1934-04-09

UNEMPLOYMENT RELIEF

Right Hon. R. B. BENNETT (Prime Minister):: I desire to file parliamentary return reference No. 68, moved by Mr. Denis, correspondence with respect to George C. Vaudrin, as to the means taken to solve the crisis of unemployment. I have already tabled correspondence with myself. This comprises the final return, being a copy of letters sent to the Minister of Labour (Mr. Gordon).



CANADA GRAIN ACT AMENDMENT

[Stage Direction]
Hon. H. H. STEVENS (Minister of Trade and Commerce) moved for leave to introduce Bill No. 53 to amend the Canada Grain Act.
Some hon. MEMBERS:: Explain.


Mr. STEVENS:: Briefly, Mr. Speaker, may I say that there are two amendments, one is in regard to grading, involving the question of the grading of Garnet wheat, separately. The other is merely an adjustment of the eastern terminal elevator receipts to bring them into conformity with modern practice.


Mr. GARLAND (Bow River):: May I ask the minister if this bill will be referred to the committee on agriculture?


Henry Herbert Stevens: I presume so; it has in the past. There is no reason it should not be.
Motion agreed to and bill read the first time.



INCOME WAR TAX ACT AMENDMENT

[Stage Direction]
Hon. E. N. RHODES (Minister of Finance) moved for leave to introduce Bill No. 54 to amend the Income War Tax Act (special tax).
Some hon. MEMBERS:: Explain.

Civil Service-Salary Deduction


Mr. RHODES:: Mr. Speaker, this bill provides for a special income tax of ten per cent on the salaries of the members of the judiciary, the commissioned officers of the military, the naval and air forces, and the Royal Canadian Mounted Police.
Motion agreed to and bill read the first time.



CIVIL SERVICE


[Stage Direction]
Hon. E. N. RHODES (Minister of Finance) moved for leave to introduce Bill No. 55 to amend the Salary Deduction Act, 1932.
Some hon. MEMBERS:: Explain.


Edgar Nelson Rhodes: Mr. Speaker, this bill provides that there shall be no deductions of the salaries, pay or compensation of any employee of the public service up to and including the sum of $1,000. That range takes in a very large number of employees of the public service. As nearly as we can ascertain some eighteen thousand in number will be affected, including revenue postmasters, part time collectors of customs, lighthouse keepers, wharfingers, charwomen, seasonal or part time labourers, lockmen and bridgemen on the canals. Those in receipt of salaries above the sum of $1,000 will be subject to the same deduction as hitherto.
Motion agreed to and bill read the first time.



QUESTIONS

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

Mr. BOUCHARD:: *
1.	(a) flow many entomologists, assistant and
sub-assistant entomologists were employed in the federal government laboratories during the year 1933;	(b) how many investigators;
(e) how many temporary employees; (d) how many agricultural students in categories (a); (b) and (e)?
2.	What was the distribution of categories (a); (b); (e) as regards the different provinces?


Mr. WEIR (Melfort):: 1.	(a) 64; (b) 53; (c) 70; (d) none.
2.	(a) Nova Scotia	 5
New Brunswick	 4
Quebec	 3
Ontario	 30
Manitoba	 2
Saskatchewan	 4
Alberta	 5
British Columbia	 11

(b)	Nova Scotia	 3
New Brunswick	 5
Quebec	 3
Ontario	 24
Manitoba	 1
Saskatchewan	 6
Alberta	 2
British Columbia	 9
(c)	Nova Scotia	 3
New Brunswick	 4
Quebec	 4
Ontario	 29
Manitoba	 2
Saskatchewan	 9
Alberta	 5
British Columbia	 14
(Totals for Ontario include officers employed at Ottawa headquarters.)


RADIO BROADCASTING-TOTAL EXPENDITURES
Mr. HANSON (Skeena):: What was the total expenditure in connection with the Canadian Radio Commission for the last twelve months, ending March 1, 1934, as follows:	(a) salary to each commissioner:
(b) travelling and' other allowances to each commissioner; (c) office help; (d) inspection and field work; (e) broadcasters, acquiring and improving stations; (f) other expenditures in detail ?


Richard Bedford Bennett: Mr. Speaker, this question was previously asked by the hon. member for Swift Current (Mr. Bothwell). It was suggested that it was not desirable in the public interest that the question should be asked in the form in which it appears, and that with the radio committee sitting every possible opportunity is afforded to secure such information without resorting to the form of question and answer. I think it would be injurious to the efficiency of the commission if it were to be subjected to this form of inquisition at every session of parliament.


Olof Hanson: I should have to attend the sittings of the committee every day in order to get the information.
Question dropped.


THREE THOUSAND FAMILY SETTLEMENT SCHEME
Mr. SMOKE:: With regard to the three thousand families settlement scheme:
1.	What was the original number of families settled, in each province, and if the information is available, in each district?
2.	What was the original total expenditure in this matter?
3.	What was the original average expenditure per family?
4.	What number of families are now remaining in the scheme?

Questions
5. What has been the total amount of loss on account of families leaving the scheme?
C. As regards families remaining in the scheme:	(a) what was the original expenditure; (b) what amount is still due; (c) of the difference between original expenditure and amount still due. what amount, if any, has been written off as loss; (d) are any further losses anticipated, and will any further writing off be done?


Mr. GORDON:: (Soldier Settlement of Canada)
1.	Families established on the land:
British Columbia	 280
Calgary	373
Edmonton	4S2
Total for Alberta	 855
Saskatchewan	 623
Manitoba	 301
Ontario	 205
Quebec	 56
Maritime Provinces	 348
2,668
2.	Total loans excluding interest	$12,393,359	553.	Original average expenditure per family	
4,645	194.	Number of families nowremaining in the scheme.	1,8985.	Ascertained	losses	
485,638	766.	(a) Total loans excludinginterest	
9,329,311	91
(b) Amount still due:
Principal. . $7,236,761 21 Interest. . .	298,129 03
Total	 $7,534,890 24
(c) Amount written off: 1932 Interest Remission $ 367,528 22
30% Reduction. . .	3,306,548 35
Dollar for
dollar bonus 23,418 73
Total	 $3,697,495 30
(d)	No information.
Note.-Answers are given as at February 28, 1934.



MEADOWVILLE, PICTOU COUNTY, N.S., MAIL CONTRACT

Mr. URQUHART:: 1.	When was the mail contract last awarded for rural mail route, Meadowville No. 2, county of Pictou?
2.	To whom was the contract awarded, and at what figure?
3.	Who were the tenderers and what was the amount of each tender?


Mr. SAUVE:: 1.	On the 4th of April, 1933.
2.	Sanford R. Cameron at $590 par annum.
3. James Blackie, Meadowville.. .. $445 00 Sanford R. Cameron, Meadowville No. 3	 590	00
Peter Cotter, Meadowville Stn. 700 00 ' Robert R. Sutherland, No. 1 R.R. 720 00 Burton Murray, West Branch
River John	
744	00Lee Ray Clark, Meadowville.. ..	785	00
J. W. Matheson, Meadowville... 799 00 Mr. James Blackie being a minor, the department could not enter into a contract with him.



DENMARK, COLCHESTER COUNTY, N.S., MAIL CONTRACT

Mr. URQUHART:: 1.	What are the names of the parties who tendered for the mail contract for Denmark No. 2. rural mail route, Colchester county, when last contract was awarded?
2.	What was the amount of each tender?
3.	To whom was the contract awarded and when does said contract expire?


Mr. SAUVE:: 1 and 2. Warner Forbes, Denmark. . $425 00 Warner Forbes, Denmark.. 499 00 Harry E. Sarson, Denmark. 599 00
3.	Warner Forbes, at $425 per annum.
Contract will expire on the 31st March, 1937.



RIVER JOHN, PICTOU COUNTY, N.S., MAIL CONTRACT

Mr. URQUHART:: 1.	When was the mail contract last awarded for rural mail route No. 2, river John, Pictou county ?
2.	To whom was the contract awarded, and at what figure?
3.	Who ivere the tenderers and what rvas the amount of each tender?


Mr. SAUVE:: 1.	On the 19th June, 1931.
2.	Charles H. Bigney at $498 per annum.
3.	Tenders received for a 14 mile route Smith Holt, River John, $500; Charles Harve Bigney, River John, $600; Calvin A. Langille, River John, $618; Ross I. Langille, River John, $625.
An error having been made in the notices inviting tenders, all four tenderers were requested to submit new tenders for a 12 mile route with the following result: Charles H. Bigney, $498; Smith Holt, $500; Calvin A. Langille, $550; Ross I. Langille, $625.



OLD ACE PENSIONS

Mr. COTNAM:: What was the total cost of old age pensions to the federal government in the constituency of North Renfrew for the years 1930, 1931, 1932 and 1933, respectively?
Motions for Papers


George Gordon: Payments made to old age pensioners in North and South Renfrew are not listed separately in the monthly cheque issue register compiled by the Ontario provincial authorities, and submitted to the federal Department of Labour, and it is, therefore, not possible for the department to prepare from the available records an accurate statement of the federal government's share of the cost of such pensions in North Renfrew only. During the month of February, 1934, cheques totalling S12,884.61 were issued to residents of Renfrew county, the cost to the federal government being 75 per cent, or $9,663.46.
The information desired concerning the cost of old age pensions in the constituency of North Renfrew can only be secured from the administrative authority, namely, the provincial government.



BEAUHARNOIS, QUE., POSTMASTERSHIP

Mr. RAYMOND:: 1.	Who is the present postmaster of the town of Beauharnois, county of Beauharnois?
2.	When was he appointed?
3.	Is he employed in a temporary or permanent capacity?
4.	Who recommended him?
5.	Whom did he replace?


Mr. SAUVE:: 1.	Miss Laurence Laberge.
2.	July 6, 1933.
3.	Permanent.
4.	Appointed by Civil Service Commission.
5.	J. N. Laberge.



QUESTION PASSED AS ORDER FOR RETURN


Mr. COTNAM:: 1.	What did it cost to operate the military camp at Petewawa during the years 1930, 1931, 1932, and 1933, respectively?
2.	How much was expended for material and equipment, and how much for labour and allorvances ?



MOTIONS FOR PAPERS


Mr. BRASSET (for Mr. Michaud):: For a copy of all correspondence, letters, telegrams, and orders in council, in connection with the dismissal of Xavier Cyr and the appointment of another postmaster, at Baker-Brook. county of Madawaska, New Brunswick, from September 1, 1930, to January 1, 1934.



GREEN RIVER, NE, MAIL CONTRACT

Maurice Brasset: For a copy of all correspondence, letters, telegrams, and orders in council, in connection
iMr. Cotnam.]
with the contract to one Camille Azzard, of Green River, New Brunswick, for carrying the mails from Green River station to post office at Green River, New Brunswick, from September 1, 1930, to date.



BEAUHARNOIS, QUE., POSTMASTERSHIP

Maurice Brasset: For a copy of all notices, reports, letters, classification sheets, decisions, memoranda, telegrams or other communications, and all other documents and memoranda in the possession of the Civil Service Commission or the Postmaster General, respecting the appointment of the present postmaster of the town of Beauharnois, county of Beauharnois.



SHEDS, PIER B, HALIFAX

Mr. IIEENAN (for Mr. Ralston) :: For a copy of all notices of tender, tenders, contracts, letters, telegrams, correspondence, orders in council and other documents, relating to the letting of the contract by the Halifax harbour commissioners for the construction of steel transit sheds on pier B, at Halifax, since January 31, 1934.



NOVA SCOTIA COLD STORAGE COMPANY LIMITED

Peter Heenan: For a copy of all telegrams, letters, correspondence, orders in council and other documents, relating to the taking over by the Halifax harbour commission of the plant of the Nova Scotia Cold Storage Company, Limited, at Halifax, and the issue or exchange of bonds or other securities in respect of same.



TOBACCO INDUSTRY


[Stage Direction]
Mr. ECCLES J. GOTT (South Essex) moved:
For a copy of the report of Hon. Donald Sutherland on the tobacco inquiry made in 1933.
Richard Bedford Bennett: In view of the observations that have
been made as to the public interest being safeguarded by the production of reports made under the Combines Investigation Act the motion will be accepted by the government, and I now produce and table the report in question. It is in part the report made under the Combines Investigation Act by the registrar to the Minister of Labour, dated March 4, 1933, and attached to that report of the registrar is the report of Mr. Sutherland. The report of Mr. Sutherland was not made pursuant to an appointment under order in council as was suggested the other day, because in looking into the matter I find he was appointed under another section of the act, but his compensation was fixed by an order in council, which order in council

Tobacco Industry
extended also to the compensation that was to be paid for similar services to various other persons named therein. I produce and table the document the more readily because in certain parts of this country it has been alleged that the report has been kept back because the Prime Minister of the country was largely interested as a shareholder of the Imperial Tobacco Company, and therefore was preventing this action being taken. I avail myself of this opportunity to say to this chamber that I am not either directly or indirectly through the intervention of a trustee or in any other way a shareholder of the Imperial Tobacco Company or any other tobacco company, and so far as I can ascertain never in all my life did I own a single share of that great undertaking.


Right Hon. W. L. MACKENZIE KING (Leader of the Opposition):: I was not one
of those who either believed or ever heard of the view which the Prime Minister has just expressed as to why the report was not brought down, but I did hear the Minister of Labour (Mr. Gordon) give very strong reasons last week why the report could not be produced under the Combines Investigation Act. I wonder if the Prime Minister could therefore tell us what circumstances have intervened to make it possible to produce the report now.


Richard Bedford Bennett: I have said that the
Minister of Labour himself indicated to me after looking the matter up, as he did and as I did, that Mr. Sutherland has not been appointed by order in council, and in the public interest there was therefore no reason why the report should not be tabled especially in view of the character of the observations that have been made in various parts of the country as to the reasons why it was not.


William Lyon Mackenzie King: The Minister
of Labour must have given to the house wrong information.


Mr. GOTT:: Might I suggest that the man who made that report will probably be in this house before very long.


Mr. STEWART (Edmonton):: You are an
optimist.


Mr. A. E. MUNN (Vancouver North):: I would like to direct a question to the Minister of Trade and Commerce. Is it not a fact that the Sutherland report was asked for by the members of the price spreads committee and was refused? They asked to have that report tabled.


Henry Herbert Stevens: No, it is not a fact. This report was asked for and the matter was
under discussion between myself, as chairman of the committee, and the Minister of Labour (Mr. Gordon). The question was raised as to whether the report should be produced under these circumstances but the matter was not finally disposed of. The point I wish to make is that it was not refused in the sense of the hon. member'! question.


[Stage Direction]
Motion agreed to.
SHIPS' CLEARANCE PAPERS On the orders of the day:
Hon. R. C. MATTHEWS (Minister of National Revenue):: Before the orders of the
day were called on March 28 last the hon. member for Charlevoix-Saguenay (Mr. Cas-grain) inquired from the hon. Minister of Marine whether the various documents necessary to clear vessels from ports were printed in both English and French. That question has been referred to my department, and in reply I beg to say that the following forms with respect to the clearance of vessels from ports in Canada are printed in both English and French: Form A6, report inwards; Form A7, report outwards; Form C8, ships' clearance.
TRANS-CANADA AIRMAIL SERVICE On the orders of the day:


Hon. P. J. VENIOT (Gloucester):: I wish to direct a question to the government based on the following item which appeared in the Montreal Gazette to-day:
The dominion government is reported to be ready to award the contract for the long-planned trans-Canadian airmail service which eventually will bring Vancouver to within twenty-four hours of Montreal.
May I ask if there is any foundation for this report?


Richard Bedford Bennett: No such action has been taken.
PARLIAMENT HILL GROUNDS On the orders of the day:


Mr. PETER McGIBBON (Muskoka-Ontario) :: I would like to ask the Minister
of Public Works now that spring is here if he would not have his horticultural staff plan the beautifying of the grounds around this building so that it may be more in keeping with the capital of Canada.


Hon. H. A. STEWART (Minister of Public Works):: Mr. Speaker, I can only say that in shaping up our program for the coming year consideration will be given to the suggestion of my hon. friend.
Business of the House

CANADIAN LEGATION IN JAPAN On the orders of the day:


Edward Joseph Garland: Mr. Speaker, last session and again this session I requested the production of copies of certain documents with respect to the Tokyo embassy. I have made inquiry of the sessional papers staff and I find that these papers have not yet been tabled. I should like to know just when I can expect them.


Richard Bedford Bennett: I was under the impression that
they had been tabled, but I shall make further inquiry.



BUSINESS OF THE HOUSE

[Stage Direction]
INQUIRY AS TO LEGISLATION TO BE INTRODUCED On the orders of the day:
William Lyon Mackenzie King: Mr. Speaker, I
have been waiting to hear the Prime Minister (Mr. Bennett) give to the house the information as to the further legislative program of the present session which he said he would try to prepare during the vacation. Is he in a position to make a statement to-day?


Richard Bedford Bennett: I did not say I would make a
statement to-day; I said I would make it as soon as possible after we reconvened.


William Lyon Mackenzie King: Is the Prime
Minister in a position to say when we will have the bill to amend the Dominion Elections Act? I asked a question in connection with this act just before the recess.


Richard Bedford Bennett: The elections act is in
process of preparation. It is being advanced and will be introduced just as soon as it can be completed. We were not able to make any substantial progress during the holidays because many of our own members were very tired and had to take a little rest. However, some progress was made with the act.



UNEMPLOYMENT AND FARM RELIEF


[Stage Direction]
The house resumed from Wednesday, March 28, consideration in committee of Bill No. 42, respecting relief measures-Mr. Gordon.- Mr. Gagnon in the chair.
On section 2-agreements with provinces.
The CHAIRMAN (Mr. Gagnon):: Shall the amendment carry?


William Lyon Mackenzie King: Read the
amendment, please.


Onésime Gagnon: It is moved by Mr. Guthrie, seconded by Mr. Rhodes, that section 2 (a) be amended by adding after the word "province" in the fourth line thereof the following words, " and to Canadian Cooperative Wheat Producers Limited," and that the marginal reference opposite the section be amended by adding the same words thereto. Shall the amendment carry?


William Lyon Mackenzie King: Are there any others?


Onésime Gagnon: No.


Mr. POULIOT:: I have a few observations
to make in connection with what happened last year when this same question was being discussed. I should like to quote what the Minister of Labour (Mr. Gordon) said on March 21, 1933, with regard to the member for Temiscouata. These remarks appear on page 3500 of unrevised Hansard of that year. I have not yet received the bound copy of Hansard for last year and I must use the unrevised edition. The hon. minister said:
If the work carried on by the province of Quebec along these lines in the past needed defence, I defended them in the house against the impeachment of the hon. member for Temiscouata. Anyone who has even casual knowdedge of the history of the development of Canada should not be slow to commend the actions of the successive governments of the province of Quebec even before confederation, and in fact almost since the beginning of settlement, along this line.
Those were the observations which the minister made at the time. Immediately after he had uttered those words I rose to a question of privilege. I stated that I was sorry to interrupt the minister but I felt I had to object to his words. The minister continued on page 3501 as follows:
I am quite content to let the words of the hon. member for Temiscouata, as they will be revealed in the pages of Hansard, speak for themselves. If I used words which were not exactly his I can only say that of course my memory is not so good that I can follow him exactly. Certainly I gathered from his remarks to-day and a few days ago that he roundly condemned the administration of the colonization department of the province of Quebec.
Mr. Pouliot: By certain employees.
Mr. Gordon: The government takes responsibility for its officials, of course. The hon. member went so far as to say that the colonists who were sent out by the government had to eat grass and roots and so on, and I believe be even said they lived like swine. I do not come in contact with the provincial colonization men and I have nothing to do with provincial policies in Quebec, but I do know that this department is in touch with our committee, which consists of the representatives of the

Relief Act, 1934
colonization departments of the railways, of our department and of the Quebec department. From my observations and from what I can gather I cannot conceive that those men would be parties to a colonization effort such as has been described by the hon. member for Temiscouata.
When we were discussing the resolution upon which this bill is founded on March 22 I read a letter which had been sent to the Department of Labour by Reverend Father Beaulieu, the parish priest of St. Emile d'Auclair. That letter was published in English as an appendix to Hansard of March 26, 1934, page 1. I am not going to read the whole letter; I will quote just one paragraph. The Reverend Father Beaulieu says:
I have been patiently waiting, until this very day. It will take a miracle to save my settlers from starvation, that is the plain fact, with the few hundreds of dollars which I succeed in obtaining each month at the price of endless complaints and recriminations. The small children of settlers in my parish are without shoes, or stockings or clothes to cover themselves this winter to attend school (a large number cannot Rave the camps), they are in great distress, utter destitution-
The French word is "misere noire."
-a life of cruel disappointment for a poor missionary who is in charge of all these people.
This is an excerpt from the letter which I find in sessional paper No. 192, tabled on March 2 this year by the hon. gentleman. He has received that letter. Now, at the time he received it he had not yet given his approval to the relief works submitted to him by the provincial government of Quebec in August of last year, but he did so on the eve of this session, the very day before the opening of the session. Therefore, in giving his approval to the request made by the Quebec government on behalf of the settlers in the parish of Saint-Emile d'Auclair, he presumably regarded as well founded what was written by Father Beaulieu in his letter. That letter is a confirmation of what I said last year on behalf of the settlers, whose case is very serious. I would therefore ask the minister one question. Is he ready to admit that he was wrongly informed on March 21 of last year when he accused the member for Temiscouata of impeaching the province of Quebec by his statements in reference to the case of the settlers in that province and, in particular, in the county of Temiscouata?


George Gordon: Under the plan whereby the dominion government contributes, with the provincial government and with the municipality, $200 towards the settlement of a family, I find by reference to the schedule that only eleven families were settled in the
county of Temiscouata. I have a recollection of observations made by myself in the house last year in answer, I think, to a criticism made by the hon. member for Temiscouata with respect to the administration of the settlement of families. I tried to make it plain that the administration is entirely in the hands of the provinces-not only the province of Quebec but all the provinces. I also, if my recollection serves me correctly, took issue with the hon. member for Temiscouata as to the general success which I at least thought, and still believe, attended the plan. As regards criticisms that were offered at that time with respect to the administration, I can only repeat that it is the province of Quebec, or any other province that avails itself of the plan, which is charged with the responsibility of administration. I do not know that I can add anything to what I have just said.


Jean-François Pouliot: I will readily admit that the minister is very clever; he evades the answer to my question, which was to the point. I did not discuss the question as to how many people had been put on the land in accordance with the plan in the county of Temiscouata. The question I asked was this: Does the hon. gentleman now admit that he was wrongly informed when on March 21 last year he declared to this house and this country that the member for Temiscouata had impeached his own province in his remarks on the colonization scheme in the province of Quebec and particularly in the county of Temiscouata? I ask the minister to answer that question in view of the fact that he has in his own files a letter from the Rev. Father Beaulieu, parish priest of Saint-Emile d'Auclair, repeating exactly what I said last year. May I ask the hon. gentleman to be good enough to answer my question, which is to the point.


George Gordon: I do not think it would add to the strength of the hon. gentleman's position if someone agreed with him in criticisms he may have made. We all have our own opinions; the hon. member has his and I have mine, and perhaps I am just as firmly grounded in my opinion as he is in his own. His criticisms of the administration of the scheme can be levelled at the governments of the provinces, and as no scheme that I have ever heard of is entirely perfect, there probably may be reasons why criticisms can very properly be levelled and perhaps maintained. But so far as I am concerned, if the hon. member cares to impeach the province of Quebec in its administration, that is his responsibility. I say that the plan gen-
Relief Act, 19SJf

erally is working out quite successfully, I believe-as successfully as, and probably more so than any other settlement plan we have had in this country with which at least I have become acquainted.


Jean-François Pouliot: I am very sorry that the minister should give that answer. I shall give him credit that as Minister of Labour he does his very best, but I did not tell him, when he did something wrong, that he is impeaching his country. His remarks had an implication of what we call in law "mens rea," "guilty intention," and the hon. gentleman spoke in such a way as to make the house and the country understand that last year the member for Temiscouata was not fighting on behalf of the settlers, to draw the minister's attention to their troubles and miseries, but was in the House of Commons of Canada simply slandering his own province.


Mr. HANSON (York-Sunbury):: Why does not the hon. member talk to Taschereau?


Jean-François Pouliot: I would ask the hon. member for York-Sunbury to keep quiet; otherwise I shall speak about his connection with the Fraser Company. I shall ask him how much he charged in former years when the *company was nearly bankrupt; was it 837,000?


Richard Burpee Hanson: I wish I had got it.


Jean-François Pouliot: Coming back to the matter under discussion, may I tell the minister that we on this side do our very best for the *welfare of our fellow citizens without any distinction of party, creed or race. We regard that as our duty. I am generous enough to give to the hon. gentleman the same fair play as I would like to have from him. Therefore, before continuing my argument I should like to know from him whether on the information which he has about the condition of settlers not only from Father Beaulieu, whom I mentioned before, but also from his own inspector Lafortune, he will evade the question or is ready to say that the hon. member for Temiscouata impeached his own province when he spoke about colonization on the relief bill last j'ear. May I tell the hon. gentleman that this is the last time I shall ask him this question and I expect a fair reply from him. I want to know whether he imputes motives to the member for Temiscouata now that his eyes should have been opened by reading the letter of Father Beaulieu and the report of his inspector not only in the case of the settlers of Saint-Emile d'Auclair but also in that of the settlers of Packington and St. Elzear, likewise in Temiscouata county. After those preliminary remarks which I hope have 
been welF understood by the hon. gentleman as well as by every other hon. member at present in the chamber, I shall ask the hon. gentleman whether he still maintains, as he did on March 21, 1933, that the member for Temiscouata was impeaching his own province of Quebec when last year on the relief bill he spoke about colonization matters.


Eccles James Gott: Yes.


Jean-François Pouliot: I am very sorry for the minister that he does not answer. I thought he was generous enough to admit that members on this side of the house are doing their duty and that when they bring forward cases of distress, they do not do so for political propaganda as the Prime Minister did during the election of 1930 when every unemployed man had a white button to show to attend his meetings, but they do it in order to improve the condition of those settlers. If the hon. gentleman is not fair enough to admit that from a political opponent, I am ready to give him that credit, but I have great compassion for those who are voluntarily blind, because the voluntarily blind and the voluntarily deaf are the worst of all.


Eccles James Gott: Carried.


Jean-François Pouliot: I would ask the hon. member for South Essex (Mr. Gott) to keep quiet or I shall ask him about trip passes to his dependents and to show his correspondence with the railway board on behalf of his brothers who are commercial travellers.


Eccles James Gott: I challenge the hon. member for Temiscouata likewise to show his correspondence.


Jean-François Pouliot: My records are available.


Eccles James Gott: So are mine at all times.


Jean-François Pouliot: So much the better. The hon. member had better table them.


Eccles James Gott: That is twice the hon. member has said that. It is on a par with the rest of his remarks.


Mr. POUXIOT:: Bis repetita placent. The hon. member will not understand, but this is a Latin expression which suits the occasion.
Let us see what has been done in this matter. The Minister of Labour blamed me for having spoken on these matters last year. I was one year ahead of my time. What I knew then he had an opportunity to learn since if he had been willing to give a real chance to the settlers. But what do we see? If we look at sessional paper No. 192, it will be found that in August of last year the provincial government of Quebec submitted to the Minister of Labour relief works for the settlers of the parishes of Saint-Emile

Relief Act, 1934
d'Auclair, Saint-Elzear and Packington. What has been done since then by the department presided over by the minister? They waited until January 24 last to give their approval to some of the relief works which had been asked for by Quebec since August of last year. On January 24 the minister gave his approval to the relief works for the parish of Saint-Emile d'Auclair.


Eccles James Gott: That is a thing of the past in relation to the hon. member for Temiscouata for 1933.


Jean-François Pouliot: I hope the hon. member will use his pass to go away from the house where he causes general disturbance.


An hon. MEMBER:: Let them both go.


Jean-François Pouliot: The Minister of Labour
is not answering me for a very good reason. It is because he does not even read the reports which he receives from his inspectors. He had the opportunity to read the reports which have been sent to him by Mr. Lafor-tune, one of his inspectors, who surely recommended the approval of the relief works asked months ago by the government of Quebec for St. Elzear, but when I asked in this house why the relief works had not been approved I had this answer from the hon. minister on March 28:
While our inspector, who visited the district in question, reported that the situation existing did not warrant the approval of the work proposed to be undertaken for the relief of unemployment, subsequent information indicated that conditions had changed and the schedule was consequently approved by the dominion on January 24, 1934.
3.	Has the work proposed for the parish of St. Elzear and St. Benoit de Packington been approved by the federal government?
Answer. No.
4.	If not, why?
Answer. Our inspector, who investigated conditions in these two municipalities, reported that the proposed works were not necessary as relief measures.
5.	With regard to-the two latter parishes, is the government in possession of any correspondence to the same effect as that contained on pages 9 to 16 inclusive of sessional paper number 192, reference number 22, tabled in the house by the hon. the minister of labour on Friday, March 2, 1934?
6.	If so, by whom was each document received and what is the date?
7.	If said correspondence exists, why is it not contained in the above sessional paper?
Answer. 5, 6 and 7. On going through the file it is found that the only document not included in sessional paper number 192, reference number 22, is a list of the unemployed of St. Benoit Abbe. This list which is undated and bears no signature was received without a covering letter and as it was attached to the inspector's report on this municipality, and as the inspector's reports are confidential, the list
of unemployed of St. Benoit Abbe was not included in the return to parliament.
I enclose herewith a copy of the list referred to in the reply to questions 5, 6 and 7.
Yours truly,
W. A. Gordon,
Minister of Labour.
Here is the list which has been sent to me by the hon. gentleman.
Temiscouata
List of those in need of relief at St Benoit-Abbe
Names-	Dependents
Pierre Ccite	Bachelor
Esdras Beaulieu	Bachelor
Alfred St-Pierre (Frs)	 2
Willie Ducasse	 8
Alfred St-Pierre	 12
Alphonse Desjardins	 5
Louis Bedard	 9
Thms Theriault	 9
Simon Theriault	 6
Henri Landry	 7
Alexis Gendron	 Single
Telesphore Dube	 9
Arthur Beauregard	 5
Athanase Huppe	 4
Antoine Dube	 7
Alfred Labbe	 5
J.-B. Dumont (Ernest)	 8
Jos. Dube	 2
Eugene Dube, pere	 10
Eugene Dube, fils	 6
Raoul Morin	 2
Telesphore Morin	 1
Alonzo Valcourt	 5
Pite Valcourt	 3
Jos. Morin	 6
Noel Morin	 3
Isidore Beaulieu	 2
Isidore Beaulieu, fils	 Single
Andre Michaud	 3
Ludger Dumont	 3
Lucien Morin	Bachelor
Esdras Morin	Bachelor
Ernest Dumont	 4
Martin Cote	 8
Jules Soucy	 3
Albert Morin	 2
Adelard Patoine	 4
Adelard Beaulieu	 10
Cyrille Beaulieu	 6
Henri Bouchard	 10
Magloire Morin	 11
Aleide Levesque	 4
Olivier Levesque	 4
Henry Levesque	 3
Martin Landry	 8
Henri Boucher	 10
Jos. Cyr	 7
Eloi Collin	 8
Eddie Jalbert	 6
Willie Jalbert	 4
Stanislas Paradis	 7
Max. Nadeau	 7
Bernadin Nadeau	 11
Phydime Ducasse	 2
Stanislas Ducasse	 4
Alphonse Pelletier	 7
Jos. Albert	 3
Emile Patoine	 7
Emile Ouellet	Bachelor
Relief Act, 1934

Names-[DOT]	Dependents
Auguste St-Pierre	Bachelor
Vital Albert	 5
Sylvio Lavoie	 13
John Ollender	 3
Alex. Dube	 5
J.-B. Dumont, Pack	 11
Ad. Leclerc	 11
Belief authorized November, 1932, to May, 1933: $2,700.
Summer relief, 1933: $500.
Total: $3,200.
To enable those people to live, to supply a living to them from November, 1932, to the date on which that letter came to the department !
Well, sir, the minister should understand very well now that I do not put the blame on the government of Quebec, because in those times of stress and despair the Quebec government submitted a program of works for the relief of those three parishes to the department of the minister in the summer of last year, but in two cases no answer came before March 31, last. It seems -that the minister will never admit that those people need relief just as badly as, if not more, than the people who live in towns and have direct relief. That is a very important point. I have been asking the minister a fair question and have not got a satisfactory reply.
Referring to the statements made by the solicitor general in Quebec during the recess, that the Liberals were continuing the same opposition to the bill now as they did in the previous years, let us go back to last year and let us remember that last year I was insulted in a Quebec paper by a man who was formerly in the press gallery and is now a civil servant. He wrote an article entitled "Mr. Bennett disapproves of all attacks on priests." I was very careful when I spoke about one of the employees of the Quebec government. I mentioned in the house that I was criticizing him as a government employee and that I had the greatest respect for his sacerdotal character. What did the man write in a Quebec paper? He wrote that Mr. Bennett disapproved of all attacks on priests. What I mentioned appears as a question of privilege on the first page of Hansard of Monday, April 3, and the English text in the appendix to unrevised Hansard No. 86. I try to be logical in my statements in the house. It is because I try to do so that when my hon. friend the senior member for Ottawa (Mr. Chevrier) rose on a question of privilege to defend the deputy ministers against the so-called attack made in this house by the hon. member for Labelle (Mr. Bour-assa) I protested against it, basing my pro-
test on standing order 41 of the house. I shall read standing order No. 41:
No member shall speak disrespectfully of His Majesty, nor of any of the Royal Family; nor of the governor or person administering the government of Canada; nor use offensive word's against either house, or against any member thereof. No member may reflect upon any vote of the house, except for the purpose of moving that such vote be rescinded.
Opinions are free. But what I say is this, that I was complaining about a man whom I had called a dirty scoundrel. I suggest that the expression could be used with reference to that man because the words " dirty " and " scoundrel " belong to the king's English. I have a right to use them in accordance with the rules of the house, and may refer to anyone in those terms, with the exception of His Majesty, or His Majesty's representative in Canada, the governor general, or any hon. members in either house of parliament. Besides that, in self defence, I am perfectly justified, not to attack anyone, but to pass judgment upon him. Therefore I say I was acting in accordance with the standing orders of the house when I used such language concerning one who has been promoted to the position of secretary to the executive in the Post Office Department. What happened? The right hon. Prime Minister rose in his place and objected to the words I had used, asking that they be stricken from Hansard. What followed that? The hon. member for Compton, who is now in his seat, without reason used the same language against a gentleman who is now president of the press gallery. His remarks were allowed to remain in Hansard.
Mr. G'OBEIL:	I never used those words,
at all.


Jean-François Pouliot: I will not insist upon it;
my hon. friend is splitting hairs. I remember very well, however, that he used most insulting language about a respectable citizen, and those words were allowed to remain in Hansard. After the proceedings have concluded for the afternoon I should be glad to show the hon. member the page of Hansard where his remarks are quoted. I shall go with him, and will agree that probably he did not use exactly the same words. My memory does not fail me, however, when I state that the hon. member for Compton complained in most abusive language about a gentleman, a highly respected citizen, who is now president of the press gallery. Those remarks were allowed to remain in Hansard.


Onésime Gagnon: May I
remind the hon. member he is running far

afield, and that his remarks are beyond the subject of debate. I suggest he cannot refer to the debates of last year, but only casually.


Jean-François Pouliot: I shall explain what I
have said. An hon. member makes a statement, and it must be either right or wrong. Any hon. member may make a mistake, but the rules of the house state that no one has a right to impute motives to another. As members of this house, however, I state that any hon. member has the right to pass judgment on another person, so long as that person is not mentioned in standing order No. 41.
I complain that in connection with this particular matter of colonization I was not treated fairly by the Minister of Labour. Further than that, I state that the hon. gentleman did not answer my questions any more than he would have done had I been speaking to a fence post. A man outside the house, and through his own publication, was insulting me, deforming the statements I had made, and imputing to me motives I had never held. Sir, my dignity was offended. As a gentleman and as a member of this house I passed judgment upon that dirty scoundrel. The government took full responsibility for him when the Prime Minister asked that my remarks should be struck from Hansard. This is my complaint, sir. I complain particularly in connection with this matter of colonization. I complain that on account of these dirty writings that man has been promoted in the civil service, and not later than March 20 the Prime Minister stated in the house .that the fact the gentleman about whom I am speaking was secretary to the executive in the Post Office Department did not prevent him from placing political propaganda in the papers, despite the fact that this secretary was paid out of public funds.
Here, sir, I asked reasonable questions of the Minister of Labour, and received no answer, or answers that were insufficient. This man who has insulted us through the press is supported by the Prime Minister. The Prime Minister treats him as the governor general, and any judgment that I passed upon this man was, at the request of the Prime Minister, struck from Hansard. And not only that; the one in question is given a promotion, and is paid by the state to misrepresent utterances of hon. members in this chamber. Well, sir, this is a pity. But may I tell you one thing, namely, that this action will not prevent me from doing my duty as a member of parliament. When I hear the hon. member for North Renfrew say, "You should go," I ans-
Reliej Act, 1934
wer, "Why should I go"? I am here to defend my people, the people who have suffered. During an election campaign arguments take place between Liberals and Conservatives, but after the election the man who holds the majority in any constituency represents all the people, whether they be Tories or Grits, Conservatives or Liberals, whether they belong to any race, any creed or to any political party. He represents them all. It does not follow that these men who have gone far into the woods, far from all the facilities and enjoyments of life, are to be forgotten. W'hen I ask decent and reasonable information from the government I want answers.
To come back to what I was saying about that dirty Bout.et, I say that the government would do much better if it would spend more money for those people at Saint Emile d'Au-clair, Packington and Saint Elzear and not use public funds to falsify statements made by hon. members on this side of the house.
I hope the minister will understand that he will receive from us the same treatment he has given-probably better. I would never have said to him that by his utterances he was impeaching his province or his country. May I say however that the Department of Labour is impeaching the progress of Canada, when it pays no more attention to the settlers. We should not forget those people because they are poor or because they do not rank as high as Sir Herbert Holt, or other people in the financial world. We must not forget them, because they are our problem. They are our fellow Canadians, and are as good citizens as are the richest men in this country. For that reason they deserve full consideration from the government. I regret that I have received no answer from the minister. He knows very well that I have at heart the success of a scheme of colonization, not only as it affects the province of Quebec, but also as it affects that part of northern Ontario in which he lives. I want every Canadian citizen to be happy and to be as prosperous as circumstances permit. Every man in Canada has a right to live. I hope the hon. gentleman will not put on the high hat in regard to the views of any member on this side of the house, but will understand that we are sincerely concerned for the welfare of those who are suffering in the remote parts of this country; and when any provincial government, whether it is the government of Ontario or of Quebec, takes the responsibility of asking him to endorse a request for relief I hope that he will understand it is done for the welfare of these very people. I congratulate the Quebec government upon having brought this par-
Relief Act, 1934

ticular matter before the Minister of Labour and asking him to do something for the relief of these people who are living in the wilderness. The Quebec government has done its duty, but did the minister do his duty when he waited several months from summer to the middle of winter and then opened his hands to only one parish of the three? Did he do his duty when he refused to give his approval to the requests made by the Quebec government on behalf of those other two parishes?
My time is up, Mr. Chairman, and I shall not continue. I leave it to the conscience of the hon. minister to determine for himself in. his own mind, when he goes home after this sitting is over, what the position is, and I am sure that he will say to himself that the member for Temiscouata is right although for political reasons the minister cannot admit it now.


Peter Heenan: I see by the press that
Premier Henry of Ontario has announced a program of public works for northern Ontario, including the blasting of many miles of rock. Might I ask the minister if it is contemplated that this government will pay a share of that work, and if so, how much?


George Gordon: The matter is not in contemplation, Mr. Chairman. This government has no authority to contribute to the work that is being done in any province at the moment. I am not acquainted with the program to which reference has been made. I have not seen any reference to it, and so far as I am aware no application has been made to this government asking for any contribution to the work which is said to be about to be carried on in Ontario.


Peter Heenan: I would like to get this
matter clear, Mr. Chairman, because it is very important to our province. The premier of Ontario-I can get his exact statement as reported in the press in a few minutes-has announced an increase of the relief allowance as well as an increase in the wages of the men working in the road camps to 25 cents an hour. In that same statement the premier of Ontario announced that he would have
25,000	more men working in northern Ontario during this summer, and that he was going to let many miles of rock work by contract, especially between Vermilion bay and Kenora.
I was wondering if the province was going on with that program of its own accord or whether there would be a contribution by the Canadian government.


George Gordon: There is no agreement
between this government and the province of
IMr. Pouliot.]
Ontario with respect to the plans of the province in northern Ontario or anywhere else.
Mr. HEENAjN: Let me put it in another way. I can quite understand that there is no agreement because the previous agreement has lapsed. But if the provincial government asks for a similar agreement on relief work to that which obtained before March 31 last, is it intended or contemplated under this measure to make such an agreement with the Ontario government?


George Gordon: It would be possible, Mr. Chairman, but I would not care to speculate on the sort or kind of agreement or whether there will be an agreement at all on behalf of this government to supplement anything that the province of Ontario may do.


Peter Heenan: Hon. gentlemen will see
the predicament in which a member of parliament on the opposition side is placed, and I am sure many members on the other side of the house are in the same position. Here is the government asking for a blank cheque to spend as they see fit, and yet according to the minister's statement they may not make any agreement at all. In other words, we are being asked to vote a blank cheque ostensibly for the purpose of providing assistance to the provinces to take care of unemployment relief, and yet the minister will not even say whether he will make such an agreement. He may or may not contribute to the provinces. It simply means that members of parliament are now being asked to agree to putting into the hands of this government a blank cheque to be used at its discretion without the government undertaking to say whether it will make any agreement with the provinces or not. I cannot take any other meaning from the minister's words than that.
I would ask this further question: In the event of the Ontario government making such an agreement after this measure becomes law, will this government insist upon the contracts being let by tender, and upon seeing those tenders before the contracts are let, in order to see that the work is allotted to the proper, which is usually the lowest tenderer.


George Gordon: It is difficult to speculate on what the government may or may not do until there is clearly before it a particular problem. I am not acquainted with the program which the Ontario government is laying down for the extension of their roads. So far as the agreement that has prevailed during the last eight months is concerned, it lapsed at the end of the fiscal year. It may be that

Relief Act, 1934
the province of Ontario may be able to convince the government that they are not able to carry on work that is going to give some return to their unemployed. The difficulties of every province must be examined in the light of the need, if there is need. I frankly state, Mr. Chairman, that the province and the municipalities and the individual have that burden charged directly to them, but as has been stated in this chamber many times if in the operation of this law, as in the case of the law that preceded it, it is disclosed that the province and the municipalities and the individual cannot discharge their burdens and a case is made out for contribution, then contributions will be made. When I hear an hon. member complaining that we have been given a blank cheque and then becoming fearful that we are*not going to fill it in, it strikes me as not being very logical. The government is charged with the handling of the taxpayers' money and I am not unmindful of the burden which accompanies this responsibility. I certainly will spend no more money than is absolutely necessary to take care of these situations which have arisen throughout Canada during the last four years, the cure of which has required the combined forces of all governments and the individuals themselves.


Peter Heenan: Surely this is not an answer to a body of public men who are trying to legislate fairly and reasonably. Surely the minister is not going to hide behind the fact that the agreements expired on March 31 and attempt to make us believe that he does not know in his own mind what is required for the various provinces. I hope the minister is not trying to have us believe that he has not seen the announcement of Premier Henry which has appeared on the front page of nearly every newspaper in Canada. Premier Henry has announced that the wages of the men in the camps are to be increased to 25 cents per hour. The government of Ontario, like other provincial governments, are not any richer to-day than they were a year ago. There must be some reason for all this and still the minister is trying to have the committee believe that he does not know what will be required or what is in contemplation. If the government do not know by this time, they ought to know for they have been at it nearly four years. The leader of the opposition (Mr. Mackenzie King) quoted from the report of the auditor general the other day and everyone should realize that this slipshod method of doing business should not be permitted to continue any longer. The Ontario government has
laughed at and ridiculed the statements I have made during the last three years to the effect that the wages paid under an agreement entered into by this government were slave wages. The Minister of Lands and Forests has admitted that the wages paid were no wages at all-not even slave wages. While the province is in no better financial standing than it was a year ago, all of a sudden on the eve of an election it announces that' the wages will be 25 cents per hour instead of $5 and $10 per month.
I do not think the minister is doing himself credit by not telling us what is in contemplation or just what his survey calls for for the coming year. He is asking for power to make these agreements and surely he must have some conception of what is required. On the eve of an election the Ontario government has increased the wages paid to these men in the camps to 25 cents per hour, yet that government is no better off financially than it was a few years ago. In fact, I know it is worse off. How is it that they can increase these wages to-day when they could not increase them at any time during the last two or three years? Do they intend to give these men some of the money of which they were robbed through not receiving proper wages during the past year? Is this what they are doing just on the eve of an election? I do not think the people of the province will be hoodwinked by this action. I think it was in 1931, when a similar measure was under discussion, that the government gave a specific pledge to the effect that the fair wages policy of the dominion government would apply to any contracts let. But instead of seeing that that was done they permitted the Ontario government to make their own terms and conditions, the result being that S5 per month was paid during the summer time when men were eaten with the flies and $10 a month in the winter time when they froze to death at ten, twenty and forty below zero. At that time the Minister of Lands and Forests told the people that he simply could not pay higher wages. Taking him at his own word, is he in any different position to-day from what he was then?
The minister will have to use some judgment when the Ontario government come to him. He will have to ask them how their financial position differs from what it was at the time the last agreement was made. The only answer which the Minister of Lands and Forests or Premier Henry can make, and behind closed doors, is, "Well, Mr. Gordon, you know we are on the eve of an election and we simply dare not go up into northern On-
Relief Act, 1934

tario after votes should these men still be working for slave wages; we want you to sign this agreement in order to help us out."
If tenders are to be let I hope they will not be let under the same conditions as some of those let by the Ontario government of which we have heard. This government is contributing fifty per cent of the cost and the minister should look these tenders over to see whether they are being let to friends of the government or to legitimate contractors. I think we should know whether men are to be sent to these camps simply because they have the ability to write letters to the press. Men have been sent to these camps from the older parts of Ontario simply because they could write a letter to the effect that a public man was not stating the case. This is the greatest joke which has ever been played on the public life of any country. Men from various parts of Ontario, even from Ottawa, have been sent to these camps because they were fairly good writers and able to write letters to the press to the effect that some public man is not making a correct statement. These men were promoted immediately to a salary of $60 or $70 a month. Some of them are not even allowed to w'ork even though they want to. I am sure some hon. members have seen a letter from a man from Ottawa in which he takes me to task for talking about these slave camps. He has been going around boasting that he has a letter in his pocket from R. B. Bennett thanking him for his good work. This man's signature appears on the letter in the press and the minister should investigate the whole matter and find out why he was sent up into northern Ontario from down here in Ottawa. If the minister does that he will find out that he is the calibre of man who will sign anything prepared by an officer of the Ontario government. I have received information that he has been promoted to the position of assistant superintendent of Algonquin park. He received this promotion simply because he called some public man-


Peter John Veniot: A liar.


Peter Heenan: I do not say that and if
Hansard caught that remark I hope they will credit it to the hon. member for Gloucester (Mr. Veniot). This is the way in which public money is being expended. I notice from the auditor general's report that the firm of Crawley & McCracken have a contract to feed and house the men in these northern Ontario camps. This firm has a staff of their own and they are charging the men 60 cents per day. They reduced the men to $5 a month while at the same time Crawley & McCracken's contract was increased from 50 cents

to 60 cents a day for the men. That is a new method of economics. Their travelling expenses, railway fares and so on, in connection with the staff of Crawley & McCracken, under a contract with the Ontario government, were actually charged to the federal government. This government has had to pay on that account nearly $3,COO up to the present time. If that is the system that is to be carried out, I think the minister should let us know whether or not it is intended to contribute to this 25 cents an hour. When they agree, as I know they must, then I would ask the minister why he did not insist upon 25 or 35 cents an hour in the last two or three years. If it is intended now to pay back the men with their own money we want to know, because if that is the intention it reminds me of a story I once heard about a fellow who fell in love with a girl. She became very cool and left him altogether. After a while he met her again, being still in love with her. She warmed up to him a little bit and he said, "You don't look as well as you used to." She answered, "No, I have lost all my teeth." Well, he saved up money and bought her a new set of teeth and she became fairly good looking again. He was still in love with her.


Ira Delbert Cotnam: Was he an Irishman?


Peter Heenan: I think this man came
from Renfrew. At any rate, the girl warmed up to him but subsequently became cool again. He happened to meet a friend about this time and told him that the girl had lost interest in him. He said to the friend, "I met her on the street and she laughed at me with my own teeth." I want to ask the minister whether he is going to permit the Ontario government to laugh at these men with their own money, bribing them during election time with their own money. This money is due these men, having been wrongfully withheld from them, and the Minister of Labour should insist that it now be paid to them as back dues, for they are entitled to it. It should not be used to pay them for the future but should be given to them as back dues. Crawley & McCracken have contracted to feed and house the men-


Peter McGibbon: Grit contractors at that.


Peter Heenan: Great contractors?


Peter McGibbon: Grit-G-r-i-t.


Peter Heenan: I know nothing about that, but if that is so it is one good feature about them. At any rate the object of the relief legislation was to provide the men with work whereby they would receive wages. That was the purpose of this unemployment relief

Relief Act, 1934
measure, according to the Prime Minister's own words; it was to assist settlers in the several communities across the country. Well, Crawley & McCracken have been purchasing their food supplies, their meat and vegetables, potatoes and all sorts of things, not from the settlers along the highway but in the cheapest places, Winnipeg in most instances, or Toronto. That is not helping the settlers along the highway; it is not giving them any assistance in the least. Now, just before an election, after we have been pounding at the Minister of Lands and Forests of the Ontario government for nearly three years, he allows the candidate in the Kenora riding to make a statement on the front page of the local papers to the effect that he has made arrangements -this candidate has made arrangements-with the contractors to purchase supplies, and is inviting all settlers to quote prices and to be ready to supply.


An hon. MEMBER:: And join the Conservative association.


Peter Heenan: I do not think they have
asked them that yet. I do know however of one place where the returned soldiers, the legion, held a meeting, calling upon the local member to explain why they were not being considered in connection with jobs, and I have a letter from the legion that his reply was: "Before you are considered you will have to pay your 50 cents and join the Conservative association, and if the executive recommend you I will recommend you to the Ontario government." Hon. members in this house have no conception whatever of the political thuggery that is going on in Ontario under the Ontario government, bludgeoning the men in.
I have here some cheques which I hope to exhibit during election time. I know I shall not convert anyone on the other side of the house to my way of thinking, but I want the people to see these cheques.


Mr. McINTOSH:: Including some of the
one cent cheques?


Peter Heenan: They range from 70 cents to 1 cent. I see that Mr. Henry has made the statement that he has received, from the gentleman who received the 1 cent cheque, a letter in connection with the payment of that amount. I suppose he has been given a foreman's job; if he has not already got such a job he will get one before long. I would point out however that Mr. Henry and his government have fallen into a trap in this regard, because, with respect to all these cheques, from 70 cents to 1 cent, I mentioned the name of only one man. I did not mention any other names, having received the cheques on condition that I would not reveal any names, because I was told, "If you mention my name, neither myself nor my dad will be allowed to live in this part of the country." That is to say, they would not get jobs. For that reason I did not mention the names that appeared on the cheques, except the name of this one man, Caesar. Well, the Ontario government fell for it, because they got next to this man in some way or other, with the result that he finally wrote a letter, although it does not appear in the newspapers. At any rate, Mr. Henry states in the press that he has received a letter from this man Caesar to the effect that he, Caesar, sent this 1 cent cheque to the Hon. Peter Heenan only by way of a joke. I agree that it is a joke all right; there is no doubt about it that it is a joke to pay a man 1 cent for a month's work. This man says, " I am quite content in the camp," and so on. Now, anyone who knows northern Ontario and is acquainted with the organization in that part of the country knows very well that this man has been got at and has been told that he will be dismissed and will have to get out of the country, or has been offered a position of some sort, as foreman, in order to get him to make the statement he has made. The fact is however that either he was anxious to please Mr. Henry, or that M-r. Henry misconstrued his statement, because the man never sent me the cheque at all, although it seems that he said he did. As a matter of fact he sent it to the editor of the Vancouver Province and the editor cut it out, had it photographed, and published it on the front page of that newspaper on Wednesday, August 16, and I cut it out of the Vancouver Province. To show how satisfied this man was, he said, " Please return me the original, because I want to frame it so that my grandchildren will see how the Ontario government treated the labouring men in that province." In view of the conditions up there, I am inviting all my friends to write letters to say that the Hon. Peter Heenan does not tell the truth and that conditions are different from those he depicts.
I invite them all to do that because they will all be made foremen and there will be no more labourers at all.
These are the conditions that exist there and it is a disgrace. And the worst part of it is that the federal government is contributing money to this sort of thing. It contributed half of this 1 cent cheque. The federal government gave this man Caesar half a cent-not directly, but they gave it to him

Relief Act, 1984

just the same, and they do not seem to be a bit ashamed, notwithstanding that in the regulations it is provided that there shall be fair and reasonable wages for the work done. But does this represent fair and reasonable wages? I should like the minister to inform the committee therefore whether he proposes to see that these tenders are let properly, whether the fair wage clause will be applied, whether the settlers along the highway will get the protection to which they are entitled by the contractors being made to procure from them as much of the foodstuffs required as possible, and what excuse the province of Ontario is giving now for the increase being made in the eleventh hour before the election. Why is it that a year ago it could not do this and now it can? I think those are questions that should properly be answered before this bill passes.


George Gordon: I have listened with a
good deal of interest to what the hon. member for Kenora-Rainy River has said. If and when any contribution is made by the federal to the Ontario government, wherein it is contemplated that contracts may be entered into, I think it is proper that where rates of wages are involved, the wage earners should be given such protection by way of schedules of rates or going wages, as the case may be, as it is possible for the dominion government to impose.
With respect to the remarks made by the hon. member about the spoils system or whatever you like to call it, I assume that if what is going on now has only recently started, this is a surprise to most of us. I think the best that any of us can do is to see that in the expenditure of public moneys every kind of precaution is taken in order that the taxpayers' money shall foe devoted to the purpose for which it was raised, and in so far as it is humanly possible to minimize the amount of money that may be wasted or may go to people who are not entitled to it, I believe the committee can take my assurance that the government will see to it that moneys are not wasted. It is not a new thing to hear about political parties dealing with public funds in a way that might not commend itself to us, but in order that we may get the picture from a number of angles, I assume the hon. member will remember that a provincial election took place in British Columbia not very long ago, last November, I believe. In February following the election this advertisement was called to my attention. It is from a place in British Columbia called Bella Coola and it starts off like this:
. You must he all right for this job.

None but Liberals need apply for government work at Bella Coola.
To the victors belong the spoils!
This is declared to be politically true in the Bella Coola district. . . .
Applications will be received by the undersigned until noon, February 6, 1934, for road foremen, tractor drivers and truck drivers in the Bella Coola valley and district. Applicant must state qualifications, experience and what position he desires. Applicant must be a Liberal and have his application endorsed by three Liberals in good standing.
C. A. Brynildsen,
Secretary Treasurer of the Bella Coola Liberal Association.


William Lyon Mackenzie King: Does the minister endorse that sort of thing?


George Gordon: I certainly do not, but I
just wanted to illustrate that sometimes in spite of every possible effort, people who have not what we believe to be the right sort of approach in the spending of public money, do take advantage and I think one of my tasks is to see that that is minimized to the smallest possible amount. I may say that when these matters arise I draw them to the attention of the premier of the province. I drew this matter to the attention of the British Columbia government and I have from them the assurance that they will not countenance this sort of thing. It is very difficult just to say in a broad way that because persons happen to belong ito a party that does not hold the same political views, for that reason they are totally without virtue and have no sense of responsibility; that is going a little too far. I offer that to the hon. member for Kenora-Rainy River to ponder over.


Peter Heenan: The minister like myself is not speaking very loudly. Did he say he would leave that matter for me to ponder over?


George Gordon: Yes.


Peter Heenan: He need not. I belong to Ontario, not British Columbia.


George Gordon: Let the hon. member
ponder over it anyway. I can only repeat the assurance that I gave a while ago that in joining with a province in order to assist in the relief of unemployment and of those in need, this government will take every possible step to incorporate in the arrangement or agreement such clauses and terms as will best ensure that the money which the dominion contributes jointly with the province and other bodies, will be devoted to the purpose for which it is intended.	.

Relief Act, 1934


William Lyon Mackenzie King: The communication which the minister has just read only confirms what we on this side have been saying right along, that something more in the way of direct supervision over the expenditure of federal moneys by the provinces and municipalities should have been provided for by the government in the agreements that they were making with the provinces at the time that this money was being handed over to the provinces. If that had been done, nothing of the sort the minister has just read would have been possible under any circumstances. Had it been understood from the beginning that there was to be an audit instead of that there was not to be one, many of the matters that are now coming to light would not have occurred.
But what I wish to speak about at the moment is this:	We are on clause 2 of the
bill which contains the provision:
Notwithstanding the provisions of any statute or lawthe governor in council may pass orders in council for peace, order and good government. At the very beginning of the discussion I asked the minister whether he would not confer with his colleagues and advise the committee at a later stage whether that clause could not be deleted from the bill this year. The minister said that he would so confer, but he has not yet told the committee whether he has done so, or if he has, what has been done as a result of the conference and what is the decision of the government in the matter. If that clause were to ibe dropped, it would shorten materially the further discussion of the measure. The minister ought to drop it; the argument that has been advanced from this side in opposition to the retention of the clause at this time is unanswerable.
May I repeat what was said the other day? The clause did not appear, it was not found necessary, in the bill of the special session of 1930, though the session was called to deal with an alleged emergency. It appeared in the bill of 1931, but it was kept there only by the application of the closure on the part of the administration. In 1932, it was dropped, and nobody suffered as a consequence, no public interest suffered in the least. The next year it was reinserted, against the protests of hon. members on this side, but notwithstanding that it was there the minister has since told us that no use was made of it at all last year. He also told us that the only use made of the clause at any time was to allow banks and insurance companies to revalue
74726-123J	[DOT]
their securities, and to prohibit the export of gold; according to the minister, that is the extent to which the power has been used.
I submit that that does not justify the retention of the clause this year, particularly when, as I have already pointed out, it is known that in all probability this is going to be the year of a general election. And particularly, may I add, when the government is alleging that the emergency is pretty well gone by, that times are improved and conditions are now on the upgrade. There is therefore not the necessity for this alleged emergency legislation that there was before. If under these circumstances the minister does not withdraw the clause he must not wonder that we see an ulterior motive in its retention. As I pointed out, the clause is not to give the ministry power to legislate with respect to peace, order and good government; under the statutes they have already all the power needed for that purpose, but this clause is to give the ministry power, notwithstanding any law or any statute, to pass any measure it pleases by order in council, so long as the order in council may be designated one for the furtherance of peace, order and good government in Canada. As the minister has* shown us, the action with respect to the revaluing of securities was taken notwithstanding the existence on the statutes of provisions which gave the citizens of this country belief that securities having a certain value must be shown at that value when returns were being made with respect to them. I do not think the use to which the legislation has been put justifies its continuance. As the hon. member for Comox-Alberni (Mr. Neill) said the other day, under the power being asked, the government during the period of a general election could pass any order in council it pleased with respect to something happening in the election, which might have a very vital bearing thereon. They might in effect repeal any section of the Dominion Elections Act. That cannot be denied, because the purpose of the clause is to give the governor in council power, notwithstanding the existence of any law or statute, to pass any order in council it pleases. I say for that reason alone we ought to oppose its retention to the limit. It is only too clear that with that power the government, under pressure, in the event of a dispute arising in some electoral district in the course of the campaign, could forthwith pass an order in council and settle the whole matter before the election day, could say that notwithstanding such and such a section in the election act, such and such is to be done. It cannot be denied that that power would be
Reliej Act, 1934

given if this provision goes through. I cannot but believe that some purpose of that kind must be in the mind of the government, otherwise they would not retain the section at the present time. Not the election act only, but any legislation, no matter what it is, may be overridden. The government would be able to do for any corporation, for any organization, anything it pleased to designate as being done for peace, order and good government. No matter what the law of this country may be, it simply means that existing legislation, legislation enacted by parliament for the purpose of giving confidence in their rights and a sense of security to the public, is of no value at all; that there is no liberty, no right, that is not infringed by the power being given to the administration.
I have only heard the minister and hon. gentlemen on the other side give one other reason why the clause should be there, why that power should be given to the government at the present time, and to my mind it is a reason why it should not be there. It was that these are times of great social unrest. That is true. The world at the moment is passing through what may be and will be described in future as a social revolution and changes may come very rapidly. That being so, it is said that the government should be endowed with very special powers, to be able to act at any moment in regard to what may take place if something in the nature of revolutionary change came about.
One hon. member opposite, and I think the minister himself, referred to and gave as a reason for their adoption here the powers given to the president of the United States to deal with emergency conditions. May I first of all say a word with regard to the powers given to the president of the United States, in order to clear that up. The present president of the United States came into office about a year ago. He has had but one year of office; the powers given him were given only for a period of two years. But this administration is now completing its fourth year, it has had four years of power to inaugurate and carry into force the policies designated by it for the purpose of improving conditions. It has had a perfectly free hand in regard to those policies for all that time. It has had this extreme power given it on two previous occasions. As far as the United States is concerned, the president came into a situation which had been going, so it was alleged, from bad to worse, at least so we are led to believe, as a consequence of the inaction of the preceding administration. Here the situation was different. Here the government claims that

the situation has been improving right along, and that we are now into the fourth year of improvement as a consequence of their retention of office. So the parallel on that score does not hold. But the real point is this. As the minister knows and as hon. gentlemen opposite well know, the constitution of the United States is based on a wholly different principle from that underlying British parliamentary institutions. The executive of the United States is independent of the legislative body. The American system is a system of checks and balances, it is not a system of reconciling the wishes of the executive with those of parliament and vice versa. For that reason the parallel does not hold-
I am glad the Prime Minister has come in, because I would like, if I might, to speak directly to him on this point. We are discussing the second section of this relief bill; in it there is a clause by which the government asks to be given the power, notwithstanding any statute or law, to continue to pass orders in council with respect to peace, order and good government. I a,m trying to point out that the grounds for that legislation do not now exist. Whatever may have been said at previous sessions they do not exist now. According to the record, the government did not need nor ask for that power at the time of the special session of 1930, they got it in the session of 1931 only by use of the closure, it was dropped at the session of 1932 when according to the government's own statement conditions were much more serious than today, and no public interests suffered by it being dropped. In 1933 when it was restored it was against the strong opposition of this side of the house, and hon members in other parts of the house as well, but the power was never used last year, and we cannot see why the minister should ask for that power this year. The fact that this may be the year of a general election, which may occasion great uncertainty with respect to what is taking place in different parts of the country may increase the temptation for the government to use the legislation in ways that would not be followed if the pressure were less than is likely to be the case at the time of a general election.
The only real argument that has been urged in support of it is that these are times of great social unrest, that the world is passing through a time of social change. For my part I believe that it is so. I hope very much that far-reaching changes will come about and I believe they will. I hope they will result in a more equitable distribution of wealth, and mudi more in the way of social justice. I do

Relief Act, 1934
believe however that unless some country stands firmly for the preservation of its representative political institutions, institutions which have helped to preserve liberty and freedom, there is danger of every country being more or less submerged under the revolutionary tide which is sweeping across the world. Those who might otherwise greatly benefit by any social change brought about in an orderly and proper fashion would be the first to suffer by a change brought about in any other manner. We cannot stem the onward flow of the tide that has set in, but we can control and direct the channels through which it may be made to flow to the advantage and not to the ruin of all concerned.
The arguments urged by hon. gentlemen opposite are to the effect that the president of the United States has had to have exceptional powers; therefore similar powers should be given to our governor in council. When my right hon. friend entered the chamber I was saying that those powers were given to the president just a little more than a year ago. My right hon. friend and his ministers have now had nearly four years in which to shape matters and policies; as a consequence, I submit that so far as meeting any situation they are in a position very different from that of the president, when he assumed power. But apart from that-and this is the point I wish particularly to make-the executive in the United States does not bear the same relationship to the law making branch of government as does the executive in this country, or the executive functioning under British institutions anywhere. The executive in the United States is wholly independent of congress. Being independent where emergency powers are required it is necessary to give to the United States executive many powers which it is not at all necessary to give to an executive under our system of government where the executive is but a committee of the commons, and can obtain from parliament in virtue of its majority any legislation it may want or need.
The president of the United States cannot get the power he requires to deal with emergency conditions by going to the house of representatives and asking for it. He can only obtain what congress is prepared to grant. But my right hon. friend can. With the backing he now has he can come to this House of Commons and to meet a given situation may obtain whatever legislation is required. He may bring .parliament together at any time he desires, if it so happens that parliament is not in session. When it is in session he may anticipate a situation and get what he needs in order to meet it. That is a very different
state of affairs from the condition obtaining in the United States. I can well understand that in a country where the executive is wholly apart from congress, where no member of the ministry is on the floor of either house or in a position to explain a measure, it may be necessary in dealing with grave situations to have extreme powers given and to trust to their proper use. But that argument does not apply to the situation obtaining in Canada.
It has been said by hon. gentlemen opposite that there are dictators in Europe, and that the whole development on that continent is of a type which entrusts one or two men with complete authority to act quickly. I believe that is the very thing which is going to lead to much destruction throughout the world. I believe that to-day danger signals are being displayed in and sounded from almost every country in Europe, with the exception possibly of Great Britain. Great Britain is the exception because she has held more closely than any of the others to the parliamentary method of dealing with all situations.
I say that these movements for social change cannot be stopped. As a matter of fact we do not want to see them stopped, but we do want to see changes brought about in a way that will make human society a better human society not by methods which may lead to its total destruction. If change comes about without orderly development, or by means, and through channels which British parliamentary institutions through many centuries have helped to ensure as certain to be for the benefit of all, it may have a submerging effect, and men and institutions alike may be swept away before its uncontrolled advance. I could develop that thought at greater length, but I believe I have presented it sufficiently forceably to make my meaning clear to hon. gentlemen opposite. I do believe that this country of Canada, with a parliament fashioned on the model of free British parliamentary institutions, if it will but be true to itself and its heritage, may serve as an example to the nations of the world of how great social and industrial changes, in a period of world upheaval and unrest, can be brought about in the interests of the great body of the people, and without injury to any deserving interest. That is a great opportunity. I believe we can put through in orderly channels, and with the consent of the great body of the people all those measures required to effect far reaching change in the furtherance of human need, social justice and the common good.
Relief Act, 1934

Just one further thought in conclusion: it is that the consensus of view, the collective wisdom of the nation as a whole, is what parliament is able to bring to bear upon any great public question. That is a much greater safeguard to personal liberty and progress and to orderly change at a period of transition than 5s the view of any individual or group of individuals, who may be free to sit apart from parliament altogether, no matter how conscientious, earnest or sincere they maj^ be. It is for this above all other reasons that I appeal to the Prime Minister and his colleagues to withdraw this very subversive and dangerous section.


Richard Bedford Bennett: Mr. Chairman, the right hon. gentleman was correct when he indicated that I was absent from the chamber when he commenced his address, but as I have listened to it for three years I thoroughly understand what he said before I came in. The only addition to it is the chapter dealing with the powers of President Roosevelt. That is new. There are two or three chapters, however, to which he did not refer. One chapter deals with the position assumed by the executive in the province of British Columbia, and the other deals with the powers assumed by the executive in the province of Alberta. These developments have created a situation far different from that which we have had to meet at any time previously in this house.
I think perhaps the right hon. gentleman puts too strained a construction upon the words "peace, order and good government." Those words appear in section 91 of the British North America Act. And when we asked that the executive be clothed with power to deal with matters affecting the well being of Canada, in addition to any powers contained in the existing statutes, we did so for one purpose, and for one purpose only, namely, to meet any contingency or emergency which might arise, or would not brook delay until the House of Commons could be called together. Is it at all questionable that there have been moments in this country and in all countries when it has been undesirable to wait two weeks, ten days or even seven days before some action should be taken? I shall not traverse the ground I have traversed on previous occasions to point out that, having the authority to avail ourselves of the provisions of the then existing statutes, we were not compelled to wait a week or ten days to take action which we regarded and which subsequent events showed was absolutely necessary in the public interest.
IMr. Mackenzie King.l
I wholly agree that the world has changed. I wholly agree it will never be as it was before 1914. The causes need not be analysed, but in the end it will be found they are referable to war and what arose from the war. The conditions which we have today are conditions to which probably man's attention is being directed much more carefully than it has ever been directed before. The question as to the unequal distribution of wealth is not new. One of Aristotle's most famous discussions dealt with the question of the unequal distribution of wealth. That happened a great many hundred years ago. The problems connected with social justice are not new. Only a few days ago I was reading something from the life of Lord Shaftesbury, and only the other evening in picking up a biographical history I was struck with the fact that between the years 1850 and 1870 there were conditions in Great Britain to which nothing in our time is comparable. The cause of social justice has made great progress in the last half century, and will continue to make progress. With my limited vision I can foresee that there will be an entire change in connection with the consideration of some of the problems confronting us. But I do say this, that if parliament or the legislature undertakes to substitute the judgment of the commons for ihat of the people who are charged with the responsibility for the conduct of their business on the ground that they can conduct the business better than the proprietors, it is not very long before the state will have to take over the business itself, because you cannot have it both ways. You cannot say to people, "We are going to conduct your business for you," without leaving yourself open to the reply, "If you can run it better than we can, take it over and pay us for it." That is inevitable if you carry regulation beyond a certain point, and every thinking man must realize it. During the last few days we have had addresses made in this city with respect to socialism and the socialistic attitude of a great populace of one part of the world toward these problems. We are trying as best we can-I know that to some hon. gentlemen opposite it does not appear to amount to much-


Mr. HANBURY:: Hear, hear.


Richard Bedford Bennett: It will compare, however. with anything the hon. gentleman is capable of. That might not be so with respect to all gentlemen opposite but it is so with respect to his case.
I say in all sincerity to the right hon. gentleman that no one seeks this power either

jRelief Act, 1934
to use it or to abuse it unless the necessity arises for its use. If the necessity should arise and we did not have this power we should have been derelict in our duty if we had not sought it. If the necessity does not arise it is nothing more or less than a measure that is there to protect the people, and not to abuse their liberty, their freedom ar their rights. That is all I can usefully say. I am not going to traverse the ground that we have traversed here during the last three and four years. I am not disposed to do so in view of the position taken by the legislature of British Columbia-


Wilfred Hanbury: Would the Prime Minister explain that a little bit?


Richard Bedford Bennett: I am referring to the
statute called tire Special Powers Act. If the hon. gentleman has read it he will be able to draw his own conclusions from it. It has already been said at least in one instance by those responsible for it that it will enable them to do many things if the occasion arises without calling the legislature together.


Wilfred Hanbury: In what way would that affect the federal government?


Richard Bedford Bennett: It might affect the
federal government if the powers given under that act were exercised.


Wilfred Hanbury: I cannot see in what
way.


Richard Bedford Bennett: I would not expect the
hon. gentleman perhaps to see that. But if anyone will study that act, which in terms delegates to the executive all the legislative power of the assembly of British Columbia, thereby not delegating to but substituting for the assembly, the executive, thereby sweeping out the whole of section 90 of the British North America Act, thereby destroying the right to veto or disallow legislation, thereby destroying the protection given with respect to taxation and with respect to the other matters that are inserted in the statute for the safeguarding of the federal power-


Peter John Veniot: Might I ask a question?
Does not the federal government still retain the power to disallow any act of the legislature if they consider it ultra vires?


Richard Bedford Bennett: The hon. gentleman has asked a question that is certainly very relevant to the discussion, but he must realize that these are not acts-they are called ordinances-


Peter John Veniot: I am referring to the act
passed by the legislature of British Columbia giving the executive power to pass these orders in council.


Richard Bedford Bennett: That invitation is one
which the attorney general of the province held out for the purpose of showing Ottawa just what he would do to them when the time arises. That is what he held out. It is just because no intelligent executive will at the moment recommend the disallowance of a statute passed for the purpose of having it disallowed, but will leave it in the terms provided by law to be dealt with as the law has provided. There may be ample opportunity to deal with it. Perhaps the hon. gentleman has not seen the speech of Attorney General Sloan.


Peter John Veniot: I would not need to see
it to convince me that the federal power has the right to veto.


Richard Bedford Bennett: I have not suggested
that it has not, but I do suggest to the hon. gentleman that the attorney general was practically inviting the federal power to disallow the act in order that he might have a grievance. The hon. gentleman's courage-


Peter John Veniot: It has always stood the
test.


Richard Bedford Bennett: I shall not use the word I was going to use, because it might not be parliamentary. No one will deny his courage, but it does arise at very inopportune times for himself.


Peter John Veniot: No more than yours.


Richard Bedford Bennett: I would hardly compare my courage with his.


Peter John Veniot: I would not compare it with the sort of courage you develop.


Richard Bedford Bennett: The hon. gentleman need not become touchy. I am not comparing my courage with his.


Peter John Veniot: You are getting touchy.


Richard Bedford Bennett: We all take off our hats to him and say that his courage merits the high encomiums which he has himself bestowed upon it.
May I proceed to another point? In the province of Alberta there has been passed a law which creates an industrial bureau. It provides for codes, rules of ethics, the fixing of wages, rules for the conduct of business, and names those businesses, wholesale and retail, barbers, printers, and a whole long list of others. It vests in the executive power to set up bureaus to deal with these matters. Now we would be derelict in our duty if we did not at this time provide in this legislation the safeguards that are essential for the purpose of enabling us to protect the business of this country if the necessity arises. But leaving that for the moment, the difficulties
Relief Act, 1934

with which we have had to deal we have usually managed to dispose of except in a few cases without reference to this provision of the statute at all. Other provisions of the statute have enabled us to deal with them. There were a few cases in which we had to utilize the provisions with respect to peace, order and good government, but none of those cases had to do with the freedom or the liberty of the subject. They all had to do with what you might call the industrial, financial and economic fabric of our country, and the action that was taken was for the purpose of endeavouring to maintain them in their integrity until parliament should pass the legislation that might be necessary to enable us to deal with them. One illustration that at once flashes upon the memory of most members was when we dealt with the exportation of gold. We had not the legislation to deal with it when the crisis came, and but for this provision relating to peace, order and good government we would not have been able to prevent the exportation of gold. We used the provision in that case. Then later on the minister introduced the act by which power was conferred upon the executive to deal with that matter. There was not very much difference between seeking the power in the first instance under peace, order and good government to pass an order in council prohibiting the exportation of gold, and coming to this parliament later and specifically dealing with it. The power is exercised in both instances in exactly the same way. It is derived from the power granted by this parliament, only instead of granting it by name it is included in this instance under peace, order and good government. I cannot think of all the cases in which it might be desirable to utilize this power, but hence it is that we had recourse to this provision, and we used it in that instance. No other method suggested itself at the moment, and action had to be taken at once. The right hon. gentleman knows that in 1929 his then Minister of Finance sent forty million dollars of gold to the United States. At once Canada was off the gold standard because once having shipped that nueh specie out of this country we were no onger in a position to meet the requirements of our own statute. The successor of the late Mr. Robb found himself in the position where he was not able to provide the yellow metal to meet the demands made upon the country. He had no statute such as that and he did not desire to deal with it at the moment in parliament. I was then in opposition and I told my party in caucus-I can refer to this now in the same manner as the right hon. gentleman did with resoect to another matter some years ago-I asked my supporters to
LMr. Bennett.]
make no reference in parliament or elsewhere to that fact. I am bound to say that they met my wishes and did not do so. I subsequently discussed it with the minister. The fact was that we were without gold to meet the situation and maintain this country upon the gold standard. As 1 told my friends in caucus, and as actually happened, an enterprising man gathered together half a million dollars of Canadian money and brought it to Montreal where he exchanged it for legal tender. He went around to the receiver general's office and asked for gold for this money. Arrangements had to be made whereby a chartered bank intervened and this request was withdrawn. When England went off the gold standard a Canadian citizen who was more enterprising at the moment than patriotic conceived the happy idea that there was a good deal of money to be made in gold. He converted $50,000 into legal tender and asked for gold. He got gold for the first $50,000, but the government, having the advantage of this statute, were able to pass the requisite order in council by which the exportation of gold was forbidden. This one lot of gold was shipped out of the country the next day. That is only one of the many illustrations which might be given.


Wilfred Hanbury: That is provided for
now.


Richard Bedford Bennett: That is provided for at
the present moment by legislation but there are other matters that are not.


Wilfred Hanbury: What are they?


Richard Bedford Bennett: It is idle to say, "what
are they?" because they arise every day. If I had been asked that question two or three years ago the prohibition against the exportation of gold would not have suggested itself as being a matter which would have to be met. There are many that may arise. I feel inclined to believe with the right hon. gentleman that they will not arise, but believing that they will not arise, I cannot think that the government would be doing other than the proper thing by providing against a contingency which might arise. Caution is the endeavour to foresee and provide against a condition which may arise. There may be the hope that it will not arise but there is the knowledge that it may.


Mr. NEILL:: I do not just understand how Mr. Robb met the situation of there being no gold when the house was not in session and having no statute to provide for peace, order and good government.

Relief Act, 1934


Richard Bedford Bennett: He did not meet it; it
was never met except in this way: In the last instance the house was in session but it was not regarded as being in the public interest to direct attention to this fact at the moment. Perhaps the hon. gentleman did not hear me, but what happened was that an arrangement was made with the chartered banks, through which the gentleman from the United States was operating, and he was induced to come to another arrangement than that sought to be made. If the holder of the certificates had clung to his opinion it would have been necessary to enact legislation or else face the inevitable consequences.
I have described to hon. members what I conceived to be the cautious method which should be pursued. Many hon. members disagree with the government in its conduct of public affairs, but will they not admit this: that after three and a half years of the greatest depression the world has known we have kept the ship of state upon an even keel, we have maintained the integrity of our institutions, we have abused no power and have deprived no man unjustly of his liberty or his freedom of action. It is easy to charge a man with hypocrisy from the Boor of this chamber; it is easy to denounce him as a dictator, but I ask any fairminded hon. member: On the evidence of the world conditions which have confronted us, would you not, if you were similarly situated, not for any personal reason, take such action as might be necessary for the preservation of peace, order and good government in the Dominion of Canada?
If one is permitted to indulge in a few personal remarks, one must say that he sometimes finds it difficult to understand why his fellow countrymen should think that he is actuated by any personal wish or desire with respect to a matter of this kind. What personal interest can I or my colleagues have in this matter? What personal purpose have we to serve in connection with this? I can understand criticism, but do not put it upon the ground that we have a personal desire that this statute should read thus. If I did not believe when it was first put through that it was desirable and in the public interest, why should it be assumed that I put it there? Why should it be assumed that my colleagues would want to have it there? We have no interest beyond the interests of this country. I have no desire to object for a single moment to hon. gentlemen differing with us, but I can only point out that in following the course we are following in asking parliament to confer these powers upon us we are not doing it for any purpose other than an earnest and honest
effort to have available as a precautionary measure the power to safeguard the interests of Canada if the occasion arises. That is all.
Much as I would like to, I cannot agree with the suggestion made by the right hon. gentleman. Any thought of the utilization of these powers for electoral purposes does justice neither to himself nor to me. I do not think there is anyone connected with this party who has any desire or thought that this power should be utilized for electoral purposes. The only answer I can make to those who talk in suspicious terms is: Why not be frank about this and admit that there is not an instance which can be pointed to where this power has been abused, that there is not an instance where this power has been used where you yourself would not have used it in the public interest if the necessity had arisen? Because of this and because of the conviction I have that we would be doing the improper thing so far as this country is concerned, I am not prepared to abandon it, much as I would like to meet the views of the right hon. gentleman.
The right hon. gentleman has placed himself freely, frankly and fairly on record with respect to it this year, last year and the year before that. I respect his convictions, but I say that his fears have not been borne out by the results. I challenge any hon. member who will take the time to look into it to say that the power has been abused, the liberty of the subject invaded or his freedom curtailed. He must admit that in every instance subsequent events have shown that the action taken was warranted. This is all I can usefully say in answer to what has been said.


William Lyon Mackenzie King: The Prime
Minister (Mr. Bennett) in answering my criticism has said that I have added nothing to what I said in previous years except my statement about the position of the president of the United States. In that I think he was quite correct, because I have emphasized over and over again the points I made this afternoon. But my right hon. friend did not reply to what I said as to the difference between the necessity of giving great powers to the president in a time of emergency and the British system under which he as Prime Minister can get whatever he wishes in the way of legislation at any time from this House of Commons. That point he has not answered at all, and to my mind it is the very strongest point that can be made, because it indicates the difference between British parliamentary systems of government and the systems of government that
Relief Act, 1934

have existed in other countries and particularly, with reference to the subject under discussion, in the United States. I am not going to follow my hon. friend in not replying to him, but I will say, as he said to me, that he has added nothing to what he has said in previous speeches except it be his reference to what has taken place in British Columbia where the government has secured the enactment of the Special Powers Act, and to what has taken place in Alberta in the establishment of a bureau to deal with a number of matters to which the Prime Minister made reference. My first observation, so far as this special legislation is concerned, is that this special powers legislation, to which the Prime Minister has referred, was not known to be in contemplation at the time this statute was drafted for this year.


Richard Bedford Bennett: The legislation was but
not the terms of it.


William Lyon Mackenzie King: My right hon. friend is quick to grasp at anything that will serve his purpose, and that seems to serve it for the moment. But may I point out to him that what he has said in regard to British Columbia-and I know he takes very strong exception to what that province has done- is the most powerful argument that can be urged in support of what, on behalf of the opposition, I have been saying on this side in the last three or four years. Neither British Columbia nor Alberta nor any other province in Canada would ever have dreamed of permitting its executive to have the power to do whatever it wished, during the period the legislative body was not in session, except for the example set by this government in connection with this very provision respecting peace, order and good government in its relief legislation. That statement is as true as anything could possibly be. It is one of the reasons why, in my opinion, it is important in connection with all legislation for us to see precisely where we are likely to drift as a result of a particular course of action. To my mind the essence of the matter lies in the difference between this practice which is growing up of legislating according to plans as they may present themselves to the minds of individuals and the practice of legislating in accordance with principles as they have found expression in government under parliamentary institutions now for some generations, principles which bear directly upon all that affects all classes in all parts of the country at all times.
Take the position to which the Prime Minister has referred. He says that the government of the province of British Columbia

have taken to themselves all the legislative power of the legislature for the period during which the house is not in session.


Richard Bedford Bennett: Have vested in the
executive.


William Lyon Mackenzie King: Yes. Well, may I say to my right hon. friend, when he asks, that notwithstanding the existence of any law or statute, he and his colleagues may do what they please when parliament is not in session, under this provision with respect to peace, order and good government, which is merely a designation for the absolute power we are being asked to give that they are doing exactly the same thing. The Prime Minister says, as if it were a very slight additional power, "When we ask, in addition to existing legislation"; but that is not the language of the bill, and this is significant. The language of the proposed statute is not, "in addition to existing legislation" but "notwithstanding the provisions of any statute or law," and the difference between "in addition to" and "notwithstanding" is the essence of the whole objection we have to this measure. The whole purport and intention of it is that, notwithstanding the existence of any law or statute on the books of this parliament, this government, when parliament is not in session, may legislate as it pleases by order in council. That, I repeat, is the purpose, no matter how you may try to conceal or glide over it by referring to peace, order and good government; the power which the government seeks is the power to legislate as it pleases, apart from parliament altogether and that notwithstanding any law or statute in existence in the country.
Well, what is the position in Canada to-day? The Prime Minister has directed attention to what has taken place in British Columbia, and he has also pointed to what has occurred or is occurring to-day in Alberta. May I suggest that he might have spoken of what has been done in the province of Saskatchewan. The government there have taken to themselves, away from the legislative assembly, vast powers to do as they please with respect to many matters when the legislature is not in session. The Prime Minister might have gone a step further and referred to the province of Manitoba, and have called attention to the measure which was introduced into the legislature of that province within the last few weeks, a measure containing the provision that all powers which the legislature exercises in regard to property and civil rights should cease to be of force or effect if in any way they conflicted with an enactment that this federal government might pass, which would serve

Relief Act, 1934
the purpose of the provincial exeutive-not of the legislative body but of the executive- at a time when the house was not in session. When the Manitoba house came to discuss the matter the government withdrew that particular clause, with the result that it does not form part of the measure since enacted. But it would have been embodied in that measure had it not been that the forum which the legislature provides permitted argument to carry weight and to prevail, rather than that mere force of numbers should succeed in granting the authority necessary to do that particular thing.	.
There is the situation to-day-all four western provinces imitating the example set by this government have given their executives power to legislate as they please when the legislature is not in session. But why should the tendency stop with these four provinces, if that is to be the new method of dealing with public affairs in Canada? If that method is going to prevail, then we shall probably find the government of Ontario taking a similar course before long, and possibly the government of the province of Quebec, possibly the government of New Brunswick, and the government of Nova Scotia as well. And what shall we have then? Instead of a number of representative assemblies laying down the laws of the country we shall have so many soviets established in different parts of Canada. We have a dictatorship at Ottawa and, if the process extends, we shall have dictatorships as well in different parts of the country-a nice condition to contemplate. I submit that all this is leading this country along entirely wrong lines; it is imitating the worst features of what has taken place in Europe and rejecting the best of what we possess. After all, what is the situation in Europe to-day? We find that little by little one country after another has torpedoed whatever authority its legislative body possessed, and that power has been handed over, in one instance to a Mussolini, in another to a Hitler, in a third to a Stalin, and so on, until we find a group of dictators taking the place of representative bodies in determining what shall be the law and what shall govern the liberties and freedom of the people. And instead of resisting that sort of thing the Prime Minister takes the view that because these countries have done this sort of thing therefore we should do likewise. My reply to him, so far as that is concerned, is this:	Because they have done it we should show them that it is not necessary. This the more, because they will have to recede from that position eventually. The world cannot go on
being governed in that fashion. Sooner or later these dictatorships will (have to end and power to legislate and control, if it is to be exercised for the wellbeing of the many, will have to reside as we of the British tradition boast it does, in the great representative assemblies, to which executives are wholly responsible. For my part, I should like to see this parliament hold its own as a truly representative body which would at all times exercise the collective will in determining what shall be done in the matter of legislation, instead of permitting the will of any individual or group of individuals to prevail, however able and sincere they may be.
Let me assure the Prime Minister frankly that I am not questioning his sincerity or his motive; I do not believe that he intends to use this power in any indefensible way. But I do say that the minute he takes that sort of power to himself and the government, he has set an example and given a reason to the premier of British Columbia, to the premier of Alberta, to the premier of Saskatchewan and to the premier of Manitoba and to all other provincial premiers to do likewise. Those I have mentioned have all followed his example in greater or less degree up to this point and others may very soon do the same.
Now, what position shall we be in when parliament is prorogued? Here is the position to which we have drifted in Canada. We have at Ottawa a government free to do anything it pleases by order in council. In British Columbia there is a government free to do anything it pleases by order in council. If what the Prime Minister has said is true, we have in Alberta a government free to do any thing it pleases by order in council- along certain lines. The same, I believe is, now true also of Saskatchewan and Manitoba. Who is going to know what his liberties are, and how long they are to be preserved? During the session further legislation already brought down will be discussed which will reveal the extent to which we are to be asked to abandon parliamentary institutions, even going the length of delegating to groups unknown at the present time, the right to come together, to enact any measure they please, and further to provide that, once they have determined what specific rules are to govern in an industry, there is not even to be recourse to the courts of the land against what they may lay down as determining factors governing trade and industry. This all simply shows whither we are heading. This tendency to get away altogether from the control of legislative bodies leads inevitably to getting away from the courts as well. One may deride
Reliej Act, 1934

communism and hurl one's bolts at socialism, but in communism and socialism there is nothing essentially different from that. Communism simply gives to a collective group the right to run things themselves regardless of : body properly representative. Socialism gives to a group the right to manage the business of the country as best they can under autocratic powers; powers that in the last analysis have to be supported by force on a large scale.


Mr. HEAPS:: What form of socialism delegates such powers as those which the right lion, gentleman describes?


William Lyon Mackenzie King: Where socialism undertakes to run the industries of a country, it cannot attempt that, as the Prime Minister said this afternoon, without having bureaucratic powers, without having autocratic powers, without having its efforts supported by force on a tremendous scale. That kind of administration of public affairs is not what is wanted in Canada, or what is needed in any part of the world. What the world needs to-day is, true enough, to have industry controlled, regulated, to have all the conditions under which men and women are to work and earn their livelihood and to live made such that a larger and fuller life will be possible to all and that just relations may be made to prevail in industry and trade and other relations of life. But the way that can be brought about and maintained is by this institution of parliament as we have it to-day where the representatives not of any one class but of the people of all classes and of all parts of the country meet together and, after a full and free discussion of all sides of a situation, decide what is best for all, what is most in the public interest.


Abraham Albert Heaps: In those countries that have a dictatorship at the present time, was it not the socialist party that was suppressed?


Wilfred Hanbury: How about Russia?


William Lyon Mackenzie King: What my hon. friend has pointed out amounts to this: It is just one autocracy or bureaucracy that has suppressed another. It so happens that in the countries he has in mind the fascists have been a little stronger, and have at the moment more power than the socialists. But imagine the socialists being in control in those communities! What would the position of the rest of the people be under a government exercising the autocratic powers essential to the socialistic state. My contention is that we do not need fascism or communism; what we do need above all is the maintainance of the

British system of representative government as we understand it and as it has developed through the years, and to have changes of the social order effected in a constitutional manner through that agency; not the destruction, as would otherwise be inevitable, alike of parliamentary institutions and the social order.
My criticism of this legislation is that it is baneful in the extreme because of the example it sets in matters of government. It is very serious, in my opinion, that this sort of legislation should again appear this year, and that an effort should once more be made to drive it through parliament. That was the reason-and I think the Prime Minister will credit me with sincerity in the position I took-I opposed this legislation so strongly at the outset. If he looks over what I said at the time, he will find that my main criticism was in the nature of the query: Where is this kind of thing taking us? Where are we going? That is the question the people of Canada will be asking themselves very soon in regard to this world revolutionary movement that is influencing this country as well as all others. So far, we have been more fortunate and in a better position than other countries, but with the rapid way in which thought is influencing action and conduct in different parts of the world, if men are going to imitate what is worst and throw out what is best in governmental methods, what hope is there for anyone ?
I have said all I intended to say on this section, but I say it with the deepest convic-ton and out of a fear that so far as Canada is concerned we are at this very time, to use once more a phrase that has been used in another connection, at the parting of the ways. We have to decide whether we shall stand for those institutions that have maintained liberty in the interests of all, and brought about and secured that liberty through their parliament as the palladium of liberty, or whether we are going to cease to have government conducted on a representative and responsible basis and go in for one or other of these extremes, the extreme of communism, on the one hand or of socialism or of fascism on the other.


Wilfred Hanbury: Referring to this particular measure, the Prime Minister (Mr. Bennett) gave us the example of British Columbia, but I am frank to admit that I cannot yet see-and I would like to have him enlighten me in the matter- what measures they could adopt there, notwithstanding the latitude they have taken, that would be beyond their powers in so far as the federal government is concerned. The Prime Minister has given as

Relie/ Act, 1934
a particular reason for the necessity of the inclusion of this special feature of the bill, the action already taken by British Columbia and Alberta. I cannot see how they could take any action that would in any way interfere with the rights of this parliament, and I would be glad if the Prime Minister could enlighten me on this point.


Peter John Veniot: May I ask a question of the Minister of Labour? Under clause 2 the dominion may enter into agreements with any of the provinces respecting relief measures therein. Is it the intention of the department in entering into such agreements to have a regulation insisting upon audit of accounts by the federal authority?


George Gordon: The government at the present time insists upon an audit by the auditor general. As early as the fall of 1930 the matter of audits by the auditor general was taken up with him and his officials. Before this bill goes through I shall spread upon the record the orders in council and the correspondence that passed, but in the fall of 1930 the auditor general certified to the method that should be pursued with respect to auditing those accounts.


Peter John Veniot: To the provincial governments?


George Gordon: To the Labour department. It developed in 1932 by reason of certain complaints that came to the notice of the Labour department that the course which had been adopted, and which was certified as sufficient for the purpose by the auditor general, was probably not as complete as it should be. Then an order in council was passed in September, 1932 specifically directing the auditor general as to the course that the government desired him to take.


Peter John Veniot: Did it direct the auditor general to make an audit at that time?


George Gordon: Yes.


Peter John Veniot: In September, 1932?


George Gordon: Yes, September, 1932. That was again followed by a further order in council elaborating on the first.


Peter John Veniot: That of the tenth of
October?


George Gordon: Yes, I think it was the tenth. However, before the discussion of the bill is finished I will spread the orders in council upon the record so that hon. members will have full knowledge of their contents and of the dates on which they were passed.


Peter John Veniot: The reason I asked that question was to draw the attention of the
minister to what I consider was a lack of care on the part of his department, and perhaps also a lack of care on the part of the branch known as the audit department. Why should the department of the Minister of Labour, or the audit department accept an estimate as a basis for payment of federal aid to New Brunswick, as they did in the matter of stumpage? The province of New Brunswick entered into an agreement with the federal authorities that if they reduced the stumpage charge to the lumbermen of that province in order to encourage operation and give employment to bushmen that winter, the federal government would reimburse the provincial government to a certain extent- I do not remember what the proportion was. When the time came to reimburse the province the Department of Labour accepted a certificate from the provincial government of an estimated stumpage to be paid that year. There is no mistake about it; I have it right here in the auditor's report-that payment was made on a certificate of an estimated amount of $51,556.29. It was found later on, when the auditor general audited the accounts of the province of New Brunswick at this point, that the federal government had overpaid $2,523.12.


Richard Burpee Hanson: What was the date of the provincial government's certificate?


Peter John Veniot: 1932.


Richard Burpee Hanson: That is
very indefinite. What time of the year?


Peter John Veniot: If the hon. gentleman wants to get pernickety about it he had better look it up himself. I am drawing the attention of the Minister of Labour to the report of the auditor general of Canada. He is not giving the dates, and I cannot be expected to supply them. I have his report here in my hand. He reported that the federal authority paid their proportion on an estimated certificate by the Department of Lands and Mines of New Brunswick. If that does not show lack of care in handling relief funds I want someone to find a name for it.
Let me give another reason why there should be a careful audit. In the proportion paid by the dominion Department of Labour of the cost of construction of the electric power line from Dalhousie to Jacquet River, also in the county of York-Sunbury, the auditor general's report shows that there was an overpayment of practically $4,000. If a proper audit had been made at the time there would not be the necessity to ask for a refund to-day. The minister will remember that at
lielie] Act, 1934

the time I drew his attention to these two works, especially the Jacquet River works. I claimed then that the federal government had no right to pay any unemployment relief money for that construction, because the hydro electric commission of New Brunswick had authority to borrow money for that work, which was a revenue producing work. Not only is it bringing revenue, but a surplus over operating expense comes to the treasury of the province of New Brunswick. I pointed out that that money would have been better used to help real unemployment in some other section of New Brunswick. The minister at that time promised me that he would give particular attention to this; that he would look into it. He admitted that if it was a revenue producing enterprise it should not be included in the category in which it was placed. Yet that work went on, and I have yet to learn that the minister carried out the promise he then made that he would look into it.
At six o'clock the committee took recess.
After Recess
The committee resumed at eight o'clock.


Peter John Veniot: When the committee rose
at six o'clock I was speaking about stumpage, and the fact that the share of the federal government was paid on estimates submitted by the Department of Lands and Mines of the province of New Brunswick, instead of being paid after the accounts were submitted and the amounts known. I was asked the date to which I was referring, and according to the auditor general's report I find it was May 1, 1932, after logging operations were completed.
I was attempting to show how these accounts could, without proper investigation, be-I was going to use the word cooked, but I do not mean it in that sense-but how these accounts can be made up so as to mislead. For instance, at page 11 of the report of the auditor general I find an item of $41,000 as a bonus for clearing lands. The federal government's share was fifty per cent. Let me explain that long before the depression set in-perhaps a year or two-the government of New Brunswick passed an act in which, in order to encourage the opening up of more lands, they granted a bonus of eight dollars an acre to those farmers who would break up new lands, and who held titles to such lands. The reason the stipulation was made as to titles was to distinguish between the settler on crown lands who had not yet

obtained his title, and the established farmer. Under this provincial legislation the established farmer with one hundred acres of land, only forty or fifty acres of which was clear, and Who undertook to clear more of his land, received eight dollars an acre. When the depression set in and the federal government decided to aid unemployment by paying a percentage of the costs, the government of New Brunswick transferred this act so that it operated under federal aid. In 1931 fifty per cent of the $41,000 paid in connection with the clearing of this land was paid under the federal aid system and charged to unemployment relief. The federal Department of Labour certified and made the payments.
I suggest that this money could not have been paid as unemployment relief, because the farmers who received the eight dollars per acre were well to do; they did not require any relief in 1931. Prior to the depression years they received this money under legislation of New Brunswick which had for its purpose encouraging the opening up of more lands. Yet we find that fifty per cent of that is charged to and paid by the federal Department of Labour. I am pointing this out not so much to criticize the department but to show how necessary it is that care should be taken and every precaution exercised by the federal Department of Labour to see that the moneys voted by parliament are properly expended and not used for purposes for which they were not intended.
The minister has said that authority was given for an audit. I believe he stated that it was in September, 1933, the government consulted with the audit department and had come to the conclusion that an audit should take place. However, that audit was not made until late in 1933. I should like to know from the minister Whether the audit contemplated by the order in council passed in September, 1933, will apply to all works done by the provinces or municipalities to which the federal Department of Labour would contribute, and whether that audit will be made from the date of 'the adoption of the relief legislation, or rather from the time the work was begun. I wish further to ask the minister whether in connection with laying out public works projects the engineers representing the federal government will have anything to say as to the approval of locations of such projects. The reason I ask that is that the auditor's report I have before me sets forth that the approval of projects given by the federal Department of Labour was so broad that almost any kind of work, even work not contemplated under the agree-

Relief Act, 1934
ments, could be included. I know that condition has prevailed. I know that in my own county work was Charged up to unemployment relief which could not possibly have come under the federal agreement. Yet hundreds and thousands of dollars were charged up in that way.


Richard Burpee Hanson: That is a large statement to make.


Mr. YENIOT:: I gave this statement in
1932, before I ever saw the auditor general's report, and from the floor of this house I read into Hansard the names of the roads in question. I do not now intend to tax my memory-


Richard Burpee Hanson: The hon. member said " hundreds of thousands."


Peter John Veniot: I said "hundreds and
thousands of dollars." I did not say "hundreds of thousands." The hon. member for York-Sunbury ought to be more careful when he interjects.


Richard Burpee Hanson: It sounded very much like "hundreds of thousands," and just about as large as the hon. member's statements usually are.


Clarence Joseph Veniot: If my statements are too
large for the hon. member may I say to him that I know some statements I could make which would be considered far larger than those I am making now. 1 do not think the hon. member has any right to interject; if he has anything to say let him get up and say it after I have finished. If he has any objections to offer to my criticism he has a perfect right to make them at the proper time. I suggest, however, that he should allow me to proceed with what I have to say.
The figures I have given are taken from the reports before me prepared by the auditor general, and I take them to be correct. In fact I know some of them of my own knowledge to be perfectly in order.


George Gordon: I wonder if the hon. member would permit an interjection?


Peter John Veniot: Certainly.


George Gordon: I have a recollection of the comments that were made by the hon. member with reference to the work to which he is now referring. An officer of the Labour department was sent down to inquire into the work that was going on, and as a matter of fact the federal government did not contribute anything to that work.


Peter John Veniot: The minister is mistaken. It is true that a gentleman by the name of Carter was sent down, and he reported among
other things that the work on the Bathurst and old Miramichi road did not include federal aid. But I have here on my desk a reply to a question that was submitted by an opposition member in the legislature of New Brunswick to the Minister of Public Works of that province, asking for the names of the roads in the county of Gloucester to which the federal government had contributed, and included in those roads, in the answer submitted by the Minister of Public Works for New Brunswick, was this Miramichi road. I read to the house at the time a certified copy of the answer of the Minister of Public Works of New Brunswick.


George Gordon: Quite true, but while that may have appeared in some record in New Brunswick, the fact remains that the federal government did not contribute to that road.


Peter John Veniot: The federal government did contribute to the Miramichi road. More than that, I have it right here in the auditor general's report under the name of the Eskidillock road. If the minister wants to look at the report I will send it over to him. I know what I am talking about when I am talking of my own county anyway, and I know the facts in regard to other counties if my hon. friend from York-Sunbury (Mr. Hanson) wants to know. I know that in the county of York, represented by the hon. gentleman opposite, the accounts submitted to the Labour department included items for medical care, medicine and dental service, which instead of being charged up under those heads were charged up to food in the city of Fredericton.


Richard Burpee Hanson: That is not correct.


Peter John Veniot: Then the auditor general is a liar.


Richard Burpee Hanson: I investigated that statement when I was at home-


Peter John Veniot: The auditor general is not telling the truth?


Richard Burpee Hanson: What happened in the city of Fredericton was that the mayor, one of my hon. friend's friends and a defeated candidate once or twice, and a man who is going to run again I understand, authorized medical relief in the city of Fredericton. W hen the accounts were gone into the attention of the authorities was called to the matter and the money was refunded by the city of Fredericton.


Peter John Veniot: The auditor general in this report says that these items were entered as food, and he recommends that the Minister of Labour -have the amount refunded.
Relief Act, 1934


Richard Burpee Hanson: It has been refunded.


Peter John Veniot: Then my statement is correct, that it was charged up as food.


Richard Burpee Hanson: It never was entered as food.


Peter John Veniot: Then the auditor general lies in this report. I believe the auditor general.


Richard Burpee Hanson: I believe the officials of the city of Fredericton who are not here to defend themselves.


Peter John Veniot: I am not accusing the auditor general, but my hon. friend is. The hon. member for York-Sunbury states that the auditor general has made a mistake when he sets out in his report that this stuff was charged up to food. The hon. member says that that statement is not correct. It is he who is accusing the auditor general, not the hon. member for Gloucester. I am trying to defend the auditor general who is not here to defend himself.


Richard Burpee Hanson: Nor are the officials of the city of Fredericton.


Peter John Veniot: I am not touching the question of the Fredericton officials; I am simply giving the facts as reported by the auditor general. He goes further and says that the same thing was done in the city of Saint John, that medical care and medicine and dental service was charged up to clothing. He states further that clothing collected by the Daughters of the Empire and handed in without any cost to the relief committee in the city of Saint John, given absolutely free, had a price put on it and fifty per cent of that was charged up to federal aid. That is what the auditor general says in his report here; it is not the hon. member for Gloucester who is saying it. If my hon. friend from York-Sunbury will take the trouble to read this report he will find out that every word I have stated is to be found in it, and it ill behooves the hon. gentleman to stand up in this house and say that the auditor general's report is not correct. If the auditor general is making reports to the government and to this house, because he is the servant of this house, that are not correct, he should be impeached. We should not allow an officer to continue in the public service if he is making reports to this house which members can stand up and say are false. The government should look into the matter.
There is another item which I take from the auditor general's report, and perhaps my

hon. friend from York-Sunbury will say that this also is not correct. It has been the custom for years-I know it was the practice when' I occupied the position of Minister of Public Works in New Brunswick-for the Indian department in the federal government to contribute fifty per cent of the cost of roads constructed across the Indian reserves in the province, the provincial government paying the other fifty per cent. This same practice prevailed in 1932. The Indian department of the federal government paid fifty per cent, or S258, for the construction of a road across the Indian reserve at Church point in Northumberland county. Now what do we find the provincial government doing? They charge their share up to federal aid, and it is paid by the federal Department of Labour; and so the Department of Public Works in New Brunswick gets paid twice for the same work. The auditor general recommends in this report that the forty per cent-I see it is forty per cent, not fifty per cent-that was charged up to the Department of Labour be refunded by the province of New Brunswick.
I think I have shown plainly enough by these items, Mr. Chairman, that it is necessary that an absolutely strict audit be made by the federal department.
Before resuming my seat I wish to refer to a matter which came up this afternoon in a discussion between the hon. member for Kenora-Rainy River (Mr. Heenan) and the Minister of Labour as to the fixing of wages in Ontario. It was stated this afternoon that 25 cents an hour was to be the maximum wage paid under the Ontario government's relief plan for the unemployed, and the question was raised as to what the federal government should pay. Would it not be possible when entering into agreements with the various provinces to provide for the fixing of a uniform maximum or minimum wage? When the road and bridge work was being carried on in 1931 and 1932 to help out unemployment, the wages paid in the various provinces varied considerably. Labour should be worth as much in New Brunswick as it is in Ontario, British Columbia or any other province. The wage paid in New Brunswick was $2.10 per day, with a deduction of 60 cents per day when the man boarded in the road camp. I ask the minister to study this phase of the situation and see if it is not possible to fix a uniform wage in the different provinces.
Coming down to the contribution of the federal government to reimburse the provincial government for the lowering of the stumpage rates, for the making up of the

Relief Act, 1934
difference between what would have been collected had the regular stumpage rate applied and what was collected under the reduced rate: In the two years 1931 and 1932 this difference amounted to somewhere around $96,000 or $97,000. Having entered into an agreement with the province to reimburse them for the loss caused by the reduction in stumpage, I should like to ask the minister if he could not see that a corresponding increase is given to the men getting out the lumber. If a corresponding increase is out of the question, I should like to see a minimum wage paid to these men. I think it should be stated that if these men were not paid a reasonable wage, no federal aid would be given. I understand that the provinces are looking into this phase of the matter, and New Brunswick has passed an act to cover it. I was brought to task the other day for not mentioning this fact, but the reason I did not do so was that the act was to come into force upon proclamation; it had not yet been proclaimed, and therefore I did not refer to it as an act in force. I understand that the act has since been proclaimed and -a commission appointed, under Judge Grimmer I believe, to look into lumbering operations in the province with a view to seeing that the men receive better treatment than they have in the past. The matter of wages to be paid to the men working in the bush may come up, and I ask the minister, should the question of reimbursing the province for the reduction in stumpage be brought forward, that he make certain that a reasonable wage is fixed before federal aid is granted. It may be said that this government does not desire to interfere with the provincial governments in their operations, but it should be remembered that we are contributing forty or fifty per cent of the difference between the stumpage which would have been collected at the regular rate and that collected under the reduced rate. Under these circumstances we have a perfect right to say to the provincial government that they must assure us that proper treatment in the way of wages and accommodation is given to the men working in the bush and making the profits for the lumbermen.
This is all I have to say at the moment, but I may have further remarks to make on other sections of the bill.


Richard Burpee Hanson: Mr. Chairman, I had not intended to intervene in this discussion and probably would not have done so were it not for some wild statements made by the hon, member for Gloucester (Mr. Yeniot).


Peter John Veniot: What right has the hon.
gentleman to say that my statements are wild?
Mr. HANSON (York-Sunbury); Some of the mistaken statements.


Peter John Veniot: He cannot say that either
under the rules of this house.


Richard Burpee Hanson: I will say, unfounded statements made by the hon. member.


Peter John Veniot: He cannot say that.


Richard Burpee Hanson: I have
said it.


Peter John Veniot: I ask that you withdraw
that.


Richard Burpee Hanson: I do not think that is unparliamentary.


Peter John Veniot: It is unparliamentary.


Richard Burpee Hanson: If we were not in a position to make statements of that kind in connection with statements made by the hon. member and many others like him who sit around him, we would never be able to contradict a statement. As a matter of fact, I think the remarks made by the hon. member for Gloucester this afternoon and this evening will indicate to hon. members of this committee that there is a general election in the offing in New Brunswick.


Peter John Veniot: I did not know that. Are
you speaking for the government?


Richard Burpee Hanson: No, I am not speaking for the government. The hon. member is beginning to lay a foundation for an attack on the provincial government which his friends in the legislature 'have failed wholly to do during the last session.


Peter John Veniot: Oh, oh.


Richard Burpee Hanson: I have
heard other animals make noises like that.


Peter John Veniot: Mr. Chairman, on a question of privilege: while it is against the rules of the house to apply such a term to an hon. member, may I be permitted to say that I have listened to jackasses braying better than the hon. member.


Richard Burpee Hanson: My main reason for taking up a few minutes of the time of the committee is to comment upon two or three references made this afternoon by the hon. gentleman, and to what may be termed a charge of misappropriation of relief funds in New Brunswick. I have not read the report of the auditor general and I do not know what is in it, but I venture to say that his report is simply based upon the statements

Relief Act, 1934

made by his officers. During the holidays a statement was given out to the press that there had been misappropriation of funds by the city of Fredericton. Anticipating that this matter would come up, I made it my business during the vacation to interview the relief officer in that city. What happened was this: Under the contracts made between the two governments there was no provision for medical attendance, medicine or dental relief. The mayor of that city, who is a bosom friend of the hon. gentleman and who has suffered at least one defeat in supporting his policy and will probably suffer more-


Peter John Veniot: No, he will not.


Richard Burpee Hanson: This
gentleman is a public spirited citizen. He has been mayor of our city for a long time and is a personal friend of mine.


Peter John Veniot: He will not be after what
you say to-night.


Richard Burpee Hanson: Who is
making this speech?


Peter John Veniot: I just want to give you an example.


Richard Burpee Hanson: Everyone
knows that Mr. Clark is a public spirited citizen and has given much of his valuable time to public service. He is not to be condemned if he has political ambitions, although they are not likely to be realized for a long time. What he did was to see that in contributing a measure of relief to the poor and unemployed of Fredericton there should be included medical attendances, medicine and dental relief. In the first instance these were paid for by the city, although that was contrary to the letter of the agreement between the provincial and federal governments. When attention was called to the fact that the city had gone beyond the letter of the contract, the error, if such it may be termed, was immediately rectified and the amount reimbursed to the provincial government. I do not think that even my hon. friend will say that the city of Fredericton did wrong in providing medical and dental relief if necessary, and if it was wrong, then it was a great pleasure for the people of that city to pay it out of their own pockets as taxpayers. Moreover, we will continue to give medical relief so long as the exigencies of the situation call for it.
The hon. gentleman took some exception to the expenditure of unemployment relief moneys in the extension of hydro in the province of New Brunswick, including a part of my constituency. That was an extension of
[Mr. R. B. Hanson. 1
hydro lines in rural communities, work which would never have been undertaken by the commission unless they were getting federal assistance. We have been able to put lines into communities where a hydro line would never pay, where hydro would never have been extended, where the capital cost would not have been warranted, and we have been able to do so because of the contribution made by this government. I wonder if the hon. gentleman will go into York county and condemn that expenditure in the next election.


Peter John Veniot: I did not condemn it.


Richard Burpee Hanson: Then what was the object of mentioning it? Will he go into Jacquet River and condemn the expenditure that was made there? The fact is that the expenditure was a proper one, as was well understood by everyone.


Peter John Veniot: Certainly it was a proper
expenditure.


Richard Burpee Hanson: With respect to the reduction of stumpage, I agree that the reduction should have been passed on, as far as reasonably possible, to the men who worked on the project, and I believe that this was done except in a few individual instances. In certain cases, as in all other phases of activity, there will however be always the exception, the man who will queer the pitch, so to speak, and who will not pass on this sort of thing. But as a rule the lumber operators in New Brunswick did pass along the reduction, and if they did not increase wages they increased the number of men employed, granting relief that way. On the whole, by and large, I want to say that unemployment relief in New Brunswick has been carried on in as honest and systematic a way as it has been in any province in Canada, and it ill becomes the hon. member from Gloucester to foul his own nest even in the face of a provincial election. That is what he has done to-night, but it will not get him votes down there; I will tell him that,-


Peter John Veniot: You will find out after the election.


Richard Burpee Hanson: -because they know the hon. gentleman.


Peter John Veniot: And so is my hon. friend
known, not only in York county, but he is known before the barristers' association.


Richard Burpee Hanson: That is
very nice, isn't it?


Peter John Veniot: Don't you become personal and I will not.

Relief Act, 1934


Richard Burpee Hanson: I am not
becoming personal; I am speaking as a politician to you.


Peter John Veniot: I am talking as a politician and a lawyer.


Richard Burpee Hanson: I will put my reputation in New Brunswick alongside the hon. gentleman's.


Peter John Veniot: I have never been condemned by any society I ever belonged to.


Richard Burpee Hanson: Perhaps
you never belonged to any.


Peter John Veniot: Yes, just as good societies
as the hon. gentleman belongs to.


Richard Burpee Hanson: The hon.
gentleman was condemned by the electors of New Brunswick.


Peter John Veniot: I have never had any of my colleagues in politics, opposed to me or for me, condemn me in the way the hon. gentleman was condemned for his action in connection with certain matters in the province of New Brunswick.


Some hon. MEMBERS:: Cheap.


The CHAIRMAN (Mr. Gobeil):: Order.


Peter John Veniot: The hon. gentleman got
personal and I do not see by what right I should be called down because I am retorting in kind.


Samuel Gobeil: The discussion is getting away from the amendment.


Peter John Veniot: Yes, but who brought it on? I did not; the hon. gentleman did, and he is always that way. He is a lawyer and is used to the practice, when a man is defending a bad case, of abusing opposing counsel. That is what he practises. Now, in order to put myself right in the statement I made in connection with the city of Fredericton, let me read what the auditor general says in Annex A, 1:
Drugs, medical supplies and also medical and dental fees were included as "food" in claims to which the federal government contributed. The irregular claims in this regard should be computed and the necessary refunds made to the federal government.
I would ask the minister whether the refund has been made as suggested by the auditor general.


George Gordon: Adjustments and refunds are being constantly made, and while I have not the figures for this particular item I have no doubt that the refund has been made. Wherever it is found that there has been any 74726-124 i
departure from the agreement, or some little matter of that kind has perhaps not followed the exact terms of the agreement, we find that on bringing it to the attention of any of the provincial governments adjustments and refunds are made without difficulty.


Peter John Veniot: I agree with the hon. gentleman and think he is quite correct in stating that when the attention of the provincial government is drawn to any misapplication, if I may use that term, of federal funds, the refund will be made and likely has been made in the past. But that is all the more reason for the stand I take to-night, that there have not been sufficient safeguards surrounding the expenditure of federal aid money, not only in the province of New Brunswick but in other provinces, because it is rife throughout the dominion. I am not attacking only the province of New Brunswick. My hon. friend from York-Sunbury says that I am trying to besmirch the reputation of that province. I am not attempting to besmirch its reputation at all, but I do deprecate the idea of allowing such a misuse of public funds to go on as revealed here in the report of the auditor general. At any rate, I have the courage of my convictions and stand in this house to denounce that sort of thing, and that is more than the hon. member for York-Sunbury can say, because he is scared that in denouncing misdemeanours of that kind he will be reflecting on a government he so loudly praises and to which he is so solidly attached that he cannot see any good in those differing from him in political opinion. That is the only reason that prompts me to expose the matter. I drew the attention of the government to the state of affairs in 1932 and warned them then against certain misdemeanours am? '*ertain misappropriations of money, not by the individual who wanted to boodle or graft but by the provinces and municipalities who were using the money in a way in which it should not have been used, so that it did not reach the unemployed whom it should have reached.
Let me give you an instance of how unemployment relief is administered. Here again I wish to impress upon the minister that in making agreements with the different provinces he should be careful to stipulate what agreements these provinces shall make with the municipalities, and that the federal government shall have a word to say as regards the manner in which the municipalities are to distribute federal unemployment relief, instead of leaving it entirely to the provinces to deal with the municipalities. In the example I am going to give I am speaking of a
Relief Act, 1934

matter whereof I know. It became the practice in 1932 for them to go to a farmer and say, "You have lumber on your land. There are a lot of people who are too poor to buy wood and we want you to sell to us, the committee in charge of relief in this district, fifty or one hundred cords of wood. We will pay you fifty cents a cord as the wood stands. We will cut it and it will be hauled off your land." The farmer agrees to that and the wood is cut. The wood is not given to be hauled by the individual who really needs it for relief, but teams belonging to independent farmers are engaged to haul that wood at so much a cord. The cost of the wood when it reaches its destination amounts, including the fifty cents stumpage so-called, to $2.50 to $3 a cord to the municipal committee. The municipal committee, instead of distributing that wood to the poor and needy, sells it at so much a oord to some individual who undertakes to sell it to the public. He does not sell it to the unemployed because they have no money to pay for it, but when the municipal committee require wood they go to this individual and pay him $4 a cord for wood that they could have given to the needy person at a cost of $1.50 a cord. The federal government is asked to pay thirty-three and a third per cent of the cost of that class of relief work and the poor individual who is in need of wood does not get it until the municipality buys it back at the rate of $4 a cord from the individual to whom it had sold it at from $2.50 to $3 a cord. There is a great deal of wood needed among the poor people, especially if we have another winter like the one through which we are just passing. This shows that the minister should take particular care to give instructions to the provincial government that the agreements entered into oetween the provincial government and the municipalities shall, before becoming operative, be submitted to the Minister of Labour at Ottawa for his approval. If that system is adopted, the very misdemeanours, if I may so term them, to which I have just now referred, will be avoided.


Richard Burpee Hanson: Where
does that occur?


Peter John Veniot: It occurs; that is all I say.


Richard Burpee Hanson: In
Gloucester?


Peter John Veniot: No, it occurs in York.


George Gordon: Perhaps at this juncture
I might make some observations about the method that was pursued by the Department IMr. Veniot.]
of Labour in connection with the disbursement of unemployment relief funds. It may be recalled that in 1922 we had a similar sort of situation to that experienced in 1930, and the then government outlined a plan of assistance from the federal government to the provinces. This will be revealed in an order in council dated January 25, 1922, P.C. 191. I will ask the consent of the committee to have this order in council spread upon the record. It reads:



P.C. 191

[Stage Direction]
Certified copy of a report of the committee of the privy council, approved by His Excellency the Governor General on the 25th January, 1922.
Privy Council Canada
The committee of the privy council have had before them a report, dated 25th January, 1922, from the Prime Minister submitting the following observations with reference to the order in council of 7th October, 1921	(P.C. 3831),
respecting unemployment relief.
1.	The present administration, assuming office at the close of the year 1921, finds that a condition of unemployment beginning in the late months of 1920 and continuing throughout the year 1921 does not promise any material abatement during the early winter months of 1922.
2.	Consideration has been given to the means which would seem best adapted to the relief of the distress resulting from severe unemployment conditions, and the provisions to this end of P.C. 3831 have been carefully noted.
3.	The minister concurs in the view that the question of unemployment relief is fundamentally a municipal and provincial responsibility; that the abnormal economic and industrial conditions now existing and arising in a measure out of the late war alone afford justification for action on the part of the federal authorities; that federal action must therefore supplement municipal and provincial efforts, must be designed on lines permitting close and effective co-operation with and supervision by municipal and provincial authorities, and must be proportioned by the efforts of those authorities.
4.	That municipal undertakings in the nature of public works are important factors in meeting unemployment conditions, but such undertakings cannot be proceeded with during the winter months save at a considerably increased cost, which is in many cases beyond the financial resources of the municipalities.
5.	That, having these various points in mind, it is desirable that federal employment assistance and unemployment relief should be granted on the following basis:
(a)	In the case of public works undertaken by a municipality during the winter months and specially with a view to the relief of unemployment in the district, the municipality will bear the normal cost and the federal government will bear one-half of the extra cost incurred by the prosecution of the work during the winter season, the estimate of the normal cost to be approved by officers of the federal Department of Public Works; the federal grant to be conditional on the province assuming responsibility for one-third of such excess expenditure.

Relief Act, 1934
(b)	That where work cannot be provided, the federal government will refund to a municipality one-third of the disbursements made on account of unemployment relief, disbursed to others than those specified in paragraph (d) following and conditional on the participation on an equal basis by the province concerned.
(c)	That where in certain provinces there are unorganized districts without municipal government in which unemployment or distress exists and the provincial government finds it necessary to administer a system of unemployment or distress relief, the federal government will reimburse the provincial government concerned to the extent of one-half of such disbursements for relief and for the administration of the unemployment or distress relief policy in the district.
(d)	That in the case of unemployed former members of the Canadian or British forces, now in Canada, discharged as physically fit or not entitled to assistance by the Department of Soldiers' Civil Re-Establishment, the federal government will reimburse the municipal authorities to the extent Of one-half the disbursements made for unemployment relief, the remaining quota to be contributed in equal parts by the province and municipality respectively.
6.	It is to be noted that these regulations do not seek to meet the case of disabled members of the Canadian overseas forces and other classes of returned soldiers which fall within the jurisdiction of regulations administered by the Department of Soldiers' Civil Re-establishment; or of persons (where such exist) whose necessities do not clearly arise from inability to secure employment and with whose necessities the municipal authorities have been accustomed to deal.
7.	It is the expectation of the federal authorities that the provisions herein will be interpreted broadly and generously by the municipalities and the provinces so that no resident of Canada willing and able to work and unable to secure employment shall lack food, clothing or shelter for himself or herself and dependants.
8.	These provisions to continue in effect until the close of the present fiscal year.
The committee concur in the foregoing observations and recommendations and submit the same for approval accordingly.
(Sgd.) Rodolphe Boudreau,
Clerk of the Privy Council.
I would call particular attention to paragraph 7. Perhaps it will be remembered that the hon. gentleman (Mr. Yeniot) who has just spoken, was a member of the government at that time.
Clarence Joseph Veniot: I did not catch that. What was it?


George Gordon: This was an order in council passed by the federal government on January 25, 1922. In order that proper safeguards might be thrown around the contribution of federal moneys under that order in council, the auditor general was consulted in the matter and he adopted a form of certificate wherein the municipal treasurer, the minister of labour or
his deputy and the provincial treasurer would certify to the expenditure. With the consent of the committee I would like to have that certificate spread upon Hansard for the information of the members. It is as follows:
Form D 3 Civilian
The Dominion Government In account with
The municipality of	
Month	192..
To unemployment relief disbursed by municipality:-
Number of applicants (married) given relief..
Number of dependants given relief	
Number of applicants (single) given relief.. .. Total expenditure for relief disbursed by municipality between the period beginning
	, 192.. and ending	, 192..
$	
(Substantiated by certificates "B" or statement of account filed at the Ontario Department of Labour.)
One-third payable by dominion government
$	
I hereby certify that the above amount was expended as stated, and solely for the relief of distress due to unemployment, and in accordance with the terms of the agreement between
the municipality of	and the
federal and provincial governments.
Municipal Treasurer
I hereby certify that I have checked the above relief certificates and believe that payments have been made as stated, and in accordance with the agreement between the municipality of	and the federal and
provincial governments, and recommend that payment be made by the Ontario government.
Minister of Labour
Deputy
I hereby certify that the government of Ontario has made payment of the sum of
$	in settlement of the amount
due from the province under the terms of the agreement respecting unemployment relief
between the municipality of	and
the provincial and federal governments.
Date	
Provincial Treasurer
This account when certified by the provincial treasurer to be forwarded to the Department of Labour, Ottawa.


Peter John Veniot: The minister stated that I was a member of the government in 1922. I was not.


George Gordon: I thought the hon. member was a member of the government of New Brunswick.
Relief Act, 1934


Peter John Veniot: I was a member of the
government of New Brunswick in 1922. I thought the minister spoke of the federal government.


George Gordon: The federal government
under this order in council to which I have just made reference, and following the practice laid down by the auditor general at that time as disclosed in the certificate, disbursed to the provinces and to the municipalities moneys from the dominion treasury.
In 1930 after the passage of the first relief act the same question arose and the method to be employed was discussed by the director of unemployment relief with the auditor general. A form of certificate much more restrictive than the one which was employed in 1922 was adopted by the auditor general, and I would ask the consent of the committee to have this certificate spread upon Hansard. It is as follows:
(Crest)
Canada
Department of Labour Unemployment Relief Act, 1930 Certificate of expenditure under section 8 of regulations (P.C. 2246)
The undersigned hereby certify that the
amount of $		dollars
	cents is due to the province of
	by the dominion government
in respect of (A)	
Payable	by dominion	$Paid by	province	$Paid by	municipality	$Total joint expenditure	$
In accordance with the terms of section (B)
of the agreement entered into between the
province of	
and the Minister of Labour, Ottawa, dated..
and that the attached statement of account has been checked and found to be correct; that the work which it covers has been duly carried out in accordance with the terms of the above mentioned agreement; that no charges for the expense of administration are included in the said statement and that the province has reimbursed the municipality or agrees to do so for their proportion of the total joint expenditure as set forth above.
Signature of provincial auditor
For the province of	
Signature of
For the province of	
This certificate and statement of account to be forwarded to the Director, Dominion Unem-[Mr. Gordon.1
ployment Relief, Department of Labour, Ottawa, in triplicate.
(A)	Insert here short description of work or direct relief covered by this certificate giving sub-agreement number and/or municipality or district.
(B)	Insert here section of dominion-provincial agreement concerned.
In the fall of 1930 after many conferences between the Department of Labour and the auditor general with respect to the best method to be employed in order to safeguard the federal treasury and after this certificate was agreed to, the auditor general wrote to the deputy minister of labour in a letter dated November 5, 1930, as follows:
Dear Sir:
In reply to your letter of the 29th ult. enclosing a form of certificate w'hich it is proposed to send to the various provinces to be filled in as indicated thereon with the particulars of all projects undertaken by the various provinces and municipalities claiming aid from the federal government under the Unemployment Relief Act, 1930, 21 George Y, chap. 1, I am of opinion that if the particulars asked for thereon are carefully prepared and signed by the appropriate provincial officers, the information thus provided will be sufficient for my purposes.
"The appropriate provincial authorities," it seems to me, are such as may be designated by the provincial government. I would consider it more satisfactory if the provincial auditor were one of the signatories to the certificate.
And in order that the Labour department might follow the direction of the auditor as disclosed in the letter I have just read, the certificate was required to be signed by the respective provincial auditors. Undier the terms of this arrangement which was agreed to, certified to, and approved by the auditor general, the administration of the act of 1930 was carried on. I hold no brief for the auditor general, neither do I want unduly to criticize his activities, but under his direction this work has been projected; all these accounts are certified to first in the department, then by the auditor general's department, and the cheques were countersigned by the auditor general. During the year 1931 some irregularities were disclosed; I do not suggest for a moment that they amounted in any way to a deliberate attempt to defraud either the federal treasury or any other. The administration of unemployment relief has been a most difficult and complex matter, giving rise to many baffling situations not only to the federal government but to the municipalities and the provinces, and in my business experience I have never seen any work so well and unselfishly administered. There have been but few instances of people who so forgot their duty and disregarded their responsibilities as to transgress. Generally

Relief Act, 1934
and broadly speaking the administration of the moneys of the taxpayers, municipal, provincial and federal, has been free from any sort of pilfering or looting such as suggested by some hon. members.
However, a time came when certain irregularities appeared, and the attention of the auditor general was drawn to them. It came to a head with respect to Port Alfred in Chicoutimi county. The director of unemployment relief notified the auditor general that he thought it desirable that a further investigation, outside of the then prevailing practice, should take place with respect to that municipality and some others that seemed to be in a similar condition. Now what happened'? Apart perhaps from a test audit, nothing was done until September; 1932, when order in council P.C. 2163 was passed by the executive. With the leave of the committee I would like to put this upon the record. In giving directions to the auditor general the order in council states: In view of the foregoing,-
That is, after reciting the necessity for further audit.
-the minister recommends that the auditor general be authorized to conduct such audit of provincial accounts, in connection with unemployment relief expenditures, as he deems essential to safeguard the interests of the dominion treasury;
Then further on:
The minister further recommends that the auditor general be authorized to investigate the provincial systems of auditing municipal relief accounts, to the end that the dominion government may be satisfied that the municipal accounts put forward by the provinces are in accordance with the agreements entered into between the dominion government and the provin ces.
That order in council was assented to on September 30, 1932. After the passage of that order in council the Labour department again called the attention of the auditor general to the necessity of carrying out the directions therein contained. I ask that the order in council be incorporated into the record, which order reads as follows:
The Relief Act, 1932 P.C. 2163
Certified to be a true copy of minute of a meeting of the Committee of the Privy Council, approved by Kis Excellency the Governor General on the 30th September, 1932.
The Committee of the Privy Council have had before them a report, dated 27th September, 1932, from the Minister of Labour, submitting as follows:
1.	That parliament has enacted legislation dealing with relief which may be cited as The Unemployment Relief Act, 1930,
The Unemployment and Farm Relief Act, 1931,
The Unemployment and Farm Relief Continuance Act, 1931,
The Relief Act, 1932.
2.	That the auditor general has had a survey made in the offices of the Ontario government at Toronto, of the accounts, records, etc., of payments made to the province of Ontario under the agreements entered into under the provisions of the Unemployment and Farm Relief Act, 1931, and has advised the minister that his investigations indicate:
(a)	The province does not receive sufficient proof of payments made under the act by municipalities.
(b)	The province relies almost entirely upon the good faith of the officers of the municipalities for assurance that claims are made only for expenditures properly chargeable against the dominion.
(c)	It appears that claims have already been presented and payments made thereon which may be open to question.
(d)	In the case of expenditure where the proportion payable by the municipality is collected from private sources, the municipality is thereby exempt from payment of any portion of such expenditure.
3.	That under date of April 20, 1932, the auditor general advised the minister that accounts submitted for payment based on agreements with the provinces under the Unemployment and Farm Relief Act, 1931, were in the approved form, certified by authorized officers of the provincial governments and officers of the Department of Labour, who passed them for payment after examination, and that this procedure was considered a sufficient safeguard for the payment of the federal government's share of the expenditure, and for that reason the auditor general was justified in taking no exception to the general principles under which the accounts were administered nor "until recently of the ultimate effects of certain interpretations of the regulations under which the moneys voted were to be paid."
4.	That under date of July 4, 1932, the auditor general has submitted a report made by his officers dated June 27, 1932, being the result of an investigation made of the accounts and records of the Saskatchewan relief commission at Regina, and that in this report it is stated "The test audit made by me does not relieve the Department of Labour from making the detailed audit called for by Section 54 of the Consolidated Revenue and Audit Act, Chapter 178, R.S. 1927."
5.	That under date of August 2, 1932, the auditor general has submitted a report dated July 30, 1932, being an investigation of unemployment relief payments in the province of Saskatchewan made outside of the area administered by the Relief Commission, or which were made in Saskatchewan prior to the date of the inception of the commission (August 25, 1931), the period covered by the test audit being from October 10, 1930 (the date on which the relief agreement under authority of the Unemployment Relief Act, 1930, was signed) to April 30, 1932.
6.	That at a conference between the minister, the auditor general and the commissioner of unemployment relief on September 6, 1932, the auditor general maintained that the Dominion government was responsible for the auditing of
Relief Act, 1984

the provincial government's accounts but was of the view that the auditing of municipal accounts was the responsibility of the provinces.
7.	That clause 6 of the agreements entered into with the provinces under the Unemployment and Farm Relief Act, 1931, provided that "The dominion shall pay to the province for remittance to any municipality such proportion of the cost of construction of municipal works and undertakings carried out to provide work for the unemployed as may be agreed upon between the province and the dominion. ..."
8.	That the auditor general has interpreted clause 6 of the agreements referred to in the preceding paragraph to exclude municipal works and undertakings if the municipality charge any part of the costs to persons or properties directly benefited and has suggested that a test audit be made "If the department cannot assure this office that no such amounts are included in the claims, and that they have cheeked the claims at the point of issue."
9.	That clause 1 of the agreements entered into with the provinces under the Unemployment and Farm Relief Act, 1931, provides that "the dominion shall pay to the province for remittance to any municipality within the provincial territory such proportion of the expenditures of the municipality for direct relief .... as may be agreed upon between the province and the dominion."
10.	That the auditor general has interpreted clause 1 of the agreement referred to in the preceding paragraph so as to exclude contribution in cases where the municipal contribution or part of the municipal contribution is provided by "private" subscription, including in this expression contributions made by local organizations, such as the Red Cross society.
11.	That the form of certificate to be rendered by the province in connection with the submission of relief expenditures was submitted to the auditor general on October 29, 1930, and that the auditor general under date of November 5, 1930, stated "In reply to your letter of October 29, enclosing a form of certificate which it is proposed to send to the various provinces to be filled in as indicated thereon, with the particulars of all projects undertaken by the various provinces and municipalities claiming aid from the federal government under the Unemployment Relief Act, 1930, I am of opinion that if the particulars asked for thereon are carefully prepared and signed by the appropriate provincial officers, the information thus provided will be sufficient for my purpose."
12.	That with only minor modifications made necessary by difference in arrangements with the provinces, similar forms of certificate continued to be received from the provinces under the Unemployment and Farm Relief Act, 1931, and The Relief Act, 1932, and that such certificates, with their supporting statements of accounts, have been submitted to the auditor general and have been, since the inception of the unemployment relief branch of the Department of Labour, accepted by the auditor general; and that in due course cheques to the various provinces have been issued with the counter signature of the auditor general's representative.
13.	That as a result of the auditor general's advice on November 5, 1930. that the certificates proposed would' be sufficient for his purposes, it has not been deemed necessary to carry out any audit of the provincial and muni-

cipal records, and the audit of the unemployment relief branch has been confined to the checking of certified accounts as received from the provinces.
14.	That the unemployment relief branch has relied upon the auditor general for any necessary additional audit as the staff of the branch does not include personnel necessary to carry out an audit in the field.
In view of the foregoing, the minister recommends that the auditor general be authorized to conduct such audit of provincial accounts, in connection with unemployment relief expenditures, as he deems essential to safeguard the interests of the dominion treasury;
And that the commissioner of unemployment relief and the auditor general be authorized to accept from the provinces accounts rendered under clause 6 of the agreements under the Unemployment and Farm Relief Act, 1931, and to provide for dominion contributions to such accounts irrespictive of whether such accounts cover what are known as local improvement works to which the local proprietors will eventually contribute, or otherwise;
And that, further, the commissioner of unemployment relief and the auditor general be authorized to accept accounts from the provinces under clause 1 of the agreements entered into under the Unemployment and Farm Relief Act, 1931, and to pass for payment the accounts for the dominion contribution to the expenditures reported by the provinces as having been made by the municipality, including in such municipal expenditures amounts voluntarily contributed by individuals, business firms, or associations, to the municipality, providing that such amounts have been utilized solely for relief purposes, and have been expended under the jurisdiction of the municipal authorities; and provided that such funds have not been raised by arbitrary deductions from wages payable to those engaged on relief work.
The minister further recomends that the auditor general be authorized to investigate the provincial systems of auditing municipal relief accounts, to the end that the dominion government may be satisfied that the municipal accounts put forward by the provinces are in accordance with the agreements entered into between the dominion government and the provinces.
The committee concur in the foregoing recommendations and submit the same for approval.
(Sgd.) E. J. Lemaire,
Clerk of the Privy Council.
Then, on May 31, 1933, the dominion director of unemployment relief received this letter from the auditor general:
Re: Port Alfred, Chicoutimi County I have your letter of May 22, in which you request that I audit the accounts of relief expenditures rendered by the province in respect to the town of Port Alfred, and informing me that you are placing the municipality on the "stop-payment" list until such time as I report on the audit.
When I requested my chief investigator to inform you that my representatives were about to continue their investigations in Quebec. I had in mind that if there was some particular municipality that you thought should be investigated, I would include it among those which, in due course, I intended to examine.

Port Alfred might be one of these municipalities. Under present conditions, however, would it not be advisable to have the provincial auditor make a special local audit of the accounts of that municipality and report thereon before further federal payment may be made?
Bear in mind that this letter is dated May-31, 1933; the first order in council was in September, 1932, and this is the answer that comes from the auditor general to the Labour department. The letter continues:
That audits of certain municipalities should be made at your specific request, and that the making of payments should be contingent upon my report, would not only interfere with the independent functioning of the audit office, but might possibly work a hardship on the municipality concerned.
You will understand that, in the circumstances, I cannot assume the obligation of making an immediate audit of the municipality named.
Yours very truly,
Geo. Gonthier,
Auditor General.
That letter was directed to the dominion commissioner of unemployment relief and was referred to me; and in answer to it I wrote to the auditor general on June 7, 1933, in the following terms:
Re: Port Alfred, Chicoutimi County, P.Q.
The dominion commissioner of unemployment relief has brought to my attention his communication to you regarding the above, dated May 22, also your reply of May 31.
I observe that it is your view that the making of audits of certain municipalities at the request of this department would interfere with the independent functioning of the audit office and in your opinion "might possibly work a hardship on the municipality concerned."
I understand from the commissioner's letter of May 22, that your representative informed him that you were proceeding with an audit of accounts in certain municipalities and that you would like to have the names of municipalities suggested to you by the commissioner, whose views on this point would naturally be helpful, and I understand that it was in accordance with this request and in the spirit of cooperation that the commissioner suggested that an audit be carried out of the municipal accounts at Port Alfred.
I cannot agree that the submission of the name of this or any other municipality to you in reply to your request would interfere with the "independent functioning of the audit office," nor can I conceive why it could "possibly work a hardship on the municipality concerned." Indeed I would assume that your first concern would be for the interests of the federal government rather than for the municipality.
I observe your statement that in the circumstances you cannot assume the obligation of making an immediate audit of the municipality named. I do not know what circumstances you refer to other than that you refuse to make the audit because the commissioner has suggested it. As I have above stated, the suggestion was
Relief Act, 1934
made at the request of your representative, and an audit which may be necessary should not be omitted because in your opinion it might possibly work a hardship on the municipality concerned, or for any other reason that I am aware of.
Yours truly,
W. A. Gordon,
Minister of Labour.
Then there is a reply dated June 23, 1933, from the auditor general. It is addressed to myself, and is as follows:
I am in receipt of your letter of June 6 regarding the audit of relief expenditure and of another of the 7th received in this office on the 19th, with special reference to the municipality of Port Alfred, P.Q.
I am naturally anxious to avoid any misunderstanding which might arise out of informal conversations and correspondence concerning the audit of a class of expenditure having its own special problems of administration and' control. In the circumstances, and in order to avoid any doubt as to my intentions concerning cooperation, I am making a broad review of the whole question after which I shall write to you at greater length.
I sincerely hope that it may be possible to arrive at an acceptable solution of our problems consistent with the designedly limited duties and responsibilities of the auditor general as defined by statute and with the administrative limitations under which this office has been labouring for some time past.
Assuring you of my desire to assist in any way possible in coping with the great difficulties arising out of the administration of unemployment relief.
I am,
Yours faithfully,
(Sgd.) Geo. Gonthier,
Auditor General.
On June 28, 1933, I replied to that letter in these terms:
I am in receipt of your letter of June 23 and note your anxiety to avoid any misunderstanding which might arise out of informal conversations and correspondence concerning the audit of relief expenditures. I must confess I do not altogether grasp what misunderstanding you have in mind which might occur in this regard. To my mind there would appear to be no ambiguity or ground for doubt as to the duties and obligations which devolve upon yourself and staff in this matter.
The terms of P.C. 2163 of September 30, 1932, are clear and devoid of any ambiguity. It contains specific instructions provided for in section 62 (g) of The Consolidated Revenue and Audit Act. being chapter 178 of the R.S.C. 1927, from which I quote as follows:
"The auditor general shall examine and audit, if required so to do by the Minister of Finance, and in accordance with any regulations which are prescribed for his guidance in that behalf by the treasury board, . . .
(g) any other public accounts which, . . . the treasury board directs him to examine and audit."
The disbursements under the consecutive relief acts having reached such proportions
Relief Act, 1934

made it necessary, in the judgment of myself and colleagues, to pass the said order in council in which we have set out specific instructions to yourself as auditor general. From that order in council I quote two clauses, of which I am confident you have already taken full cognizance:
" The minister recommends that the auditor general be authorized to conduct such audit of provincial accounts, in connection with unemployment relief expenditures, as he deems essential to safeguard the interests of the dominion treasury."
"The minister further recommends that the auditor general be authorized to investigate the provincial systems of auditing municipal relief accounts to the end that the dominion government may be satisfied that the municipal accounts put forward by the provinces are in accordance with the agreements entered into between the government and the provinces."
There can be no doubt as to the government's intent contained in these instructions, and I am at a complete loss to understand why there can exist in your mind any lack of comprehension as to their import. They call for you to conduct such audit of provincial accounts as you deem essential to safeguard the interests of the dominion treasury. These instructions were given you in September, 1932, and now, nine months later, you advise the dominion commissioner that, owing to certain embarrassments which you fear it might cause some of the municipalities, you are loath to take the necessary steps by way of audit which would carry out those instructions.
With great diffidence and great reluctance I am compelled to state that your department has not complied with the expressed intention of the government in a matter of very vital and national importance. Ministers of the crown, particularly at a time like this, must of necessity rely upon the various departments of government which are charged with the responsibility of seeing that the policies of the government are carried out, and there is no department which should be more astute to recognize the necessity of activity, and be more zealous in its activity, than that of the auditor general, when the federal government is making contributions in vast sums out of the federal treasury to the provinces of Canada, who with their creatures, the municipalities, alone are the agents to expend the money so contributed.
X write this letter, as I have above stated, with the greatest reluctance but, in the light of our previous interviews and correspondence and the attitude you have taken, I am regretfully forced to the conclusion that you either are not seized of the national importance of conducting your audit in accordance with the instructions of the government as contained in P.C. 2163, or that you entertain views with respect to the same which are in conflict with the spirit and terms of the order in council, and have decided to adopt a course of your own fashioning.
Yours very truly,
W. A. Gordon.


Mr. GRAY:: What was the reply from the auditor general?
Mr. 'GORDON: I do not believe there was a reply. This is the order in council to which

the right hon. leader of the opposition (Mr. Mackenzie King) made reference on March 26 last. On that occasion he made statements, probably not with a desire to misrepresent in any way but purely through inadvertence. From his observations it would seem that action by the Dominion government was taken only on March 12, 1934. As a matter of fact action had been taken in the fall of 1930, and in each succeeding month the closest sort of check was made, as I have indicated.


William Lyon Mackenzie King: The fall of 1930?


George Gordon: Yes, 1930.


William Lyon Mackenzie King: Does the minister mean 1932?


George Gordon: No, 1930.


Ross Wilfred Gray: What is the date of the letter the minister has just read?


George Gordon: The letters I have read will appear in Hansard.


Ross Wilfred Gray: I should like to have the date, so that we may follow what is now being said.


George Gordon: The last letter I read was dated June 28, 1933. When the right hon. gentleman opposite was speaking on March 26 last no doubt he believed that the first action taken by the government was taken on March 12, 1934. However, if one reads the order in council a little more carefully he will not labour under that misapprehension. It is as follows:
Whereas the Relief Act, 1932, empowers the governor general in council, notwithstanding the provisions of any statute of law, inter alia, to enter into agreements with any of the provinces respecting relief measures therein, and also (in addition to such relief and other measures specified in the said act), to take all such other measures as might be deemed necessary or advisable for carrying out the provisions of the said act;
And whereas agreements having been entered into with the various provinces of Canada respecting relief measures therein under the authority of the Relief Act, 1932, and other measures of relief undertaken under the antecedent legislation respecting unemployment relief and need having arisen in consequence for the conduct of audits of provincial accounts relating to relief expenditures and the investigation of the provincial system of auditing municipal relief accounts, it was directed by order in council, dated September 30, 1932 (R.C. 2163), passed under the authority of the Relief Act, 1932, that:
Then it goes on to embody in the order in council of March 12, 1934, what was recited in the order in council passed over two years before. So if the right hon. leader of the opposition in making his observations a few

Relief Act, 1034
nights ago had gone through the order in council passed on March 12 he would have seen there a clear and distinct reference to the earlier order in council to which I have made reference, and would not have fallen into the error which he did.
I do not want to detain the members of the committee but I want to say in fairness to the municipalities, in fairness to the provinces, in fairness to the Labour department and in fairness to the taxpayers of this country, that the federal Labour department has taken every reasonable step to see that the moneys provided by the taxpayers were applied for the purposes for which parliament enabled this government to make the moneys available. If the suggestion that the treasury has been looted goes out to the taxpayers it only adds to their anxieties, and I could not therefore refrain from shortly spreading on the record just what the situation is. I can only repeat that if there was looting then every little village council, every town and city council, every provincial government and the federal government are all looters together. I do not think anyone would care to subscribe to any such idea as that. I think, Mr. Chairman, that the members of this committee should have this record spread on Hansard in order that anxieties that may have arisen in the minds of the taxpayers of this country should be allayed to the extent at least that these official records disclose that the government has endeavoured to have audits made from the very beginning right down to date of such a kind and character as were approved of, as they were, by the auditor general.


William Lyon Mackenzie King: After listening to what the minister has said I feel pretty sure that one is not wide of the mark in saying that it is a case of endeavouring to lock the door after the horse has been stolen. It is all very well for the minister to come along to-day and say, "We asked the auditor general to do this and that," when at the time these original agreements were being entered into the Prime Minister himself said on three or more occasions in this house, in answering the opposition when we were advocating the auditing of the accounts, that it would be an insult to ask the governments of the provinces to permit the accounts to be audited. I think the minister heard my statement the other day but perhaps the Prime Minister was not in when I read what the Prime Minister said at that time. His words were quite distinct. For example, at page 173 of Hansard of 1930 the Prime Minister is reported as having said:
Are we to be told, because two or three members of this house stand up and complain
of a provincial legislature that therefore we are to insult that legislature by saying that we are to deal with their affairs and not our own? Are we to mind our business or their business?
And at page 175 the Prime Minister is reported as having said:
I will look further into the suggestion made by the leader of the opposition-
That was that great care should be taken to see that the accounts were audited.
-.but I cannot conceive how, under our constitution. any self respecting province would expect the dominion government to place upon it what I regard as an unenviable and unnecessary insult by saying:
This was the proposal in the form of a section that I had suggested should be included in any agreement made with the provinces:
Where any moneys are expended under this act by way of contribution to provinces, municipalities or other bodies, the auditor general shall audit the expenditure made by the province, municipality or other body, and shall report thereon to parliament within thirty days after the commencement of the next session.
That was the clause which we suggested should go into the bill relating to the expenditure of public moneys for purposes of relief, and the Prime Minister himself said that it would be an insult to the provinces to insert any such clause. Again at page 164 the Prime Minister said:
This parliament has no jurisdiction to interfere with the provinces and the municipalities in the expenditure of their moneys. If that were made a condition I think it would be regarded by the provinces as an insult.
As I pointed out at the time it was federal moneys that were referred to, not the moneys of the municipalities or the provinces, but money going out of the federal treasury, and the government could attach to the expenditure of that money any condition it pleased. It would not have interfered with the powers of the provinces or of the municipalities in the slightest degree. They did not have to take our money. It was, however, our duty to the public who had to pay the shot to see that with respect to any money to be spent there were adequate audits. I venture this prediction, that in the agreements which the minister entered into with the provinces it is not specifically set out that every dollar of public money from the federal treasury to be spent for purposes of relief shall be audited by a federal auditor. The minister reads correspondence between himself and the auditor general which took place after several millions of public moneys had been expended-
Relief Act, 1934


George Gordon: No, it started in November 1930.


William Lyon Mackenzie King: A great deal of money had been spent, as the minister well knows, within the very first year.


Richard Bedford Bennett: This was November, 1930.


William Lyon Mackenzie King: After beginning to spend the money.


Richard Bedford Bennett: That is when we settled it with the auditor.


William Lyon Mackenzie King: Did the minister
settle it with the provinces?


Richard Bedford Bennett: Yes.


William Lyon Mackenzie King: And with the municipalities?


Richard Bedford Bennett: No.


William Lyon Mackenzie King: That is the
point. It was public money and it was the business of my right hon. friend and his colleagues in spending federal money to see that every bit of expenditure was audited down to the last payment. But as I say the minister reads correspondence with the auditor general asking him to do certain things which, with the staff he had, I presume it would have been to some extent physically impossible for the auditor general to do. What should have been done, as we suggested from the very first, was that the expenditure of these millions of dollars, now over one hundred million, should have been entrusted to a national commission which would have exercised careful supervision and none had auditors who would have reported to parliament. Then we should have had proper auditing.
To begin with, to expect the minister's department to deal with this whole question of unemployment relief was a mistake. The department was established to carry on business in a normal way in normal times, and there has never been, despite its increases, the staff necessary to begin to handle unemployment relief. The first Minister of Labour, as hon. members recall, worked as conscientiously as any minister could have done to carry out his duties, and with what result? He broke down completely and is now no longer here. It was impossible from the first that any minister could take on the task he did with the staff he had and attempt to do it satisfactorily, with due regard for the public interest. The mistake made was that the government did not at the outset grasp the significance of the unemployment problem.

If they did, they never took the steps necessary to see that relief was properly administered. When next the Prime Minister made the statement that it would be an insult to the provinces to expect to have any auditing done, it was in the public mind inviting the expectation of the freest kind of distribution of public funds. It was not until after this that the minister corresponded with the auditor general and sought to put an impossible task upon him. The fact that the auditor general even by a cursory visit of his officials to different communities had no difficulty in unearthing the evidence which he did of waste on a colossal scale is conclusive proof of the inadequacy of the measures taken by the government, and the fact that such waste was possible at all can only reflect on the administration because they alone are responsible for it.


Richard Bedford Bennett: I am very grateful for
this opportunity to deal with this situation. The right hon. gentleman would have us believe that his .anxiety for the public interest is so great that he must cry aloud to high heaven that money has been wasted and that the taxpayer has been defrauded. He practically charges theft against the provincial and municipal authorities. Let us see what are the facts. In 1930 when he suggested in this chamber that adequate provision was not being made to safeguard the public interest with respect to expenditures to which the dominion was contributing, we declined absolutely to deal with municipalities. There was no point of contact between the municipalities and this government except through the provincial governments. At that time we did not undertake by agreement or otherwise to do other than make a contribution to expenditures by the provincial authorities. When it was suggested that we should audit the accounts of the provinces I said that they -being autonomous units, that would be little short of an insult. I had high authority for saying that. In 1922 the right hon. gentleman had to deal with the problem and he passed an order in council in which he pointed out the difficulties of the situation. I hold in my hand the form of certificate which was settled upon by his government, not with t'he provinces but with the municipalities to whom contributions were made. That certificate was to be signed by the municipal treasurer and, what minister does the committee think? It was not a commission, it was not a denial of responsible government; oh, no, we are going to have responsible government when we are in power, and have it through our ministers. But when

Relief Act, 1984
we are in opposition we want a commission and thereby destroy the theory of responsible government. That is the view of the right hon. gentleman. The Minister of Labour, the Honourable Mr. Murdock, was to certify and the treasurer of the municipality was to sign. There is the form under which the provincial auditor then gave his certificate and our auditor paid.
I was so impressed with what was said in 1930 that before I left for England I gave certain instructions as to how I thought the matter should be looked after. The late Senator Robertson sought, through his deputy to safeguard the federal treasury in his dealings with the auditor general and the preparation of the provisions of the agreements which were made. In the correspondence we find a letter written by the auditor general to Mr. Ward. I ask the committee to note the date of this letter. It was dated November 5, 1930, before any considerable money had been spent. The letter reads in part:
In reply to your letter of the 29th ultimo- It will be observed that that was October- 

enclosing a form of certificate which it is proposed to send to the various provinces to be filled in as indicated thereon with the particulars of all projects undertaken by the various provinces and municipalities claiming aid from the federal government under the Unemployment Relief Act, 1930, 21 George V, chapter 1, I am of opinion that if the particulars asked for thereon are carefully prepared and signed by the appropriate provincial officers, the information thus provided will be sufficient for my purposes.
Pursuant to that a form of certificate was prepared in the fall of 1930 to meet the situation. This certificate reads:
(Crest)
Canada
Department of Labour Unemployment Relief Act, 1930 Certificate of expenditure under section 8 of regulations (P.C. 2246)
The undersigned hereby certify that the
amount of $		dollars
	cents is due to the province of
	by the dominion government
in respect of (A)	
Payable by dominion	$
Paid by province	$
Paid by municipality	$
Total joint expenditure	$
In accordance with the terms of section (B) of the agreement entered into between the
province of	
and the Minister of Labour, Ottawa, dated'..
and that the attached statement of account has been checked and found to be correct; that the work which it covers has been duly carried out in accordance with the terms of the above mentioned agreement; that no charges for the expense of administration are included in the said statement and that the province has reimbursed the municipality or agrees to do so for their proportion of the total joint expenditure as set forth above.
Signature of provincial auditor
For the province of	
Signature of
For the province of	
This certificate and statement of account to be forwarded to the Director, Dominion Unemployment Relief, Department of Labour, Ottawa, in triplicate.
(A)	Insert here short description of work or direct relief covered by this certificate giving sub-agreement number and/or municipality or district.
(B)	Insert here section of dominion-provincial agreement concerned.
That was the form prepared and sent out in the fall of 1930. It was approved by the auditor general of Canada as being sufficient to safeguard the interests of the Canadian taxpayer in connection with the contributions being made by the dominion to the provinces for the purpose of enabling them to discharge their constitutional functions.


Ross Wilfred Gray: It has been shown that it was not sufficient.


Richard Bedford Bennett: Could any department do more than ask the auditor general what should be done that would be sufficient?


Ross Wilfred Gray: It certainly was not an insult to audit that statement or report.


Richard Bedford Bennett: The hon. gentleman knows perfectly well that the auditor general said that the certificate of the provincial auditor was sufficient.


Ross Wilfred Gray: It was not.


Richard Bedford Bennett: It was for the purpose of complying with the laws of this country and protecting the Canadian taxpayer that this form was prepared and approved by him.


Ross Wilfred Gray: Apparently the minister has
felt all down through the years that it was not sufficient.


Richard Bedford Bennett: We will point that out in a minute. In 1931 there was an expansion of activity and the agreements between the provinces and the dominion contemplated larger expenditures by the municipalities. The min-
Relief Act, 1934

ister, not being able to get the certificates he was looking for for his own safety and the safety of the government, took it up with the auditor general, the person with whom he should take it up. I ask any hon. member to read that correspondence and tell the committee what he thinks of it. The auditor general was fearful that it might involve difficulty with the municipalities but he was reminded by the minister that his duty was to the dominion taxpayer and not to the municipality. That is what we complained of. Everything that could be done was done for the purpose of having the federal official appointed by law do his duty and protect the taxpayer in accordance with the terms of a certificate with which he said he was satisfied. He replied that he was fearful that it might involve difficulties with the municipalities.


Ross Wilfred Gray: He is a servant of this house.


Richard Bedford Bennett: Exactly.


Ross Wilfred Gray: Why was it not brought to the attention of the house before?


Richard Bedford Bennett: It has been; the papers have been laid on the table. If the hon. gentleman will read them he will see exactly what they indicate. I have no quarrel with the auditor general but I have a quarrel with an official who, when asked for his views, outlines the method by which the work should be done and when it is done in accordance therewith and he is asked, re-asked and asked again to put this matter in such shape as will not leave any doubt, then files what he calls an audit and says that the officials of the municipalities and provinces are really thieves. That is his suggestion. I say that you have no right to say that the mayor of Fredericton, New Brunswick is a wrongdoer because he devoted a portion of the money which he expended to medical relief and then asked the dominion to pay a share. As soon as it was pointed out that that was wrong, he undid it. It is as wrong as it possibly could be to make that assertion.
The check which is being carried on in connection with these accounts by the minister and his department has been for the purpose of inducing the auditor general to do his duty. It is a nice mess that we have to face when the auditor general, over whom the government has no control, through these test audits and letters which he wrote, has made it appear that the government has failed in its duty when, in fact, the government has continued to ask him to do his duty and he has failed to do it.


Charles A. Stewart: Did the right hon. gentleman not state in the house that

it was not the duty of the government to have an audit of the provincial and municipal accounts?	.


Richard Bedford Bennett: That was not the kind of agreement.


Charles A. Stewart: If the
formula that my hon. friend has read was followed, I cannot see anything particularly wrong with it. If the auditor should proceed against the will of the government, as expressed by the Prime Minister in the House of Commons, it would be a curious state o affairs.


Richard Bedford Bennett: That is his duty when he thinks he is right.


Charles A. Stewart: My right hon. friend is straining the point to a very considerable degree to-night.


Richard Bedford Bennett: I am not. I say, it is his duty.


Charles A. Stewart: That is my impression and I am entitled to it.


Richard Bedford Bennett: It is wholly wrong for the Prime Minister or any other minister to interfere with the auditor general, and I have made it my duty not to interfere with or to suggest to him what he should do, and the correspondence, if it is desired, will prove that conclusively. The Minister of Labour, in the submission he made to him with the approval of the government, indicates clearly the position which he took, namely, that you cannot blow hot and cold, that you cannot tell us what course to pursue one day and, when we pursue it, say it is wrong. If there is anything wrong in connection with this the wrong rests with the auditor general of Canada and not with us. What is more, when in 1930 I made the statement I did, it was a correct statement and one which I would repeat; but in consequence of the character of the agreements that were made, and the extension of our activities in the finding of money for direct relief and for work in the municipalities, we believed that it was desirable that the auditor general should exercise closer supervision. In consequence-I will say frankly-of what the right hon. gentleman said in 1930, I wondered if my view of this situation could by any possible chance be in error and if you will refer to what he did in 1922 under similar circumstances and compare his agreement with this, you will see in our certificate safeguards for the dominion which were not dreamed of in the certificate of 1922. His account was with the municipalities; ours was not, for we dealt

with the provinces. We insisted upon their auditor giving a certificate that the money indicated had been spent and that the municipality had made its contribution, whereupon our obligation arose, under the agreement, to make our contribution in accordance with the terms of that agreement, which we did.
I have no reason to believe that the auditors of the various provinces are not honest men; I have no reason to believe that the certificates which they certify to as being correct are bogus certificates. But I am asked . to believe that these certificates, signed as they are by the auditors of the respective provinces, are fraudulent. That is what I am asked to believe to-night, and I decline to believe it. That errors may have arisen would be expected in an expenditure so vast, and wherever they have been detected and any injury has been suffered by the exchequer of Canada the wrong has been undone and the remedy made by the action of the provinces themselves. Now, those are the facts. Talk about locking the door after the horse is stolen! Why, it was the very fear I had, in consequence of the way in which the right hon. gentleman had spoken, that before I left these shores in October I asked that the Minister of Labour should give this matter more than ordinary attention, and the form of certificate as compared with the certificate issued in 1922, indicates the extent and character of the real care that was taken to prevent any difficulties arising on that score. And I say now, test audits or no test audits, that I do not believe that in the city of Fredericton, the mayor of which is a gentleman of the high character of Mr. Clark, or in any municipality in this country there has been a deliberate effort on the part of anyone to gouge the dominion taxpayer. I do not believe that the auditor of the province of Quebec or of Ontario or of Prince Edward Island or of New Brunswick or of Nova Scotia or the western provinces would sign a certificate for the purpose of fraudulently taking money from the dominion taxpayers, and that is what I am asked to believe; for there is the certificate, the form of which is such that if the auditor general felt that i was insufficient his duty was to point out to us wherein it might be changed. The hon. member for West Lambton (Mr. Gray) asks, why did I feel that there was any possible difficulty about this and that the auditor general should give it further attention. I will tell him why.


Ross Wilfred Gray: A guilty conscience.
Relief Act, 1934


Richard Bedford Bennett: That is unworthy of the hon. gentleman.


Ross Wilfred Gray: I withdraw it.


Richard Bedford Bennett: Thank you. If he will
ask me the reason why I will tell him at once. It is this. I was hearing stories-sometimes one would pick up a newspaper so indicating-that municipalities were trying to take what they should not out of the federal government. I was asked to agree to certain expenditures in connection with medical attention, to which the hon. member for Gloucester referred.


Ross Wilfred Gray: We had evidence of it in our own province of Ontario.


Richard Bedford Bennett: Then I saw, too, criminal prosecutions taken, but these were prosecutions not involving our money in the first instance but involving provincial and municipal funds; because two dollars would be stolen-if you use that word with respect to it-from the provincial government and the municipality before one could be stolen from us. In other words, we had the assurance, the greatest assurance in our judgment, that in addition to the certificate of the auditor, fraud involved the depriving of the municipality of its funds and the province of its before our share could be taken.


Alan Webster Neill: Not necessarily.


Richard Bedford Bennett: Yes, under the agreement.


Alan Webster Neill: The province could pad the
dominion rolls without paying out anything improper as against itself.


Richard Bedford Bennett: That is the point exactly, and that is what the certificate points out, that the money must have been expended before our share was paid. So that before there could be any fraud practised against the dominion there must also be fraud practised against the province and the municipality. And if we t-ook the certificate of the provincial auditor, and he in turn took the authority of the proper officer of the municipality, we had three safeguards: (1) This certificate, which is No. 1 so far as we are concerned; (2) The signature of the provincial auditor; and (3) The certificate given by the proper officer of the province pledging the fame and good name and reputation and honour of the province to the validity and justice of the claim.
Now I submit to the committee that inasmuch as it would be asking the dominion auditor to audit the accounts of all municipalities and provinces it would be putting
Relief Act, 1984

upon him-and I repeat what I said in 1930- a burden which is not contemplated by the constitution; for all that he would have to be sure of would be the expenditure of our money. Now our money was not spent like other money. Our money was to be paid to the province to reimburse the province for expenditures actually made by them, or the municipalities, the creatures of the provinces; and when a certificate in that form was produced, certified to by an auditor, with the good name and fair reputation of the province behind it, the province itself signing, then I submit that this is the greatest possible safeguard you could have. And if test audits showed that the precautions taken by the auditor general to secure the Dominion of Canada's taxpayers from exploitation were inadequate, why did he not respond with some sort of suggestion in answer to all the inquiries made of'him? That is my objection. There is the record, and he who runs may read.
We have no apology nor excuse to offer- neither one nor the other. In 1930, as soon as the act came into force, we took up with the dominion auditor, appointed by statute, not amenable to any government, the method that should be pursued for the purpose of safeguarding the public treasury against exploitation. The contributions made by the dominion were made not for the purpose of getting vouchers for work done here and there, but as contributions to work undertaken by the provinces and municipalities in discharging their constitutional duties. In every instance the papers that came in were checked and rechecked by the Department of Labour just as in 1922 for services of a similar character the checking was done by the late administration. When the documents were so checked, supported by the vouchers and by the certificates of the auditor of the province and an officer speaking for the good name, honour and reputation of the province, we felt safe. What is more, if it subsequently develops that there have been overpayments, we know quite well that there will be no difficulty in having such overpayments refunded because the security that comes to us by reason of the name of the province being attached to the document as well as the check of the auditor general renders it impossible for this country to be defrauded of a single cent, and every cent that investigation or audit indicates has been paid in excess of what is right, just and proper under the terms of the agreement, will be reimbursed to the treasury of Canada. About that there need be no possible doubt. In the meantime we

anxiously await some suggestion from the auditor general, for whom it is very easy to produce the result of a test audit here or there; but with respect to the tens of millions of dollars that have been expended it will be found on analysis and investigation that the cases in which wrongdoing has been done wilfully or purposely by auditors of provinces, meaning that they must be parties to a conspiracy to defraud the taxpayers of Canada, or by municipalities, meaning that mayors of towns and cities have aided and abetted conspiracies for the purpose of defrauding the public, are very few, for I have no more right to assume that an auditor of a province or the mayor or chief magistrate of a municipality is derelict in his duty or fraudulently inclined or given to conspiracy than I would have that any dominion official under similar circumstances is not similarly inclined.


William Lyon Mackenzie King: The Prime
Minister has apparently at last wakened up to the fact that the treasury has been looted and is doing his utmost to load the blame on to the shoulders of the auditor general, an officer of parliament who is not here to speak for himself.


Richard Bedford Bennett: He is to appear before the Senate to-morrow.


William Lyon Mackenzie King: I need not go further than my right hon. friend's own words this evening to show where the full responsibility rests. He has admitted that there has been need for more in the way of auditing and that money has been wasted.


Richard Bedford Bennett: I deny that statement positively.


William Lyon Mackenzie King: My right hon. friend does not admit it even yet.


Richard Bedford Bennett: No.


William Lyon Mackenzie King: Perhaps he will give the house a special committee to investigate the expenditures of these moneys, and particularly the charge that the auditor general is responsible for what has occurred. We shall then have the whole matter investigated and find out where and how the public moneys have gone. If this is done, I venture to say that it will be one of the most shocking stories with which the country has ever been faced.


Richard Bedford Bennett: There will be no "valley of humiliation" so far as we are concerned.


William Lyon Mackenzie King: If the Prime Minister will kindly retain his seat while I am speaking, I shall be much obliged. I just

Relief Act, 1934
wish to repeat that we need not go further than what the Prime Minister has said to-night to make quite clear where the whole responsibility rests for any overexpenditure or waste or stealing of public money there has been in connection with this $100,000,000 that has been voted for purposes of relief. In this regard it is important to bear in mind that the statement which the minister laid on the table the other day indicates that the sum of $110,000,000 has been spent out of the public treasury for the purposes of relief, distributed in the different ways the minister has described.


George Gordon: That was in four years.


William Lyon Mackenzie King: Yes, in four years by this government since it came into office. In addition to that there have been loans to the provinces amounting to $52,000,000 and guarantees of one kind or another to the extent of $111,000,000, making altogether something like $274,000,000 which this government has either spent or loaned or guaranteed in connection with unemployment relief. What does the Prime Minister say to-night? I took his words down at the time; he said: "We did not agree to deal with the municipalities." Whose fault was that? Was that the fault of the auditor general, or was it the responsibility of the Prime Minister and his government? Why did they not agree to deal with the municipalities?


Richard Bedford Bennett: Because it is improper.


William Lyon Mackenzie King: Now my right hon. friend says: We did not do it because a previous government did not do it.


Richard Bedford Bennett: I did not say that. The right hon. gentleman is wrong. Because the memorandum produced a moment ago was a receipt by a municipality I said that we did not deal with municipalities because it was improper to do so.


William Lyon Mackenzie King: I disagree
entirely with the Prime Minister when he says that it would have been improper to do so. The government could deal with anybody it pleased, in any way it pleased. It was its duty In such a situation to see that the right method was taken to protect the public treasury. The Prime Minister said: We discovered there were certain certificates which were given by the provinces, which were accepted by a previous administration as evidence that the money given to the municipality was properly spent. He exhibited a photostat copy of a provincial certificate and said: Ours was like that, seeking to have it appear that in following the previous administration they were doing all that could properly be expected of them.
What were the facts in regard to the action taken by the previous administration? After the great war, when soldiers were being reestablished in civil life, large numbers of men were unemployed and the municipalities and provinces found it impossible to obtain occupations for many who were coming back from overseas. The then federal government, not the late Liberal government, but the previous Conservative or Unionist administration, followed by the Conservative administration of the Right Hon. Arthur Meighen, undertook to aid the provinces in assisting the municipalities in finding work for the unemployed, and adopted a system of voting sums of money as grants in aid to those provinces to further public works to enable unemployed to be put to work. When the change of government took place in December, 1921, we were faced with having to carry on this relief which had been introduced by the previous administration and we were unable to adopt a different system while the period of the fiscal year remained what it was. But as leader of the government of the day, I at once intimated to the provinces that we intended to discontinue this practice as soon as possible and that we felt the time had come when the provinces, if the municipalities needed aid, should find the ways and means themselves. I always took the position that if a province found that its business was in such shape that it could not meet its demands in relation to the needs of the municipalities, then the federal government would be ready to come to the assistance of that province, but without the province so stating in the first instance, we would expect the municipalities and the provinces to look after their own unemployed. What happened? In a very short time, instead of more and more money being paid out of the federal treasury on unemployment relief, payments ceased altogether, and during the ten years from the time that the Conservative administration started this system of paying out public money from the federal treasury to assist the provinces to help the municipalities, there was not a total of $2,000,000 spent. That was the position when the present administration took office. During the period we were in office the amount that was spent from the federal treasury was only a part of this; I am speaking from memory on that point, but I know that over the whole ten years the amount did not come to $2,000,000.
What took place at the time of the change of government? My right hon. friend in the campaign of 1930 stated in all parts of the country that the problem of unemployment

Relief Act, 1934

in Canada was such that it was no longer merely a municipal problem, no longer a provincial problem; he said it was a national problem, and that if he were returned to power he was going to deal with it as a national problem and was going to call a special session of parliament for that purpose. Parliament was summoned to meet in September, 1930, to deal with the problem of unemployment. My right hon. friend brought in his measure of unemployment relief. What did 'he ask this house to do? To give him $2,000,000? No. He asked the house to vote him $20,000,000 for the purpose of unemployment relief. But, he said, in connection with this unemployment relief we are not going to ask for any audit of the accounts; we are going to pay this money over to the provinces, and when we get the receipt of the province that is all we shall expect. That is what he said to the country; that is what people in all parts of the dominion understood-that the federal government would have fulfilled its obligation when it voted sums of money and turned them over to the provinces and obtained the certificate of the province indicating that the money had been received and properly dealt with. I said at the time to the Prime Minister that the problem was a totally different one from what it had been theretofore; that we were facing a very critical situation, a depression likely to laslt for several years, and that it was advisable that at the outset he adopt measures which *would ensure careful supervision and federal control over federal moneys. The Prime Minister says he asked the opposition to cooperate, and I then made the concrete suggestion that I have read to the committee to-night. The Prime Minister's reply was that to adopt such a course would be an insult. 3 said to the Prime Minister-I have not the words before me, but they will be found in the 1930 Hansard-that he would rue the day that he refused to provide for any kind of federal supervision over the expenditure of federal moneys. That day has now come. But it has not come to the extent that it is coming, with respect to this vast waste in the expenditure of public money.
Let me recall another instance to make clear what was said at the time. Knowing something about the Department of Labour and the extent to which it was equipped to carry on its own business without having additional obligations thrust upon it, I suggested to the Prime Minister that neither the Department of Labour nor any other department of government could begin to deal with the great national problem of unemployment

as part of its ordinary routine business. I pointed out that the Department of Labour was not equipped for it; that its business was to carry on the work of the Industrial Disputes Investigation Act and of the Combines Investigation Act, to prepare for publication the Labour Gazette, and so on; that the time of every man of the staff and of the minister was already fully occupied, and that the situation was wholly analogous to what had arisen during the war when additional obligations were thrown on certain departments. I begged him to adopt the same policy with respect to unemployment relief as was adopted by the war administration with respect to the problems then arising, in setting up the food board, the imperial munitions board, the fuel board; and I suggested that in regard to unemployment relief we should have a national commission, just as in war time we had the national patriotic fund organization, broadly representative of the interests of capital and the interests of labour and organizations such as chambers of commerce and boards of trade, the Salvation Army, the National Council of Women, the Red Cross, and the like, that have to do with these great questions. I suggested that a representative body of that kind should be formed, given power under act of parliament, and made responsible to the government through the Minister of Labour for the way in which this relief should be carried out, coordinating the work of the, provinces and the municipalities. But that idea was scoffed at. I pointed out further that that was precisely what was done by the government of the day with respect to one relatively small matter that arose during the war, namely the disaster at Halifax, when an explosion took place which destroyed a considerable amount of property and human life. In dealing with that disaster the government of the day did not leave it to a department to administer the sums of relief money involved, they appointed a relief commission for the purpose. That outlay was properly audited; every dollar was traced; the commission did its work satisfactorily. I suggested that if that was advisable in regard to the relatively small expenditure there involved, surely when we were faced with a great national problem involving the whole of Canada, one which might continue for a series of years, something of the kind ought to have been done. What was the answer? The answer was:	The two things were not parallel; we were told a true parallel was to be found in what was done when Canada gave money to the Japanese at the time of the earthquake in that country. What we did

Relief Act, 1934
then, it was pointed out, was to send the money to Japan through the auditor general's department; the auditor general was to get a certificate from the Japanese government that the money had been spent for the purpose for which it was sent, and it was not our business to look further into the matter to see how Japan had spent the money. A certificate from the Japanese government was all that was necessary. The Prime Minister said: That is what we are going to do with regard to the provinces. We propose to give them this money, to get their receipt in due form that the money has gone for the purpose for which it was intended, and that is as far as we are going to look. The auditor general, like every one else, was doubtless led to believe that that was all that he was to look into, and that I imagine is why the auditor general has taken the stand he has taken.


Richard Bedford Bennett: That is not what he said.


William Lyon Mackenzie King: It was said on the floor of the house by the Prime Minister himself that what the government intended was to see that a certificate was given by the governments of the provinces that they had received the money from the auditor general's department, and that these moneys had been properly spent, and that the auditor's functions did not go beyond that. That is all on record; we do not have to go into any secret correspondence or interviews that none of us have heard of until to-night to discover what the policy of the government was. It was stated on the floor of the house, and in the words that I have given. It was stated again to-night by the Prime Minister himself when he said: We did not agree to deal with municipalities. Do you wonder, then, Mr. Chairman, that the auditor general, after the Prime Minister may have reversed in secret, as he says he did, the attitude that he took in public, and gave the auditor general certain instructions, that the auditor general might feel that he could not go beyond what the Prime Minister had stated to parliament itself was all he was expected to do? Parliament had voted these moneys as moneys to be paid simply to the provinces. It was not the fault of the auditor general that the money was to go only to the provinces and as stated by the Prime Minister not to be traced any further.
The position we on this side took was that with relation to the expenditure of public money the government should be responsible to the last cent, responsible no matter where these moneys went, or whether or not they were mixed up with the moneys of the prov-74726-125J
inces or the municipalities. The government cannot get away from that at the present time. That was the whole cause of the battle at the beginning and has been in every session since-the government seeking to relieve itself of responsibility by saying: We are dealing only with the provinces; we have nothing to do with the municipalities. If that is the ground they have taken from the outset, which they now take, they cannot blame the auditor general for not going further. They say: We have never dealt with municipalities; we are dealing only with provinces. No wonder the auditor general replies that he should not be interfering in municipal affairs. Nevertheless as a servant of parliament it is the duty of the auditor general to the extent that he may find it possible and deem it necessary, to see where federal moneys are going, and evidently he has done his duty by making a few tests of different municipalities, with results that to-day are only too well known in all parts of the country.
No; the mistake is this, and it is wholly the responsibility of the government, that the government itself, while it assumed office on the distinct understanding that it intended to make the problem of unemployment relief a national problem and to deal with it as such, the moment it came into office reversed that position and said: We will not regard this as a national problem; we propose to regard it as a matter for the provinces and the municipalities, and it is the business of the provinces not our business to look after how moneys may be spent by municipalities. The government washed its hands of the whole business and just issued the cheques. That is the situation; no exception can be taken to the aocurancy of what I have said. It is for that reason and that only that we have the shameful situation that is gradually coming to be known to the puiblic to-day. I say to the Minister of Labour I do not believe that in any of the agreements he has had with the provinces he has included the clause that the auditor general of Canada should have the right and that it would be his duty or that of his officers to follow the expenditure of moneys to the last payment, and that the receipts would be expected from recipients of public money indicating the fact that money had been duly received by them, and that the federal government was giving this money only on one condition, namely, that it was to go for the support of those who are out of employment, and for them only; that it was not to go for the purchase of supplies, or for the payment of expenses of administration or towards materials used by contractors, or to replace
Relief Act, 1934

federal or provincial outlays, but that it was to go simply for the relief of actual unemployment. I say that without that specific agreement with the provinces we could not expect anything else.
The Prime Minister has said to-night, "I believe the municipalities are honest; I believe the provinces are honest;" and so on. This afternoon the minister read us a statement about something which was supposed to be happening in British Columbia. He said, "Is this not the kind of thing common to both sides?" It was the very fact that everyone knew, human nature being what it is, that it was necessary to take the position which hon. members on this side took at the very outset with respect to the manner in which the expenditure of these public moneys was to be safeguarded. To tell the country that every dollar that the federal government was going to expend would be spent without any audit, so far as the federal treasury was concerned, was to invite all the kind of thing which is to be found in connection with officials who deal with public funds in a loose way. To hand over federal moneys raised by one body through taxation to be spent by other bodies having nothing to do with the raising of such moneys is fundamentally wrong in principle. That is another position which hon. members on this side asserted very strongly.
I should have concluded what I had begun to say a minute ago about the amount of money the government asked for at the first session. I have said that in the ten years preceding that session the total required towards the assistance of provinces and municipalities in connection with unemployment relief did not amount to $2,000,000. But the Prime Minister at the special session asked for $20,000,000 to extend over a period of only six months, namely, until the following March. I said to him at the time that he was asking for a sum of money far greater than he would require, and I believe he found difficulty in expending this large sum,-I know he did. But what did he do next session? He took another step which was inviting a still greater waste of public money. He took the step which the minister is now proposing to repeat and against which we protested on the occasion to which I am referring. On that occasion, he said. "We will not ask for any special amount, but will make our demands unlimited. In other words, we will ask for a blank cheque, and issue all the money we please." Knowing human nature I wonder if we could expect that the public money would be other than wasted when the government said, "Give us a blank cheque;

we will not be satisfied with any fixed amount; we want power to spend all that we please," and when in addition the Prime Minister announced there would be no audit by the auditor general, because such audit would be an insult to the provinces.
It would be ridiculous not to expect the very thing that has happened. At each session hon. members on this side have drawn attention to the vicious character of that type of legislation, namely, of voting sums of money without any control by parliament or by its servants over the expenditures of those moneys. We have now before us only the fringe of what may be expected if an investigation into these matters is gone into. I say that after the Prime Minister's statement to-night about the auditor general, he owes it to this parliament to have a public investigation into the whole question of the expenditure of relief moneys, so as to give the auditor general a chance to come before hon. members of this house and explain his position. In that way we may be able to find out from the provinces, the municipalities and others just how this money has been spent, and why it was spent in the manner I have described.
This matter cannot be covered up by the government simply saying we adopted a certificate used by a previous administration. I pointed out that in taking office in 1921 the Liberal administration merely completed part of the work which had been undertaken by a previous administration, a work of assisting provinces and municipalities to re-establish men from overseas in positions of civil life. But we never adopted any emergency legislation such as this, which has now run for four years. If to-day the Prime Minister holds up a certificate and states, "This is what we have done; this is the certificate." I say it is not sufficient and it is not what should have been done to protect the public treasury.
I believe what has been said to-night gives the opposition more justification than ever, when we reach the clause in the bill which asks again for a blank cheque, to ask that the clause be amended, to read, "such sums of money as may be appropriated by this parliament." Those sums should be appropriated by parliament in specific terms, and we should expect them to be audited by the auditor general. And, similarly, I believe we have reason to expect the administration to meet the requests which we have been making as strongly as we could make them, namely, that this power now being sought to give to the government the power to pass under the heading of peace, order and good government any

Relief Act, 1934
order in council it pleases, should be dropped from the bill. That is the section we are now discussing, and I hope the minister even yet will see his way clear to delete the section.


Richard Bedford Bennett: I wonder if the right hon. gentleman will explain why he dealt with old age pensions just on the basis he did. I have had more scandals brought to my attention in connection with old age pensions than I have had in connection with the whole of unemployment relief. And he fathered it. Why? Why did he hand over all these moneys to the provinces? Why? Why did he not ask that there should be an audit such as 'he now asks for in these matters, at a time when he dealt with old age pensions? What are the frauds? What are the frauds that people are making? What about a man standing in a bank in western Canada during the last twenty-four months and finding a person cashing an old age pension cheque with one hand and cutting off coupons with the other? Why can the right hon. gentleman not be consistent? Why have we not a little of that milk of human kindness of which you so often talk? I say to the right hon. gentleman: why did he and his ministers and his government put forward the old age pensions in the form in which they did? Remember this, that the reason given now by the right hon. gentleman and his supporters was a reason which I thought was a fairly good one, that every time there was fraud, half of it fell upon the province. Now it would be seventy-five per cent against the dominion and twenty-five per cent against the province.
I just say in answer to everything that has been said to-night with respect to the administration in these matters that the reason we did not deal with the municipalities is that they are the creatures of the legislatures, and the contact between the federal government and the provincial government or outside institutions is with the provincial government. And every dollar, as it is claimed, and has been said in this house, that has been taken from the federal taxpayer means that two dollars were taken from the provincial or municipal taxpayer. Is that not some safeguard? Should it not be some safeguard? In view of what the right hon. gentleman has said, I cannot set up a committee to-morrow morning with regard to this matter, for as I observed the auditor general has to appear before a committee in another place for the purpose of making his statement with respect to public expenditures. And until that is complied with, I think it is sufficient for the moment. I see that he is to be examined by
the Senate committee of which Senator Robinson is the head, touching public expenditures. It is all right, you see, when you start it, when it is on your initiative; but it is all wrong when we start it. We took steps that were never taken by our predecessors to safeguard the expenditures. But to say that there is a great scandal behind all this is a reflection on the honour and honesty of Canadians. It may well be that Canadians, as was said to-night, have been prosecuted for fraud in taking relief, but did hon. gentlemen observe that it was not fraud against the dominion, but fraud against the province or against the municipality? There is not a case in which there was any allegation of fraud against the dominion, because we did not deal with them individually. We dealt with the province, and if a province has defrauded us we will get the money back. To say that the Dominion government should follow down every individual payment by a province for relief directly or otherwise, I simply say I do not believe that would be the thought of any intelligent person engaged in any business. The local authorities, the municipalities first, and then the provinces, must deal with them.
I want to be perfectly frank and say that when the right hon. gentleman with his experience of nine years as Prime Minister made the statement that he did in. 1930, I merely made my observations as a business man that I believed that if we had the certificates of the auditors of the provinces that would be ample for me, and that we should not follow the money into the hands of the provinces because these were grants in aid; and the statute so says. The right hon. gentleman himself so stated long prior to 1930.
I put this single consideration before the committee: Making as we believed adequate provision for the safeguarding of the expenditures of these moneys in the hands of the provinces, with a form of certificate whi-rfi went at least three steps further than the former certificate to safeguard the federal' treasury, and with the approval of the auditor general, I must say that after reading of these prosecutions I .became very much concerned about the situation. The right hon. gentleman had had nine years of experience as Prime Minister, while I was speaking more from business experience; and when the house had risen, we had a gathering of the cabinet next morning-we were up all night-and I did request with all the earnestness I could that extraordinary care be taken to see that we would get the certificates so that we could feel safe with respect to the expenditures. The certi* ficate will appear in Hansard to-morrow and
Relief Act, 1934

will indicate I think that it is the safeguard that any ordinary business man would take with respect to matters of this kind.
I do still say to the members of this committee that no federal government can undertake to guarantee the honesty of every individual receiving relief. A case of fraud in obtaining a pension came up at Regina the other day. It was one of the earliest pensions, yet it was found that assistance had been given to a mother because of the loss of a child, and it turned out that she had some $12,000 although she had alleged that hers was a case of poverty. I saw it only in the newspapers, as I suppose other hon. gentlemen did. Steps were 'taken to have the money refunded to the crown. You have cases of that kind, and cases innumerable that I might mention in connection with old age pensions and other matters. But when we put into the hands of the provincial authority our proportion of the moneys under the agreement, and the provincial auditor certifies that the expenditures have been made and that the municipalities have complied with their obligations, then I do submit that if there has been fraud or irregularities we will get it out of the provinces; we will keep it out of any moneys that may be coming to them. There need be no question about that.
It is all right to say that the auditor general cannot speak for himself, but he seems to be able to write for himself, and after a few test audits, if under these circumstances he has made no answer to the request that was made by the Minister of Labour for the purpose of having the matter dealt with, what is the reason. Why did he make the observation he did about Port Alfred, that it might embarrass the municipality if he was asked to do it? I have a right to know; I do not know, and no one can get it from him.
When it is suggested that the auditor general took his cue from what might have been said in this parliament, the answer is that he was asked if a form of certificate prepared in exactly the opposite sense was satisfactory or not, and he replied, not indeed immediately but after taking solme time, that it was satisfactory. Let us be fair about this matter. Under these circumstances, if the responsibility rests anywhere, then if it is not where I have indicated I cannot understand what Vesponsibility means.
We have paid under the terms of agreements to the provinces, and not to municipalities, sums of money which were the subject matter of agreements, based upon payments being made for the same work in part by municipalities and in part by the provinces. In the city of Montreal case we have not yet

received the certificate; the minister and his accountants have been waiting for months for the certificate that will enable them to make payments, and when we receive the certificate over the signature of a provincial auditor and a minister of the province we shall make the payments. Is there any other way in which you could carry out the very principles which the right hon. gentleman supported so strongly in this house prior to the election of 1930, namely, that the constitutional obligation was one thing, the national character of the disaster was another, and the national character of the disaster involved the granting of assistance to the provinces? Those sums of money we have paid to the provinces when and as certificates in the form I have indicated were produced to enable payments to be made.
With respect to the question of a limitation being placed upon the expenditures to be made, we did one year place a limitation, and I am bound to say that it was not as satisfactory as when there was no limitation, because, just as soon as it was apparent that there was a certain sum of money available for the purpose, the provinces combined and said: That is exactly the sum we want. It was not a combination open and apparent, but they would-shall I say?-adjust their difficulties so that they synchronized, to use a well-known word, with the amount of money available. We desire to make the amount available as small as possible, and if it is thought that that proposal will better serve the purpose in mind and the purpose set out in the bill, we will consider what amount might be provided.
I shall not deal further with the other matters referred to by the right hon. gentleman under peace, order and good government except to say that he said that I had omitted to deal with the position in connection with the president of the United States. That is perfectly true. I did not think it required any discussion in this house. The real truth is that the only difference between the United States and Canada is that in Canada the executive is the governor in council. That means that a majority of council must agree to a certain line of action being taken. The executive in the United States is one man, and one only. He signs, and that is the end of it. The safeguards here are first of all the number of the advisers in council. Secondly, the powers that were conferred upon the president of the United States were in some cases for two years. Other powers that were conferred upon him were without any time limit. Some were for a shorter period than two

Relief Act, 1934
years. With respect to his power to make trade agreements the limit is three years. Other legislation is limited, some by a shorter term and some by a longer. But there is one clear distinction, the only one which need be considered in dealing with a matter of this kind, the executive of the United States is the president himself whereas the executive here is the governor in council. The governor in council means every member or the majority of the members of the council, the minority accepting the view of the majority in the action arrived at. That is the only difference, and the only matter which need be mentioned in reference to this question. That is so far as I can see it at the moment or so far as it affects the matter. The powers conferred upon the president are so far beyond the powers which it is suggested should be conferred on our executive that they are not in any sense in the same class.
I mention this because I said this afternoon that we regret that we cannot meet the views of the opposition and leave out the provision with respect to peace, order and good government. I should like to put this test, with which I think the right hon. gentleman will agree. Supposing in 1931, when we were asking for these powers, I had been asked a question similar to that asked this afternoon: "Why do we need it?" If I had said that I wanted it because I desired to restrict the export of gold and that England would go off the gold standard some time next September, hon. members would have laughed at me. I can give an illustration from my own experience. I happen to know that that summer a distinguished financier on this continent who was watching the trend of events cabled to a gentleman in London asking if in his opinion England would soon go off the gold standard. The gentleman in London cabled back that that was an absurd suggestion for him to make, and yet it happened in September. I use that merely by way of illustration.
There are other conditions which face the world at the moment and there is the talk which I deprecate greatly and which I fancy the right hon. gentleman deprecates more than I-the talk of war. I think no good puipose is served in the world at large by talking about war. I think it is a terrible thing and it should be terrible in the sense in which it is used. That- is only my personal view. I know there is a statute which can be brought into force by proclamation but I think on reconsideration the members of this committee, when left to their own devices, would conclude that it is desirable in the national interest that the executive, which is the governor in council, should have the power to
pass such orders in council as may be necessary for the .peace, order and good government of the country. I shall not enlarge upon what I said this afternoon except to say that the seeking of this power obviously serves no personal interest. It cannot add to one's happiness but it makes one feel a little more certain that in the event of a crisis he has the machinery with which to protect the national life of the country.


William Lyon Mackenzie King: I should like to follow the Prime Minister (Mr. Bennett) in the reverse order to that in which he spoke, taking up the last point first. He has just asked what he possibly could have done with regard to the export of gold if that question had been asked two years ago and where without disclosing his hand he could have obtained the legislation necessary to help to meet a situation of that kind. I would reply by saying that he did not need anything more than will be left in this bill if he agrees to strike out the very clause which he says it is necessary for him to retain, namely, the one giving the power, notwithstanding any statute or existing law, to pass orders in council under the heading of peace, order and good government. There would still remain this clause:
-take all such measures as in his discretion may be deemed necessary or advisable to protect and maintain, the credit and financial position of the dominion or any province thereof.
I ask the right hon. gentleman: Could anything be needed beyond that? If that is the purpose of the clause, what more could he needed? The section would still read:
Notwithstanding the provisions of any statute or law the governor in council may take all such measures as in his discretion may be deemed necessary or advisable to protect and maintain the credit and financial position of the dominion or any province thereof.
We are perfectly agreeable to having that provision in the section remain, and I submit that that is all the right hon. gentleman *needs to have in order to deal with any financial situation or any situation affecting the credit of this country. In view of what the Prime Minister has just said, I submit that the other clause should not be permitted to remain.
The Prime Minister deprecates the mention of the word "war." I agree with him and I hope the time will never come when this parliament will have again to discuss war. But if it ever has to discuss war, I submit that is the time above all others when parliament should be called together and the decision as to the action to be taken not left to the governor in council. If the Prime Min-
Relief Act, 1934

ister is retaining this clause which deals with peace, order and good government in order that he may have the power, notwithstanding any statute or law, to have this country participate in a war, there is a stronger reason than ever why the clause should be stricken out. I do not know that that is what is in his mind, but he has raised the question himself. I have no wish to discuss the question of war in this connection, but it has been discussed in this parliament at different times. My recollection is that a resolution was passed some sessions ago to the effect that in the event of the possibility of war parliament should be summoned before any forces of Canada were placed at the disposition of His Majesty to serve at any point outside of Canada.


Richard Bedford Bennett: That is in a statute.


William Lyon Mackenzie King: The Prime Minister reminds me that that is in a statute, and that statute should be observed. But this clause states that notwithstanding the provisions of any statute or law which includes the very statute just referred to, the governor in council may take whatever steps he deems necessary to deal with peace, order and good government. I submit that the Prime Minister has just given two additional reasons this evening why that power should not be left in the hands of the governor in council.
Let me come to another matter referred to by the Prime Minister. He said that the only difference between the executive of the United States and the executive of Canada was that the executive of the United States was one man while the executive of Canada was the majority of the ministers in council. If I wanted to refine the point I could remind the Prime Minister that under the British constitution the executive is one man. The sovereign is the executive, but in Canada as elsewhere in British countries, the king is advised by his ministers, of whom the Prime Minister is chief. The president of the United States is one man, but he also is surrounded by members of a cabinet and undoubtedly any major action he takes is in accordance with the views of the majority of his cabinet.


Richard Bedford Bennett: No.


William Lyon Mackenzie King: Not necessarily, possibly, but I submit he would be very foolish if he did not act in accordance with the views of the majority of his cabinet, and I think he does on most occasions. However, the fundamental difference is not what the Prime Minister has said it is, the difference between one man and half a dozen. So far

as the United States is concerned, the executive has no place in congress and cannot make his views known by discussion and argument, whereas under the British system the executive as represented by the ministry not only has its place in parliament, but is responsible to parliament for every act and must get its majority from parliament itself. The president of the United States may choose whom he wishes as his cabinet.


Richard Bedford Bennett: He 'has to get a majority in congress.


William Lyon Mackenzie King: He has not to find seats for his ministers and is not responsible to his congress in the way in which a prime minister is here. If he wants to deal with any question he has to get the authority needed for the purpose from congress somehow, but he gets that without his having to discuss the why and wherefore of his policy on the floor of parliament as the Prime Minister must and is able to do. The situation is entirely different.


Richard Bedford Bennett: He reads a message, that is all.


William Lyon Mackenzie King: Yes, but my
right hon. friend can come here and with his powers of debate and eloquence he can persuade his following to give him anything he wants. He can give his followers the reasons why he should get these particular powers- no one knows it better than he-and they will give him anything he wants. The president of the United States has not that power; he has to rely upon what congress will give him when it is in session. There is a complete difference between the two, so that if anything in the form of action required to meet an emergency is required, the president of necessity has to have when congress is not in session certain powers which the Prime Minister does not begin to need to have, for the simple reason that he can get whatever powers he likes, in advance of the prorogation of parliament, or if he wishes to bring parliament together at any moment he can do so immediately in order to get these powers.
Now to return to the other matter we were discussing, the question of relief, the Prime Minister again seeks to draw a herring across the trail. He asks, "With regard to old age pensions, why did you not make a different provision from the one you did? We were simply doing the same kind of thing in regard to unemployment relief as you did in regard to old age pensions." Well, I would say that if we made a mistake in regard to old age pensions that is no reason why he should make the same mistake.

Relief Act, 1934


Richard Bedford Bennett: But you did not say it was a mistake.


William Lyon Mackenzie King: I did not say that. I will answer my right hon. friend this way. The reason we dealt with old age pensions in the way we did was that the requirements of the British North America Act left the matter of old age pensions exclusively in the hands of the provinces under the head of property and civil rights.


Richard Bedford Bennett: And relief in the same way.


William Lyon Mackenzie King: No, that is where I do not agree with my right hon. friend; I say that it is not the same. There is nothing to support his statement. The right hon. gentleman said himself, during the campaign, that relief was a national problem; it was no longer provincial or municipal but was national. It was therefore for him to make it national, to be dealt with in that way, in view of the policy he declared. Moreover, when he spent money for purposes of relief he could attach to that expenditure any conditions he pleased. To show how far short of attaching such conditions-


Mr. BURY:: Was not that true of old age pensions?


William Lyon Mackenzie King: No, it was not true of old age pensions.


Ambrose Upton Gledstanes Bury: Was it not true that the government could attach any conditions they wished in reference to that matter?


William Lyon Mackenzie King: No, there were restrictions because the question of old age pensions involved certain considerations respecting property and civil rights.


Ambrose Upton Gledstanes Bury: So does this.


William Lyon Mackenzie King: No, this does
not, and that is the difference. This is a sum of money which the government is spending for a specific purpose which it names.


Ambrose Upton Gledstanes Bury: And it involves civil rights.


William Lyon Mackenzie King: Just as the
Prime Minister himself said, we could give money to Japan, and if we could give money to Japan we could give money to the governments of the provinces of Canada.


Ambrose Upton Gledstanes Bury: Old age pensions involved civil rights.


William Lyon Mackenzie King: If my hon.
friend wants to make a speech he will have time to do so.


Ambrose Upton Gledstanes Bury: We don't want the committee misled.


William Lyon Mackenzie King: It will never be misled by anything my hon. friend says.
I should like if I might to continue without interruptions.
I wish to remind the Prime Minister of what was said in this very connection with respect to these grants in aid-and here may I say that the Prime Minister has been kind enough to observe that having occupied for a number of years the position which he now fills one gains a certain amount of experience, and I trust that this experience, by whomsoever it is obtained, will be of value in public life at all times. And out of that experience, when this country was faced with the problem of unemployment on a vast scale and the possibility of depression running over a period of years, with the likelihood of the provinces being unable to meet their various obligations, I urged at the very first session that these grants in aid to the provinces should be stopped pending the calling of a conference between the dominion and provincial governments to see whether it was not possible to have some arrangement made whereby the dominion could assume a large number of obligations for relief in its different forms-social insurance in its various aspects -taking them over as a national obligation and in return obtaining agreements from the provinces to amend their powers of taxation in some directions, or making concessions with respect to future subsidies. My hon. friends opposite will remember that I spoke over and over again about the inevitable consequences of continuing grants in aid at a time like this, pointing out that they meant that sooner ot later the public treasury would be depleted beyond all expectation. I was hooted at by hon. gentlemen opposite for repeating this observation so often, but the force of it is coming home to them now when it is too late. I suggested then that we should seek an amendment to the British North America Act inasmuch as this question was likely to present itself with increasing urgency with time. I urged that we should at once take steps, in conference with the provinces, and by whatever course might be deemed necessary, to see whether the British North America Act could not be so amended as to give the federal government larger powers with respect to social and industrial legislation in order that we might have uniformity of laws throughout the dominion, the provinces being relieved of some obligations, having them made federal charges, and the provinces on their part foregoing, if that was
Reliej Act, 1934

equitable, their subsidies either in whole or in part. I made this suggestion with a view to bringing matters to such a point as to insure that the power raising taxation would be charged with the responsibility of its control and expenditure, instead of following the false principle of placing upon one government the obligation of raising taxes and allowing another government or series of governments and municipalities as well to spend the money, for the raising of which they had had no responsibility whatever.
On all these counts therefore it seems to me that the need is becoming stronger and stronger for compliance with the request made from this side of the house, even now at the eleventh hour, rather than that the present situation should continue, albeit for but a few months or a year, or whatever the period may be.
With reference to the auditor general's position, the Prime Minister says that he will consider the matter. I think we had better have the public accounts committee called together and have some of these matters gone into very fully there, so that we may find out how public moneys have 'been spent. It is high time the committee was called together. We might have the auditor general and others before the committee. I trust the Prime Minister will see that this is granted.
These I think were the main points referred to by my right hon. friend. I would add this, with respect to old age pensions, that the Liberal administration-and I presume the present administration is following the same course-did audit the accounts with respect to old age pensions so far as the provinces were concerned; they did have their own auditors and have always had supervision over the provincial governments' expenditures, and I believe that the auditor general has been free from time to time to make, and has actually made, test audits in regard thereto.


Richard Bedford Bennett: 
Mr. MACKENZIE  ICING@: What the
Prime Minister has just said about there being other public expenditures that are not being properly audited is, I think, only a further reason that now that the whole matter has come up for consideration and discussion in the way it has, we should seek to take immediately the steps that will prevent anything of this kind happening in the future. That is Why we are stressing the matter as strongly as we are in regard to this particular measure. My right hon. friend will do me the justice, I believe, to say that at no time have I advocated any concealment of inquiries into public matters of any kind, but that I have stressed as strenuously as I could full supervision and control by the House of Commons and by its servant over all public expenditures. If there has been one thing above another that I have been emphasizing each year, it has been the necessity of that complete control on the part of the House of Commons and the auditor general over all expenditures of public money, especially in dealing with the relief situation which is an abnormal one. In handling matters in times of emergency there is greater need than at any other time that those safeguards should be exercised with the greatest possible care. For that reason I hope when the minister under the present legislation is making his agreements with the

Relief Act, 1934
provinces, he will see to it that clauses are inserted which will ensure a more adequate following down the line of those public expenditures than has been the case heretofore and that eveiy dollar of federal money goes, not to administration or to contractors or to pay for supplies, or to relieve provinces and municipalities of their own obligations, but to labour itself, a satisfactory certificate of payment being obtained in receipt thereof.


Richard Bedford Bennett: The certificate may be
as incorrect as it is now alleged ours are.


William Lyon Mackenzie King: That can be
followed up by federal officers. I should like to point this out to the Prime Minister: we are in the extraordinary situation that we have voted sums of money running to over $110,000,000 for expenditure on relief alone, and yet the house has no information as to the numbers of the unemployed. The Department of Labour has not this information. It has made all kinds of excuses and apologies for not having it. All it needed to have done was to require any province giving federal money to a municipality to obtain from that municipality a statement of the numbers of its unemployed. Those statements should be returnable periodically to the government and after being tabulated Should be brought to the attention of this house. We have had from Premier Pattullo a statement that the number of unemployed in British Columbia to-day is 100,000. British Columbia has a population about one-nineteenth of the rest of Canada, so it would look as though, if that were the average for all the provinces according to population, the total number of unemployed would be about 1,500,000. I think, however, British Columbia relatively has a larger number of unemployed than the other provinces; but if figures are available, we ought to know.


George Gordon: On what date was that?


William Lyon Mackenzie King: In the press
of Saturday night there was a statement to the effect that there was something like
100.000	unemployed in British Columbia. If that province has been able to get those figures in so short a time, some of the other provinces ought to be able to get similar information. One* very simple way to get the figures is to insert such a provision in the agreements entered into by the minister.


Richard Bedford Bennett: I am afraid the statement in regard to the 100,000 unemployed is a guess. It may, however, have some reference to a matter to which I am going to direct the attention of the right hon. gentleman to indicate how difficult it is to deal with the situation in the way he suggests. Shortly after the change of government in British Columbia my attention was directed to a press clipping in which a notice was given that certain works w'ould go forward at a particular point. I will show it to the right hon. gentleman to-morrow. Membership in the Liberal association was a sine qua non.


William Lyon Mackenzie King: That was
brought u,p this afternoon.


Richard Bedford Bennett: I was not in then. That
indicates one of the difficulties experienced in matters of this kind. I would like to show the right hon. gentleman some of the efforts that have been made in the imposition of conditions on the provinces and the difficulty that has been experienced in connection with those payments which have not to do with labour but have to do with matters connected with the credit and interest obligations of the provinces. The prospect seems much easier viewed from the outside than it is from within.


Jean-François Pouliot: Let us consider Newfoundland. I have only one thing to place before the committee to-night, and it is this: Last year I asked the Minister of Finance about the grants to Newfoundland. He told me that the Dominion government had guaranteed to certain banks the interest payment amounting to several hundred thousand dollars. On that occasion the opposition blamed the government for guaranteeing Newfoundland loans. The Minister of Finance was at that time very eloquent, and finally during the world conference when this dominion was asked to renew the guarantee or to give an additional one to Newfoundland, it refused to do so, and quite rightly. Therefore, as was pointed out during the debate on the address, it was not the members of the opposition who were wasting the time of the house in that matter, but the Minister of Finance himself.
The other day my right hon. leader spoke about those guarantees and the Minister of Finance pointed out that no money was loaned to Newfoundland; that it was only a guarantee that was given by this government. Therefore I would like to know from them whether the guarantee which was given to Newfoundland last year amounts to very much. To what banks was that guarantee given, and is it still in existence? Has the government been released from all its obligations towards the creditors of Newfoundland? May I point out at the same time that at page 9 of Hansard of this year it will be seen that I asked the government for the production of the Amulree report on New-
Relief Act, 1934

foundland and that the Prime Minister said that in that report there was nothing of interest to Canada.


Richard Bedford Bennett: Oh, no.


Jean-François Pouliot: For the information of the right hon. gentleman I will read what he said as reported at page 9 of Hansard:
Right Hon. R. B. Bennett (Prime Minister): Mr. Speaker, it was not proposed to table it. The report was not in any sense connected with the operations of this government. The government of Canada was asked to name a commissioner to sit with commissioners from Great Britain and Newfoundland. With that in mind Mr. Magrath was selected.
My idea in asking that was to know what had been found by those three gentlemen about Canada's obligation to the creditors of Newfoundland, and that was the only idea I had in view when I put the question. Therefore I will ask the government kindly to answer the questions that I have put and whether this is not the time to table that report which is just as interesting as that of Mr. Sutherland on the tobacco business.


Richard Bedford Bennett: The obligation of the dominion is represented by guarantees given to the chartered banks to the extent of
S625,000.	A half year's interest was being paid, and the British authorities said that they would guarantee or pay to the extent of one-half if we would the other. As the default of Newfoundland would have seriously affected our own securities, being trustee securities, we did so. The present position, since the commission has taken over, I am not in a position to state without verifying the facts. But that is the figure, $625,000.


Jean-François Pouliot: I thank the right hon. gentleman for the information he has just given. If he had agreed to the tabling of the Amulree report it would not have been necessary for me to ask him any questions to-night. Therefore I ask if he will kindly reconsider what he said at the begininng of the session, and let the members of the house see that report, part of which has been published by the financial papers. It is a report which is of interest to all of us.


Richard Bedford Bennett: I think copies of the report are in the library. I could not lay it on the table, because it is not a report that originated from any action taken by this house or this parliament. We have, I think, two or three copies, perhaps half a dozen; but surely there is a copy in the library. If there is not I will see that one of those we have is put there.


Jean-François Pouliot: I thank the right hon. gentleman.


Mr. CASGRAIN:: May I ask the Prime Minister if the guarantee or arrangement made for the building of Canada's legation at Toyko was made under the relief act, or in what way it was done?


Richard Bedford Bennett: My memory is, no. The order in council was passed finally when I was not in the country. I promised the hon. member for Bow River (Mr. Garland) that the papers would be brought down, and I thought it had been done already.


Mr. OASGRAIN:: I made a motion for
them.


Richard Bedford Bennett: The fact is that the minister to Japan himself advanced the money for the construction of the building, and is to be repaid as appropriations can be made for that purpose from time to time. In the meantime the interest on the money is not as much as would have been paid for rent. A high minded public service was rendered by the minister under an arrangement which merely contemplates his being repaid the money expended for construction in the manner I have indicated.


Joseph Philippe Baby Casgrain: Do I understand that the financial transaction has been carried out by the Canadian minister himself, or was a guarantee given .to him in respect of those expenditures?


Richard Bedford Bennett: It is covered by an agreement.


Joseph Philippe Baby Casgrain: How was the loan arranged?


Richard Bedford Bennett: I do not know that that was disclosed. He is a man of means; I am not sure even that he borrowed the money. He put up his own money; that is the short way to put.


Alan Webster Neill: I would like to say a word before eleven o'clock. I hope the suggestion of the leader of the opposition that this matter be referred to the public accounts committee will be given effect to forthwith. This is a more serious matter than ordinary complaints made against a cabinet minister who is here to defend himself. The auditor general is an officer of this house, responsible only to us, and something very close to a charge of incompetence has been made against him, somewhat comparable to such a charge against the Speaker or the clerk of the house. I am wholly unwilling that the information I seek should be obtained in another house. We do

Canadian Legation in Japan
not know what scope that investigation is going to take, nor can we be there to direct it along the lines of the charges made here. As regards the necessity of a thorough investigation, we must recall that the test made has been quite superficial; it was very slight, touching only the high spots here and there. For instance, in British Columbia I understand it consisted of a comparatively slight investigation of accounts for the year 1933. If the auditor had gone back to 1931 things might have been revealed that would make your hair stand on end. It will be remembered that in 1932 the relief situation there came into the hands of the Fordham commission, under which a very genuine attempt was made by the province and the dominion to run things on right lines, But if the examination had gone back to 1931 we have only to recall the charges made by the dominion government's man, McGeough, which have never been proved untrue, to realize the scope of the graft that I firmly believe would be revealed.
The Prime Minister dealt more than once with the idea that our safeguard was that if there was any graft, for every dollar of which the dominion was robbed there would be two dollars against the province and the municipality. But that is not so, because the province looked after the cities; in fact I think the cities for the most part ran their relief honestly and fairly. The province saw that the cities did not rob them. But who was to see that the province did not rob us? It is said that there was a provincial auditor, a very reliable man, but his duty was to see that the cities did not rob the province; he had no obligation to see that the province did not rob the dominion-I use the coarse word. I gave an illustration of how it could be done without any misconduct on the part of the city. Excessive charges were made for hire of government trucks and machinery, and expenditures of a capital nature were charged which should not have been shared by the dominion. Those are things in connection with which the province was not robbed, the city did not rob anyone, but we were robbed, inasmuch as we were asked to pay a share of accounts which, to put it plainly, were padded. For instance, gasoline was charged with the six or eight cents provincial tax added to the price, and we were asked to pay our share of that.


Richard Bedford Bennett: Was that wholly wrong?


Alan Webster Neill: I do not think the dominion should pay a provincial tax on gas.


Richard Bedford Bennett: That is a question that was argued at great length. If anyone else had used it they would have had that revenue.


Alan Webster Neill: Then I shall not use that as an illustration, but I shall use that of supervising employees being put in, and excessive charges made for trucks and machinery. I think it would be in the interests of the government and of this house if this thing were thoroughly investigated before the public accounts committee.


Richard Bedford Bennett: I have made some inquiry since I spoke. The difficulty of getting the public accounts committee together is that most of the members, I think twenty in all, are serving on the banking and commerce committee. The difficulty of getting a quorum, I am informed by the chief whip, has been very great. It is almost impossible, because of the interest taken in the proceedings of the banking and commerce committee. But I shall see what can be done.
Progress reported.


[Stage Direction]
At eleven o'clock the house adjourned without question put, pursuant to standing order.
Tuesday, April 10, 1934