular reason why the Sunnybrae-Guysborough road and the other branch lines cannot be completed that the Canadian National Railways did not have sufficient funds to finish the work. My understanding is that some $4,000,000 of bonds were issued and sold for the building of the Sunnybrae-Guysborough line, and consequently the railway management must be using the money for other purposes. This being so, I think the reason given by the management falls to the ground. The road should be completed.


Robert James Manion: I must confess that what
the hon. member for Antigonish-Guysborough (Mr. Duff) says is news to me. I do not think he can be correct, for the railway management could not, without the consent of the government, use money from the sale of those bonds for some other purpose. However, my hon. friend is on the special railway committee, and to-morrow I would suggest he ask about that matter. I have
C.N.R.-Branch Lines

every sympathy for both him and my hon. friend from Pictou. They have both placed the matter before me a number of times. Unfortunately this branch line is in exactly the same position as other uncompleted branch lines throughout the country. While I very much respect the opinion of the hon. member for Pictou, the railway management do not admit that the Sunnybrae-Guysbor-ough line is going to be such a profitable branch as he points out. However, I can only promise him as I have promised others, that the whole discussion will be brought to the attention of the railway management in whose hands the subject is.


Thomas Cantley: I expect you to promise me a little more than you did the other day.


Henry Elvins Spencer: I desire to draw to the
minister's attention the branch line from Bulwark to Airways, Alberta. This line has been needed for a number of years. Last year after some delay the route was graded. People in the locality expected the line would have been completed last year, and they are very much disappointed. I can quite understand financial conditions preventing the railway management going ahead with new branch lines, but where a considerable amount of money has been expended on actual work, it seems to me it would be the course of wisdom for the line to be completed; for had it been in operation last year, a very considerable revenue would have resulted from the traffic that was available owing to the heavy crop that we had there. How much money has been spent on this line, and has the minister any estimate of what is needed to finish the work?


Robert James Manion: The branch line to which the hon. member refers has had a lesser proportion of the total cost expended on it than have most of the other branch lines that are being held up. The estimated cost is over $1,000,000 for the twentj'-five miles, and the amount spent to the end of December last was $389,000, so that less than half has been expended. In the case of the Sunnybrae-Guysborough branch line for example, over three-quarters of the estimated cost has been spent, in fact in the percentage figure my hon. friend for Pictou gave he underestimated the expenditure. I do not wish to delay my own bill; the situation is just as I have told my hon. friend. The work is being held up through lack of funds.


Henry Elvins Spencer: If this bill goes through will these lines be finished within the next twelve or fifteen months?


Robert James Manion: According to the bill they must be finished within two years or we will have to bring in another bill. It depends entirely on business conditions, so far as the railways are concerned. They are anxious to go ahead, and so is the government, but the difficulty is that the earnings of the road have been in the red, as they say, and there is not a very good outlook for the spending of money on branch lines, very few of which pay their way for some time.


Henry Elvins Spencer: Is it not a question whether the railways are not losing more money by not putting down the rails than will be saved by this policy?


Robert James Manion: They do not think so.


Charles-Philippe Beaubien: Is it the fixed policy of the railways and of the government not to continue the construction of any branch lines until the revenues of the road improve?


Robert James Manion: In a general way that is correct, though there are a few small items in connection with the branch lines we are discussing at the moment. They will not total more than $350,000, however, which will be scattered from one end of the country to the other, so generally speaking my hon. friend is correct.


Charles-Philippe Beaubien: Then I suppose it would be useless for me to press further for the Mafeking cut-off?


Robert James Manion: I am afraid so.


Some hon. MEMBERS:: Oh, oh.


Charles-Philippe Beaubien: I am quite sincere in that statement. The hon. member for Pictou mentioned the value, in the matter of the relief of unemployment, of the Sunnybrae-Guysborough line, and I am equally sincere with regard to the Mafeking cut-off. I do not think my hon. friend from Pictou is a very good salesman. He is trying to sell the idea of completing this branch line of his by knocking the construction of another line. I do not think there are many successful salesmen who try to sell their goods by knocking other lines. I may tell my hon. friend that his prophecy with regard to the Hudson Bay railway will not be fulfilled if the government give the line sympathetic consideration and if proper insurance rates are obtained.


Robert James Manion: We are giving it sympathetic consideration.


Mr. MURPHY:: I do not want to delay this legislation, but as a member from Manitoba who in season and out has defended the completion of the Hudson Bay railway I feel that I must say a few words in its defence.

C.N.R.-Branch Lines


John Livingstone Brown: Deal with the Mafeking cutoff at the same time.


Thomas Gerow Murphy: One thing at a time is a very good rule. During the fall of 1931 it was my good fortune to visit the port of Churchill, where I had the privilege of a conversation with the commanders of the boats, the Farnworth and the Warkworth, which carried the two shiploads of wheat from Churchill to the old country. They told me that on their voyage into the bay they experienced no difficulty whatever; in other words it was a very humdrum sort of trip. They simply sailed through the straits into the bay and loaded their ships in the harbour, and I have never heard that they experienced any difficulty on the return journey. The fact that they did not do so is shown by their safe arrival in the old country. I could give more of their conversation, but to do so would be to make an invidious comparison with another port of Canada, and in that I do not propose to follow my hon. friend from Pictou, who has endeavoured to fulfil his desires by belittling another route. Ships have been going into and coming out of Hudson bay for two hundred years or more, and there have been very few failures. It is true that the season is short; it may not be .as safe as some other routes, but I would point out to the committee that until the last few years there were no aids to navigation along that route. Now that condition has been rectified, and if one is to believe the two commanders who brought their ships to that port, there is absolutely no difficulty whatever in making that a very navigable route in certain seasons of the year.
May I say here that we Canadians are usually prone to talk about our immeasurable resources and how we may expand this country. Why any one part of Canada should feel that the opening of another port is going to be to the disadvantage of the country rather than to its advantage passes my comprehension. If Canada is the country we think it is, then the development of the port of Churchill will work to the benefit of the whole country. If we are going to adopt in Canada a narrow, provincial attitude and contend that the country can prosper only by the development of one portion or the other, then I am afraid all our prophecies in regard to this country have been made on a wrong basis.
With regard to this government giving sympathetic consideration to the Hudson Bay railway and the port of Churchill, with the Minister of Railways I feel quite safe in saying that this government has not only given sympathetic consideration but has carried to
completion the railway and the port, and today this route is ready for business. All that is needed is for the shippers to send their goods to Churchill, and they will get to the old country.


Thomas Cantley: The last sentence of the minister's remarks contains the whole picture; all that is required is for the people to send their grain through Churchill, and why the deuce don't they? Last year the minister had to go over the country with a fine tooth comb looking for cargoes; the minister did everything and implored everybody to send some grain over that route. Those are the facts, and they can be verified by Hansard of last year. My objection is that the minister proposes to find $2,000,000 this year for Hudson bay but be cannot find a dollar to complete a short section of an eastern route. With regard to my hon. friend the Minister of the Interior, who has just spoken, if he will read up the history-


An hon. MEMBER:: Ancient history.


Thomas Cantley: -of Hudson bay and its navigation, he will find that in one year out of three the Hudson's Bay Company either did not get their yearly ship into the bay or, if they did get it in they did not get it out. That is a matter of histopf. The difficulty has not been the lack of aids to navigation; it has been that the port has been icebound, and it will be icebound again. Through the grace of God, or the weather condition last year a condition prevailed that has not prevailed for fifty years, but you cannot count on that every year.	[DOT]


Thomas Gerow Murphy: I think the hon. gentleman must be mistaken when he says we cannot count on the grace of God every year.


Thomas Cantley: I think the grace of God is fairly well exhausted as far as helping out the Hudson Bay railway is concerned. About all the dividend we get from that road is the enjoyment we derive in discussing it in this house. Certainly I would not belittle any legitimate enterprise in this country. The east contributed as much as any other section of the country to the development of western Canada, and all I am asking to-day is that a reasonable amount should be spent to complete a road which is now seventyrtwo per cent completed. The amount for which I am asking is small in comparison with what is being spent to-day on the port of Churchill. That is all I have to say about that. If anyone else wishes to make further remarks as to the navigability of Hudson bay, or to say anything about that part of the country

C.N.R.-Branch Lines
as a summer resort, I shall be glad to hear him and give the matter respectful consideration. For my part, however, I have made up my mind fairly well, from history I have read as to conditions governing both Hudson bay and James bay, that there will not be very much grain or any other commodities moved out of the port, however much you may spend on it.


Charles A. Stewart: Are the connecting links from Elk Point with the Saskatchewan line along the Saskatchewan river in the same category as the other lines? I should be glad if the minister would give me some information with regard to this and also the Coal lake connection. They are two lines I have been greatly interested in.


Robert James Manion: Those are not the names,
are they?


Charles A. Stewart: I do not know under what names they go, but my hon. friend will remember that there are two projections from St. Paul eastward to connect with the Saskatchewan line going west. Is there any chance of anything being done on these lines this year?


Robert James Manion: I do not recognize the description that my hon. friend gives it. The names of the lines are given here but not under the description he has given. I am afraid I cannot give the information he asks for.


Charles A. Stewart: Am I correct in assuming that $350,000 is all that will be spent this year?
Mr.*MANION: Yes; that is all that it is proposed to spend at the present time.


Charles A. Stewart: I can assume that nothing will be done.


Robert James Manion: My hon. friend can take it for granted that the branch lines are all on the same basis.


Mr. MacMILLAN (Saskatoon):: I was interested in the remarks of some hon. members in regard to the Hudson Bay railway. This is not a party question. Both parties are tied up to it and we have spent $50,000,000 of the people's money. I submit that it is our duty to put our best foot forward to see if we cannot make practical use of the railway, instead of condemning it after spending this money on it. I understand from the minister that the amount in the estimates this year is to provide facilities for the loading and unloading of coal, sheds for the covering of merchandise when it is shipped in and out, and other facilities of that sort. It is, I re-

peat, the duty of every member of this house to do everything possible to make that railway a success. I am not condemning it nor saying that it will not be a real shipping route, but after we have spent $50,000,000 on it we should try to make it a success.


Milton Neil Campbell: I do not intend to enter into any argument about the Hudson Bay railway. Some years ago we exhausted our oratory on the question and finally both parties were convinced that it should be undertaken. What I wish to direct attention to is the fact that at least two-thirds of the money involved in that project was raised by a tax on western land. I call it a tax advisedly, because homestead land was sold to the extent of $37,000000 to contribute to a fund used for the building of the Hudson Bay railway. So that it is not all money taken out of the public treasury in the ordinary way.


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

[Stage Direction]
Hon. E. N. RHODES (Minister of Finance) moved the second reading of Bill No. 45, respecting the export of gold.
Motion agreed to, bill read the second time, considered in committee, reported, read the third time and passed.


[Stage Direction]
Hon. T. G. MURPHY (Minister of the Interior) moved the second reading of Bill No. 64, to authorize the refund of moneys received in connection with the administration of the natural resources.
Motion agreed to, bill read the second time, considered in committee, reported, read the third time and passed.

[Stage Direction]
Hon. E. N. RHODES (Minister of Finance) moved that the house go into committee of supply.
['Before the committee rises I should like to make one or two observations. When the hon. member for Bow River first raised the question of coal I said I had not the particulars before me. When I replied to the hon. member for Acadia I was speaking generally, as to the policy of the department in connection with tenders, and I made the assertion that the lowest tender is accepted. At that time I was not speaking of the particular case to which the hon. member had directed his remarks, but was referring to the general practice in the department. May I add that at the next sitting I shall have the necessary information for hon. members opposite.\nProgress reported.']
Mr. A. W. NEILL (Comox-Alberni):: 
Mr. SPEAKER:: If the hon. member wishes to debate the motion it is his privilege to do so and if the Speaker should feel he is out of order, he will be obliged to tell him so.


Alan Webster Neill: That is not an answer to my question.


Mr. LAPOINTE:: The hon. member is not limited to forty minutes.


Alan Webster Neill: I know I am not, but I
wanted His Honour to say so to prevent my being cut off later on.
The matter which I intend to discuss is in connection with the Department of Fisheries, which has decided to inaugurate in British Columbia a system of inspection of canned salmon. British Columbia is the only province affected by this matter. The salmon canning industry as a whole is in accord with the idea of having canned salmon inspected. This industry is a very important one, last year's catch being valued at close to $17,000,000. There are directly employed in this industry some 12,000 people, and probably as many more are indirectly employed. When dependents are considered, it will be found that something like fifty or sixty thousand people are vitally interested in this industry, and this is my excuse for bringing up the matter.
I believe the idea of inspection is to help the sale of canned salmon in foreign countries, and also particularly in Great Britain. We hope to be able to say to Great Britain: If you will give us a preference we will guarantee you a first class article and demonstrate it by government inspection. With this principle I heartily agree, but I submit that the method proposed to be adopted is a poor one and calculated to frustrate the very object for which it is designed. In this connection two orders in council have been passed, one providing for the inspection and the other constituting a board of inspection. These are numbered P.C. 723 and 724, and these orders in council cause me to consider for a moment the difference between passing legislation and orders in council. I do not think the provisions which appear in these orders in council would have passed the house or the fisheries committee had they been brought down in the form of legislation. I desire to comment on one or two details in the orders in council, and then I shall proceed to discuss my main objection thereto.
Subsection (c) of section 26 of P.C. 723 is comprised of one sentence of 235 words, and consequently it is extremely involved. Among other things it states that certain provisions shall apply only when the salmon is shipped
from a cannery or private warehouse connected with a railway, whereas these provisions should apply to all shipments. Another provision of this subsection is that each day's pack shall be identified by code markings. That is a necessary provision, but it should apply to all salmon to be inspected and not only to salmon shipped out of a private warehouse. Another provision is that railway cars loaded at such canneries and private warehouses shall be sealed before they are despatched. Who would ship a carload of salmon valued at from three to eight thousand dollars without having it sealed? It is not necessary to pass an order in council to provide for that, the common sense of the railways and the cannery officials will see that such a car is sealed before it starts on its journey. The provision should be that the car shall be sealed by the inspector, otherwise it is of no use.
I am unable to find any provision to guarantee that the cases inspected are actually shipped. I may be visited by an inspector; he comes into my warehouse and I point out a thousand cases of salmon; he inspects those cases but puts no mark or stamp upon them. He tests a certain number of cans and then tells me I can ship them; he goes away without seeing them shipped and if I desire I can ship five hundred cases of that lot and five hundred cases of a lot not inspected. All that is required is that the cars shall be sealed, and that would be done by the railway officials in any case. Subsection (d) of the same section reads:
Application for inspection of any parcel or parcels of canned salmon shall be made in writing to the chief supervisor of fisheries for the province. Inspection shall be made as promptly as possible, but the Department of Fisheries shall not be responsible for any delays.
That is entirely too vague; the shipper should have some protection that his goods will be inspected within a reasonable time. A delay beyond a reasonable period might half ruin him. As is known, many of the canneries are much indebted to the banks and they have to finance on a very close margin; yet a man's inspection may be held up perhaps for a week, without any obligation on the part of the government except that they will do it when they feel like it. Of course the provision is "as promptly as possible". I submit that should be within four days.
In the same section is laid down the method of getting the inspection started. The man has to apply in writing to the chief supervisor. Then the chief supervisor, when he feels like doing so, reports to the board of inspection.
Canned Salmon Inspection

The board, when they have spare time from their other duties, because they have other business to look after as they still carry on their own affairs, get busy. After they have made their inspection, they report back to the chief supervisor and the latter reports to the owner. This is a great deal of unnecessary red tape when prompt inspection is necessary. We are trying to accelerate business, not to hold it back.
Then we come to section 29 (d), which deals with the way in which the salmon is to be inspected. There is a different procedure in regard to 100 cases from that in regard to 10,000 cases. The question of cost is not involved, because the cost is so much a case; it makes no difference as to cost per case whether 100 or 10,000 are inspected at one time. This provides that if you take out 100 cases at a time and have them inspected, twelve cases, or 12 per cent, are withdrawn. But if you have 10,000 cases, only ninety-six cases, which is a good deal less than one per cent, are taken out. Then one tin out of each such case is opened. The result is this: if you have 100 cases of salmon tested and inspected at the one time, one tin out of 400 tins will be opened and tested. But if you have 10,000 cases tested, only one tin out of 5,000 tins will be inspected. Why the difference? The quality is not likely to be any poorer if you take 100 cases than if you take 10,000, but in one instance the proportion is one out of 400 and in the other one out of 5,000. I do not think our British friends will consider adequate an inspection based on one out of 5,000 tins. Under the act dealing with canned fruits and vegetables, the inspection is three per cent. Of course I would not for a moment suggest that that proportion should be taken for salmon, because the cost would be prohibitive, but there is a tremendous difference between that and taking one tin out of 5,000.
Section 30 provides the way in which the inspection is to be paid for. It is to be paid for by a fee at the rate of one cent per case, this to be charged by the board of inspection and collected from the owner of the fish. Also in certain cases expenses of travelling and living are charged. I shall deal with that later on, but before I proceed I want to emphasize the point that it is a most unusual and phenomenal procedure that the canner is to pay for the inspection of his products. I question whether under the act there is any authority for this. I think it is section 4 of the Meat and Canned Foods Act which provides that the governor in council may make regulations not inconsistent with the provisions

of the act. That is the usual clause. Under that they have taken power to impose a very heavy charge upon the owners of these fish. I question very much and I submit to the minister and the ministry whether that is legal under the Meat and Canned Foods Act, because it is well understood that regulations must be consistent with the act and they cannot make any large and violent departure from its provisions.
As regards section 24, I shall not take time to go into it. It is only a matter of bad drafting, but as it reads at present it does not make sense. I shall say just this, and it will be on record: The words "except as herein otherwise provided" should be struck out at the beginning and inserted after the words "provided that" in the third last line. That deals with all the minor matters, what I would call the technical points in the regulations.
I shall turn now to the requirements of the inspection. We find the first one in regulation 27(a):
Canned salmon that are found by the board of inspection to be fresh, firm, well packed and in good merchantable condition shall be approved and a certificate in the form attached marked "A," shall be issued therefor.
What do we mean by the word "fresh"? What would the ordinary man on the street mean by the word "fresh" applied to fish? Would it not mean fish that had been anything but canned? I do not quibble about dictionary meanings, because you get various definitions, but the dictionary term is "not preserved by salting or by pickling, canning, etc." How can fish that has been in a can for three months be described as fresh? The language used in the Meat and Canned Foods Act, the original act, is "sound, wholesome and fit for human food," which I think is a better definition. According to the regulation, however, if the board of inspection finds the fish is "fresh, firm and well packed," the canner is given a certificate, the only one granted. No other grade or quality gets a certificate. To that form of certificate, there is a serious objection which I shall deal with later on.
What happens if the fish is not up to the first grade on which a certificate is granted? Section 27 (b) provides that if it is not up to that, but if it is "sound, wholesome and fit for human food," then it can be sold but it is not entitled to a certificate. What is the difference between "fresh, firm and well packed," and "sound, wholesome and fit for human food"? I cannot see much. If, however, the fish comes under the second category, that is "sound, wholesome and fit for human

Canned Salmon Inspection
food," it does not get a certificate but if stamped "second quality" on each tin, it may be sold. It may also be "reconditioned" for re-examination. What does the word "recondition" suggest to our minds in connection with fish in a can? My mind goes back to Upton Sinclair's novel, The Jungle, in which were described conditions, now long past, it is to be hoped, in the packing houses in Chicago. When they came upon a mass or a boiling of meat that was so bad it actually stank, and would not pass muster in any case, they reconditioned it by doping it with benzoic acid or salt petre or some other strong preservative so that it was practically embalmed. An embalmed corpse does not smell and they then sold it as canned beef. Is that what the word means in this case? The word "recondition" is used, and I do not know any other meaning for it. IIuw can we change something that is "sound, wholesome and fit for human food" into "fresh, firm and well packed"? I do not know how you can make canned salmon firm that is not already firm; I do not know how you can change it into being well packed unless you empty the fish out of the can and repack it, which course would be absurd on account of the cost. There is an important point I want to note here: there is in this order in council no provision for condemning rotten fish, let us say, on the first inspection. Only if it has been reconditioned and re-examiDed and is then found unfit for human food, can it be condemned. Mark you, it is based on that. The man whose fish will not pass first quality is privileged to recondition ic. If he brings it up again, and it is then found to be rotten it can at that time be condemned- but only then. That in my view is a foolish regulation.
Section 27 (d) reads as follows:
Canned salmon that are found after reconditioning and reexamination not to be up to "second quality" shall be confiscated

An so on. In my opinion it ought to read:
Canned salmon that are found not to be up to "second quality" shall be confiscated.
It should not matter when the defective condition is found. I notice further that if the fish is condemned the owner cannot sell it for fox meat. On the other hand, however, the government could have it for its own use, or sell it for the use of animals. If it is condemned and put into such condition that it cannot be sold for human food, I think the owner should be in a position to get what he can for it as fox meat.
At six o'clock the house took recess.
After Recess
The house resumed at eight o'clock.


Alan Webster Neill: Mr. Speaker, the order in
council No. 723, of which I was speaking this afternoon really provides for only two grades of canned salmon. The first grade is not called No. 1 grade, it is not called first quality. I presume it would be called certificated, because it is entitled to a certificate which declares it has been inspected, and is "fresh, firm and well packed." The second quality is anything under that, which is found to be "sound, wholesome and fit for human food." It does not get a certificate, and it must have the words "second quality" stamped on each tin. The question also arises as to stuff unfit for human food, but I think the department will see the point I made this afternoon and will provide for its being condemned whenever it is seen, whether on the first or second inspection. At present the question only arises if it comes up for re-examination.
We will assume that inspected salmon will fall naturally into those two grades. I will put the two together to make the comparison easier. One is "fresh, firm and well packed"; the second is "sound, wholesome and fit for human food." Now, one of two things is going to happen. These distinctions are so fine that it is almost impossible to distinguish between them. What member of this house who is not familiar with the subject will say which of these two definitions he would prefer as characterizing the best grade: "sound wholesome and fit for human food;" or "fresh, firm and well packed"? If sound, wholesome and fit for human food, it must also be fresh, firm and well packed; and I suppose, inversely, if it is fresh, firm and well packed, it also will be, or should be, sound, wholesome and fit for human food. But I think what he would prefer would be a distinction more explanatory and more likely to come home to the housewife as indicating the better quality of the two grades. But the order in council reads otherwise. The chances are that the two definitions will get so merged in the mind of the inspector, that anything that is sound, wholesome and fit for human food will also pass as No. 1 and get the certificate; in which case you have a very expensive system of inspection which will only be a farce. "What's the use? It is all going to be classified as No. 1." On the other hand, we will suppose the inspector being a very experienced man, with these two definitions-to our minds so little removed from each other-can see a distinction between them; and we will suppose he certifies 20 per cent as being under No. 1, but
Canned Salmon Inspection

nevertheless sound, wholesome and fit for human food. Then this 20 per cent will only be permitted to be sold if it has embossed on each tin in letters of a given size the words "second quality." You will find this in paragraph 27, subsection (c).
I protest against that policy. It will involve a heavy and a very unjustifiable loss upon an industry that is having great trouble at the present time to keep its head above water. Why? Because the wrong word is used. When you use the words "second quality" you simply damn the sale of everything so marked. There is nothing about which the human mind is so sensitive in connection with food as any suggestion that there is anything wrong with it, as fish, especially with respect to tins of canned fish; that it is something a little less than superior, a little less than first quality. You only have to put that idea into the mind of the housewife or purchaser-and you certainly do instil that idea when you mark on the tin that the contents are of second quality-and she says "no." In her mind or that of her husband the suggestion arises of ptomaine poisoning, and everything that that stands for, and they say, "No, even if it is going to cost a little more, we will pay the extra to get the genuine government guaranteed quality." Even the poorest of our people in institutions would object to that "second quality" fish, and if some got the tummy-ache they would blame it on the second quality fish, and you would have a scandal.
This suggestion of second quality appears so much more forcibly in the case of tinned fish than anything else. I think in Great Britain butchers are compelled to indicate that their mutton is frozen New Zealand mutton as distinguished from the home product. The housewife sees the mutton so marked, and she can gauge whether it is of a quality that satisfies her, and very often the only difference is that of price. But in that case she sees it; her eye is her informant, so to speak. Take second grade potatoes. The purchaser looks at the potatoes, it is only a question of cutting off the diseased pieces, no one will be poisoned, it is only a question in the housewife's mind if it pays to buy second quality potatoes. As I say, we use the wrong words when we prescribe this marking of "second quality." Let us take cheese and butter. While they do use figures, 1, 2 and 3. they do not apply the word "quality"; these articles are simply graded 1 and 2 and 3. But there again the purchaser has at least an opportunity of seeing, and sampling what she is buying. But take eggs; you cannot

sample them. There are three grades before you come to No. 2-specials, extras and firsts, and then the fourth grade is seconds. There are three grades to sell the better class quality before you come to the second. Then take a another comparison that is most applicable to canned fish, that is canned fruit and vegetables. Regulation No. 15-it is taken out of the same act, Canned Meat and Foods Act- prescribes that there shall be four grades of canned fruits-fancy, choice, standard and second. There again, sir, we have three descriptions not calculated to offend the eye or mind of the purchaser before coming down to the second grade.
It would be all right if we marked this fish "Canada choice" and "Canada standard" the same as fruit is marked. That would give the cannery man a chance to sell a considerable portion of his pack which might ibe assigned to second quality grade, but the consumer would be absolutely protected because it is not permitted to stamp the container "second quality" unless the fish is found to be "sound, wholesome and fit for human food." What more do they want? Why condemn this commodity with the suggestion that it is second quality, and therefore inferior quality, when "choice" or "standard" would do equally well? It would not penalize the cannery man, and -the consumer, as I say, would be absolutely protected.
There is another aspect of considerable danger, not from the point of view of health, but from the success of the inspection system -which is what we are trying to get at, or else there is no use doing it at all. The government certificate says: The contents of this tin have been examined, and they are fresh, firm and well packed. It says nothing about variety at all. There is as much difference between varieties of salmon as there is between hon. gentlemen who sit on the right and the left of you, Mr. Speaker; as much difference as there is between lamb and goat meat. In fact there is more difference than that, and perhaps I might give an illustration to bring it home more clearly. I will not talk about prices to-day, because the price of salmon today is just what you can get for it, and that is very little indeed. In the days when salmon was selling on a fair market basis the comparison would be like this: The best brand of salmon, sockeye, would be selling at $19 a case, while the lowest grade, the name of which I will not mention, would be selling for $5 a case or something like that. That gives an illustration of what the market considers to be the difference between certain varieties, -both first class in their different

Canned Salmon Inspection
ways. I have authority for that in section 24 of the Meat and Canned Foods Act, which
says:
For the purposes of this act the varieties of British Columbia salmon shall be designated, and, if the need for such is established to the satisfaction of the governor in council, graded as provided in the regulations.
The act says they shall be designated. Is that designation to be put on the chicken house or in the family bible? Do you not think the place clearly indicated is on the can itself? It should be designated as being what it really is, and the authority is contained in the act itself. It is true that the government certificate only says the contents are fresh, firm and well packed. The government say they will not go beyond that and will not be bound by anything more, but you must understand the argument that will be advanced by the wholesaler, trying to push his goods on to the retailer, and by the retailer trying to sell them to the housewife. She will be told that the government of Canada is behind that product. This is the argument that will be used: "You cannot go wrong in buying this, because posted here on the shelf is a government certificate which says this is the best you can buy." That is what it will be interpreted to mean, because the housewife will not walk over to the shelf and read it in order to find that it only says the salmon is firm, fresh and well packed. She will take the word of the retailer for it; she will think it is the best salmon because the retailer says so. Then when she gets it home and opens is and finds it to be a lower grade, though still fresh, firm and well packed, what will she think? It will not be what she thought she was buying; it will be the So stuff instead of the $19 stuff, and that will lessen sales instead of increasing them. She will say, "This government inspection thing is all a joke; this is not the kind of salmon we have been getting at all." It will be a detriment instead of an advantage.
I might give a true incident out of my own experience, which occurred after I was married and came out from the old country. I suppose we possessed the ordinary intelligence of people of the old country, accustomed to bright red salmon and knowing nothing of the food values of the lower grades. We bought a tin or two of salmon and found the contents, instead of being red, to be a dirty white colour tinged with pink at the edges. I do not mean that it was unclean or that its food values were not comparatively high, but it was a dirty looking product. It looked unpalatable, and we jumped to the conclusion
that it was off quality. We were suspicious and very afraid, so we thought we would try it on the cat, that if it did not kill the cat it would be all right for us. It did not seem to hurt the cat at all, but then we remembered that a cat is supposed to have nine lives, and we thought perhaps we had not exhausted them all. If we fed the cat enough salmon to. demonstrate on all the nine lives we would have no salmon left; and if the cat then died we would be out both the cat and the salmon, so we threw away the salmon. I have no doubt that being a Canadian cat, and possessed of more sense or at least more knowledge than we had, it went around the corner, dug up the salmon and had a fine time eating it.
That illustrates how a person who knows nothing of the substantial food values contained in these lower grades may be led away.
I find on page 36 of a market report issued by the department some months ago the following words:
.Retailers express the opinion that the grade and quality of canned salmon should be clearly marked on all labels. It was even suggested *that labels should distinguish between early and late pack.
There is some little advantage in the one as against the other.
What is the remedy? It is very simple one. We already have the word "Canada" on the tin, and I would suggest that we put the word "choice" and then the name of the variety. Then we would have on the tin "Canada choice soekeye" or "Canada standard sockeye," whatever the grade might be. There is further authority for that in section 15 of the fish regulations, which provides:
British Columbia salmon when packed in cans shall be designated as follows:
I will not take time to read the five designations which are mentioned one by one. The name of each is given, together with the kind of salmon that may be included under that grade. It is provided elsewhere in the act that British Columbia salmon shall be designated; here is a designation ready to hand, and we only have to use that designation and put one of those five names on the tin, coupled with the word "choice" or the word "standard" as the case may be. Then the housewife will know she is getting what she pays for; she will know she is getting a grade of salmon certified by the government, and she will get the grade that suits her purse and her inclination. If she buys sock-eye she will know she is getting the best salmon she can buy, and if she buys one of the lower grades, which some people think
Canned Salmon Inspection

was packed into the car and the door shut and sealed-we did not need an order in council to do it-rushing to get the railwayman to sign the bill of lading, and then speeding up to the bank with the bill of lading, to make good a draft that had already been obtained. It is absolutely necessary that there be a sufficient number of men to do this quickly. The government should pay and control the inspectors as it does in other industries. The department was created two or three years ago to foster the fishing industry; it certainly was not created to hurt it. The sales tax has been increased, a duty has been put on tin which has hurt the industry without benefiting the tin man because his factory is in the middle of Canada, so why burden the industry with another $22,000? No other industry has to bear a burden of this kind. In addition to all this, the industry undergoes heavy taxation in other ways, such as licence fees, case taxes, and so on.
I shall deal with the arguments which no doubt will be raised against my contention. It will be argued that the cannery men are agreeable to these regulations, that they were consulted and were unanimous. If a meeting is held of 500 people and they are asked if they are in favour of good government, everyone would say yes, but if you ask them what they consider to be good government, there will be 499 different methods given for achieving that end. That is the situation which exists in this case. There were 60 canneries in operation last year, and I should like to know how many were represented at the meeting. I should like to know if they were really unanimous, because I have certain knowledge that some were not present. They agreed to the general principle, but who would not? There is no doubt it is a highly desirable thing, but there are differences of opinion as to the methods of carrying it out. I could quote the, opinions of a couple of cannery men, but I shall not take the time. I have in my hand a copy of the draft proposal made some months ago by the canneries, also a copy of what was proposed and submitted to them and copies of the orders in council which were passed. The three documents do not agree; there is a difference of opinion on substantial points. What is it about which the cannery men are said to be unanimous? Was it their own views, as expressed in their memorial; was it those submitted to them, and which have since been changed, or was it the provisions of the orders in council? The cannery men may not as yet have seen these orders in council, or if they have, it is only just recently.
[Mr. Neill.3
Even supposing the cannery men were unanimous, which they were not, what about it? Two or three years ago this house, the pension officials and the pension commission were all agreed that we had the very last word in pension legislation. We acclaimed the fact that we had at least settled a difficult problem, but what happened? In less than ten months it was found that this was not the last word in legislation, that it did not work out as all of us hoped it would. It is possible to be unanimous about what you do not thoroughly understand, and the cannery men should be given an opportunity to consider this matter. They may be unanimously in favour of inspection, but have they been advised by their lawyers and managers as to the effect of these regulations?
Another argument which will no doubt be used is that even though this may not be exactly right, it should be tried out for a year. This is a new departure, something which we do not make very often, and it should be started right. It will be a lot easier to start right than to retrace our steps later on.
Let me summarize in a few sentences the points to which I wish to call attention.
In the first place, there are too few inspectors to do justice to the cannery men who must have prompt inspection. There are too few inspectors to obviate the suggestion of favouritism. If an inspector condemns a large portion of a man's pack he should have the right of appeal to a board consisting of more than three men. Secondly, the only provision for the condemning of fish is in connection with reconditioned fish which is then seen to be unfit for human food. Thirdly, the words "second quality" should not be permitted to appear on the can, as it would kill the sale of a perfectly good article of food. If this item is insisted on, it will put a heavy handicap upon the cannery men. Fourth, as the government certificate will be taken to mean that the article is of the very best, there may be a misapprehension on the part of the customer. The salmon should be rated as being " standard " or " choice " of a particular named variety, of which there are only five. Lastly, the system of having inspectors appointed and paid by the cannery men should be done away with.
It will be said that this is destructive criticism, but I state again that I have nothing but approval for the principle of inspection. However, I want to see it a workable system, and the cannery men do also. I am quite willing that my remarks in connection with these particular orders in council should be considered as destructive criticism. We do

Supply-Indian Affairs
not need an architect in this case, we -need a wrecker. A sound edifice cannot be built on a rotten foundation-let us wreck the rotten foundation and start to build an edifice which will be a benefit to the industry and a credit to the department. The regulations do not go into effect until June 1 and there is time fo-r reconsideration. They should be explained to the cannery men so that their viewpoint -may be obtained, and then an effort made to evolve a workable system. If necessary it could1 be left over -until another ye-ar has passed. There will not be much bad salmon -put up this year because economic conditions will -make such a practice unprofitable. You get such a miserably low, cut-throat price for the very l>est grade that it would never pay -to put up a -bad grade-you would have to give something away with the tin as well. There is not much danger of the fish noit being good quality this year.
I have endeavoured to keep away from any factious or political criticism, I simply want this matter considered. I am glad to see the former minister present in the chamber; he understands the fishing industry, and if he will look into the matter I shall be satisfied with his decision.
Motion agreed to and the house went into committee of supply, Mr. Maloney in the chair.



[Stage Direction]
To provide for expenses connected with the administration of Indian affairs, including salaries, supplies, relief, medical attendance, hospitalization, dwellings, agricultural activities, surveys, roads, bridges, irrigation, dyking, education, etc., and a grant of $100,000 approved by parliament in the session ot 1920-2/, $3,873,000.
Mr. POULIOT:: Mr. Chairman, I shall not take up much of the time of the committee, but I have a little story to tell. The incident to which I shall refer after three centuries of so-called civilization, is almost as cruel and appalling as those which took place during the days of Indian warfare. I do not intend to be hard upon the minister because he was kind enough the other day to give me some information, but it is my intention to try to prevent a bad appointment being made by the Civil Service Commission. I refer to the appointment of an Indian agent at Cacouna. On September 23 of last year the following letter was sent to the department, addressed to the minister:
(Personal.)
My Dear Sir:	,	.
I herewith enclose a sworn declaration signed by Mr. Omer Dube, ex-candidate in the last provincial election, who complains of political
interference on the part of Mr. Jos. Berube, agent for the Indians, at Cacouna, Temiscouata county.	.
Would you please be good enough to authorize an investigation to be held as to this man s conduct during this last election.	..
Mr. Alphonse Garon, advocate of Rimouski, is appointed investigator for this district for these cases.	.
With thanks for your kind attention, l am, Yours respectfully,
Chas. Eug. Dube.
There is no other letter from that gentleman in the returns tabled in the house. The files have been carefully combed and conscientiously weeded, and following the example of one of the most famous naturalists, Cuvier, who with a single tooth of a prehistoric monster reconstituted its skeleton, I shall try to do the same thing with this case. I wonder if the minister will be kind enough to let me see the original of the letter which was signed by the gentleman and which appears on the file. I hope he will have no objection to doing so later on. With that letter is sent this affidavit, which is very curious:
Riviere du Loup,
September 10, 1931. I, the undersigned, Omer Dube, of Cacouna, solemnly declare that on the 9th of August, while I was candidate in the provincial election contest-
Note those words.
-I saw Joseph Berube, Indian agent at Cacouna, indulge in political partisanship, and he has even, to the knowledge of a great number of electors at St. J. B. of Isle Verte, with other persons upset the hustings on which I was, as candidate-
Note those words.
-addressing the crowd which was present, s	(Sgd.) Omer Dube,
Ex-Candidate.
Sworn before me-
And so forth. Note this again, Mr. Chairman: he called himself a genuine Liberal candidate, It was in virtue of an affidavit given by a so-called Liberal candidate and transmitted to the department by a well known Conservative candidate that the investigation was ordered. But the real fact is that this man has never been a candidate, either Conservative or Liberal, because he has never made in any election the deposit required by law. This is the only publication that he issued during the last provincial election. I am sorry I have no English translation, but I shall read it in French and I am sure the hon. member for Labelle (Mr. Bourassa) and all those who understand French will have a hearty laugh at it:
To the electors of Temiscouata North. I have the intention to canvass your votes as a
Supply-Indian Affairs

candidate in this county. Last Sunday, at St-Jean-Baptiste de 1'Islc-Vcrte, I was stoned, pelted with stones, so much so that I ascended to Heaven like Elijah in his chariot of fire; until suddenly, I was crowned by the sun's glorious rays, likewise shall I be crowned at sunset on August 24.
I give warning to my opponents that I shall carry on an honest and courteous fight.
Awaiting the evening of August 24.
J. P. 0. Dube,
Straight Liberal Candidate, Cacouna.
The fact is that he was not a candidate at all. The matter was taken very seriously by the department, and the private secretary to the minister wrote to the Deputy Superintendent General on November 20, 1931, that ample time should be given Mr. Dube in order that he might make arrangements for the attendance of witnesses and the holding of the investigation. He said;
I am enclosing the letter addressed to the minister by Mr. Dube, as 'well as an affidavit completed by Mr. Omer Dube. These may be helpful to the commissioner.
A euphemism for "executioner." He went out with a tomahawk and he was on the warpath. Then the deputy minister writes to the minister that time, not ample, should be given to make the investigation. I am very sorry that the minister acted on the letter that was sent to him, because a man who has not made a deposit in an election is not a candidate. The investigation disclosed some very aimusing things. First of all, it was held on December 4, 1931, and a witness said that the agent had discussed politics in favour of the Liberal party with another person in the store. The agent at the same time is a chauffeur. This will explain something that comes immediately after. According to a letter that I received from his attorney at the investigation, what he spoke about when he discussed politics was a conversation about the price of butter during the election of 1930. If he was wrong then, I do not see why the Prime Minister and all his supporters should not foe impeached. If it is a crime to speak of butter, that is perhaps the reason why all the 'Conservative members were silent while the butter provision was placed in the New Zealand treaty the other daj7. Everything has an explanation. Apparently it was a crime for him to say that the price of butter was low, but he was only repeating what the leader of the Conservative party had said on every .platform in this country. He was blamed for something else, for having made a bet on the result of the election. This was in 1926 and the bet was made after the poll was closed so that it could not have influenced any voter. Someone had offered to bet and he made a bet, but the poll

was closed. As I said, the man was a chauffeur and they blamed him for having driven a voter on the polling day to Bic, in Rimouski county. He was asked by the father-in-law of the voter, who was a Conservative, to drive his son-in-law to Bic in another constituency quite far from there in order that he should not be in Cacouna, Temiseouata county, on the polling day. No one could blame him for that. As a chauffeur he was paid for the trip; nevertheless he was accused of political partisanship on that account. He was simply earning money.
Then there is a complaint from the so-called Liberal candidate who was supposed to have gone to heaven. I cannot say, whether, according to the circular I have just read, he was supposed to go to heaven like the prophet Elijah, when they raised the hustings which fell-a very unfortunate incident. In the report of the investigation there was a note that I find in every report of Mr. Caron, the investigator, to the effect that the accused man did not think fit to make himself heard; so he was guilty. That is contrary to all principles of British fair play and justice.
I have something to ask the minister and I am sure he is fair enough to give me a favourable reply. That investigation took place in the month of November, and on January 13, the Deputy Superintendent General of Indian Affairs wrote thus to Mr. Berube:
I beg to advise you that under the authority of an order of His Excellency the Governor General in council of the 8th instant, your services as Indian agent, grade 2, Cacouna agency in the province of Quebec, are dispensed with on account of political partisanship. I wired you to-day to this effect.
Yours very truly,
Duncan C. Scott.
Another letter was sent to him 'bearing the same da-te, January 13, as follows:
Dear Sir:
With further reference to my letter to you of to-day advising you that under the authority of an order of His Excellency the Governor General in council of the 8th instant, your services as Indian agent, grade 2, Cacouna agency, Que., are dispensed with. I have to say that the order in council states that they are dispensed with as from the first day of January, 1932.
It had a retroactive effect; it was like the Unemployment and Farm Relief Act-peace, order and good government. He acted as agent until the first of February, at which time another appointment was made. Very naturally he asked for his salary for the month of January. Then, on February 13 Mr. A. F. MacKenzie, the secretary of the department, wrote as follows:
In reply to your letter of the 6th instant. I beg to refer you to letter of the 13th ultimo,

Supply-Indian Affairs
and to say that as order in council No. 3 of the 8th ultimo states that your services were dispensed with as from January 1, 1932, the department cannot pay you salary for January.
That, of course, was too late for a Christmas gift. What is due, however, should be paid, and I am now asking the minister if he will be kind enough to see to it that the salary for the month of January is paid. At a later time I shall have something further to say.


Thomas Gerow Murphy: Mr. Chairman, I do not know whether the hon. member has completed his remarks in regard to this matter. In reply to his question concerning the salary, I may say I know of no provision whereby Mr. Berube can be paid a salary for the month of January when the order in council dispensing with his services was passed to take effect December 31, or January 1.


Jean-François Pouliot: Mr. Chairman, I am very sorry, but I shall have to continue my remarks.


An hon. MEMBER:: So am I.


Jean-François Pouliot: Well, you may as well take it with a smile. Then followed some correspondence between the deputy minister and the Civil Service Commission asking for the advertisement of the agency. Finally, on February 9, posters were sent out, and on the same date the secretary of the Civil Service Commission wrote to the deputy minister as follows:
It will be appreciated if you will have this competition brought to the attention of any temporary employee who may desire to compete.
The answer of the deputy minister on February 10 was as follows:
I beg to advise you that pending a permanent appointment in the position, Indian agent, grade 2, Cacouna, Quebec, as a result of the competition now pending, it has been necessary to employ an agent temporarily as the services of Mr. Berube, were discontinued immediately on receipt of order in council P.C. 3 of the 8th ultimo. We have engaged Mr. Alexis Michaud under the thirty-day clause. His services began on the first instant. I am enclosing his application also requisition, and would ask that you issue a temporary certificate in his favour.
On February 12 the deputy minister again wrote to the Civil Service Commission as follows:
I beg to advise you that we are informed by Mr. Alexis Michaud who is now temporarily employed as Indian agent, Cacouna agency, Quebec, that his is desirous of being a candidate for permanent appointment. As I know that the applications are received by you up to the 22nd instant and it may not be possible for him to fill an application before that date, it is desired that the application forwarded you with my letter of the 10th instant requesting temporary certificate for him, be transferred to the competition.
It does not appear that after that any application was sent by Michaud to the Civil Service Commission. Michaud's first application, including the signature, was in handwriting, and was declared at Cacouna on January 15, 1932, before the mayor of Riviere du Loup. The document may have been declared worthless by the department, because all in the department know that although municipal officials may have jurisdiction to act as justices of the peace, they cannot so act outside of the municipalities in which they are mayors or councillors.
An answer to one of the returns gives the following information:
When competition 21818 was advertised Michaud entered application with the Civil Service Commission.
He made that application on January 15, and on February 9, three weeks later, the position was advertised. The right answer to the return ivould have been:
After the competition was advertised Michaud entered his application.
And not-
When the competition was advertised Michaud entered his application.
That application was received at Ottawa by the Civil Service Commission on February 18, 1932.
The second application, a requisition for temporary employment, was sworn to at Riviere du Loup on January 21, 1932, before the same gentleman who made the recommendation to the department. It was forwarded by the Deputy Minister of Indian Affairs to the secretary of the Civil Service Commission, together with a covering letter dated February 10, 1932, which I have read, and which was received by the Civil Service Commission on February 11, 1932.
*I am sorry the Postmaster General is not in his seat, but I should like to say that an application was made on January 15 and was received in Ottawa only three weeks after, or on February 18. It seems to me that is a long time for a letter to come from Cacouna to Ottawa. It would take no longer for a letter to go to the south pole or to the end3 of the earth. Usually the service of the department of the Postmaster General is much better than that. The other application' took more than a fortnight to reach the Civil Service Commission, namely, from January 21 to February 11. There is something very strange about this affair. The fact is that the temporary certificate for Michaud was sent by the Civil Service Commission on February

Supply-Indian Affairs

20, and had a retroactive effect to February 1. Berube could not be paid, although he was informed only in the middle of January, and had received no notice from the department before the middle of January, that his dismissal had taken effect. Until the end of the month he had to fulfil his duties as Indian agent, no other appointment having been made. The circumstances in the case of Michaud are somewhat different. The certificate was issued on February 29 for the month of February and also for the month of March. It would seem that he was luckier than the other chap.
I asked the following question:
On whose recommendation did the Superintendent General of Indian Affairs temporarily appoint Mr. Alexis Michaud as Indian agent at Cacouna, Quebec?
The answer to that question was:
Mr. Michaud was appointed as temporary Indian agent at Cacouna on instructions of the Superintendent General of Indian Affairs.
I was under the impression that he had been recommended by someone who had known of the vacancy before it was advertised. To my great surprise I received a few days ago the following letter from the gentleman who had sworn to Michaud's application. It is as follows:
Vous auriez mieux fait de m'ecrire et je n'aurais eu aueune objection a vous renseigner.
The English would be:
You should have written to me, and I would have had no objection to giving you the information.
This communication was signed by the gentleman who has the patronage for the Tory party in my constituency. When I asked for information the minister hesitated in giving it to me. As a consequence I would have to write to Riviere du Loup, to that gentleman, to get the information my good friend the minister is supposed to supply. I should think, after the letter I sent to the minister, he would have had no objection to making me familiar with the whole case.
I asked for a copy of all the correspondence, telegrams, petitions and applications exchanged between all persons of Temiscouata county on the one hand and the ministers and officials of the federal government on the other since August, 1930, about the position of Indian agent at Cacouna. The return was brought down containing no papers from Temiscouata with the exception of the applications forwarded to the Civil Service Commission. The

report of Mr. MacKenzie, the secretary' of the Department of Indian Affairs, reads as follows:
March 30, 1932.
As requested I visited Riviere du Loup early in March and interviewed four candidates for the position of Indian agent, Cacouna:
John Dunnigan, David Lebel,
Alexis Michaud, Cleophas J. Sirois.
These men all have fair qualifications, are of good standing in the community, and it is really hard to make much distinction.
This is very nice. It sounds like honey, maple syrup and Gobeil's preserves.
The present incumbent, Mr. Michaud, is in my opinion qualified to carry on the rvork; in fact he has done so with reasonable satisfaction since February 1st.
Reasonable satisfaction is something less than ordinary satisfaction, but it has been so drafted probably because he had been appointed agent temporarily.
The Indians, hov'ever, object to his appointment on the ground that he lives about two miles from the village.
The Indians had to wear their moccasins and snowshoes to visit him two miles away; on the other hand, it was quite troublesome for him to go down to the village in his feather headdress, wearing his wampum belt and all the insignia of his great office.
I might also say that his knowledge of English is very limited; the other three candidates are much more competent in that respect. I do not know', however, that this might be considered much of a drawback as the locality is distinctly French-Canadian. Mr. Michaud found it necessary to speak to me through an interpreter, not being sure enough of his English.
He is the only man against whom there are any serious objections, because, as Mr. MacKenzie says, the other men are all "of good standing in the community, and it is really hard to make much distinction." The whole trouble is that the worst man has been appointed temporary agent, and this is what I protest against. I have no interest in the matter, because nearly all four candidates heckled me at my meetings and voted against me. I stand up to-night for the public interest in order that the Indians may be well looked after, and this can only be done by choosing the best man for the position. But may I tell the minister that the appointment will be temporary, because I take this opportunity of advising him and his colleagues also that with respect to all those whom they have dismissed for what in their eyes is the mortal sin of political partisanship I will see to it that in

Supply-Indian Affairs__________
some way or another they are reinstated when my party comes into power again. So the "permanent" employee will be only a temporary employee until after the next election. Mr. MacKenzie continues:
Mr. Sirois would be a very competent man but he runs an hotel during the summer season and there is objection on this score.
The trouble is Mr. MacKenzie says that Mr. Sirois runs an hotel during the summer season, while Mr. Sirois himself says that he ran an hotel in years gone by. He contends there is no objection now because he is no longer in the business. In fact in his statement he says he was glad to employ Indian waiters while he was keeping an hotel. It gave a picturesque touch in the old days when he was doing so well as host. Mr. MacKenzie adds:
He is also away considerably during the rest of the year in his capacity as a commercial traveller. This absence accounts for his not signing his application for the position, it having been prepared in his absence by his wife.
He speaks very good English, and his wife also speaks very good English. She could very well look after the Indians while he is away.


An hon. MEMBER:: Are they Conservatives?


Jean-François Pouliot: They are all good Conservatives, so my choice would be very embarrassing. I am not blaming the minister. I am confident he does not know the qualifications of the man he appointed. He was simply recommended to him without any reason at all. Now, there is another good man:
Mr. David Label would be quite competent and lives near the village. His father was a former Indian agent. He has a good command of English and French and knows the Indians well.
Well, if it was not his father it was his uncle; anyway, it was in the family. If he gets the job the wampum belt will come back again as a family trophy. Here is something in the report that I regret very much. Mr. MacKenzie says:
Mr. Dunnigan did not impress me so favourably. He has had little business experience.
Mr. Dunnigan is a studious gentleman and is familiar with French and English. He writes and speaks both languages well, and in fact he is a perfect bilinguist.


Mr. COTNAM:: Is he a Tory?


Jean-François Pouliot: Yes, he is a Conservative, and the next time you see him you will like 41761-162J
him. He is a very nice gentleman for whom I have great respect. I like him a little more than my hon. friend from North Renfrew (Mr. Cotnam) because he is not so noisy; he is a wise and undemonstrative gentleman. Not one of these gentlemen voted for me. Mr. Dunnigan is a good man; Mr. Lebel is a good man; Mr. Sirois is a good man; Mr. Michaud is not a good candidate. Unfortunately the one chosen does not speak English and is also objected to by the Indians, because he lives too far from them.
The last paragraph of Mr. MacKenzie's report is very strange:
My recommendation would be in favour of either Mr. Michaud or Mr. Lebel.
There are three good men and one bad man, and one good man and the bad man are recommended while the other two good men are left aside. I cannot understand that. If Sirois, Lebel or Dunnigan had been recommended, I would not have spoken to-night, but instead of that Michaud was recommended.
Now let us take up the Civil Service Commission. I suppose they have read the file, but they have not seen Mr. Sirois, Mr. Lebel, Mr. Dunnigan or Mr. Michaud. Having seen them, the secretary of the department says that the two best men are Mr. Michaud and Mr. Lebel. This is unfair, and I hope the minister will see to it that either Mr. Sirois, who is very well qualified, or Mr. Lebel, who told a little fib in saying that his father was a former agent, instead of his uncle, or Mr. Dunnigan, of whom it was wrongly said he had little business experience, is chosen, by the commission on the recommendation of the department. May I say here that I regret very much that no representative of the Civil Service Commission examined these men. All they had to go on was the recommendation of the department. Mr. MacKenzie stayed at the Victoria Hotel, near the station in Riviere du Loup, and the candidates had to meet him there. I wonder if there was not a nigger in the Indian woodpile, who then said to Mr. MacKenzie, "Give a chance to Lebel, who is my most intimate friend. The others will not know that I have recommended him, and the minister is very discreet. He does not leave many letters in the files coming from Temis-couata county. I can trust him, and I think I can trust you to give a chance to my good friend Lebel, even if it is at the expense of the others. They will know nothing about it, and the Civil Service Commission will be blamed for making the appointment. I can say to Mr. Dunnigan or Mr. Sirois that I regret very
Supply-Indian Affairs

much that they cannot be appointed, but I can say the Civil Service Commission appointed LebeL" I do not state that to be what happened, but I think that is the presumption.


An hon. MEMBER:: Carried.


Jean-François Pouliot: Let me state what I want carried. To sum up, here we have an Indian agency. The former agent was dismissed after an investigation, on the sworn affidavit of a so-called candidate, a gentleman who really has not been a candidate in any election in this country since confederation, and who is much too young to have been a candidate at the time of confederation. In the first place the investigation was not justified, but when it did take place what w'as discovered? It was stated that the former agent had made a bet, after the polls were dosed, which could not have influenced any voter, and as a matter of fact he wras provoked to do so by one of the candidates. Then it was stated that he talked politics, that he said the price of butter was low. Perhaps he said that to a farmer who wanted a higher price for his butter. That was held to be political partisanship. Then it was said he acted as chauffeur and drove a Conservative voter to another constituency. He was paid for his trip, but he was blamed for that. Certainly those were not good reasons for dismissing him. He cannot be reinstated now until after the next general election, but in the meantime I have great sympathy for the poor Indians. They must be looked after by someone who is able to speak both languages, and. the agent must not live too far away, otherwise the Indians will wear out their moccasins and the department will find it very expensive to buy new moccasins and new snowshoes all the time.


An hon. MEMBER:: Carried.


Jean-François Pouliot: No; I have not yet stated my case. The minister is fair minded and I know he has been deceived. If he had known what I have been telling him I am sure Michaud would not have been appointed temporary agent. But I did not want to impose on the minister by recommending anyone, and in any case it is not my duty to do so. What I want to-night is to prevent the minister from making another faux pas. I cannot be more in favour of one of the candidates than another, because according to an official of the department, three are good and Michaud is not so good. To sum up, I wonder if the minister would be kind enough to let me know if the appointments will be
[Mr Pouliot.]
made soon by the Civil Service Commission, and if he would be favourable to either Mr. Sirois, Mr. Dunnigan or Mr. Lebel rather than Mr. Michaud?


Thomas Gerow Murphy: The hon. gentleman asked as to the appointment of the agent, but a sentence or two before that he stated that the appointment was made by the Civil Service Commission. He should direct his question to the body who will make the appointment.


Jean-François Pouliot: I will send them a copy
of Hansard.


Mr. VENIOT:: I wish to direct the attention of the minister to one or two matters having to do with Indian reservations in the province of New Brunswick. The first case to which I would direct attention is that of Burnt Church, in Northumberland county, where a change was made in December of 1930 in the person furnishing supplies to the Indians. At that time supplies were furnished at a point within a mile or so of the reservation. Now the Indians have to travel twenty-five miles for their supplies, and I wish the minister would look into that matter.
The next complaint that has been sent to me with regard to the Indians has to do with Big Cove, in the county of Kent, where formerly the Indians obtained their supplies within a mile of the reservation. They now have to travel nine miles, and it is a hardship because these Indians have no horses. In some cases they have to hire horses in order to get to the store where the supplies are given out. I have in mind the case of one Indian whom it cost $12 during the winter to get his supplies. The store at Rexton, where the Indians obtain their supplies, will not send in those goods, according to my information, unless they have a large order which will warrant their sending it in by team. This should not continue. These Indians should not have to pay their own money, especially in these hard times, to get supplies to their homes. I know it is not the intention of the department and I wish they would look into the matter. Another point to which I would direct the attention of the minister and ask for some explanation is this. I put a question on the order paper asking what firms had sold supplies to the Department of Indian Affairs for Indian reservations in the province of New Brunswick in 1930-31. The department laid on the table a reply giving names for 1930-31 and I find on page 4 of the return that the name of Howard Brothers Limited appears as having supplied the Indians in 1931.


Thomas Gerow Murphy: What is the name?

Supply-Indian Affairs


Peter John Veniot: Howard Brothers of Sussex. A letter from Messrs. Howard Brothers to me states that they gave no supplies in 1931. The last they gave were in August 1930 and they were then notified that they would no longer be required to furnish supplies. They got their cheque for the August supplies in September, but they appear on this 'list as having supplied in 1931. I would ask the minister to look into this matter. Perhaps it is an error in copying, but at any rate they requested me to bring the matter to the attention of the minister and I replied that I would do so when the estimates were under consideration.


Mr. NICHOLSON:: This item now before the house provides for expenses in connection with the administration of Indian Affairs, including salaries, supplies, relief, medical attendance, hospitalization, and so forth, and there is a reduction of $S53,600 as compared with last year. I am wondering whether, in making up this estimate, the department is fully alive to the condition of the Indians in a large part of the country. I speak particularly with regard to the Indians on the great lakes between what is recognized as the Ottawa river district and the boundary line of Manitoba. In this regard, I would say that unless some steps are taken and taken at an early date to provide the Indians with some means by which they can earn their own livelihood, then every Indian in that entire district will have to be provided for in food and clothing. Last year I called the attention of the minister and of the department to what I considered to be the necessity for some arrangement being made between the federal department and the provinces by which the right of the Indians to the natural means of earning their living- that is, taking furbearing animals-would be restored to them.
For more than forty years I have watched the development of the Indians throughout that great country and have noticed a gradual rise in their standards of living, up until perhaps eight or ten years ago, since when they have been virtually driven out by a class of white trapper who has no regard for any law that anjr government can place on the statute books with regard to the conservation or the preservation of animal life in this country, until the Indian has been reduced to absolute pauperism. That is particularly true during this period of economic stress, when it is impossible for the Indians to get employment as guide? or in ordinary vocations in the woods or with mining companies or anywhere else. They have been deprived of their own natural means of livelihood and they cannot compete *with the white man in the only available
avenues of ordinary work now open to anyone. Consequently, unless some steps are taken and taken quickly to provide them with some opportunity to make their own living, the department is faced with two things: Either they will have to watch the Indians starving to death or they will have to provide completely for their sustenance and clothing.
It is impossible to describe the desperate condition some of the Indians are in throughout that country. I cannot speak of other parts of Canada except from what I have gathered from persons with whom I am associated in connection with some of the work carried on amongst the Indians. But in all that country designated as northern Ontario and the watershed of Hudson bay, the Indians have now been reduced to such a state that the Department of Indian Affairs must do something for them or they will starve. They are going down and down. The inroads of tuberculosis, to which they are naturally subject, especially in their present undernourished condition, are so great among them that the Indians will disappear; and as I have said on one or two occasions in this house before, if there is any class of people anywhere for whom the Canadian nation is responsible, it is the native races of this country. I therefore urge upon the minister that a vigorous, determined effort be made without further delay to arrive at some arrangement between the federal government and the provinces, by which the Indians will have restored to them the exclusive right of taking fur-bearing animals.
Having given a lot of thought and study to the question, I say that the matter of conservation in relation to the fur-bearing animals and game birds of Canada will be at once provided for if the Indian is left in his inherent right of taking the fur-bearing animals in that country. There will be no such thing as wiping them out, as the white trapper does, going in with dynamite and other instruments which serve to destroy the sources of supply. The Indian will conserve the fur-bearing animals and the game birds and animals of the country if he is allowed exclusive jurisdiction and is given his natural, inherent right in this regard. That is the only thing the Indians have left to them, and surely we can provide that they be given that right.


Thomas Gerow Murphy: The hon. member has
mentioned a very real problem in the administration of Indian Affairs. Prior to the building of the Transcontinental railway the Indians inhabiting the northern parts of Ontario and Quebec subsisted, as their ancestors had
Supply-Indian Affairs

done, on the products of the chase, and after that railway was built the Indians came from the northerly districts down to the railway and overcame, to a certain degree, their fear, shall I say, of the white man and his civilization, and increasingly they have made their homes along that line of railway. In addition to that, the railway provided necessary facilities whereby the white man who was interested in trapping could gain easier access to that country. Latterly the development of airplane transportation has made it that much easier for the white man to enter that district and denude the country of its game, the natural supply of food for the aborigines.
The hon. member has said that we should take steps to see to it that the natural, inherent right of the Indian to pursue game in these areas should be his. But may I point out to the house that that area is under the jurisdiction and control of the provinces of Ontario and Quebec, and that the dominion government have no jurisdiction over it, through the Indian department, except as regards those areas which have been set aside as reserves for the Indians, on which they may live and carry on their natural vocations. The department is fully alive to the seriousness of this question. Il has not neglected the interests of the Indians, because hospitals have been built at various points along that railway and large sums of money are paid out annually for the maintenance of residential schools for Indian children.
With regard to the preservation or conservation of game, I am happy to be able to tell the committee that during the past winter the province of Quebec passed an order in council which virtually sets aside all that area north of the Transcontinental railway for the exclusive use of the Indians for trapping. At the present time a game commission in Ontario is inquiring into the preservation of game in that province. It may be, and we hope it will be, that that commission's recommendations in connection with the area north of the Transcontinental railway will follow the example set by the government of Quebec. If that is done, no doubt the Indian will be able to take care of himself just as well as did his forebears. The department is faced with difficulties in connection with this part of the country comparable only to the conditions which exist to a lesser degree in the Northwest Territories. I am not prepared to say whether or not the department has been pursuing the right course, but
IMr. Murphy.]
I am prepared to say that it is the policy of the department to endeavour to put the Indian in a position where he can stand upon his own feet and provide himself with the necessities of life.


Alan Webster Neill: Has the department made
any progress in getting the British Columbia government to carry out the bargain entered into in connection with Indian reserves? I understand an agreement, called the McKenna agreement, was entered into, either in 1917 or 1919, which settled a long-standing dispute with British Columbia. A new survey was to be made of the reserves; where it was found a reserve was too large for the use of the Indians, a certain portion would be given up, and in other cases where fishing sites and the like were needed, extra reserves were to be provided. When this had been done an agreement was entered into with the province of British Columbia under which that province was to deed in fee simple to the dominion all Indian reserves, suspending what is known as the reversionary rights. It was agreed that after that was done the Dominion government would have the control of these reserves and if it should happen that the Indians did not need them, they could be sold, a reasonable arrangement being arrived at as to the disposition of funds so acquired. The disposition of reserves not required was also agreed to.
Many of these reserves were in out of the way places, making the survey difficult, but I understand, that it has been completed for some years and the Dominions government is having difficulty in getting the provincial government to implement its bargain and deed over these reserves. In some cases the Indians want to sell their lands; in other cases the lands are needed for public purposes but everything is being held up because the provincial government seems to be either unwilling or unable to deed over these reserves. Is there any prospect of bringing this matter to a head?


Thomas Gerow Murphy: Some years ago a commission was appointed to inquire into this matter and a report was made whereby certain reserves were contracted in size while others were enlarged. A survey was made following the recommendations of the commission, and that survey is on file. In order to convey undisputed title of these reserves to the Dominion government in trust for the Indians, it is only necessary that an order in council be passed by the British Columbia government.

Supply-Indian Affairs


Alan Webster Neill: Why don't they do it?


Thomas Gerow Murphy: That question should
properly be addressed to another quarter. For the information of the hon. member I may say that negotiations with British Columbia are now in progress and have been for some time, but up to date they have not been successful.


Mr. REID:: Mr. Chairman, I should like to refer to a matter in connection with Indians which affects the people of British Columbia, and perhaps affects the people in other provinces. Reference has been made at various times to the fact that the Indians are in a destitute condition, but I intend to refer to the Indian who might be considered as well off. There are some Indians in British Columbia who might even be considered rich and who in many ways have copied the white man, especially in the ownership of motor cars. Many of them have discarded the now ancient pony and have taken to the motor car. Many of these Indians are careless in driving and accidents have occurred where other cars and persons have been damaged. The Indian, being a ward of the government cannot be sued in the courts, and I should like the minister to give some attention to this angle of this question.


Thomas Gerow Murphy: This is the first occasion upon which this matter has been brought to my attention, and I shall be pleased to give it every consideration.


Thomas Reid: This matter was brought up last year at the farmers' institute, and I was sent a copy of the resolution passed at that meeting and again at the meeting this year. The feeling is that the Indian is allowed to go free while the white man can be sued.


Mr. HOWDEN:: I fancy there is no part of Canada where the Indian is more seriously pressed, particuarly in the winter time, than in Manitoba. In the original treaties made with the federal government, I think at the time of Lord Selkirk, the Indian was given certain reserves in which to hunt. As these reserves were released for settlement purposes, other parcels of land farther back were provided, and at the present time the Indian is located far away from civilization. Unfortunately, the game had been pretty well cleaned out in these districts. Under the original agreement with the government the Indian had the right to hunt at all seasons of the year not only on his own preserve but on all crown lands, but since the natural resources have been returned to the western
provinces and the provincial game laws are extended to crown lands, the Indian is prevented from hunting thereon. There is no doubt that the Indian is faced with many hardships but as the hon. member for East Algoma (Mr. Nicholson) has said, he would be able to keep himself fairly well if he were permitted to hunt over all crown lands as well as over his own reserves. As the situation is now, the government of Manitoba, and I presume, those of Saskatchewan and Alberta, have game laws which protect these crown lands so that the Indians have not an opportunity to hunt on them. It would be a matter well worthy of consideration for the minister to see if he could not obtain a licence for the Indians to hunt on crown lands, because that would go very far towards relieving their condition.


Thomas Gerow Murphy: The hon. member for St. Boniface says that in the original agreement or treaty entered into between the dominion and the Indians they had certain rights to hunt on crown lands as well as on the reserves which had been set apart for their use. But the natural resources agreement which was entered into between the dominion and the three prairie provinces, if I am not mistaken -and I speak subject to correction-contains a clause under which at the present time an Indian ha.s a right not only to hunt on his reserve but also to take game at any season of the year if he requires it for food for himself or his family. The hon. member shakes his head, but I have the natural resources agreement in my room. I am going to ask a messenger to get it, and I shall read the clause.


Charles-Philippe Beaubien: Only for food.


Thomas Gerow Murphy: I said for food. Therefore my statement is correct. That is the point I understood the hon. member for St. Boniface was making. Thus the rights which the Indian had at the beginning are now increased because he may take that game whenever he finds it if he or his family require it for food.


John Power Howden: I may be in error but
several bands in Manitoba from time to time have appealed to me; I have had occasion to take the matter up with the provincial government following the transfer of the natural resources and if I am not mistaken, Hon. Donald McKenzie, Minister of Mines and Natural Resources of that province, gave me to understand that the provincial game laws would apply and the Indians would not be permitted to hunt.
Supply-Indian Affairs


Charles A. Stewart: Would be
permitted to hunt for food.


John Power Howden: I am afraid some of those Indians unfortunately are not aware of that fact. I know they have been stopped by the game wardens when they were hunting for food on crown lands.


Mr. STANLEY:: Recently in the Calgary
police court an Indian was proceeded against under the provincial game act for killing game. Judgment was rendered against him, and I believe an appeal has been entered. So that in one instance at least judgment has been given against an Indian for shooting game on crown lands.


John Power Howden: I know several instances
in Manitoba where Indians have been put in gaol.


Edward Joseph Garland: So far as
hunting by Indians is concerned, I presume hon. members are speaking of exclusive right, because my experience in Alberta is that they hunt over any land they feel inclined to hunt over, until they are put off.
I should like to ask the minister why he has so completely and radically altered the form of his estimate this year. At page 49 the total amount to be voted is given in one lump sum, $4,107,000. Last year the estimates were spread over two and a half pages, carefully itemized by provinces, so that a member interested in one or more provinces could see at a glance what the expenditures were and with a certain degree of detail. My first question is:	What is the reason for this
change?


Thomas Gerow Murphy: There is no particular
reason for the change other than it makes the record more complete. I can assure the hon. member there was no ulterior motive in making the change from the former method. It has to deal with all matters pertaining to the Indians, and any member who has a question he wishes to bring up may discuss it as fully under the item as it stands at present as he could have done formerly.


Edward Joseph Garland: I am quite sure there is no ulterior motive in the mind of the minister, but if the item is voted in this lump sum there is no definite destination directed by parliament. Therefore the department will have the power to swing the entire $3,000,000, or the bulk of it, within certain statutory limitations, to even one province. The different amounts not being designated by the house and voted in that way, certain sums may be diverted to the wrong provinces.


Thomas Gerow Murphy: The hon. member fears
that possibly under the vote as at present constituted, Indians living in one province might benefit at the expense of those living elsewhere. I can assure the hon. member that such a policy will not be followed.


Edward Joseph Garland: Can the
minister give me the total amount estimated as the expenditure required for Manitoba, Saskatchewan, Alberta and the Northwest Territories? They were includued in one column last year and the total then was $1,007,639.


Thomas Gerow Murphy: The amount this year is


Edward Joseph Garland: Is there any decrease in the amount for the Blackfoot Indians?


Charles A. Stewart: If the minister would give the amounts to be voted for each province, we would have a better idea of what the allocations are.


Thomas Gerow Murphy: The estimates for each
province are as follows:
Nova Scotia,. $71,460; New Brunswick, $69,124; Prince Edward Island, $9,405; Ontario and Quebec, $359,411; Manitoba, Saskatchewan, Alberta and the Northwest Territories, $821,639; British Columbia, $489,600; Yukon, $21,450; General, $280,500; Indian education, including the construction of school buildings, $1,750,381. -Total, $3,873,000.


Charles A. Stewart: A reduction of $853,669.


Edward Joseph Garland: What is
estimated as being required for the Blackfoot agency in Alberta?


Thomas Gerow Murphy: Blackfoot agency, general expenses, $6,839.


Edward Joseph Garland: That includes the requirements for the purpose of supplies for the agency, does it not?


Thomas Gerow Murphy: It includes salaries, rations, travelling expenses of the agent, fuel and feed, miscellaneous and additions and repairs to buildings.


Edward Joseph Garland: What is the method of securing, let us say, the fuel supply? Is it by tender?


Thomas Gerow Murphy: Yes, by tender.


Edward Joseph Garland: Is the
tender called for by advertisements?


Thomas Gerow Murphy: It is not advertised; the
agent calls for tenders. [DOT]

Supply-Indian Affairs


Edward Joseph Garland: The agent
does so privately; do I understand he does it himself?


Thomas Gerow Murphy: On instructions from the department.


Edward Joseph Garland: I want to have this clear. Is the invitation to tender
advertised?


Thomas Gerow Murphy: No, the tenders are not
advertised; they are not published advertisements.


Edward Joseph Garland: Exactly;
may I ask the minister how it is done?


Thomas Gerow Murphy: The procedure followed
for many years is being carried out; firms dealing in certain supplies are asked to tender.


Edward Joseph Garland: I suppose
a coal firm would be asked to supply coal. I just wish to have the matter clear, because this is an interesting point. I presume only coal firms would be asked to supply the coal for the agency.


Thomas Gerow Murphy: That would be the natural inference, yes.


Edward Joseph Garland: Who was
awarded the contract this year for the Black-foot Indian agency?


Thomas Gerow Murphy: I have not that information with me.


Edward Joseph Garland: Would the
answer given earlier in the session be correct, namely, that it was William McConnell of Gleichen?


Thomas Gerow Murphy: I have not that information before me. Again, however, the inference is that it is correct, unless an error was made.-


Edward Joseph Garland: I wish to
direct the attention of the committee to a rather strange situation. The department does not advertise or call for tenders by advertisement. It appears that tenders are invited; by whom, I am not yet clear. Tenders were not invited from all the coal dealers in the town of Gleichen where the coal was purchased. Certain selected favourites are invited to tender, and in addition some who are not in the coal business at all and never have been are requested to tender. It may interest the committee and surprise the minister-because I am quite sure he is not a party to this-that this year's contract was awarded to a man who is not and never was a coal dealer, and that two of the regular firms dealing in coal in the town were not consulted or asked to tender. The man who got the contract is
purchasing the coal from the Crown Lumber Company. I understand-and I trust my information is correct-that cheques in payment for the coal are being made out to Mr. McConnell, who, I presume, in turn pays the Crown Lumber Company for the coal shipped in.
But that is not all. This year's tender for the coal is $7.65 f.o.b. agency; $7.65 at farm No. 2 at Cluny; $8.65 at farm No. 3; $9.25 at farm A and $9.65 at farm B,-a five mile haul. We may take it, therefore, that the base price laid down f.oib. the agency is $7.65. It happens there is another government department in the town, namely, the Royal Canadian Mounted Police. They also sent out invitations for tenders, and probably through some accident the wrong person got an opportunity to tender, a person who has been tendering for about fifteen years, and whose figure was the regular market rate. That tender was for first grade jewel coal-and there is no better-to be laid down at Gleichen at $6.40 a ton.
The mystery to me is why a man who is not a coal dealer should get a contract for three hundred tons of coal. The Royal Canadian Mounted Police order was for only twelve tons, and hon. members will readily see how valueless such an order would be. That contract, however, is filled at the rate of $6.40 per ton, which is a fair price when we consider the drop in coal prices in the present year and the further drop in the costs of handling. On the other hand the Indian agency, which does not invite tenders by advertising but selects certain privileged persons who are asked to tender, awards a contract at $7.65 per ton, or $125 more than was necessary. That is worth while considering. The gentleman in question, Mr. McConnell, is the president of the local Conservative association. That is indeed most interesting.


Mr. McGIBBON:: But not a crime.


Edward Joseph Garland: No, not a crime. It is very interesting, however, that the president of a Conservative association, who is not a -coal dealer, should be awarded a contract at $125 above the price at which coal could be secured. But that is not all. This government has been spending money in the development of a coal mine on the Indian agency. In 1929 the sum of only $56.11 was spent; in 1930 $100.56 was spent; in 1931,- there was a real -boom on at that time-the government spent $2,193. That is the information I have received from the department. There is a similar difference in the output. In the year 1929 the output was only 260 tons; in 1930, 600 tons; in 1931, 3,085 tons. The Indian agent is selling the coal, in the town
Supply-Indian Affairs

of Gleichen where the agency is situated. That is first grade lump coal, and is being sold at $3 a ton. Now comes a further mystery: Why does the agent go outside the district to buy coal from the president of a Conservative association at $125 above the hauled-in price of domestic coal in Drumheller when he has at his own door a mine developed and operated and worked by Indians under the supervision of the department producing 3,085 tons, which is being sold around the district for only $3 a ton? I leave to the minister the elucidation of these mysteries. I am sure he is not a party to such irregularities, but I do hope he will clear up the mess. Certainly the situation is not a pleasant one in the nostrils of the people of that district. It is an affront both to good Conservatives and to people of other political persuasions, and is the sort of practice which should not be permitted to continue.


Thomas Gerow Murphy: I have not all the facts before me, but I do not think the matter is as mysterious as the hon. member may think. It may be that the man who secured the tender did so at a price slightly higher-about a dollar a ton, if I followed the hon. member correctly. The fact, however, that there was a haulage of some five miles or more, would no doubt explain the difference.


Edward Joseph Garland: I am sure the minister does not wish to mislead the committee. The coal which was hauled five miles cost $9.65 per ton, an amount greatly in excess of $6.40.


Thomas Gerow Murphy: There is haulage in each
case?


Edward Joseph Garland: There is no haulage for agency coal laid down at Gleichen.


Thomas Gerow Murphy: Is it not hauled a certain distance?


Edward Joseph Garland: About three-quarters of a mile, or about the same distance as it would ibe to the Royal Canadian Mounted Police barracks.
Mr, MURPHY: As the hon. member is well aware, there are many different grades of coal sold in western Canada. The haulage may explain part of the difference. I do not say it does; I am offering it as one explanation because I have not all these details before me. But with , regard to the other matter of which he complains, namely, that the Indians have on their reserve a coal mine, I do know that is true. I may tell the hon. member that the mine was opened up under the present administration. Whereas formerly the department bought their coal outside, now that the mine on that reserve has been opened up it

is not only supplying the fuel needs of the Indians themselves, but also, I believe those of the agency this fall. I may also say to the hon. .member that we received some very strong protests against the present policy of the department in operating that mine for the benefit of the Indians. The Indians have not only been able to supply themselves with fuel, but they have been given work during all last winter at fair wages. They have also been able to purchase coal at the mine head, merely paying the wage cost, and selling it, as he said, in the town at $3 a ton. This is directly of benefit to the Indians-something they did not have until the mine was opened Aout a year or so ago.


Edward Joseph Garland: Since the mine is producing 3,085 tons of coal, and, as the minister states, he hopes to produce a greater quantity next year, why is his department purchasing coal from outside at more than twice the amount? Is that economic? Is it common sense? If the Canadian National Railway system was run on that basis it would be broke long ago.


Thomas Gerow Murphy: As I stated, the mine has been open only a few months, and it may be that the department was not in a position at the time-I speak again subject to correction -to supply its needs. In other words, the tenders were called for for the season 1931-32, prior to the opening of the mine. But now that we are in a position to meet those requirements, there is no reason why the coal should not be supplied to the agency from the mine provided it is suitable coal for their requirements.


Edward Joseph Garland: The minister h moment ago attempted to show that there might be some explanation for this thing. I happen to know that the coal that was ten-tered for the Royal Canadian Mounted Police was a very fine, first class grade of domestic coal. You could not get anything better. It is the bottom seam coal. It is laid down at the Royal Canadian Mounted Police barracks at $6.40 a ton and only for twelve tons.


An hon. MEMBER:: That was a gift.


Edward Joseph Garland: They did not have the advantage of getting it in carload lots as they can for the agency order, which amounts to 300 tons. I am glad the minister is open to reason in this matter. I do hope ihe will look into it, because frankly it is a disgrace. I cannot imagine anything that more reeks of the old spoils system than this thing does. The government takes office, pro-

ceeds to develop a coal mine on the reserve, produces a tremendous quantity this year, knew it was going to do so because it spent 82,193 in 1931, in addition to $56.11 in 1929 and $100.50 in 1930.


Thomas Gerow Murphy: I think the hon. member will bear me out when I say that the mine at that time was not producing.


Edward Joseph Garland: Not anything like the quantity that is being produced today.


Thomas Gerow Murphy: Not anything at all, I think.


Edward Joseph Garland: There was some coal being taken out in 1930. The facts are as I have stated to the minister. The government changes office, the new government does not call for tenders by advertisement, but sends out an invitation to one or two friends in the town, and accepts a tender from one of those men, whom obviously they must have had their eyes upon all the time, or whose eyes must have been upon them all the time-the president of the local Conservative association. He gets the contract at a price that is higher than any price contracted for in the district by a government agency since 1928. Remember that. During all the period the price of coal has been going down. In 1928 it was $7.50; in 1929, $7.20; in 1930, $7.20; in 1931, $6.40. I am sure hon. members are fully as disturbed as I am about this matter and do not like this kind of thing to be done with public money. This gentleman may be a very worthy man, but why the government should have given the contract to him for a large amount of coal, 300 tons, at $1.25 over the price at which they could have secured first grade coal, is a mystery to me. Of course, the other point is that the man is not a coal dealer, and never has been-. Again, for fear there may be any mistake about it, the price paid to this gentleman is $7.65 f.o.b. agency, which gives him a profit of $1.25 for doing nothing except signing a contract. On farm No. 2, Cluny- which is also in the same relation to the railway station as the Gleichen farm-the same price is quoted, $7.65; at farm No. 3, which is one mile away, the price-full allowance has been made for providing profit-is $8.65, at farm A, four miles away, the price is $9.25, and at farm B, five miles away, the price is $9.65. I can assure the minister that the contract is well worth while; it has not cost any effort or investment on the part of him who got it. It is a straight gift out of the public treasury and is a disgrace. I know the minister will pay attention to the matter and have it cleaned up.
Supply-Indian Affairs


Charles-Philippe Beaubien: Is there a man by the name of William Tweed well, Indian agent at Le Pas, where there is a reserve?


Thomas Gerow Murphy: There was a William Tweedwell, at Le Pas.


Charles-Philippe Beaubien: Was he dismissed?


Thomas Gerow Murphy: Yes.


Charles-Philippe Beaubien: For what reason?


Thomas Gerow Murphy: For incompetency and misbehaviour.


Charles-Philippe Beaubien: Was the misbehaviour political partisanship?


Thomas Gerow Murphy: No.


Charles-Philippe Beaubien: Was a man by the name of Samuel Lovell appointed agent in the place of Tweedwell?


Thomas Gerow Murphy: He is acting temporarily.


Charles-Philippe Beaubien: Has the position been advertised?


Thomas Gerow Murphy: I do not think so.


Charles-Philippe Beaubien: Will it be advertised by the Civil Service Commission?


Thomas Gerow Murphy: It may not be advertised, for this reason; an order in council was passed some time last year directing the Civil Service Commission to fill vacancies by appointing former members of the Department of the Interior staff who in their opinion had the necessary qualifications to fill such offices.


Charles-Philippe Beaubien: Is my information correct, that the only qualification of this man Lovell is that he is a painter by trade?


Thomas Gerow Murphy: I have no information on
that subject.


Charles-Philippe Beaubien: Would the minister let
me have that information as soon as possible? My information is that this man Tweedwell was dismissed for very poor reasons, and I believe the minister and his department were skating on very thin ice in making that dismissal. Then they temporarily appointed a man who I am told has had no experience in that line of work, whose trade is that of painter. The Indians might need a little warpaint or something like that, but I should like the minister to give me that information.


Thomas Gerow Murphy: I do not think it is in the public interest or in the interest of any employee of the government to state publicly, in certain cases, everything that might be said against that individual, but I can assure my hon. friend that if he will come to the office of the department and consult the files he will not repeat the statement he made a
Supply-Indian Affairs

few moments ago, that we were skating on very thin ice in dismissing this man. I do not wish to pursue the subject at greater length for the reasons I have already given, but if the hon. member persists it may not be greatly to his advantage.


Charles-Philippe Beaubien: I might tell the minister that since this government has been in power there have been so many dismissals for political partisanship, and the investigators have condemned men on such scanty evidence, that members on this side of the house must be expected to be suspicious. Among those dismissed from the Post Office Department or from the minister's own department I could name many who have been dismissed or suspended because of charges of political partisanship, many of which were cooked. In my own district we had an investigator inquiring into the conduct of a civil servant accused of political partisanship, whose accuser was a mail contractor, delivering the mail from the station to the post office, who acted as agent for the Conservative candidate. This was the man who made the charge against the postmaster, whom he was trying to get dismissed. If I can get the information I require privately I will do so.


Thomas Gerow Murphy: I have no knowledge at
all of anything that might have taken place with regard to the Post Office Department, but I can assure the hon. member that no charge of political partisanship was made in the case of the agent who was retired at Lc Pas.


Charles-Philippe Beaubien: I will give the minister some information that he may remember. A certain medical man who was attending the Indians on a reserve in my district was advised shortly after the election was over, that his services were no longer required. That man never took any part in the campaign; I warned him not to do so. I feared that the promises my hon. friends were making might bring them into power, so I told him, "If you do not take any part in this fight you will be able to hold your position." He did not take any part, but nevertheless in October or November he was notified that his services were no longer required. That dismissal was unjust and unfair, and it has turned more votes away from my hon. friends opposite than anything else they could do in my district.


Mr. STITT (Nelson):: In fairness to the
minister and to the gentleman referred to by the hon. member for Provencher, I think I should say a word, since probably I am
[Mr Murphy.]
in a better position to know about this matter than any man in this house. Mr. Twecdwell was a very warm supporter of mine, so there could be hardly any partisanship shown in his dismissal. Mr. Tweedwell was looking upon the wine when it was red just a little too much; he got himself into difficulties, an investigation was requested and an investigator was sent up. I have not seen the evidence on which he was dismissed, but I can assure the hon. member for Provencher that the department had every justification for the action that was taken.


Mr. VALLANCE:: AVhen these estimates
were under consideration last year I asked the minister a question regarding the list of firms permitted to tender on supplies for the Indians. I mentioned the specific case of a firm in connection with the supplying of flour to the Indians in northern Saskatchewan. For many years the Bishop Milling Company of the town of Battleford supplied flour to the Indians, not only under the late government but under the preceding government as well. Last year I asked why the Bishop Milling Company was not permitted now to tender for flour; in fact I wrote the minister's department, and I was told then that they were not on what I might call the eligible list. Might I ask the minister whether they are on that list now, and if they are not on it would the minister tell me why they are not.
Mr. MUItPHY: I am not sure whether the firm mentioned by the hon. member has been asked to tender, but I am safe in saying that there is a firm in Battleford that is asked to submit prices. I am not certain whether or not it is the firm he mentioned a moment ago.


John Vallance: Has the deputy minister the information?


Thomas Gerow Murphy: I am informed that the Bishop Milling Company is asked to tender on supplies.


John Vallance: I wish to thank the
minister.


Peter McGibbon: I would like the minister to be good enough to revert for a moment to a question of policy. In my riding I have two Indian bands, and on the average I think they are as intelligent as the ordinary citizen of the country. Most of them are equally thrifty and ambitious, and many of them have expressed the wish to me, both individually and collectively, that they might become enfranchised and enjoy the full rights of ordinary citizens. They harm never been able to do so, and for the life of me I cannot see why that should be so. A number of them went to the

Supply-Indian Affairs
war and were enfranchised as a result, but their brothers, their fathers, their mothers and their sisters are still there. They are ambitious, energetic and thrifty, and are very desirous of getting the citizenship that is enjoyed by other people in this country. I should like to ask the minister if it would not be possible to give these people a little more responsibility and a little more liberty by granting them full citizenship. I do not see why a difference in colour should bar one man from full citizenship while his neighbour enjojrs that privilege.


Thomas Gerow Murphy: As I think the hon. member is aware, there is a provision in the Indian Act now whereby an Indian man or woman may be enfranchised, and Indians in different parts of Canada are being enfranchised practically all the time. It is done by order in council, after certain recommendations have been made in regard to the standing, the character and the ability of the person concerned. To the best of my knowledge there is no provision in the Indian Act now whereby Indians might be enfranchised en bloc. That could only be done if the present Indian Act were amended. The question has been given some consideration but not all the consideration it deserves, and it may well be that legislation might be introduced in this house to accomplish something of what the hon. member has in mind.


Peter McGibbon: I thank the minister
for his assurance that consideration will be given. I was quite well aware of the provisions he has enumerated, but in the fifteen years I have been in this house I have been able to get only one enfranchised, and that took me from six months to a year. Speaking irrespective of governments, I do not think this matter has received in the past the consideration which the citizens in those bands deserve. I thank the minister for the promise that the matter will be considered, because I think it is just that it should be.


George Brecken Nicholson: I was very much
pleased to hear the minister say that the department had been successful in arranging with the government of Quebec for granting exclusive rights to Indians in that province to take furbearing animals north of the Transcontinental railway, and if I understood him correctly he said that at present an effort was being made, pending the report of the game commission appointed in Ontario some eighteen months ago, to accomplish the same object in the province of Ontario, namely, to provide that north of the Transcontinental railway the Indians should have the exclusive right in that
province. So far as the Indians north of the Transcontinental are concerned, that would be a splendid arrangement. But what about the Indians south of the Transcontinental? There are two distinct bands or, as they are sometimes referred to, tribes of Indians in the northern part of Ontario and the eastern part of Manitoba. To some extent, particularly in northern Ontario, the Cree Indians found their native home north of the height of land in the watersheds of the Hudson bay, while the Ojibway Indians found their home south of the height of land, roughly speaking. If the Cree Indians get their rights north of the Transcontinental they will be amply taken care of, but they would be about in the same position north of the height of land if an attempt were made to transport the Ojibway bands of Indians from the watershed of the great lakes to north of the Transcontinental, which is only a small portion of Hudson bay watershed, because the watershed comes down one hundred miles south of the Transcontinental. The hunting grounds south of the Transcontinental are more prolific and will furnish better opportunities for the Indians, in the main, than the hunting grounds north of the Transcontinental. You will take care of one group of Indians partially, namely, the Crees, north of the Transcontinental, but the Crees south of the Transcontinental in the watershed of the great lakes will be in the position they are now in-and their position is worse than that of any Indians I know of in the country. There are three lines of railways traversing the districts from end to end of that country, and it is through these railway lines that the white hunter comes in. Then, following up what the hon. member for St. Boniface has said with regard to the Indians not being permitted to take furbearing animals or food supplies from the game in Manitoba, certainly they are not in Ontario; they are treated exactly the same as the while man is treated. They are haled before the police court if they shoot a partridge out of season, or for any act committed in violation of the game laws of Ontario, just the same as any white man. The result is that they have been reduced to a state of absolute pauperism, their only means of earning a living having been taken away from them.


Charles A. Stewart: May I suggest that a slight mistake has been made in curtailing the description of the votes. If it was desirable to have the vote all in one item, then at least the items the minister read to the committee allocating certain amounts to each province should be in the
Supply-Indian Affairs

estimates. However, that is not the point I want to make at present. Will the minister give some explanation with regard to the closing of the Regina office and the allocation of the three inspectors?


Thomas Gerow Murphy: The commissioner's office
at Regina, as such, has been closed and Inspector Murison will continue, under the department here at Ottawa, in charge of affairs in Saskatchewan, Inspector Hamilton in Winnipeg for the province of Manitoba, and Inspector Christianson in Calgary for the province of Alberta.


Charles A. Stewart: Reporting
direct to Ottawa?


Thomas Gerow Murphy: Reporting direct to Ottawa, yes.


Charles A. Stewart: In the curtailment of the amount allocated generally to the department, how much of the reduction is estimated to be in construction of schools? Perhaps I might put it a better way:	Are there any new schools under construction this year?


Thomas Gerow Murphy: No.


Charles A. Stewart: Any new
hospitals?


Thomas Gerow Murphy: No.


James J. Donnelly: I understand that what is known as the Greater Production Farm in the neighbourhood of Regina has been abandoned. What was the reason for this?


Thomas Gerow Murphy: As nearly as I have been able to ascertain, what is known as the Greater Production Farm was brought into existence, along with some others of a similar type, during the war years when this country was straining every effort to provide foodstuffs for the allied armies. In other years a similar farm was closed on the Blood reserve in Alberta. This year it was decided to close the farm north of Regina, because the Indian department is not engaged in the business of farming as such; that is rather outside the province of the department. I may say, for the information of the hon. member, that the farm has not been abandoned. An arrangement has been entered into with the former manager of the farm whereby he will crop the land this year with the idea eventually, in a couple of years' time, of returning the farm to its natural grassy state to obviate the danger of the land becoming weedy and thus a menace to surrounding farms.


James J. Donnelly: Has any of this land
been handed over to the Indians to farm this year, or has it been placed in the hands of this individual to carry on farming?


Thomas Gerow Murphy: The arrangement has been made with the individual to farm the area with the idea of returning the land to its natural grassy state, or to sow the land where needed to broom or some other variety of grass.


Ernest Lapointe: Can the minister advise
the committee of the present stage of the negotiations between himself or his department and the government of Quebec with regard to Indian reservation lands alienated by this government? The privy council has decided that these lands must revert to the provinces and that the proceeds of any sales belong to the provinces. I understand there is now due to the province of Quebec more than S300,000 in proceeds from the sales of these lands. I think an arrangement was reached many years ago with the province of Ontario, but so far no definite conclusion has been reached as far as Quebec and the Dominion government are concerned. I understand that the department take the stand that the province must wait; they do not contest the validity of the claim but they seem to ask for some sort of moratorium. The province of Quebec in the past has been willing to agree to favours being granted to other provinces; it does not ask for any favours, but it has a right to the money received from the sale of Indian lands which are the property of the province.


Thomas Gerow Murphy: Mr. Chairman, in one
sense, I am rather pleased that the former Minister of Justice (Mr. Lapointe) has brought up this question. I have not all the details before me, but I think the general facts are something like these: It was understood by the Dominion government and by the Indians themselves that where a band surrendered a portion of their reserve for sale or lease, the proceeds of the sale would be held by the Dominion government in trust for the purpose of assisting the Indians. Certain lands in the province of Quebec were sold after being legally surrendered by the Indians to the department for disposal, and the province has claimed the reversionary interest in those lands. A case was carried to the Judicial Committee of the Privy Council, which decided that the province was entitled to the reversionary interest in the lands or, in other words, that the proceeds from the

Supply-Indian Affairs
sale of the lands belonged to the province. I do not dispute that that is the correct legal position, but certain negotiations have been carried on between the Premier of Quebec and myself and other officials of the government. The dominion's standpoint is that the province of Quebec could claim a reversionary interest in the lands. However, it may be of interest to the committee to know that the province of Ontario has entered into an agreement with the Dominion government whereby the proceeds of any such sales would be held in trust by the Dominion government to be used for the welfare of the Indians, and 1 have endeavoured to have the province of Quebec adopt a similar attitude. The Dominion government is not holding these moneys for the benefit of the crown in the right of the dominion; it is holding them in trust to be expended from time to time for the benefit of the Indians. I think there is a difference of opinion as to the $300,000 mentioned by the former Minister of Justice, the Dominion contending that that amount includes not only the proceeds from the sale of lands but also the proceeds from the sale of timber and other resources upon the lands. My main object has been to have the province of Quebec adopt the same attitude as that adopted by the province of Ontario, whereby the moneys from the sale of , such lands would remain with the Dominion government to be expended for the benefit of the Indian. If this is not done, the department will be placed in this position: Unless an Indian band dies out or for some reason leaves its reserve, no further land would be surrendered by the Indians, because it would be felt that the proceeds of any sales would go to the province and the poor Indian would be denied that which he supposed was his for all time to come.


Ernest Lapointe: I do not challenge the right of the minister to enter into negotiations with the province of Quebec to try to get them to agree, that this money should be kept in trust for the benefit of the Indians, but my hon. friend must agree that the money now in the hands of the government is the property of the province of Quebec. While negotiations are pending and before an agreement is reached, if it is ever reached, I do not think it is a fair method of procedure for the government to keep this money, and I do not see how my hon, friend can justify it. In order to show the view taken in regard to this matter by the government of the province of Quebec, I shall read the last fetter sent to my
hon. friend by the Premier and Attorney General of the province. The letter is dated April 25, and reads:
I am in receipt of your letter of the 19th instant, regarding the question of the property rights of the province of Quebec in lands comprising Indian reserves.
I regret to state that it is impossible for our government to accept the views expressed by you in your letter.
Surely, undisputed claims between Canadian governments cannot be treated in this way. After much litigation the privy council held, in the Star-Chrome case, that these lands reverted to the provinces.
Before this decision was rendered, the government of the dominion had been selling these lands. We declared, however, before the privy council that we w-ere prepared to recognize the validity of the titles given by Ottawa before the priviy council decision, and ever since Ottawa has been disposing of the lands, the proceeds of the sale being deposited in a special trust fund. The amount due the province of Quebec is now over three hundred thousand dollars, in addition to interest. We have, however, declared that we were prepared to waive interest if .the capital is paid forthwith.
I really cannot understand the stand that you take when you declare, in your letter, that the adjustment of this claim must be indefinitely deferred.
The government of the dominion is showing itself most generous for the provinces of the west and, for this generosity. I am offering no criticism. We are not applying for charity or for a gift, but only for the payment of a sum which is legitimately due to the province.
I. therefore, earnestly hope that our claim will be adjusted forthwith.
May I add that the privy council dealt with this matter in the ease of the Dominion of Canada vs. the province of Ontario, in 1910, in the Indian Treaties indemnity case. You will find that case reported at page 676 of Cameron's Canadian Constitution.
Yours truly,
L. A. Taschereau.
Ido not want to press the matter unduly, but I submit, even after the explanations of the minister, it is clear that the money belongs to the province of Quebec, and until any other agreement is reached and pending any negotiations, I dispute the right of this government to keep the money.


Thomas Gerow Murphy: As I stated a few moments ago, there is no question, or at least I have never heard any, as to the legal right of the province of Quebec to the proceeds from the sale of the land. When the ex-minister read from the letter that settlement must be indefinitely postponed, this had reference to the amount claimed, not to the legal right of the province to the proceeds from the sale of the land. That is, the province of Quebec claims the right to money which was received from the sale of timber and certain other proceeds
Supply-Indian Affairs

which the Dominion government feels is not included in the judgment given by the privy council. But the ex-minister, in his concluding remarks, stated that he felt that this government was not entitled to keep moneys which rightfully belong to the province of Quebec, although we were endeavouring to negotiate with them whereby the moneys from the sale of this land would be kept for the Indians. That money has been owing to the province of Quebec for some years, I believe, and the ex-Minister of Justice, although I am not sure of this, may have had the matter brought to his attention during those years.


Ernest Lapointe: I did not hear of it until two days ago.


Richard Bedford Bennett: Bad staff work.


Thomas Gerow Murphy: Then I do not need to give any further explanation along that line. I sincerely hope, however, the province of Quebec will see its way clear to allow the dominion to retain that money in order that, it may be expended for the welfare of the Indians who certainly need it.


Charles A. Stewart: I think I should lend some support to the minister in this matter, because I had a rather trying experience with the province of Ontario in regard to the same question. While there is no use in denying the fact that we were defeated in the case .before the privy council, the question of ownership of Indian lands is rather beclouded. I always held the opinion that our case was not very well presented. It, however, went against us; there is no use in arguing about that, but even so, we felt we had a claim in equity. Surely these lands were set aside in the various provinces for the maintenance of Indians and the responsibility for their maintenance devolves upon the federal authorities. All the contributions the provinces made were the lands themselves.


Ernest Lapointe: The lands themselves- that is something.


Charles A. Stewart: -the lands themselves, for the purpose of setting aside reserves for the Indians. The care, the education and all the other responsibilities fell upon the shoulders of the federal government. It is not fair to say that there is any difference between the treatment in Ontario and Quebec and that in the western provinces, because under the agreement with the prairie provinces and British Columbia there is a provision that if further lands are required, they are prepared, upon negotiation, to provide them. If in the provinces sales of land are undertaken, the proceeds remain in the custody

of the federal government. It sems to me -this is a question of equity, if not of law. In the negotiations with the Ontario government we were able to retain these moneys and arrangements are made whereby, in sales of reserves in that province, the proceeds remain in the custody of the Department of Indian Affairs for the benefit of the Indians themselves. It is true on a clear case of law the province of Quebec is entitled to recover that money, but to be fair to the rest of the provinces and to give the same treatment-


Ernest Lapointe: Quebec is paying all the time to the other provinces.


Charles A. Stewart: I do not want to enter into a controversy with my hon. friend over that question.


Ernest Lapointe: We shall discuss it at some other time.


Charles A. Stewart: Not particularly with respect to Indians-


Ernest Lapointe: We do not borrow money, but we want what is due to us.


Charles A. Stewart: As regards the question of Indian reserves in Quebec, it is only fair to expect that that province should be given the same treatment as that which prevails in regard to Ontario.


Richard Bedford Bennett: I think the difficulty is
this: the ex-Minister of Justice overlooks the fact that the privy council has not decided that the fund, if it is paid to the province of Quebec, does not become a trust fund for the benefit of the Indians.


Ernest Lapointe: Let Quebec decide that.


Richard Bedford Bennett: If it is a trust fund for the benefit of the Indians, then as the exMinister of the Interior has observed, a difficulty of administration arises, because, under the constitution, with the dominion rests the responsibility for the Indians, and the extent to which the moneys thus received by the province from the sale of assets belonging to the Indians would pro tanto be available for their relief and support. I think what the exMinister of the Interior has said should be viewed from that standpoint. I understand the minister has suggested to Quebec, not that the moneys should not be paid in accordance with the terms of the judgment, but that, if paid, they should be regarded as a trust which may be administered by the dominion or by the province, but if by the province, by its discharging the constitutional obligation of the dominion with respect to the wards of the crown, namely, the Indians.

Sup-ply-Indian Affairs


Ernest Lapointe: Does my right hon. friend not think that, while these negotiations are pending, the money should go to the province to which it belongs?


Richard Bedford Bennett: The question has not been determined, as I understand it-


Ernest Lapointe: It has.


Richard Bedford Bennett: The hon. gentleman has
not heard my sentence. The question has not been determined whether or not the money is earmarked as a trust fund, and if paid over by the dominion without its being thus earmarked, a question that might be very difficult would arise. That is the point which the minister has endeavoured to make with the provincial authorities. If we earmark it as a trust fund, then of course the administration of the fund would relieve pro tanto the obligations of the dominion. But this would complicate administration, because you would have the province charged with a responsibility which constitutionally rests with	us.


Ernest Lapointe: Surely the	judgment	is
clear that when Indian lands are abandoned, they , revert to the provinces.


Richard Bedford Bennett: Quite so.


Ernest Lapointe: When they	are	sold,	the
money should go to the province, whether that money is earmarked or not. Whether it is to be administered for the benefit of the Indians or not, it must go to the province, and while this question is being discussed, I do not think it is fair on the part of the federal government to keep the money.


Robert Gardiner: Has the minister any
information with regard to the situation in relation to trachoma on the different reserves in the west?


Thomas Gerow Murphy: I did not hear the hon.
member very well, but I believe he is inquiring about the trachoma situation in the west. At the present time the department is availing itself of the services of Doctor Wall, who is an expert in that disease, having especially studied the subject in Vienna. He is making a tour throughout the west and is instructing the various doctors whose services were engaged for the benefit of the Indians in the detection and treatment of this disease. He is cooperating also with the provincial Departments of Health in their endeavour to prevent the ravages of that disease among certain elements of the white population.


Robert Gardiner: I was very much interested in the questions asked by the hon. member for Bow River concerning the coal 41761-163
contract at Gleichen. I have before me a return which was tabled in this house some time ago at the request of the hon. member. Notwithstanding the fact that the price of coal has been very substantially reduced, I notice the department is paying fifteen cents per ton more than they did in the previous year. Can the minister explain this?


Thomas Gerow Murphy: I have already informed the committee that tenders were asked for by the Indian agent, and that the lowest tender was accepted. Further than that I can give no explanation to the committee.


Robert Gardiner: Does the minister really believe that they were proper tenders? In his own mind is he satisfied that those tenders were properly made?


Thomas Gerow Murphy: They were proper, I
suppose, in the sense that they were submitted by responsible dealers. When those dealers were tendering they knew that they were in a competitive field, and as business men they would know that they must submit prices at which they could supply the coal.


Robert Gardiner: In view of the fact that the public was not asked to tender for the supply of coal I presume the minister would not like to say that the tenders were really competitive?


Richard Bedford Bennett: He said so.


Robert Gardiner: The minister would not for one moment say that those tenders were competitive; the public was not asked to tender for the supplying of coal.


Thomas Gerow Murphy: Yes, the tenders were competitive, because the different dealers were asked to quote. I do not know what the hon. member has in mind when he suggests to the committee that those men got together in some sort of cabal and boosted the price. I do not know whether or not that is what the hon. member has in mind. Apart from that, however, I would say that as business men they would submit the lowest possible prices in order to secure the business.


Robert Gardiner: I did not infer that those gentlemen got together with the idea of boosting the price higher than it should have been. In an endeavour to get to the bottom of this matter I should like to ask the minister how many tendered for the coal contract, the amounts at which they tendered, and the dates upon which the tenders were received.


Thomas Gerow Murphy: I am sorry I.have not that information before me.

Supply-Indian Affairs

Mr, GARDINER: I do not like to delay the item, yet I should not like to see it pass until we have some further explanation in regard to so important a matter. After all, we are spending the funds of the people, and it is the duty of this house to see to it that proper tenders are received. In all cases, quality considered, the lowest tenderer should receive the contract. In this particular instance it is quite evident that only a few people were asked to tender. I believe the committee would be justified in asking the minister to let the item stand until such time as he can furnish more information.


Richard Bedford Bennett: Certainly.


Robert Gardiner: I should like to know who were invited to tender for this coal contract. I should like to have the tenders produced, so that the committee may know whether the lowest tender was accepted, the date that tenders were asked for and when the successful tender was accepted, in order that we may determine whether or not the agency itself could have supplied this coal from its own mine at the time the tenders *were received.
I should like to say a word or two about the manner in which estimates have been brought before the committee this year, as compared with that of former years. In item 201 of this year's estimates a lump sum of 83,873,000 is provided. If hon. members will turn to last year's estimates they will find a much better description of the particular purposes for which these moneys are allocated than is to be found in the estimates now before us. With all the estimates for the Department of Indian Affairs lumped in one sum it is quite possible for the department to allocate those funds to whatever purpose they may desire. Under the circumstances and in view of my past experience I do not think that is advisable. Turning to page 54 of the estimates for the year 1931-32, last year, we find that there are certain amounts allocated to each of the provinces, and the total vote was $4,516,313. Then we come to a special vote for Nova Scotia, and in that vote there is a sum set aside for salaries, another for supplies for destitute Indians, another to provide for encouragement of agriculture, another for medical attendance and medicines, another for repairs to roads and dyking, another for Indian dwellings, and the last for miscellaneous and unforeseen expenditures. Each of these items has a certain amount of money allocated to it in last year's estimates, making a total for the province of Nova Scotia of 885,960.


The CHAIRMAN (Mr. Maloney):: I must remind the hon. member that it is now eleven o'clock.


Thomas Gerow Murphy: Before the committee rises I should like to make one or two observations. When the hon. member for Bow River first raised the question of coal I said I had not the particulars before me. When I replied to the hon. member for Acadia I was speaking generally, as to the policy of the department in connection with tenders, and I made the assertion that the lowest tender is accepted. At that time I was not speaking of the particular case to which the hon. member had directed his remarks, but was referring to the general practice in the department. May I add that at the next sitting I shall have the necessary information for hon. members opposite.
Progress reported.


[Stage Direction]
At eleven o'clock the house adjourned without question put, pursuant to standing order.
Tuesday, May 3, 1932.