1934-06-22

[Stage Direction]
Eleventh report of the select standing committee on miscellaneous private bills-Mr. Stinson.

Right Hon. R. B. BENNETT (Prime Minister):: I lay on the table a certified copy of the order in council passed on June 20, 1934, consenting to the Canadian Pacific paying off $12,000,000 of the $60,000,000 borrowed

Australian Wheat
from the chartered banks of Canada, releasing one-fifth of the security on which such loan was obtained.



AUSTRALIAN WHEAT AND FLOUR

[Stage Direction]
On the orders of the day:
Hon. H. H. STEVENS (Minister of Trade and Commerce):: Yesterday on the orders of the day I. had unfortunately to leave for the sittings of a committee and I was not present when the hon. member for South Perth (Mr. Sanderson) asked a further question regarding importations of Australian flour. The direct answer to the question, which was answered once previously, though not with complete assurance, is as follows. The question is as to whether or not Australian wheat or flour coming to Canada is subsidized. We cabled the Canadian trade commissioner in Australia and recently received from him a reply in which he states that there is no bounty in force on wheat or flour. The Wheat Growers' Relief Act passed on December 12 last was a purely temporary measure, and it will be recalled that I explained the nature of that on a former occasion, on June 7 last, as appears in Hansard. I do not think I need to repeat that; it does not involve anything in the nature of subsidizing wheat or flour. May I add to what I said then a brief statement regarding the situation in connection with the winter wheat supply and the winter wheat crop of Ontario. There were 630 000 acres of fall wheat seeded last autumn, and it is estimated that there were about 246,000 acres winter killed. The condition of the balance of the wheat crop is not up to last year; in the early part of June, I think, it was estimated at around 45 or 50 per cent. So that the winter wheat crop is certainly behind that of a year ago. In estimating the supplies of winter wheat available for flour-soft wheat flour-consideration must be given to stocks in hand; and upon careful examination and inquiry .it is ascertained that on March 31, 1934. a total of some 3,140,000 bushels of winter wheat was considered to be in the hands of the farmers. There is reason to believe that stocks of wheat on the farms in Ontario at the end of July, 1934, will approximate 1,000.000 bushels which, together with the new crop, will of course supply the requirements. Furthermore, while I have under my hand the exact figures, it must be remembered that a comparatively small proportion of winter wheat grown is used for flour. When I say a small proportion, if my memory serves me aright, it is less than 30 per cent. Therefore there should be ample Canadian wheat for soft wheat flour purposes.
I might make a further statement to the house as to the steps taken by the government in connection with the importation of flour from Australia. It will be recalled that in the Canadian-Australian trade agreement provision was made under article IX for giving notice and I shall read just briefly from the article so that the exact language may appear on Hansard. It reads:
If at any time either party to this agreement gives notice in writing to the other party that, in consequence of the importation of goods of a kind specified in the notice, being the produce or manufacture of the exporting country, intc the other country, the sale of similar goods produced in that other country is being prejudicially or injuriously affected-
And so forth. Then three months' notice may be given by the importing country to the exporting country. If within that period satisfactory remedial measures are not arranged, the article complained of goes under the general tariff.
In respect to the agreement I may say that we have always had the heartiest and most genuine cooperation from the Australian government; in this instance all that has been necessary is to give notice and we are assured that the importation of Australian flour under present conditions is not likely to be of any magnitude. Furthermore, such quantities as are already en route are not sufficient to give any alarm; in fact, there is a certain small quantity that regularly comes in to the Pacific coast and the quantity coming in to the eastern seaboard is comparatively small. The officials of my department as well as other officials of the government, after giving the matter the most careful study, are quite satisfied that nothing will occur that need in any sense give alarm, and I believe from recent advices from the trade the same opinion is shared by it.


Mr. SANDERSON:: I take it from the remarks of the minister the government are still going to permit the importation of Australian flour.


Henry Herbert Stevens: No, the hon. member is wrong; he is not even approaching the fact. We have given notice and the importation of Australian flour has been stopped. I would suggest to my hon. friend that it is not necessary for Canada to be rude to Australia. I repeat that Australia and the Australian government and officials have cooperated with us in the most cordial spirit in this and in other matters. We have had no trouble and further importation of Australian flour will not occur.
Dominion Elections Act


Frederick George Sanderson: If I misunderstood the minister I am very sorry. Now I understand him to say that importations of Australian flour will be stopped. Am I right in that?


Henry Herbert Stevens: Yes, quite right, with one point which I think any reasonable person will recognize. There was a small quantity en route and naturally we are not under present circumstances going to reject that. But let me make it clear to the house-and I trust the house will accept this and be satisfied with it -the normal imports of Australian flour are not large but there is a considerable quantity; we could not reject flour that was already en route but it is a very small quantity. There is nothing whatever to be perturbed about.


Mr. WILLIAM DUFF (Antigonish-Guys-borough):: Speaking for the maritime provinces, may I say to the hon. member for South Perth (Mr. Sanderson) and to the Minister of Trade and Commerce (Mr. Stevens) that if Australia can send to Canada as good wheat as that produced in this country and at a lower price I want to say on behalf of the consumers of the maritime provinces that they desire that wheat to come in.



DOMINION ELECTIONS ACT

[Stage Direction]
On the orders of the day:
Mr. A. W. NEILL (Comox-ALberni):: I
should like to inform the Minister of Justice now that he is in his seat that Bill No. 115 that he introduced on Wednesday has not yet been printed. We are told that it will not be available to-day so that it will not be in the house until Monday and at this stage of the session that is rather a long time to wait for an important bill.


Hon. HUGH GUTHRIE (Minister of Justice) :: The bill is not important in this way that, as I mentioned before, there is only one real change in it. It is the Elections Act which is to-day on the statute book with, taken out of it, those clauses which refer to the preparation of the election lists. The only change of any importance is the one as to the appointment of returning officers. While I am mentioning the matter, it will be the intention of the government to refer both the elections bill and the franchise bill to a special committee. When they are called to-day I would be obliged if the house would give its consent to the reference of those bills to a committee in order to expedite business.



DOMINION FRANCHISE ACT


[Stage Direction]
Hon. HUGH GUTHRIE (Minister of Justice) moved the second reading of Bill No. 101, respecting the franchise of electors at elections of members of the House of Commons.
Right Hon. W. L. MACKENZIE KING (Leader of the Opposition):: Mr. Speaker, I understand from what the Minister of Justice said a moment ago it is his intention to ask the house to refer this bill to a special committee. That course is in accord with the suggestion that was made yesterday from this side of the house. It is a step which should help to expedite the consideration of the measure and avoid protracted discussion. In this particular so far as the official opposition is concerned, we are wholly in accord with the course the government proposes. It will be understood, of course, if the second reading is passed at the moment, this is without prejudice to the fullest discussion of all features of the measure when the bill returns from the committee.
I should like to say just a word before the motion for second reading passes. In discussing the resolution at the time of introducing the measure the Minister of Justice made it clear that the present elections act was really three acts in one: a franchise act, an act relating to the preparation and revision of voters lists, and an act relating to the machinery of elections. As I understood at the time the franchise phase was one which it was not intended to alter except possibly in one particular that would be considered and that is the one that relates to the Doukhobors in British Columbia. If that is strictly adhered to, I imagine there will be little difficulty in reaching agreement on the measure. I should like to stress the importance of it being seen to that the bill when it comes back to the house is not a measure that because of its provisions may serve to disfranchise any persons who at present enjoy the franchise but one that will ensure a continuance of the enjoyment of the franchise by all who at the present time enjoy that right.
The bill as originally drafted-and for that the government says it takes no responsibility -would have disfranchised large numbers of persons; it would have disfranchised those who are not able to read and write English or French, Doukhobors and others. However, the government has disclaimed, and rightly, I think, any intention of having had that object

Franchise Act-Mr. Mackenzie King
in view. But the bill as it was presented lacked certain features that are in the present Dominion Elections Act, and this, I believe, would have materially affected the enjoyment of the rights of many of those whose names should appear upon the list. As a consequence they would really have been disfranchised. There was the provision that limited the preparation of the lists to a single enumerator. If that provision had not been altered, and the government had not agreed to double enumerators in the preparation of the basic list, I believe that numbers of names would have been left off the list which under the act as it now stands would have been on it. The measure in such circumstances would have been in reality a disfranchising measure. The arguments urged in support of the employment of double enumerators in connection with the preparation of the basic list are equally applicable with respect to the annual revisions that are to take place. It does not follow that because a revision is to take place every year, the amount of work in connection with a revision will be anything like that required for the preparation of the original list. Double enumerators might very easily go from house to house and check up on the basic list in a way which would avoid the omission of large numbers of names or the possible inclusion of names that should not appear. That is a requirement which I think should be considered by the committee.
Then, as the bill was introduced, there would have been deleted another provision which appears in the Dominion Elections Act at the present time, namely, the right to appeal to a county court judge. The removal of that right would, I believe, have served to disfranchise a certain number of persons. But the government has conceded the restoration of that feature, and to that extent as far as the rights of electors are concerned their chances of having their names appear upon the lists will continue to be what they are under the present act.
There still, however, remain in the bill certain provisions which are new and which if not altered will, I believe, lead to the virtual disfranchisement of a large number of persons. One of these is the provision which obliges those who wish to exercise the franchise to make application and sign a document which will have to be witnessed, and which will state that the signatory has read over certain sections of the act and certain regulations that will appear upon the document itself, and that they are thoroughly understood by him. May I say that, knowing human nature as I think all hon. members
of this house know it, there is reason to believe that if many of the electors are to be obliged to sign documents, no matter how understandable they may be, or how genuine their purpose, they will refuse to sign altogether, and will be disfranchised as a consequence. In this country the franchise-manhood franchise-ought to be considered an inherent right of the citizen. If a man or woman is twenty-one years of age and qualifies in regard to the conditions that have been generally set forth and the requirements that have been generally accepted, citizenship in and of itself should include the right to vote, without any preliminaries or accessories of a kind that are at all likely to threaten or impinge upon that right. It ought to be and is a duty of parliament to see that this inherent right is protected above everything else, and that anything which will tend to take away from an individual who is a qualified citizen absolute freedom in the matter of the exercise of his vote at the time of an election is not countenanced. The fairness of that general statement will I am sure appeal to all hon. gentlemen.
With the alleged objects of the bill, as stated by the government, we are as I have said, in complete sympathy. With the object of shortening the time necessary for an election, the object of reducing expenses, the object of having a clear, clean list which will help to prevent impersonation or what is called "plugging" and "telegraphing" at the time of election-with all those objects we are in complete accord, and they are the objects as set forth by the government. If however they are to be attained in this measure only at the expense of other provisions which will have the effect of disfranchising a large number of electors, then the price to be paid will be too great and the measure should not be permitted to pass. I would think it should be possible for the government to attain the objects it has in view without imposing on the electorate conditions which will involve the possibility of a large proportion of its numbers not having the right to record their votes at the time of an election. I might say that one of the reasons I had for expressing the hope that the government in the first instance would consider this measure by a special committee was that I believed it would take up a great deal of the time of the house to set forth the variety of instances in which it could be clearly shown that under the machinery as at present provided in the bill the voting might be so blocked on the day of election, or electors themselves so terrified

Franchise Act-Mr. Gardiner
or discouraged or nonplussed with respect to preliminary requirements that there would be a very large number who on election day would be deprived of the right of having their votes recorded. I am prepared to accept, and I am sure the house will accept the statement of the government that it really has in view only the objects which have been alleged, and that any measure that we shall be asked to accept after consideration by the committee will not be one which because of provisions not existing at the present time will obviously limit the numbers of those who on election day will be in a position to exercise their right of the franchise. There are other features of the bill which have to be carefully examined, and to which as they stand we would wish to take exception. With these few remarks, however, I am quite agreeable that the bill should pass the second reading and be sent to a special committee.


Mr. ROBERT GARDINER (Acadia):: With some of the remarks of the hon. leader of the opposition (Mr. Mackenzie King), so far as safeguarding the franchise of the people is concerned, I am in agreement. I am sure that on all sides of this house the same desire prevails. I am not very fearful that anything will be done in the special committee that is to be appointed to consider this measure which will tend to disfranchise any of the people of Canada who are entitled to vote. There is one point, however, on which I wish to make a few remarks, that is in regard to the proposal for double enumerators, or the appointment of two enumerators for each poll. I believe that we have men and women in Canada, who, if they are appointed to enumerate a polling division, will do it expeditiously and well and satisfactorily to all concerned. In my judgment the statement of the leader of the opposition (Mr. Mackenzie King), both to-day and on the former day when this bill was introduced, does not augur well for the political situation in this country. It almost takes it for granted that we have not got people in Canada who are honest enough to give an honest enumeration. I protest against that idea. Personally I believe that we can get all the enumerators we require who would do the work honestly and well and see that everyone entitled to vote is placed upon the list.
We are supposed both in the House of Commons and in our provincial legislatures to have proper representation of the wishes of the people. Last Tuesday there were two provincial elections held. The results have given some heart to a certain portion of the members of this house-and they are entitled

to take what satisfaction they can on that score-yet when we look over the returns we realize the fact that after all we have not representative institutions in this country. In the province of Ontario for instance according to press reports this morning it required only 8,500 votes to elect a Liberal candidate while it required something over 28,000 votes to elect a Conservative candidate and 94,000 votes to elect one C.C.F. candidate.


Mr. McINTOSH:: It serves them right.


Robert Gardiner: Taking those figures we find that the Liberals elected sixty-five members, the Conservatives seventeen and the C.C.F. one. In the final analysis, so far as the votes of the people of the province of Ontario are concerned, we are going to have a minority government notwithstanding the fact that 65 members were elected to support the Liberal government.


William Lyon Mackenzie King: May I ask my hon. friend a question? He has referred to the seventeen Conservative members elected in Ontario. Is it not a fact that if the votes that went to the C.C.F. candidates had gone to the Liberal candidates there would have been only seven Conservatives elected instead of seventeen?


Robert Gardiner: I am afraid that question is beyond me for the moment. Now let me refer to the situation in Saskatchewan, where fifty-four members were elected last Tuesday. According to the latest returns the Liberals elected forty-nine members.


Some hon. MEMBERS:: Hear, hear.


Robert Gardiner: Yes, I suppose my hon. friends feel quite satisfied about it. The Conservatives did not elect any members while the C.C.F. elected five. Now let us look at the actual figures. According to press reports -and I must admit, of course, that the returns are not complete as yet-the Liberals received approximately 178.000 votes, which elected forty-nine members out of fifty-four. The Conservatives received 103,000 votes but obtained no representation at all. The C.C.F. received 84,000 votes and elected five representatives. I submit that the time has come when we should consider the idea of securing a more representative house than we have at present or than resulted in the two provincial elections. May I suggest to the government that they refer to the committee the questions of proportional representation and the single transferable vote in single member constituencies. After all is said and done, if we are going to boast about our representative insti-

Franchise Act-Mr. Guthrie
tutions those institutions should be truly representative of the ideas of the people of this country.


Hon. ERNEST LAPOINTE (Quebec East):: With regard to the last remarks of my hon. friend I should like to remind the house that a few years ago, when I was Minister of Justice, I introduced a bill for the purpose of having the alternative vote in this country, in order to remedy the ill my hon. friend has just represented as existing. At that time we were told that if we insisted on proceeding with the bill the session would last all year, and we had to postpone the matter.


Hugh Guthrie: Will my hon. friend say
whether he would support such a bill now, if it were introduced?


Ernest Lapointe: I certainly would, so far as I am concerned, because it is a Liberal measure.


Hugh Guthrie: Mr. Speaker-


Mr. SPEAKER:: The Minister of Justice
will conclude the debate if he speaks now. If any other member wishes to speak he should do so.


Hugh Guthrie: I have just a word of
reassurance for my right hon. friend the leader of the opposition (Mr. Mackenzie King), and I must confess that I experienced at least some mild degree of surprise when I heard his remarks this afternoon. As I stated when this bill was introduced we had some preliminary discussions, not only upon the principle but upon practically every detail of the bill. My right hon. friend and the hon. member for West Edmonton (Mr. Stewart) were present at those discussions; I was present, as was the Secretary of State (Mr. Cahan), and I came away from those discussions with the idea that they had been eminently satisfactory to all concerned. I think there were only three questions left upon which we did not agree. One was the question of double enumerators; another was the question of an appeal from the revising officer, and the third was the question as to the appointment of the chief officer. No agreement was reached on those points. Apart from that, however, I came away with the impression that we were all thoroughly agreed and satisfied. The impression I received today from my right hon. friend's remarks was that someone has been interfering. I am inclined to think an enemy hath done this thing, that someone hath been sowing tares among the wheat.


William Lyon Mackenzie King: I do not wish to interrupt my hon. friend at the moment, but perhaps he will allow me to do so later.


Hugh Guthrie: Perhaps it would be
better after I have concluded. The bill as introduced has remedied two of the questions upon which we failed to agree. With regard to the language qualification we agreed absolutely; that was struck out. That was the first action of the conference. We agreed in regard to the disqualification of Doukhobors, and the clause in the present bill is an adaptation of the British Columbia act which has been in force for many years. The bill as introduced provides for the appeal which we. discussed at that conference, and I was under the impression that we had met all objections.
I do not think my right hon. friend need have any apprehension as to what either a committee of the house or a committee of the whole may do in regard to this bill. The question of the signed statement was thoroughly discussed at the conference, and when the bill was before the house previously I remember the language of my right hon. friend when he pointed out how satisfactory it would be if two enumerators should sign as witnesses to this statement, what intense satisfaction that would give everyone. I thought that matter was practically settled. Again that is the British Columbia system, adopted by a Liberal government in that province and commended from every side by people in the west as being the best cure for the evils of personation and telegraphing as we know them in other parts of Canada.


Mr. STEWART (Edmonton):: I should
like to ask my hon. friend a question with regard to one particular. So far as I was concerned form 7 as provided in the original bill was entirely new; while we did discuss it at some length it was entirely new to us and we asked for some time in which to think over the matter. As to the rest of it my hon. friend is correct.


Hugh Guthrie: The form attached to the bill?


Charles A. Stewart: The principle of registration.


Hugh Guthrie: The principle of registration, if I understood it aright, was approved by everyone. There may be details in connection with the matter which we did not discover or discuss. In a bill of this kind there are always new ideas.


William Duff: May I ask a question? How
is an absentee fisherman or sailor-and there are thousands of those in the country-to sign a questionnaire or have his name witnessed?
4202	COMMONS
Franchise Act-Mr. Mackenzie King


Hugh Guthrie: If they are absent there is provision in the bill to have someone else do it for them. If they are not broad enough they can be broadened, but I think they are broad enough in the bill now.


Mr. ERNST:: The hon. gentleman need not worry; I have most of them.


Hugh Guthrie: In regard to this bill, and in regard to the other bill appearing on the order paper, namely Bill 115, I propose to make this motion. I shall make it now in regard to Bill 101.


William Lyon Mackenzie King: May I answer the minister before he makes his motion. If the house will look at the statement which I made, and which the Minister of Justice and other hon. members accepted at the time it was given, they will see I stated that my understanding of the conference which the hon. member for West Edmonton (Mr. Stewart) and myself had with the Minister of Justice (Mr. Guthrie) and the Secretary of State (Mr. Cahan) was that it was to be without prejudice in any particular as to the rights of all hon. members in the house to discuss any and every phase of the measure. We were not agreeing, on behalf of the opposition party, to anything. The conference was to see how near we could bring our minds to meet, and to have eliminated from the bill as largely as might be possible those provisions on which we could not agree. But beyond that there was no understanding whatever.
May I recall to the mind of the Minister of Justice exactly what took place at the first conference, seeing that he has referred to that matter himself. When we began to discuss the matter there were certain features to which my colleague and I took exception. The Minister of Justice said, "I think it is all right that exception should be taken to those matters; we will reserve them for consideration," or words to that effect. We got no farther than that. Later he told us that having considered with the Prime Minister certain provisions it had been agreed to eliminate them. When other features were mentioned the Minister of Justice said, "That is a matter we cannot consider. The government has its policy on this phase of the matter, and it is not open for discussion." He will recall that that position was taken with regard to the very matter of obliging the electors to sign applications. I spent some little time pointing out the extent to which I believed the electors would be disfranchised, if they were obliged to sign a declaration, and particularly one in which they were called upon to assert that they had read what was on the back of the

declaration, and had understood its meaning and consequence. I dwelt particularly upon the extent to which women who for the first time were exercising their franchise would hesitate to sign such a document, and I pointed out the extent to which workingmen would also hesitate. The minister at each turn indicated that so far as that matter was concerned the mind of the government was made up on what he called a closed list and that we could not consider any further that aspect of the closed list. It was after that position was taken that I said, "If that is the government's decision in the matter, it makes stronger than ever the need for double enumerators." I did not acquiesce at all in the provisions which required applications to be made and signed. But, from the discussion which took place there I assumed that the government's mind was no longer open on the point, and that if we wished to consider anything that would make that feature of the bill more acceptable we were only at liberty to make representations. I think the Minister of Justice himself made perfectly clear to the house in his own statement that we were not-


Pierre Édouard Blondin: I do not wish to interrupt the right hon. gentleman, but he is making a second speech.


William Lyon Mackenzie King: May I say that much to my surprise the Minister of Justice began to discuss what took place at the conference.


Pierre Édouard Blondin: I do not wish to interrupt the right hon. gentleman but-


William Lyon Mackenzie King: Your Honour
may not wish to interrupt, but you are succeeding admirably in so doing.


Pierre Édouard Blondin: Then I now call the right hon. gentleman to order.


William Lyon Mackenzie King: I think there are some rights which belong to the members of the opposition in this house and also some rights due the leader of a political party, and I am going to assert those rights.


Pierre Édouard Blondin: With all due deference to the right hon. gentleman and not wishing in any respect to slight him as leader of his party, I merely remarked that each member has a right to speak once on this resolution. I called the attention of the house to the fact that in speaking as he began to do the Minister of Justice would close the debate. No other hon. member, even the right hon. leader of the opposition, has a right to speak twice.

Franchise Act-Mr. Bennett


Ernest Lapointe: I suppose that applies to the right hon. leader of the government, too?


Pierre Édouard Blondin: It certainly does.


Richard Bedford Bennett: Certainly it does.


Ernest Lapointe: He has never been called.


Richard Bedford Bennett: Dealing with the point of order may I suggest that I think perhaps the right hon. gentleman, in annoyance, went rather farther than he would wish any leader of a political party to go. The question it seems to me might easily be solved by the right hon. gentleman making his observations on the motion to appoint the committee, and then there would be no question of him being out of order. He would have a perfect right then to make the statement he is now making, but he was speaking in contravention of the rules of the house, and when the right hon. gentleman suggested he might make the statement he was launching into a discussion which would necessitate further discussion. I think he would be the first to say that the Speaker was within his rights and his duty to_ suggest to the house that this debate constituted a violation of the rules. I did endeavour to make myself heard, but I did not succeed. I think the former Minister of Justice did hear me suggest that the observations which the right hon. gentleman desired to make might be made on the motion for the appointment of the committee.


William Lyon Mackenzie King: Have I, Mr. Speaker, the same right as the Prime Minister has to talk at the present time?


Richard Bedford Bennett: I am speaking to a point of order.


William Lyon Mackenzie King: Then, on a point of order may I also say something? The Prime Minister has told me that my remarks were occasioned by annoyance. May I tell him they were occasioned by nothing of the kind. They were occasioned by the sense that it was right and proper and justifiable to make the statements I did in the present discussion. Before His Honour spoke, the Minister of Justice undertook to say what he had understood at the conference. That conference was understood to be private and without prejudice to anyone. Surely when the Minister of Justice states what his position was at the conference I have the same right to make absolutely clear to this house the position which was taken by my colleague and myself. That is all I did.


Mr. HACKETT:: Why bring out what was in a confidential memorandum then.


Some hon. MEMBERS:: Sit down.


William Lyon Mackenzie King: I notice that the hon. gentleman who has just interrupted me always assumes that he is a member of the ministry. He talks about what "we" mean by this and what "we" mean by that, as if he were a member of the government. May I say-


Some hon. MEMBERS:: Order.


William Lyon Mackenzie King: May I say that if the government has any desire to ask me questions I shall answer them, but I do not propose, when I am replying to a minister of the crown, to be interrupted by the hon. member who is not a member of the ministry, and is not likely ever to be a member.
Motion agreed to and bill read the second time.


Hugh Guthrie: That Bill No. 101 be referred to a special committee of this house to consist of Messrs. Guthrie. Duranleau. Hanson (York-Sunbury), Willis, Stirling, Lapointe, Stewart (Edmonton), Power and Irvine to inquire into and report said bill to this house.


Richard Bedford Bennett: I should like to remove from the minds of any hon. members any misapprehension as to what document was before those engaged in what the right hon. leader of the opposition has described as a confidential discussion.


William Lyon Mackenzie King: Was it or was it not a confidential discussion?


Richard Bedford Bennett: That is what I thought, but the right hon. gentleman only a moment ago left the opposite impression.


William Lyon Mackenzie King: I was replying only to aspects of it which the Minister of Justice had discussed.


Richard Bedford Bennett: As I understand it, the Minister of Justice discussed the conference when he introduced the bill, and I listened to the right hon. gentleman who stood in his place and said that the statement made by the Minister of Justice was an accurate statement. I am using broad terms. After that I made a few observations and I thought it was a very excellent thing that a conference of this kind had been held and that all those present who had spoken were agreed as to what had transpired. That is what took place in this chamber when the Minister of Justice introduced the bill.
What I desired to point out was that the bill introduced was not the document that the members of the conference had before them. There was no bill that had then been introduced. It was merely a memorandum
Franchise Act

which had been prepared by the draftsman, of the measure and was never introduced into this house as a bill although it was so treated by some, and I did make some complaint with respect to that although I have never made any complaint in this house with respect to it because I thought one could rely upon the ordinary amenities of life so that what was a memorandum would not be described as a bill. It was not for circulation. Two copies of it had been placed in the hands of hon. gentlemen opposite, and the Minister of Justice made a statement indicating where the five copies were.
I notice that during the discussion to-day frequent reference was made to that document as a bill. It never was a bill. It was printed in the form of a bill by the draftsman who prepared it, but the only bill that has ever been before this house or submitted by council to this house was the bill which was introduced a few days ago by the Minister of Justice, and the second reading of which he moved to-day. I mention that because of the effect upon the institutions of the country of the very circumstances which have been referred to to-day. Democracy sometimes is laughed at by those who regard it as a very unsound form of government, but if the ordinary amenities of life were observed by some-I am not referring in this instance to the members of the conference themselves -certainly the statement sent abroad from this city would not have been made, for there was no bill introduced or submitted except the bill that is now before the house. I find that the right hon. gentleman in his remarks the other day, at page 3942 of Hansard, said:
Mr. Mackenzie King: Mr. Chairman, since the Minister of Justice (Mr. Guthrie) has made reference to the conference which took place between himself and the Secretary of State (Mr. Cahan) and myself and my colleague the hon. member for West Edmonton (Mr. Stewart), perhaps I should say a word with regard to the minister's representations in that particular. In a word, though speaking generally, I may say that so far as my recollection of the entire proceedings is concerned, the Minister of Justice has stated the matter accurately.
He referred again to the matter in the same sense. It would take too long to read it all, but he indicates at page 3943 of Hansard that the recollection of the Minister of Justice was correct, and he speaks of his desire then for a closed list.
It is unfortunate perhaps that there should be any misunderstanding now after both parties to the conference have indicated that the expressions by the Minister of Justice of what transpired correctly indicated what had in fact transpired, and the right hon. leader

of the opposition agreed that that was an accurate statement of it.
I desire again to repeat to this house that when an effort is made to induce people to believe that the government introduced a bill to disfranchise people, the government introduced no such bill. The government had a number of points put down for consideration and they discussed them at a conference with the leader of the opposition, and after that conference the only bill that was presented was the bill now before the house.


William Lyon Mackenzie King: The Prime Minister has just said that there never was a bill before the conference committee, that there was only a memorandum. I would remind the Prime Minister that time and again I asked him when we might expect to have the franchise bill, and in all the answers which my right hon. friend made to me he intimated that the bill would be ready, that it was being printed, that the government was going to consider it, that we would have it before us in a short time. When I went to see, my hon. friend, at his request, he spoke to me of a bill and said his colleagues would have a bill, and would I manage to have one of my colleagues go with me and consider all phases of it in order to see how far we might be in agreement.
Speaking in this house on June 13 I made the remarks to which my right hon. friend has just referred, and I repeatedly used the expression "bill" and no exception was taken to the word "bill," it was accepted by the Prime Minister. This is the first time we have had any talk of a memorandum instead of a bill.


Some hon. MEMBERS:: Oh.


William Lyon Mackenzie King: May I read what I said in this house on June 13?


Mr. HANSON (York-Sunbury):: Read what the Prime Minister said.


William Lyon Mackenzie King: If hon. members will kindly listen to this, they will see that the Prime Minister in his own mind was thinking of a bill just as much as we were. The only question at issue was whether the government itself had finally passed upon the bill or not. It was a draft bill we had before us, and it was a bill that was-


Richard Bedford Bennett: A draft measure, the right hon. gentleman called it.


William Lyon Mackenzie King: May I read what I said in this house on June 13?
As the house will remember, I frequently asked the right hon. Prime Minister (Mr. JUNE 22, 1934
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Bennett) when we might expect to have this new electoral measure brought down. Finally, towards the end of April, the Prime Minister stated that very shortly a bill would be printed and that he would see that, as leader of the opposition, I was supplied with a copy. When the bill was printed the Prime Minister had a copy sent to my office, and on the day the copy arrived he stated in the house that it had been so sent. Later in the day, the Prime Minister said to me that he would be pleased if I, together with one of my colleagues, would confer with the Minister of Justice and the Secretary of State concerning the measure. The Prime Minister was careful to state at the time that the purpose of the conference was solely that of considering a draft measure-


Richard Bedford Bennett: Hear, hear.


William Lyon Mackenzie King: A bill is a draft measure.


Some hon. MEMBERS:: Oh, oh.


William Lyon Mackenzie King: Of course a bill is a draft measure. Every bill is a draft measure.


Richard Bedford Bennett: Go on, read the rest of it.


William Lyon Mackenzie King: I went on to say:
The Prime Minister was careful to state at the time that the purpose of the conference was solely that of considering a draft measure with a view to seeing how much in the way of possible agreement might be arrived at in the introduction of a measure of this kind, and that our conference was to be entirely without prejudice in any direction.
There was no exception taken at that time by the Prime Minister or the Minister of Justice to my use of the word "bill." There was no reference to any memorandum that had been prepared, but when a question came up about the original measure as it was drafted, concerning certain very objectionable provisions, the Minister of Justice stated to the house that those provisions were merely in the draft and that they had not been finally accepted by the government.
In order to make perfectly clear to the house, from a chivalrous motive, that the government was not responsible for those particular objectionable features I stated that what the Minister of Justice had said, "speaking generally," was correct, and the thanks I now get for it apparently is that the government are seeking to hold me to a position which when we were in conference was never for one minute asserted by the Minister of Justice. May I read the words I used in the house on June 13, and which I have just quoted:
Since the Minister of Justice has made reference to the conference which took place between himself and the Secretary of State (Mr. Cahan) and myself and my colleague 74726-266
the hon. member for West Edmonton (Mr. Stewart,), perhaps I should say a word with regard to the minister's representations in that particular.
That is, representations as to the nature of the conference and as to these particular objectionable clauses. They were the ones he stressed especially. I went on:
In a word, though speaking generally, I may say that so far as my recollection of the entire proceedings is concerned, the Minister of Justice has stated the matter accurately.
Reading the statement which the Minister of Justice made at that time and comparing it with the statement he has made this afternoon, hon. members will see that there is a great difference between the two. The Minister of Justice did not say, speaking on June 13, that that conference was at all in the nature of a conference which was to arrive at a final agreement between the parties.


Hugh Guthrie: I do not say so now. I
never alleged it or even hinted it.


William Lyon Mackenzie King: I will ask the Minister of Justice, was it ever understood at any time that with respect to all the provisions my colleagues and myself were not to be free to suggest amendments to them?


Hugh Guthrie: Certainly it was.


William Lyon Mackenzie King: Well, was it
not true that I took very strong exception to persons being asked to fill out an application form and to affix their signatures? The Minister of Justice knows such to be true.


Hugh Guthrie: I thought the right hon.
gentleman gave strong approbation to the proposal, provided there were two enumerators; he undoubtedly did, in my judgment, on the occasion of the first reading of the bill, when he said we could have the witness of two enumerators, and what satisfaction that would give. I thought at that time he was perfectly satisfied.


William Lyon Mackenzie King: The Minister
of Justice knows very well that there was no approbation at all. I took the strongest exception from the beginning, as I do now.


Hugh Guthrie: I am talking about the
first reading of the bill.


William Lyon Mackenzie King: I thought my hon. friend was referring to the conference. Let me make it perfectly clear-and I hope my hon. friend will bear me out-that so far as the conference was concerned I took strong exception there, and the only reason I did not continue that exception was that I was given to understand by him that that was not a phase of the bill we could have

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considered further. When speaking in this house on the resolution, what I stated was [DOT] in relation to what the Minister of Justice had said to me about the government's determination to retain that phase of the measure. I was making clear that, if that phase was to be kept, there would have to be double enumerators. But I wish to repeat now, as emphatically as I can, that any provision of that kind will serve to disfranchise hundreds of thousands of the voters of the country, and if the bill comes back with that provision in it, so far as it is possible to avoid its passing this house, hon. gentlemen opposite may expect to see that that will be done.
Mr. J. S. W00DSWORTH (Winnipeg North Centre): I think the discussion that is now taking place illustrates very well the dangers which this house gets into when it undertakes to do things outside this chamber and when there is a secret arrangement between two parties.


An hon. MEMBER:: There was no secret.


Mr. WOODSWTORTH:: You may call it what you like; but whether secret or not the fact is that although there is a third group represented in this house-that is very well understood and recognized when it comes to the appointment of committees, and so forth- we find here a discussion of a private conference a discussion of proceedings that took place where a part of the house had no idea at all of what was occurring.


Mr. GRAY:: What is the name of the third group?


James Shaver Woodsworth: It is anything but fair to the third group in this house that the government and the leader of the official opposition should get together with respect to a public bill of this kind, and reach a conclusion which as it turns out is not satisfactory, and then bring it before the house, and that we should be listening here to a discussion, back and forth, of what was understood in a private conference. I think a protest has already been lodged in this corner against a practice of that kind, and I want to take this opportunity of emphasizing that position.


Ross Wilfred Gray: The hon. member should have been here to protest.


James Shaver Woodsworth: The hon. gentleman says I should have been here to protest. The protest was made, but I suggest that there were a number of members from the Liberal side who were away a considerable time-


Ross Wilfred Gray: And we made a good job of it.


James Shaver Woodsworth: -and a large number of members on the Conservative side as well, including cabinet ministers. I think, Mr. Speaker, it is a rather ridiculous situation when members of the Liberal party will seek to deny to others privileges they claim for themselves. It is characteristic of them.
Now, with regard to one phase of this legislation, that, I do not think, can be at all justified. It is an adaptation, we are told, of the act now in force with respect to elections in British Columbia. I protest very decidedly against dominion legislation following the lines of some one particular province. It seems to me that if we are acting here on behalf of the dominion at large our legislation should be uniform, and there should be no exception of any kind for the prejudices of some one particular province. I have felt that way for quite a long time with regard to the practical disfranchisement of orientals on the coast. If an oriental in Alberta or Saskatchewan may vote, I think the oriental ought to be able to vote in British Columbia. The issues at stake are very considerable, especially when we think of international affairs, and I do not think that the attitude of one particular province towards a certain matter-


Mr. MACKENZIE (Vancouver):: Is the
hon. member in favour of enfranchising orientals in British Columbia?


James Shaver Woodsworth: I am in favour of enfranchising orientals in British Columbia.


Alan Webster Neill: Did you say that during the late election in British Columbia?


James Shaver Woodsworth: I did.


Alan Webster Neill: I did not hear of it.


Ian Alistair Mackenzie: Is the
C.C.F. in favour of it?


James Shaver Woodsworth: Yes; there is no doubt about that. I will go into your riding and tell them so; there is no doubt about it. I say that, especially in view of the international situation, it is perfectly absurd that the narrow prejudices of one particular little group in one province should imperil the good relationship between Canada and other countries. It is a ridiculous situation. If we are to have exceptions, and if dominion legislation is to follow provincial lines, I presume that in the province of Quebec we ought to refuse to give the vote to women.


An hon. MEMBER:: Why?


James Shaver Woodsworth: will so blast the hopes of the Ottawa government and so impress the electorate throughout the dominion that the federal election field next year will provide the C.C.F. with a far better and greater opportunity to become a real force in the dominion.
Mr. Mitchell Hepburn immediately before the election-


Some hon. MEMBERS:: Hear, hear.


James Shaver Woodsworth: Liberal members
may cheer. Mr. Mitchell Hepburn immediately before the election proceeded to appeal to the electors of Ontario and especially to the C.C.F. electors to support the Liberal party. He quoted from what he said was the official organ of the C.C.F. The Commonwealth, and he read a paragraph from the paper which I hold in my hand. He made that the ground of appeal

the official organ of the C.C.F.; this is what the C.C.F. says; this is what Woodsworth says, and so on. There is no indication on this document as to who the printers are and I suppose that in itself makes it illegal. I am not in a position to say whether Mr. Hepburn knew it was a fake; I can hardly think Mr. Hepburn who sat in this house for some years and knew the position we had taken could be so innocent as to believe this was a genuine publication but he used it on the eve of an election when there was no chance whatever for us to answer. If the Liberals cheer and rejoice in this thing, I want to say to them that I would rather our party should go down to defeat than that they should win an election by methods such as this.


William Lyon Mackenzie King: I rise to a question of privilege. It relates to the point as to whether the understanding at the time of this conference was not that we were considering a draft bill or a draft act and not a memorandum. On page 3001 of Hansard of May 14, the Prime Minister is reported as follows:
Right Hon. R. B. Bennett (Prime Minister}: Resolutions have been sent to the clerk of the house with respect to. first the public works bill, second, the elections bill, third, the bill providing for arrangements between farmers and their creditors, fourth, the bill amending the Farm Loan Act.
Then on page 3002, under the heading " Dominion Elections Act " we find this:
On the orders of the day:
Right Hon. W. L. Mackenzie King (Leader of the Opposition): The Prime Minister was kind enough to say he would send me a draft of the election act.
Right Hon. R. B. Bennett (Prime Minister): I sent it over Saturday.

The Prime Minister did not say he had sent me a memorandum; he said that he had sent me a draft of the act. That was the only term used in all our discussions. Sometimes it was referred to as an act or bill, sometimes as the elections act, sometimes as the franchise act or bill. There was no mention at any time of any memorandum until this afternoon. With regard to what was said in conversation while in conference in reply to my hon. friend the other day I was careful to draw the attention of the house to the fact that I was referring, in my reply to him, only to the representations which he had made on the floor of the house; that I regarded myself as precluded from saying anything about what had actually taken place in the conversation, other than to indicate in general terms, that the representations that the Minister of Justice had made in the particulars I had mentioned were correct.
On page 3943 of Hansard it will be seen that I spoke as follows:
In what I have now to say, Mr. Chairman, I presume T must confine myself, not to my remembrance of the draft bill, but rather to what the Minister of Justice has just said in regard to the proposed measure.
Then a little further on:
As to the franchise, may I say that I do not believe there is a necessity for altering in any particular the franchise as it now stands. I noticed that in his remarks this afternoon the Minister of Justice has not indicated any changes to be made in that respect.
Mr. Bennett: Except the difficulty in British Columbia.
Mr. Mackenzie King: The Prime Minister mentions the difficulty in British Columbia; I presume he means the difficulty with respect to the Doukhobors in that province.
Mr. Bennett: Yes.
Mr. Mackenzie King: Yes, that is the only possible change in regard to the franchise, and it is a matter which may easily be considered when we have the clause before us. If we leave that matter out of account, and it is understood that so far as the franchise is concerned the new measure will be in all particulars the same as the present act, that will be entirely satisfactory.
Now what I really had in mind and actually thought when I made that statement and said that I believed the measure would be satisfactory was that the government had listened to the representations which had been made by my colleague and myself as to the strong objection that would be taken on this side to retaining the provisions requiring electors to sign an application, and had decided to drop them. I had pointed out clearly in the conference that if the signing of applications was to be required there would be a large number of persons who would not sign and who would therefore be disqualified from

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voting. That is what I meant when I said I would be perfectly satisfied if in this bill, which I had not seen, but which the minister was introducing, the franchise was left as it is at the present time. The words are as plain as the English language can make them.


John Thomas Hackett: With the permission of
the right hon. gentleman who leads the opposition may I say a few words? I might ask him to pursue the explanation he has given. He has found it convenient this afternoon to vent his spleen both upon the Speaker and upon one-


Some hon. MEMBERS:: Order.


William Lyon Mackenzie King: Mr. Speaker,
I ask if that is in order? I ask that the hon. member be obliged to retract that statement. I say that the language used by the hon. member in reference to myself is unparliamentary and should be withdrawn.


Pierre Édouard Blondin: The hon. member should
not accuse the right hon. leader of the opposition of venting spleen.


John Thomas Hackett: Mr. Speaker, I will withdraw the term and say that he has found it convenient this afternoon to address language to the chair which seemed questionable in the minds of most hon. members. Furthermore, carrying on in the temper in which he had addressed the chair, he has found it convenient to address certain words to a newly arrived member and one who occupies a very inconspicuous position in the party to the right of the speaker. As the right hon. gentleman is in a mood to explain, and as he is an adept at explanations, I ask the right hon. gentleman to tell this house how a memorandum which he has called a confidential memorandum, discussed in what he called a confidential conference, found its way into the press, when he and he only was in possession of that memorandum.


William Lyon Mackenzie King: Mr. Speaker-


John Thomas Hackett: When the right hon.
gentleman has given this explanation to the house, then and not until then may he use the terms of chivalry and justice and decency which so frequently fall from his lips.


William Lyon Mackenzie King: In the first
place may I say that I think the remarks of the hon. member are in the nature of an insinuation which he should be obliged to withdraw, and I ask that they be withdrawn. I say to the house, as the house will well remember, that before any conference took place whatever between the Minister of Justice (Mr. Guthrie) and myself, the press of
this country had a very full and fairly accurate statement of much that appeared in the so-called draft measure. Any information that was obtained throughout the country with regard to the measure came from that source. I said the other day in this house, and this statement was accepted by the Prime Minister and hon. gentlemen, that I had not in any way disclosed any matter of confidence with respect to the conference. I think my word will be accepted by everyone, even the hon. gentleman who has just spoken. If he is not prepared to accept it, of course, I must just allow him to pursue the course that he thinks proper. But he rather prides himself as being one who understands the amenities of parliamentary life, so I hope he will now show that he is capable of appreciating the obligations of a gentleman by withdrawing the insinuation which neither he nor anyone else had the right to make.


John Thomas Hackett: Mr. Speaker, I shall
withdraw any insinuation, that I may give to the right hon. gentleman an example which I trust he will follow.


Richard Bedford Bennett: Mr. Speaker, purely on
a question of privilege, I do regret, especially in view of the observations made by the right hon. gentleman who has just resumed his seat, that he was not quite fair either to the house or to myself. These were his words, not in the heat of passion, not in the midst of discussion but immediately after he commenced speaking, as found on page 3942 of Hansard:
As the house will remember, I frequently asked the right hon. Prime Minister (Mr. Bennett) when we might expect to have this new electoral measure brought down. Finally, towards the end of April, the Prime Minister stated that very shortly a bill would he printed and that he would' see that, as leader of the opposition, I was supplied with a copy. When the hill was printed the Prime Minister had a copy sent to my office, and on the day the copy arrived he stated in the house that it had been so sent. Later in the day, the Prime Minister said to me that he would be pleased if I, together with one of my colleagues, would confer with the Minister of Justice and the Secretary of State concerning the measure. The Prime Minister was careful to state at the time that the purpose of the conference was solely that of considering a draft measure with a view to seeing how much in the way of possible agreement might be arrived at in the introduction of a measure of this kind, and that our conference was to be entirely without prejudice in any direction. That is to say, anything that was said at the conference would not necessarily bind the government with respect to its rights in the matter of the final form of the bill and would not in any way limit the opposition or other parties in the house with respect to proposals and criticisms they might wish to make.
When the hon. member for West Edmonton (Mr. Stewart) and myself met with the Min-
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ister of Justice and the Secretary of State, we were again advised that the measure before us was a draft measure and that neither side would he committed with respect to any suggestions that might be made or with respect, as I understood it, to any conclusions that might be reached. We were simply to endeavour to see how far our minds might be brought to be as one with respect to the measure as drafted. As the Minister of Justice has stated, the draftsman, Mr. O'Connor, was present at the two conferences that took place, and was consulted with respect to the intent and meaning of different clauses.
On these matters I think there is no point of difference between us. If I have omitted to refer to any phase of either of the interviews which either the Secretary of State or the Minister of Justice would expect me to mention I should be glad to be reminded of it and to say what may seem necessary by way of comment.
Now, I do submit to this house that what I said this afternoon is borne out by what I have just read; that the purpose of the conference was solely that of considering a draft measure with a view to seeing how much in the way of possible agreement might be arrived at in the introduction of a measure of this kind. That is all. There was no bill.


Mr. CASGRAIN:: There was a bill.


Richard Bedford Bennett: Pardon me, there was no bill; it was in the form of a bill, and there are many of them in the privy council office, as I said before. The draft had not even been considered by the cabinet. That draft had been given to the right hon. gentleman in order to see what parts of it we might agree on for the introduction of a bill. The bill now before the house represents the only bill which was considered by the council and approved for the consideration of this house. I mention that only as a matter of privilege, because I think there was no doubt in the mind of the right hon. gentleman at that time that what was before him was a draft submitted to him for the purpose of arriving at a conclusion.
As far as the rest of it is concerned, I think it is very much to be deprecated that difficulties have arisen as to recollection, in view of the statement made by the right hon. gentleman in the opening of his observations. The endeavour to describe a draft that has not been submitted to this house as a bill which represented the mind of the government is as unfair and ungenerous as the right hon. gentleman a few moments ago said were certain observations of other hon. members of this house.


William Lyon Mackenzie King: There is no difference between the statements I made this

afternoon and what my right hon. friend has read.


Richard Bedford Bennett: Oh dear, dear. Just read them.


John Thomas Hackett: On a question of
privilege, I am going to ask the right hon. leader of the opposition whether or not he thinks he should withdraw the words he addressed to me this afternoon, having attributed to me words which I did not utter.


William Lyon Mackenzie King: Will the hon. gentleman tell me what words I attributed to him that he did not utter?


John Thomas Hackett: The right hon. gentleman said I had addressed him and his former ministry in terms of "we" and "us" as if I were speaking for His Majesty's government. That is an inaccuracy.


William Lyon Mackenzie King: The hon. member has just stated that I used the word: "me" and "my ministry." I have no ministry.


An hon. MEMBER:: And you never will.


William Lyon Mackenzie King: We shall see; do not be too sure. I was referring to the ministry which my hon. friend follows, of which I said, by the expression he used, he seemed to think he was a member.


John Thomas Hackett: Apparently the right hon. gentleman wishes to miss the point. He has declined to make the amende honorable, and I cannot say that I am entirely astonished.


Mr. ARTHUR DENIS (Translation):: Mr. Speaker, before this bill is referred to the special committee appointed to either sanction or amend the elections act. I wish to make a few suggestions in order that members of that committee be not deceived by some of the speeches delivered by our friends opposite with the intention of disguising the object which the government have in view in introducing this bill, in the last days of the session. To my mind, this bill is but a gilded pill which leaves me quite indifferent. Like the former act passed previous to the 1917 campaign, its object is simply to steal elections. Members opposite wish to sanction this bill at this session because of their fear of being put out of power and having to remain at home. I see no necessity for introducing this bill when all are aware that the two official parties were quite satisfied with the former act, at the last election. The Conservatives took office thanks to this act; however, it is obvious, to-day, more than ever, that their victory was not due to that

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act, but rather to their lies and pledges, they therefore fear now that their promises might not have the same result.
I have serious doubts, sir, as to the government's intentions in introducing this measure. The following is a proof of their lack of sincerity: after accepting the suggestions of the right hon. leader of the opposition (Mr. Mackenzie King) to appoint two enumerators, whose names would be suggested by the former candidates, the hon. Minister of Justice (Mr. Guthrie) forgets to include the suggestion in the bill, in order to be better prepared to again set aside his promise and appoint two enumerators of his own choice.
With reference to the signing of a form by the electors in what way will the object of the bill be attained, if the enumerators do not often call at each home to ascertain the names of the voters? If these enumerators simply make one call and find the people absent, the latter will have to go to the trouble of leaving their residence so as to sign a new form in the presence of the receiving officer.
If the government were in earnest, and wished to extend the franchise, thus allowing all persons duly qualified to register their vote, it would introduce a measure compelling such persons to exercise their franchise. It would thereby dispel many doubts as to its intentions.
I have little to add, sir; however, I wish to state that this conflict of opinions with reference to this new act should be settled by the people instead of by the house. The government is aware that it does not command, to-day, the confidence of the people. It is high time to appeal to the people, so as to get rid of a government which, for the last four years, is dying from inertia, has done nothing to help the people of this country and, thereby, realizes, to-day, what responsibility weighs on its shoulders.


Hon. MAURICE DUPRE (Solicitor General) (Translation):: Mr. Speaker, I followed
the hon. member's remarks. May I put forth a suggestion. It would be more practical for him to repeat his suggestions before the committee when the latter meets. Thus, the hon. member will discover that his fears and charges are ill-founded and, furthermore, it will give the committee an opportunity of taking advantage of his experience and suggestions.
Mr. PAUL MERCIER (St. Henri). I should like to add a few words to what has been said by the hon. member for St. Denis (Mr. Denis), and to offer a suggestion with regard to rules 1 a^d 2 of schedule A to section
17, which has to do with the preparing of lists of electors.
I humbly submit that if this provision is not changed many people entitled to vote will not have their names on the list, and this will work to the disadvantage of all candidates in the next general election. I suggest that these enumerators-of whom I hope there will be two-when going from house to house should he allowed to register all those residing in that house who are over twenty-one years of age and entitled to vote, according to the Franchise Act. That was the practice followed in the 1930 election. The legislation was amended to meet the wishes of hon. gentlemen opposite, who were then on this side of the house; one more enumerator was given them, and that law was accepted as being as nearly perfect as possible. Now we wish the same privilege we granted them in 1930; we want these two enumerators to prepare the list as it was prepared then, when hon. gentlemen opposite were returned to power. Surely they can offer no objection to that law, because the Minister of Justice (Mr. Guthrie) has said that he wants to extend the franchise to all those entitled to vote. I humbly submit that it should be done in this way. If you just, leave a form at the house to be signed by each voter, during the day the husband, the son and the daughter will be away, and if there are boarders in the house they will be at work also. If we wish to give the franchise to all those who are entitled to it, and to act on a basis of giving British fair play we will have to have the enumerators inscribe on their lists the names of those who have the right to vote. They could do that when they go from house to house preparing their lists. I humbly suggest that this system was approved in the past and those who were entitled to be on the lists were on the lists. Perhaps if the enumerators would leave a few applications at the houses, according to the number of voters, those people might sign the applications. They would be obliged to return them to the enumerators who would be the only judges to say whether or not those people were entitled to vote.
May I say that one must read the form appearing in the schedule. Let us consider the case of a woman who has never signed anything in the absence of her husband. Husbands tell their wives not to sign this or that document without authorization. Does any hon. member think that a woman would sign these blanks? I say most of them would refuse, because they do not know why they are signing; they do not know the purpose of it. They would not sign, and especially when they must swear that they have taken
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cognizance of the forms and all matters and things printed on the back thereof. Snch procedure would be unjust on the face of it, and does not have the effect of granting the franchise to those who would like to have it. I humbly submit to the Minister of Justice, who is so anxious to give the freedom of the franchise to everyone entitled to vote, that he should see that this list is prepared on the basis and as a result of the instructions given when the preparation was made in 1930.
Another suggestion is this, that if we are to accept the signatures of all these persons their duty must be made very simple. We cannot, by a long written document make the plan operative, in the judicial sense. The applications should certainly be taken by the enumerators. I know of one district in Montreal with a population of 97,000 and a voting population of 65,000, and I am wondering why those people should be obliged to find a registrar or to go here and there on behalf of a revision. That would be the burden imposed on the people of that district, _ and I suggest it is not the proper way to give the franchise to Canadians. They are entitled to vote, and they must not be stampeded by legislation or by putting obstacles in their way in the matter of getting their names on the lists. Let them have their names on the lists in as free a manner as possible, so that they will be given justice, and may attain their rights easily and according to British fair play. Let us have a system so that all voters will be on the lists and will be accorded the best and easiest way of having their votes inscribed.
I say again that the system in 1930 was satisfactory. The Conservative party then sitting to the left of Mr. Speaker, appeared before the committee on privileges and elections, asking for some amendments to the law. Strange to say, in 1930 we had a change in the Elections Act. In 1917 the law was changed by hon. members now sitting to the right. In 1921 another change came into effect at the request of the Conservative party. When the Liberal party assumed office amendments were asked, and were given. Then, in 1930 the Conservative party took the reins of office and, in 1934 when an election cannot be far distant, when we may expect one either now or next year, that party comes along and changes the act. When it has been in power the Conservative party has always changed the Elections Act and when the Liberal party has been in power they have offered changes.
In my humble view the 1930 legislation should be accepted as a fair basis upon which any party could prepare new voters' lists.

Voters should be given ample facility to register and should have the facility to which under British justice they are entitled.


Mr. H. E. SPENCER (Battle River):: Mr Speaker, I should like to refer to the statement made a few moments ago by the hon. member for Winnipeg North Centre (Mr. Woodsworth). In his remarks he referred to the publication of a paper entitled The Commonwealth, a weekly review in the interests of a cooperative commonwealth for Canadian people. He mentioned that this was advertised as being printed at 146 King Street West, Toronto. He omitted to say-and I am saying it for him-that this address is the head office of the C.C.F. in Toronto, and it is an absolute falsehood to say that this paper is printed at that address. The address given on the publication is given intentionally to mislead people, which apparently it did. I draw the attention of hon. members to the fact that the address is entirely wrong, that the place indicated is the head office of the CjC.F. in Toronto, and that the paper was not printed at that place.


Mr. JEAN FRANCOIS POULIOT (Temis-couata):: Mr. Speaker, I listened to what was said by the hon. member for Winnipeg North Centre (Mr. Woodsworth). He said that Mr. Hepburn, the premier-elect of Ontario, appealed to the C.C.F. voters in the Ontario campaign. His appeal was not absolutely that. He appealed to all men of good will, and all the men of good will in the good old province of Ontario have answered his call.
I have very little to say about this bill. I made the suggestion that section 4 should be amended. It disqualifies the Esquimaux and the Indians. I suggest that also those who make extravagant promises during election campaigns should be disqualified. This is a very humble suggestion I make to the committee. Then, there is another suggestion I would offer ,to the government. I have not read the bill, but I shall read it before the election. My impression is that the Prime Minister wants to leave something behind him in the shape of books, statute books. Why does he not publish a telephone directory of all the cities of Canada as a statute in order to make a still larger book? All the legislation that has been enacted by this government since 1930 is economically unsound, useless and futile. The only sensible legislation which has been passed by -this government is the act relating to the statute of Westminster, which had been decided upon by the hon. member for Quebec East (Mr. Lapointe) and the British ^ government be-

Franchise Act
fore this government came into power in 1930, and all that this government did in the matter was simply to repeat what had been decided upon by the previous Liberal administration.
Sir, there are hard things done at times during an election, and there are hard times, but it is not on account of Liberal policies. But it is hard when the Tories try to steal our votes. During one campaign when the shadow government was appealing to the country a man went about from house to house and door to door asking people to give him their names so that they could be registered, and after they had given him their names this man gave to the registrar the names of the good Tories of the constituency and left off the names of the Liberals. I have made this same statement in my home town of Riviere du Loup, to the shame of that man. Last year I asked the government if that man had been employed by them in the election, and the answer of the Secretary of State was no.
In this legislation, Mr. Speaker, I notice that the government is trying to have the least possible number of votes cast in the next election. That is my personal opinion. What happened last year? We had a Redistribution Act.


Cameron Ross McIntosh: The first steal.


Jean-François Pouliot: It was the first steal after the Liberal victory in Huron which brought us a message of cheer from the good old province of Ontario. Now that the Conservatives have been swept out of office or defeated at the polls by popular indignation in provincial elections in Nova Scotia, British Columbia, Quebec, Manitoba, Ontario and Saskatchewan, the Tories are like flies on fly-paper. The Tories here are trying to stick to office, but they will not stick to it against the will of the people. They will be blown away just as Conservative governments have been blown away in Nova Scotia, Ontario, Saskatchewan and British Columbia.
Mr. E. C. ST-PERE (Hochelaga) (Translation) : Mr. Speaker, within the last few years, sociologists and all those who take an interest in public matters have endeavoured to create throughout the country a stronger civic spirit. One delights in repeating, here and there, that nations have the governments they deserve and, one even extols compulsory vote, in order to oblige citizens to fulfil the most important duty of all those which fall to their lot-after the one rendered to God- to all exercise their franchise, on election day, both provincial and federal.
The bill which bears the number 101 is far from promoting such a civic spirit and I note that far from pointing out to our people this spirit which is proclaimed everywhere, such a measure would close all avenues, not only as regards compulsory vote but also as to the one that all citizens are morally called upon to give at election time.
In my opinion the first provision of the bill, that of the preparation of the lists of electors in our large cities, will disfranchise three quarters of the electors at the next election. What do we find in reading over this provision? That the enumerator will have one single form signed by the only person present at the residence when he calls, disregarding entirely those who are away from the house. Our friends opposite will contend that those absent will have, as a last resort, the office of the revising officer. I appeal to their good faith and their practical knowledge of how the vote is to be cast in our large cities.
I cannot recognize or approve by my vote a measure which would deprive of their franchise the three quarters of the electors of my constituency. During this crisis when people leave their home daily to seek work, here and there, can one reasonably suppose that an enumerator calling at a house, at any hour of the day, will find there every one who is entitled to vote on polling day?
Let us closely examine this famous rule, No. 1. What more do we find? An enumerator, twenty years old or even older will be the sole judge to decide of the right of vote of an elector having signed a form.
I cannot subscribe to such a regulation which would deprive my electors of their right to exercise their franchise. Why close to the elector, by such a bill, all avenues which lead, as I previously stated, to the fulfilment of this important duty of casting his vote on election day?
The right hon. Prime Minister (Mr. Bennett) and the hon. Minister of Justice (Mr. Guthrie) pointed out the other day that such a measure would purge election morals. I am perhaps a pessimist, however, I always recall this advice of Jean Jacques Rousseau to his son: My son, beware of mens honour when the sun has set!
Without attributing any bad intention to those who are, at present, the sponsors of this bill, I state that this piece of legislation such as drafted will receive not only my disapproval as to the various provisions embodied but I shall cast my vote against the bill, unless it is amended.
The right hon. Prime Minister pointed out to us-Oh! the fear of those greatly frightened
-'214
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-that an election may be won by telegraphing, by plugging, an expression used in Western Canada. A candidate must consider himself not very popular to resort to telegraphing or plugging organization on election day.


Maurice Dupré: 
Mr. ALFRED SPEAKMAN (Red Deer):: To my mind this bill deals with a subject of transcendent importance, an importance far beyond that of any party consideration, of any consideration of racial origin or of creed, because its object is or should be to secure to every qualified citizen of Canada, no matter what their ideals or beliefs, the opportunity of recording their vote, and to suppress to the degree that is possible fraud in connection with elections, in order that when an election does take place it shall reflect the real voice of those in Canada who have a right to speak. Because of this fact I was delighted when the Minister of Justice moved to have this bill referred to a committee. But I find myself wondering whether I was mistaken in my conception of the reasons why this bill was thus referred.
In listening to the leader of the opposition (Mr. Mackenzie King) when he made the suggestion, in which I fully concur, that the bill should be sent to a committee, I understood that it was to avoid protracted and contentious debate in this house, contentious debate upon a subject which, as I have stated, should be beyond political considerations because it is a subject upon which rests not the fate alone of one party but the fate and the proper functioning of all of our democratic institutions in this country, of parliament itself, and of any government which is returned to power. I have begun to wonder of late, however, as the debate proceeded, whether I was mistaken in that conception of the purpose, for it seems to me that in the form which the debate has taken-and I make no reference to any one in particular of the three sides in the house-that purpose is being defeated, and those passions are being roused which it should be our object to obviate. To my mind, though I may be mistaken, as I have been accused of being a visionary in these matters, this is one subject which essentially should be treated dispassionately, calmly and wisely; and in a reference to a committee it would be made possible for the dL mssion to be carried on free from this passion, for an agreement to be arrived at based on the suggestions and ideas ot all sides of the house, so that when it did come before the house, after the com-miifee had finished with its work, it might be a bill which might be presented to the countiy as the united voice of parliament seeking to bestow on the people an opportunity of speaking and registering their views, politically speaking, no matter what those views might be.
Might I make this suggestion, that in this committee itself, all differences of opinion might well be threshed out to better effect than in the house; and if agreement is then not reached, when it has become obvious that agreement cannot be arrived at and that strong differences prevail, then after the committee had reported would be time for any real fight to be carried on. I am not speaking merely because, like everyone else, I should like to get home; I am speaking in the interests of the bill and of every party in this house, and I think I express the opinion of most people in this country.
Mr. JOSEPH A. MERCIER (Lauritr-Outremont): It is not my intention to take up much of the time of the house after the lengthy discussion we have had, because I intend to appear before the special committee named this afternoon and submit to that committee my views in reference to this bill. But as so much has been said by members from the city of Montreal in reference to the bill, I think it is my duty to add a word or two to what has already been stated.
In the first place, I believe that in 1930 the electors of Canada were more than satisfied with the electoral lists as submitted to them.
Franchise Act

At that time, you will remember, enumeration was made by a visit from house to house. The list was prepared and submitted to the electors and to the candidates, and the utmost satisfaction was expressed with regard to that list. The difference with the present bill is that the two enumerators to be named by the registrar will likewise make a house to house visit with application forms for registration on the voters list, but of necessity it will happen, in places like Montreal, in the division which I represent, that these visits will be made in the day time. During the hours of these calls most likely the only person to be found in the family residence will be the mother. The application form will be presented to that lady and she alone will have the right to have her name placed on the list because the application forms when signed, are returned to the enumerators who give a receipt stating whether they accept the application of the person who is the signatory to the form. In cities like Montreal and, as a matter of fact, in most cities throughout Canada with the enlarged franchise that we have now, there are in some families as many as twelve persons who are entitled to vote and the result will be that, only the mother of the household being present when the enumerators make their calls, she alone out of the large number of persons in that family entitled to vote, will have her name placed on the list.
What will the other members of the household do? The law does not seem to be clear or, at any rate, it is not clear to me on that point; but the enumerators will possibly leave other application forms there because the law provides for the signing of these forms apart from the presence of the enumerators. If we assume that such a condition exists, if the other members of the family desire their names to appear on the voters' list, they will have to sign these forms and take them to the office established either by the registrar or by the revising officer. For the reason I have just given there will be a large number of persons who, if they desire to have their names on the voters' list, will have to go before that official and the result will be that they will have to wait a long time outside his office. They will have to suffer loss of time and inconvenience in waiting at that office and in many cases such people will not go to that trouble with the result that out of a family of several persons entitled to vote the only one whose name, according to the preliminary arrangements made upon the visit of the [Mr. J. A. Mercier.J
enumerators, will be found upon the voters' list, will be that of the mother.
I think the Minister of Justice (Mr. Guthrie), in explaining this measure when he introduced it in the house in the beginning of the week, said that the main idea of the government in presenting a new franchise measure was to shorten the period during which an election could take place. It is quite true that under the 1030 act six weeks passed during which the election campaign was carried on and the present idea of shortening that period is in itself good, but it seems to me- and I shall submit this to the special committee named this afternoon-that if these enumerators were empowered to make a second and perhaps a third visit to the family in order to pick up the application forms which might have been signed in the interval by the other members of the household, the period during which the election could take place would not be changed and elections could be brought about in the same manner in a period of one month or five weeks. The enumerators would pick up the applications signed by the other members of the family who were absent on the first call; those applications would be submitted to the registrar; the registrar would draw up the list and once it was drawn up in that manner it would become a closed list just as it is the intention of the government to have it. If the election comes on, as we hope it will, within twelve months after the making up of the lists, no revision will take place, but in case of a revision of the lists during the revising period fixed by the law the same difficulties will be encountered; a man who moves from one district to another in a city and whose name is not on the list will have to go to the same trouble as he would have had to do in the case of the drawing up of the basic list. This means a period of disturbance for all the electors of Canada every twelve months when these lists are being revised.
In addition, I would like to draw attention to one clause in the bill which says that the revising officer may direct an elector who has made application under the revision to have his name put on the list, to go to another district than the one in which he resides. That is an additional burden upon electors. If we take the matter as a whole, if it were possible for these enumerators by making several house to house visitations to draw up a list which would be closed and would resemble the list of 1930, the people of Canada would be amply satisfied with such a list.
I understand there is a question of expense which has to be taken into consideration in

Bank of Canada
this matter. The sum of 8600,000 has been placed in the supplementary estimates to put this legislation into working form but it would not be a matter of great additional expense if these enumerators followed up their first visit, went back to the households in which were persons entitled to vote who were not present on the first call, get their applications and submit these to the registrar. In this way a competent, efficient and just list could be drawn up and the election carried on in such a manner as to satisfy the people of Canada.


[Stage Direction]
Motion agreed to.

[Stage Direction]
On the order for the second reading of Bill No. 115, respecting the election of members of the House of Commons:
Hugh Guthrie: Before the motion is made in this case I shall have to ask the unanimous consent of the house as this bill has not been printed. It is cognate to the bill we have just sent to a committee and I propose to move that it be sent to the same committee. If that committee is to meet early in the week it might consider both bills at the same time and in that way avoid delay. If the house agrees I will move that this bill be read a second time and be referred to that committee.


William Lyon Mackenzie King: I assume the Minister of Justice will undertake to say that in no way will we be committing ourselves to any phase of the measure.


Hugh Guthrie: No committal at all.


Pierre Édouard Blondin: Mr. Guthrie moves that Bill No. 115, respecting the election of members of the House of Commons, be read a second time.
Motion agreed to and bill read the second time.


Hugh Guthrie: That Bill No. 115 be referred to a special committee of this house to consist of Messrs. Guthrie. Duranleau, Hanson (York-Sunbury), Willis, Stirling. Lapointe, Stewart (Edmonton), Power and Irvino to inquire into and report said bill to this house.


[Stage Direction]
Motion agreed to.

[Stage Direction]
The house resumed from Thursday, June 21, consideration in committee of Bill No. 19, to incorporate the Bank of Canada-Mr. Rhodes -Mr. Rowe in the chair.
On section 9-Directors.
Mr. RALSTON:: The committee was discussing last evening an amendment which I was proposing to section 9. I placed the amendment in the hands of the chairman, but it has not actually been read. The amendment is:
That section 9 be struck out and the following be substituted therefor:
9. (1) In addition to the governor and the deputy governor as members of the board, and notwithstanding anything contained in section ten of this act, the following members of the civil service of Canada shall be provisional directors of the bank, namely, the deputy minister of finance; the counsellor of the Department of External Affairs: the comptroller government guarantee branch; the comptroller of the treasury; the comptroller of currency:	the director of estimates and
assistant secretary to the treasury board, and the solicitor to the treasury, and shall remain in office until replaced by directors duly elected or appointed in their stead, as hereinafter provided. The said' provisional directors shall serve without remuneration.
(2)	To replace the provisional directors designated in subsection (1) hereof.^ four directors (hereinafter referred to as "shareholder directors") shall be elected by the shareholders and three directors (hereinafter '[DOT]eferred to as "federal directors") shall be appointed by the governor in council, as provided for in subsection (3) hereof;
(3)	(a) At the first general meeting of
shareholders, four shareholder directors shall be elected for terms to run as follows: one until	the	third annual	general	meeting,	oneuntil	the	fourth annual	general	meeting,	one
until the fifth annual general meeting, and one until the sixth annual general meeting, respectively.
(b)	As	of the date	of the	first generalmeeting of shareholders, three federal directors shall	be	appointed for terms to run	as
follows: one until the date of the fourth annual general meeting, one until the date of the fifth annual general meeting, and one until the date of the sixth annual general meeting, respectively.
(4)	From time to time, on the expiration of the terms of office of the respective directors, the successors to shareholder directors shall be elected by the shareholders, and the successors to federal directors shall be appointed by the governor in council and each of such successors shall hold office until the date of the fifth annual general meeting after such election or appointment.
(5)	In the event of a vacancy amongst the directors, if the director whose place has become vacant is a shareholder director, the board shall appoint a qualified person to fill the vacancy and to hold office until the next annual meeting when the shareholders shall elect a person to fill the vacancy for the remainder of the term of such director; and if the director whose place has become vacant is a federal director, the governor in council shall appoint a qualified person to fill the vacancy and to hold office for the remainder of the term of such director.
(0) Directors shall be eligible for reeleetion and reappointment.
Bank of Canada

I have already indicated to the committee the purpose of the amendment, which is to substitute for seven directors appointed by private interests as represented by the shareholders of this bank four directors to be appointed by the shareholders and three by the governor in council.
The Prime Minister (Mr. Bennett) in replying to what I said last evening, mentioned two or three points which I should like to recall to the committee. In the first place he rather took issue with what I said as to the powers of the treasury board under the Finance Act. He is quite right in this, that the treasury board has not the full powers as provided for the central bank in this bill. But the point I was making is this; the Prime Minister indicated that his reason for not having the government take a prominent part in the control of this bank was that he did not want the bank made a political football. My point was that ever since the Finance Act passed the treasury board, which is admittedly and wholly a political body, consisting of five members of the government of the day. have had all the powers under the Finance Act, which powers include almost every power provided for in the central bank bill. I think the only two powers omitted, speaking generally, are the power to deal in gold bullion, which after all is a power which the government has in a general way under our present financial structure, and the power to make advances in certain cases on commercial paper.


Richard Bedford Bennett: And a third power, open market operations.


James Layton Ralston: If the committee will permit me to withdraw and correct that last statement; I should have said that the second power which the central bank has which the treasury board has not is the powe- to conduct open market operations. Under the Finance Act the treasury board have power to make advances on:
(a)	treasury bills, bonds, debentures or stocks of the Dominion of Canada. Great Britain, any province of Canada, and of any British possession;
(b)	public securities of the government of the United States;
(r) Canadian municipal securities;
(d) promissory notes and' bills of exchange-
And I commend this to some hon. gentleman who suggested that there was no such power.
-secured by documentary title to wheat, oats, rye. barley, corn, buckwheat, flax, or other commodity;
_ (e) promissory notes and bills of exchange issued or drawn for agricultural, industrial, or commercial purposes and which have been used or are to be used for such purposes.
EMr Ralston.1
And then section 7.
The minister may permit bills of lading or other documents of title, covering such grain or other commodity while in transit, to go forward under the control of the bank to the point at which delivery is made and payment therefor is received, and the bank shall be a trustee for the minister, to the extent of the advances, of the proceeds received for such grain or commodity.
Those powers are pretty wide. They were administered by a political body, and there never was and never has been any suggestion made, and no suggestion can be made that in any sense the powers of the ministry and the treasury board under the Finance Act permitted the financial system of this country to be made a political football.
That is the point that I was endeavouring to make. And my attention is called to what Sir Thomas White said with regard to it;
It was suggested during the course of our hearings that political influence might possibly affect unfavourably the administration of the Finance Act because the treasury board which authorizes advances and fixes rates of interest payable thereon is composed of members of the government. With regard to this I have only to say that if by "political influence" is meant partisan or improper influence not a shred of evidence has been adduced before the commission in support of such a suggestion.
That is why I was referring to the Finance Act. The fact that the central bank has a little more power, that is power to conduct open market operations, which merely means the buying and selling of securities, and power to deal a little more freely in gold, I do not think detracts in the slightest from the point that I was endeavouring to make, that even under direct political control the administration of the Finance Act has never been made a political football. So I think we can put that suggestion aside: I think it is not justified nf this period in our history. Even in the financial publications, for instance in the Financial Post, I noticed not long ago a statement in regard to this very matter indicating that political considerations had not entered into the administration of the Finance Act and it was not believed that they would enter into the administration of a central bank. That is one reason that my right hon. friend gave for not accepting the amendment for government ownership.
What has my right hon. friend brought out in connection with the proposal for government control? He has said, and I see the statement appearing prominently in the press this morning, that in no country is there so large a measure of control in the hands of the government as there is under the bill which is at present before this house.

Bank of Canada


Richard Bedford Bennett: Pardon me; the hon. gentleman might look at Hansard and see what I did say.


James Layton Ralston: I am stating what the papers say.


Richard Bedford Bennett: But that is not fair.


James Layton Ralston: I intend to be perfectly fair.


Richard Bedford Bennett: The press is not the official record.


James Layton Ralston: I quite understand that, but I say that is the effect which the press is taking from what was said.


Richard Bedford Bennett: But unfortunately that is not what I said.


James Layton Ralston: All right. Let us deal with the degree of control which is exercised. My right hon. friend made quite a point of the degree of control found in this bill. The three points which my right hon. friend stressed were: Number one that the governor of the bank is appointed by the governor in council, or his appointment is subject to the approval of the governor in council. Number two: the Prime Minister said the deputy minister of finance under this bill is made a member of the board, although he has not a vote; there-forp the government has communication as to what is going on in the board room and general supervision, without any power so far as the deputy minister is concerned, over what is being done by the directors. Number three: the Prime Minister said nothing can be done by this board of directors without the consent or the sanction of the governor, who is appointed by the governor in council in the first instance and whose appointment must be apnroved thereafter.
Mv right hon. friend rather laid strong emphasis on the fact that he knew a good deal more about this bill than anyone else knew.


Richard Bedford Bennett: That is not fair, either.
The hon. gentleman said that I treated it in a cavalier sort of way, and I said I thought I knew as much about it as any other member of the committee, but I did not pride myself on knowing any more.


James Layton Ralston: If I may suggest, I think the Prime Minister did this: he compared what he knew about the bill with what little I knew about the bill.


Richard Bedford Bennett: No.


James Layton Ralston: Well, Hansard will bear
me out in that; that was the substance of
it, and then my right hon. friend said he did not want to boast about it, but at the same time he felt that he knew as much about the bill as anyone else did.


Richard Bedford Bennett: I think I do.


James Layton Ralston: I do not boast about it
at all, but if there is anything to be said with regard to those features in the bill on which my right hon. friend lays so much emphasis, I think it might be fairly said that two of the three points on which my right hon. friend relies as being the sheet anchor of government control were introduced in the committee and included in the bill at the suggestion of those sitting on this side of the house.


Richard Bedford Bennett: Hear, hear.


James Layton Ralston: So I do not think my
right hon. friend can suggest that there is any monopoly of knowledge with regard to this measure, or with regard to the appreciation of what the measure contains, on the government side of the house. That means that as this bill was introduced it contained no provision for control at all; it only provided that the governor should be appointed by the governor in council, or that his appointment should be subject to the approval of the governor in council. Once appointed the governor is a member of the board of directors and of the executive, and the executive submit their decisions-it does not say for approval-to the board of directors.
There was no provision that the consent or approval of the governor was needed with regard to any action of the board of directors or any action of the executive; that provision was inserted in committee, and not at the instance of the government. There was no provision that the deputy minister of finance should be a member of the board of directors; that also was inserted in committee. and not at the instance of the government. What does my right hon. friend say was the reason for this provision not being inserted as to the approval of the governor being necessary before any action of the executive or the board of directors might become effective? He says the reason is that they were sort of fearful and apprehensive that the committee would not accept a proposal of that kind. That is a strange doctrine to hear in this house from my right hon. friend, with a majority of forty behind him. He says the government were fearful that the provision would not be acceptable. So I think perhaps we are entitled to credit for this, that in the midst of my right hon. friend's timidity, fearfulness and apprehension at least we were able to take him by
Bank of Canada

the hand, pat him on the back and say, "Don't worry. Have courage. We will stand by you in enacting this particular legislation." I am sure my right hon. friend will give us credit for that.
I do not know what the right hon. gentleman meant when he gave that explanation. If when he introduced this bill be believed that the governor's control was necessary and that this was a proper provision to put in the bill, why was it not put in the bill? Why was it left to be introduced in committee by those sitting on this side of the house? If it was advisable to make the deputy minister of finance a member of the board, why was that not put in the bill by the government? Those are the two points on which my right hon. friend relies in alleging that there is a very large measure of government control in this bill.
My hon. friend from Vancouver Centre (Mr. Mackenzie) has given me the quotation of what the Prime Minister said regarding the extent of control which the bill as amended in committee provides. These are the words used by my right hon. friend last night:
I would therefore submit that to the extent of my reading there is no other bank in which you find wider powers of public control conferred. absolute control by government in council, than there is in this particular case.
In support of that statement my right hon. friend relies on two provisions which were inserted in the bill from this side of the house. I wish I could be as sure about those two provisions as my right hon. friend is. I am pleased that they have been put in; I am glad they have been accepted, but in connection with those provisions my right hon. friend missed the point entirely. He knows perfectly well, if he will just think for a moment-and I have no doubt he has thought of it already-that those provisions only permit of a veto of the action of the board of directors or the executive. The provision with regard to the deputy minister gives no power at all; he simply holds a watching brief, and is simply permitted to sit in the board room. The provision with regard to the governor's consent being necessary means nothing more than this, that if the board of directors take positive action then the governor may say, "No, you cannot do that thing." But it gives the governor no power of initiative of any kind or description. If the board of directors decided to do nothing, nothing could be done by the governor or by the executive. In other words this provision simply means that the governor may put on a brake, but if positive 
action were needed; if action were needed to suspend the twenty-five per cent ratio, for example, and the board of directors simply did nothing at all, what would be the good of having a provision that the governor may veto any action taken, or that his approval is necessary before any action of the board of directors shall become effective? There would be no action of the board of directors to become effective and to be vetoed. My point, and I have made it repeatedly in this committee, is that the initiative in connection with every one of the matters I mentioned last night is with the board of directors, and if the board of directors does not see fit to take the initiative the governor and the governor in council are powerless.
My right hon. friend went on to say that the governor can work through the executive, which is formed of the governor, the deputy governor and another director. They act as an executive, but after all they are an executive and not the board of directors, and there are certain things expressly provided by this act to be done by the board. The acts of the executive must be submitted to the board of directors. I feel satisfied that this must be the legal construction of that provision, that the board of directors may take such action as they think proper with regard to the actions of the executive. So I say the control on which my right hon. friend insists and as to which he speaks so positively, so dogmatically and broadly, only means the power of veto, the power of putting on the brakes. It gives no power to the government or to the directors appointed by the government to take such positive action as they may think is necessary in connection with the economic activities of this country.
That is the point my right hon. friend has missed entirely, and by this amendment I am endeavouring to place power in the board of directors so that five of the nine directors shall be either appointed by the governor in council or their appointments shall be approved by the governor in council and so that positive action may be taken in a time of national crisis or whenever the national interest may make it advisable. I submit that this is a proper provision in an act which has to do with what I referred to last night as the greatest public utility in this country.
I want to point out further that if my hon. friend wants a brake, a safeguard, a balance wheel, a safety valve or something of the sort he has it in the fact that there are four directors representing private interest and five directors representing national interest. There

Bank of Canada
will not be very much danger of the political football being trotted out; it seems to me there will not be veiy much danger of the five government directors going wild in connection with these matters, with the safety valve, the balance wheel of the other four directors sitting beside them. I submit that this is the most modest provision it is possible to make if we are to preserve our national economic and financial autonomy. I submit that the Prime Minister, with all his power of special pleading and after taking up a considerable portion of. the time of this committee, has not submitted any valid reason emerging from the clouds of all that he said last night as to why there should not be government control of this bank. He read Kisch and Elkin. He knows perfectly well that the work of Kisch and Elkin, is only one of many authorities, and after all is but a recital of the provisions connected with the establishment of central banks in all parts of the world. But Kisch and Elkin state definitely that at times of national crisis, whether the bank is controlled privately or otherwise, the government are going to step in and make it serve a national purpose. I say that the bill should provide in the first instance that the bank shall do what it will have to do in the end, namely serve in a national emergency, and generally serve the interests of this country whenever financial conditions make it necessary.
I do not think the statement by the right hon. Prime Minister fairly met the resolution proposed to the committee. He traversed a great deal of ground. The one point is this: Shall this committee of the whole leave to the directors appointed by the people, who have invested the comparatively paltry sum of 85,000,000 in the shares of this enterprise, the control of the affairs of this great national institution? It would have a note issue of
8400,000,000 or $500,000,000, all the advances to the banks, all the gold resources of the country, the whole credit and economic life of the country, including that to which I particularly referred last night, namely, the regulating-if regulating is possible-of the value of our currency externally. Those are matters of immense importance.
In connection with the last point let me read one reference contained in the report of the commission concerning the importance of the external situation. I believe we miss that entirely when we put the enterprise in the hands of private individuals. Section 230 of the report of the Macmillan commission states:
Canada is a country with a relatively large volume of external trade and a heavy external 74726-267
indebtedness and is, therefore, especially interested in the international value of her currency. The holding of gold and foreign exchange by the central bank should and could become a factor of the first importance in carrying out the national policy in regard to the external value of the currency. It is no part of the functions of a central bank to monopolize the exchange markets. Here, as in the case of credit control, its function is to impart or counteract a trend as circumstances require, and this task, even from an early date, would be within the capacity of a Canadian central bank.
And when my right hon. friend suggests that it is sufficient that the control of this bank is placed in the hands of a governor, who has the right to veto the actions of the board of directors or the executive committee, I say to him that that provision was put in there in the hope and in the belief that he would accept what was suggested by the hon. member for Beauharnois (Mr. Raymond) last night, namely, a Canadian as first governor. It seems to me when he comes to think of it he will realize that no one outside Canada, no matter how high he might stand in the confidence of the Canadian people, would be able to discern the trend of events in this country, to understand our situation with regard to export markets, to understand the nature of our products and our channels of trade, to be able to understand the economic signs of the times, to be able to say when it is best to extend credit and when it is best to restrict credit under conditions which are peculiarly Canadian. It seems to me that decisions in those matters ought to be vested finally in the hands of a Canadian. After that my right hon. friend may have any advisers or technical assistants he desires. I do submit however, with all due deference to him and with all due deference to the judgment, if judgment it is, of the Canadian bankers, which may have been expressed in an offhand manner in the committee room, that he is wrong in this respect. I have serious doubts as to the opinion they may have expressed, because I believe that the bankers in Canada are as capable as any bankers in the world to deal with our Canadian difficulties, and to cope with the financial conditions in which we may find ourselves. They are equipped by experience and first hand knowledge to regulate, so far as it is possible, our economic and monetary situation for the good of Canadian trade. Notwithstanding the statement made by the Canadian bankers to which my right hon. friend has referred, I find in the Macmillan commission report a statement to which reference was made by the hon. member for Beauharnois and one which, in my view, cannot be over-emphasized. This is the statement made by the commission which

Private Bills

consisted of two Canadian bankers and three other gentlemen who had the opportunity of meeting and knowing Canadian bankers and Canadian financial men. They said:
Experience, skill and integrity are required in the highest degree, and that, not only to ensure that the operations of the bank shall be wisely conducted, but also that the institution should win and maintain the confidence alike of the government, the people and the commercial banks.
We have no reason to suppose from our discussions with leaders in Canadian finance and industry that these qualities are lacking in Canada. On the contrary, we are convinced that there are resources of intelligence combined with experience and public spirit fully adequate to ensure the successful management of a central bank.
I leave that last word with the Prime Minister, and I say that when I proposed that the approval of the governor of the bank should be necessary to the effectiveness of any act of the executive committee or board of directors, I believed and I still believe that there could be found within the confines of Canada a Canadian who could properly handle the management of the central bank. The governor at least to an extent would have the direction of the destiny and policies of the bank. I have said that he should be a Canadian, and I still think so.
Mr. Chairman, I have submitted this amendment with some confidence, because I believe it will meet with the approval generally of the Canadian people.
At six o'clock the Speaker resumed the chair and the house took recess.
After Recess
The house resumed at eight o'clock. PRIVATE BILLS



ST. CLAIR TRANSIT COMPANY

[Stage Direction]
The house in committee on Bill No. 100, respecting the St. Clair Transit Company Mr. Gray-Mr. Smith (Cumberland) in the chair.
On section 1-Powers granted by act of incorporation (as amended) revived.
Hugh Guthrie: Is there any change beyond the extension of time?
. Mr. GRAY:	No, Mr. Chairman.


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

[Stage Direction]
Bill No. 85, for the relief of Mary Mabel Taylor Johnson.-Mr. Lawson.
Bill	No. 86,	for	the relief	of	Blanche
Marjorie Short Hanson.-Mr. Bell (St. Antoine).
Bill	No. 87,	for	the relief	of	Fenwick
William Smith.-Mr. Heaps.
Bill No. 102, for the relief of Edward Headley Acland.-Mr. Bell (St. Antoine).
Bill No. 103, for the relief of Ella Gertrude Bush Adamson.-Mr. Bell (St. Antoine).
Bill No. 104, for the relief of Helen Cohen Levine.-Mr. Vallance.
Bill No. 105, for the relief of Annie Rosner. -Mr. Luchkovich.
Bill No. 106, for the relief of Grayse Irene Westlake MacLaren.-Mr. Bell (St. Antoine).
Bill No. 107, for the relief of Naomi Willard Lyman Robertson-Mr. Bothwell.
Motion for third readings agreed to on division.

[Stage Direction]
On the order:
House in committee on Bill No. 12, an act respecting patents on certain inventions of which Duplate Safety Glass Company of Canada Limited, is entitled to benefit.-Mr. Lawson.
Mr. LAWSON:: Mr. Chairman, will you
please allow this bill to stand? I have had members on both sides of the house request that the bill stand to-night as they desire to be heard on it.
Order stands.



PERSONAL FINANCE CORPORATION

[Stage Direction]
On the order:
The house in committee on Bill No. 43, to incorporate Personal Finance Corporation-Mr. Hackett.
Mr. HANBURY:: In connection with the
Small Loan Company bill, the Prime Minister some time ago indicated that he would bring down a bill to regulate small loan companies. I notice a bill on the order paper but I do not know whether the Prime Minister can give any information in respect to what he proposes to do in that regard. If he could do so I would be very pleased to hear it.


Richard Bedford Bennett: There is nothing before
the chair, Mr. Speaker. The bill stands.



BANK OF CANADA ACT

[Stage Direction]
The house resumed consideration in committee of Bill No. 19, to incorporate the Bank of Canada-Mr. Rhodes-Mr. Smith (Cumberland) in the chair.

Bank of Canada
On section 9-Provisional directors.
Richard Bedford Bennett: I do not propose to traverse the arguments adduced by the hon. member for Shelburne-Yarmouth (Mr. Ralston) rather I intend to make a few observations with respect to the matter discussed by the leader of the opposition yesterday. I should like however to make this observation, with which I think every member of the committee will agree. There is about as much resemblance between the operations of the Finance Act and the central bank as between a lot of steel plates lying in a yard and a finished ship. There is no organization under the Finance Act. The committee that constitutes the treasury board is a variable committee of the cabinet. They have never had an opportunity to consider, and since the war never have considered, the question of rediscounting commercial paper. The only securities they ever dealt with were bonds and securities of that character, federal and provincial, upon which advances were made; and there was never any consideration, from the beginning of the year until the end,-sometimes there was in the middle of the year- of the amount that should be advanced. For instance, the City and District Savings bank had a line of credit, say, for 815,000,000 and all they did was to notify the receiver general at Montreal that they required one or two millions, having lodged their securities antecedently to requiring the money, and got it from day to day, and paid it off sometimes within two or three days so as to escape the payment of interest.
The central bank is of course an organization, a corporation, an entity which the treasury board is not in that sense. I do not intend to do more than mention one matter in connection with the final observations of the hon. member for Shelburne-Yarmouth. I think, when he was reading section 230 of the report of the royal commission, he must have realized the implication of these words:
The holding of gold and foreign exchange by the central bank should and could become a factor of the first importance in carrying out the national policy in regard to the external value of the currency.
The national policy is the policy of the government of the day, and a central bank serves the government, that is, the policy which it enunciates. It is their duty to serve the community, that is, the country, the dominion; and the national purposes mentioned are 'national purposes as they may be from time to time indicated by the policies of the administration of the day.
74726-267J
I shall presently refer in detail to some of the observations made last evening by the leader of the opposition, but this I should like to say now in respect of the amendments proposed by the hon. member for Shelburne-Yarmouth. Surely it must be within the memory of every member of this committee that when the bill was introduced by the Minister of Finance he pointed out that it was the very earnest desire of the government that suggestions in the way of constructive amendments should be offered as the bill proceeded through committee. I may say to the hon. gentleman that the question of the control of the bank is the one that was given most consideration. His suggestion, in section 14, that the bank be controlled through the governor as representing the government was a suggestion that was accepted by the government in the committee. There was for instance a discussion as to whether or not the end might be better accomplished by asking the Minister of Finance to become, ex officio, a member of the board. We canvassed that idea at some length. We canvassed at some length the idea as to whether or not the government might be given more direct control over the operations, and when the hon. gentleman made the proposal that he did I thought it was a fair one; and as I said last night, I am glad he made it. But it seems to be difficult for the hon. gentleman to realize that we did not look upon this measure as one in which the government should lay down a fixed policy in detail antecedently to discussion, but rather that we should, indicating the general principles upon which we proposed to proceed, ask for constructive suggestions from every member of the committee. The reason for that was twofold: first, that it was a measure that was espoused by all parties in the house, by those who sit to the extreme right and opposite me and those who sit directly opposite, as well as the government of the day. So that all parties being agreed that a central bank was desirable, and that opinion having been expressed, it became of first importance that if possible we should secure the good will and commendation of all parties in the house.
When the minister asked, before the bill was submitted to the committee at all, that constructive suggestions should be offered from all quarters, I can only say that suggestions that were made that did not conflict with the principles which we believe are inherent in the legislation as we suggested it, and which were possible of acceptance, were accepted; and
Bank of Canada

although the hon. gentleman finds it difficult to believe that this party would accept suggestions from those not associated with it, in the very nature of things the purpose was to secure their suggestions. Finally, the suggestion embodied in section 14 and the suggestion that the deputy minister should be a member without a vote, were a modification of the extreme view I have expressed, on the one hand of the minister himself being a member, and the provision that the governor in council should have the final say with respect to matters that are now left absolutely in the hands of the government.
This brings up the last question in the observations of the hon. gentleman to which I wish to refer. He has kept on reiterating that I have said a Canadian would not be appointed to the position of governor. I said no such thing. I was very careful in what I said yesterday, to indicate that no Canadian, without acquiring certain experience, was available for the position.


James Layton Ralston: I am sure my hon. friend will not find such a statement of mine in Hansard.


Richard Bedford Bennett: I am obliged to my hon. friend, but this afternoon I certainly listened with great care and my hearing was that the hon. gentleman thought I said that a Can' adian would not be appointed.


James Layton Ralston: No.


Richard Bedford Bennett: I am very glad of that, because I noticed yesterday the observation that I had made that statement. The purpose of the government was to appoint a Canadian to that position but not to do so unless we could appoint him several months before his duties would commence in order that he might go abroad into countries where central banks existed so that he might be able to obtain the requisite experience to enable him to discharge the duties and functions of his position. It is idle to say that he can secure the information on this side of the water, for the central bank system as practised in the United States would not be of assistance for one undertaking the duties of governor of a central bank as indicated in the measure.
I leave this thought in the minds of the committee. It has -been pointed out on many occasions in the committee on banking and commerce and in this committee of the whole house that the bankers of this country have vigorously opposed this legislation. In fact, in their annual meetings you will find speeches directed against this central bank. I ask this

committee whether they think any government would have a free hand if it had to appoint to such positions those whose object would be unfavourable to and who in fact tried to destroy the central bank. That is the question, and that phase of the matter must be considered. The government therefore have sought a free hand in dealing with that question. If we can obtain in Canada any person qualified by experience in commercial banking and able to leave this country for the purpose of obtaining at least a few months' experience by observation in connection with matters concerned with a central bank, one who is not opposed to a central bank, then of course he will be appointed. But the important thing is that we must not appoint to that position anyone who is unsympathetic and who desires to destroy the venture and to make it a failure, and we do not propose to do so. Therefore we must have a free hand in dealing with the matter. It is equally probable that if we can secure a suitable person as assistant who has had a lifelong experience as a central bank authority to assist a general manager or governor experienced as I have indicated, we would desire and I believe any government would desire to do so.
In view of the observations made this afternoon I want to repeat what I said yesterday. You will not find in any records of central banks, that is banks similar to this-I am not talking about publicly owned banks; I am talking about banks whose shares are held by private individuals and the control of which is vested in the government as I indicated last night-any case in which the control is more certain and in which the inducement to those who are directors as representing shareholders will be greater to discharge an important public trust in a manner befitting the obligation that is imposed upon them. Why? Because they know they will receive nothing more than four and a half per cent upon their money; that no effort upon their part can increase this; that it merely adds to the sum total of the profits that go to the Dominion of Canada and in their patriotic zeal to serve a great public trust with fidelity I am quite certain there will be found in this country those who, will be not only willing but anxious to discharge so great an obligation in a manner befitting the magnitude of the work they will have to undertake. This is not a case in which they are seeking profit as it is in that of some of the central banks that are privately owned in the older countries. There their dividends may vary from six to eight, ten and twelve pier cent and,

Bank of Canada
as is known, in older countries the dividends of the bank run eighteen, twenty, twenty-three per cent. Here there is merely a modest return of four and a half per cent fixed upon the capital invested, and as I have pointed out I may misjudge, but I think I do not and I believe the zeal of those who are charged with this responsibility to do something to discharge a great public trust in a fitting manner will be manifested by the success which will attend their efforts. In the selection of officials, in the selection of governor, deputy governor and assistant, that object will be constantly in mind whether it be on the part of the governor in council or of the shareholders.
Last evening the leader of the opposition made an observation which I thought I heard correctly but which I verified in Hansard at page 4196 where he is reported as saying:
If you alter the situation by taking away from the government the power that it has to-day; and the banks are to be allowed to control the central bank-for that is what it really amounts to, the banking interest are all to be one, the central bank being in private hands; let us put it that way-there is, it seems to me, a real danger of the financial control which may thus be exercised by the bank being exercised against what may be the fiscal policy of the government of the day.
It is difficult for me to find in the same number of words a more inept conception of the real policy of the statute itself. Not only do the banks not own or control the central bank, but the statute in terms prohibits banks or bankers from owning shares in the central bank. It was that fear that the right hon. gentleman has expressed that is at the bottom of the provisions in the statute to prevent the bankers from exercising control over the central bank. I cannot conceive of any clearer statement being made than that contained in the bill in the clauses that will be dealt with this evening where there is a prohibition against any directing officer, clerk or employee of any bank being interested directly or indirectly or through the medium of anyone else, in this central bank. The restricted control by any individual or group of individuals is further indicated by the limitation imposed upon the shareholders: no one can hold in the institution more than fifty shares. I mention that because possibly the right hon. gentleman overlooked the provisions of the statute in that regard.
When it is indicated that the government is parting to a certain extent with the control it has over the regulation of credit I only desire to point out that for the first time in the history of Canada we are setting up an organization in which the control of the government over credit is real. I know the hon. member for Shelburne-Yarmouth did not overlook the fact that in all the advances made to the banks under the Finance Act, there is no coverage of the money advanced; under the Finance Act all the money advanced was without coverage.


James Layton Ralston: Without gold backing.


Richard Bedford Bennett: Without gold backing or metal coverage. The only support it had was the security of bonds or other securities mentioned in the Finance Act itself.


James Layton Ralston: Without the requirement for gold coverage because as a matter of fact it did have gold coverage; for, as I understand it, there is about forty per cent gold backing for all the notes issued.


Richard Bedford Bennett: There was not until the borrowings under the Finance Act became very much restricted. When the borrowings under that act went to $66,000,000 in 1931, there was no metal or gold coverage that would approximate forty per cent. But the point is this-and I think it has been overlooked-this bank when it begins to function must maintain twenty-five per cent gold coverage for all of its note issue. Whether it be by way of loans or advances to those who come into the bank seeking them, or whether it be for the deposits or other business of the bank, it is compelled under the statute to hold twenty-five per cent gold coverage. That differentiates it from the conditions that exist under the Finance Act. I am not going to do more than say that heretofore in this country the members of this house, both those opposite and those to my extreme right, were always insistent, and I have never controverted the soundness of their statement, that the chartered banks really exercise control over credit, and under the Finance Act as it now stands their control over credit became more and more apparent as they relied more and more upon the provisions of the Finance Act. Under this bill the control of credit in truth and fact rests with the central bank, as it could not under the Finance Act.
I have looked through the provisions of the bill to determine whether or not there is any that I could see under which, the bank could operate to the detriment of any policy, fiscal or otherwise, which the government of the day might have. My judgment, for what it may be worth, and I offer it after having looked over the bill again, is that the Bank of Canada cannot control the mechanism used by the government for the purposes of its policy under any circumstances whatever.

Bank of Canada
The government promulgates its policies, whatever they may be; the central bank, an instrumentality of the government, assists in giving effect to those policies, carries them out in every way in its power; but surely it could have no jurisdiction under this or any other statute that I can conceive of with respect to a central bank that would enable it to interfere with or work at cross purposes with the government of the day in effecting its policies, whatever they may be. The ideas of the bank in regard to carrying on open market operations might conceivably be different from what an individual in the government might at the moment think, but I do not see how it could be said for a moment that they would in any way interfere with the general policies of administration. I have not been able by any process that I can rely upon to arrive at any such conclusion.


James Layton Ralston: Would the Prime Minister permit me to interrupt here?


Richard Bedford Bennett: Certainly.


James Layton Ralston: This is one point I have in mind: suppose the government of the day considered it advisable that the requirement of twenty-five per cent gold backing should be suspended, let us say for six months, in order that the issue of currency might increase, would it not be necessary for the privately appointed board first to pass a resolution providing for the suspension before the government could secure it?


Richard Bedford Bennett: I have no doubt that
as the law stands the directors would take the initiative. But if it were a publicly owned bank with a board of directors the same course would have to be pursued.


James Layton Ralston: Yes, but there would be
government directors on the board.


Richard Bedford Bennett: But what assurance have you that the directors would discharge a public trust any more carefully because they are appointed by the government than if they are elected in the manner I have indicated?


James Layton Ralston: Oh, if you take that
position there is no use in arguing.


Richard Bedford Bennett: And with the four and
a half per cent limitation.


James Layton Ralston: One has a good deal
more assurance than if they are appointed by private shareholders.


Richard Bedford Bennett: Have we? One has only to look at the history of one great publicly owned enterprise that we have had in this country to see. Certainly the evidence is

against that view. All you have to do is go down to the West Indies, and follow up from there to this country.


James Layton Ralston: That has nothing to do
with the point.


Richard Bedford Bennett: The point is that the directors would have to take the action in any event. Suspending the twenty-five per cent provision would be an act of the directors in the first instance. Under our provisions it would have to be approved by the government. If it were publicly owned the same procedure would follow, presumably, from what the hon. gentleman has said. He has not suggested that if it were a publicly owned bank and the directors were appointed by the government there would be any change in that part as far as the governor is concerned. Assuming that is as it is now, where would be the difference?


James Layton Ralston: I think it is obvious, even if my right hon. friend cannot see it. If the directors were appointed by the government it would seem that they would be more likely to carry out the wishes of the government by whom they were appointed than would directors appointed by private shareholders.


Richard Bedford Bennett: What the hon. gentleman suggests proves what I have contended from the start. This view is that the directors are not to think for themselves, that they are to be thought for and to be told what they are to do, without regard to their own views;-whereas in the other instance we imply some intelligent consideration of the questions at issue. There is no doubt that in both cases the initiative must come from the directors, acting in both instances on the request of the government of the day, and if they suggest the suspension of the twenty-five per cent gold coverage merely because a political group said it should be done, as against what their reason told them should be done in the interests of the nation as a whole, they would be reflecting a political judgment on the one hand as against a business judgment on the other. That is the whole story. That is what we have endeavoured to set our face against. The discussions that have taken place here indicate how readily the situation would become charged with danger for the bank itself, even as the situation would become charged with danger with directors who merely carried out the will of either one man or a group of men. That is the position. I am not going to traverse it further except to say that by no process of reasoning which I can apply to the facts and in no case of which I can conceive

Bank of Canada
would it be possible for this bank in any sense to balk or stand in the way of policies of a government being made effective in any manner that the government of the day thought in the public interest, whether fiscal or otherwise.


William Lyon Mackenzie King: Mr. Chairman, the Prime Minister (Mr. Bennett) has not really answered my point beyond giving it as his individual opinion that there would be no possibility of conflict between this bank and the government. He has not given us reasons why such conflict of opinion might not arise. As members of the committee will recall, my point was that, in the absence of any directors appointed by the government, and with all directors being appointed by the shareholders, there might on occasions be no means of bringing about the necessary harmony between the government and the bank with respect to a course of procedure that might vitally affect some great national policy. I pointed out that I thought a case might arise where the bank, being a privately owned institution and privately controlled, and being associated with private banks in' other parts of the empire, might come to have one financial policy to which it would adhere very strongly, but that the government of the day, for very obvious national reasons, might desire to follow another policy, or to alter in some particular, essential to the national interest, the policy of the bank. The government might have a policy with respect to trade or shipping or some other great national service which would require the cooperation in a friendly way of the bank, and that would not be possible unless the government as well as the shareholders, was represented on the board of directors of the bank. The Prime Minister did say last night that there was the possibility that in time of crisis there might be a moment when there would appear to be conflict, but he thought it would work out all right. I wish I could be as sanguine as he is about everything working out all right. I can understand my right hon. friend having the feelings he has at this time about this phase of the situation; he is going to appoint the governor, he is going to appoint the deputy governor. The shareholders of this bank will appoint the directors, but the real control of the bank's affairs will be in the hands of his own appointee. The governor will be a gentleman, unquestionably, of the same point of view on financial and economic affairs as the right hon. Prime Minister himself. I know the Prime Minister is sincere in the views that he holds as regards both trade and finance, but, with all
respect and deference, I say to him that there are those who believe that his policies are wrong, and that the best interests of this countiy and of the empire would be furthered by policies wholly different from those which he cherishes at the moment. That is where I see the possibility some day of conflict between what may be the policies of this bank and the policies of the administration that may be in office.
I want to make this fact clear: no one could have had the responsibility of being the head of an administration for any time without realizing all that is meant when one speaks of political pressure. I think I would be the first to sympathize with the Prime Minister in his desire so to frame an act that what is termed political pressure would not be permitted to interfere with the successful and independent working of a great financial institution. May I say we may give a wholly wrong meaning to the word "political" in speaking of political pressure. A political influence or point of view is not necessarily something that is contrary to the national interest; a political point of view is one which arises from an endeavour to give expression to public feeling and public opinion, and I submit that in all democratic countries public opinion is the one great factor for which all governments must have consideration. There are times when it is necessary and vital that every institution in the land should be subject to the public opinion of the nation, and this is always the case when it is expressed in a constitutional way in parliament. I do not believe powers should be given any institution that would enable it to put itself in a position of opposition to a government that has been entrusted with great responsibilities of enforcing particular policies.
In order to be perfectly clear, I should like to assert the two definite sets of circumstances I have in mind. The first relates to a conflict which might arise between the government and the bank at any time of crisis regardless of what administration may be in office, a crisis which might arise from unforeseen economic conditions in the country itself. You would then have two powers that would come into conflict with each other; and unless there is some way of harmonizing them great mischief may be done. You have the money power represented by the central bank and you have the political power represented by the government. I am not one of those who is given to indulging in the extravagant language which is used in these times about money power and the terrors of international
Bank of Canada

banking and finance, blit no one can live in this day and age without realizing that we have in the money power of the world an invisible force which is all-powerful in different countries at the present time. What is being proposed under this legislation is that the government shall part with its control over the issue of currency and over national credit to a private corporation which is a great banking institution and which to a certain extent is to regulate the affairs of all other banks. When I say that the banldng institutions are to be all one, I do not mean that the central bank will be controlled by the chartered banks of the country. What I do mean to say is that all questions relating to currency and national credit will hereafter be in the hands of the central bank and other banks throughout the country and no longer in the hands of the government. They will be in the hands of the banking interests, which means in the hands of the financial interests, and parliament will have parted altogether with any control it has over the issue of currency or over credit. There are those who hold that when a nation parts with its control over currency and national credit, it does not matter very much who makes the laws of that nation. The power that controls the currency and the credit of the country is a power that, if there is such a thing at all as political influence of the kind referred to by the Prime Minister, can make itself felt upon governments.
I say that power of influence of governments and defiance of governments by the money power is being created by this act in the form in which it is at present, and the only way in which that possibility can be avoided is for the government to see to it that, on the board of directors who are to direct this institution, there are representatives of the government, who will not own any of the shares, but who will be the appointees of the government placed there solely to watch and safe guard the public interest. I think my right hon. friend must agree that in these matters of large finance, check and counter check is wholly advisable. It is advisable in financial transactions of a limited size, and it is more necessary as well as advisable in those of considerable size. But here are financial transactions of the greatest magnitude conceivable, and check and counter check are imperative. I do think the directorate of the bank ought to be so formed that, whether the pressure is upon the bank from the government on the one side, or upon the government from the financial interests and through the bank on

the other, there should be on the board of directors some one or more persons who will be quick to sense the situation, give the danger signal, and arouse the country to the pressure which is being brought to bear. There is the danger of a government bringing too much in the way of pressure to bear on a central bank. On the other hand, there is equal danger of the financial interests that are allied with the banks bringing influence to bear upon a government. There will be both these dangers always, and the only way in which that possibility can be lessened is by making sure that both powers, the money power and the power of government, are represented on a common board so that one or the other will be in a position to direct the attention of the people at large to the dangers which they may see developing in the affairs of an institution which is or ought to be a great national trust.
May I now direct attention to the other set of circumstances I have in mind, namely, the difficulties that I see which may arise in carrying out national policies when there is a change of administration. Here I want to differ absolutely from and to take issue with the Prime Minister in what he said last night. In order that I may not misinterpret what he said after I had asked for an explanation as to a certain point, I shall quote the words of my right hon. friend as they appear at page 4195 of Hansard:
If the government were in complete control of the bank it would mean that if you had one government succeeded by another the bank would naturally change its policy, assuming that the policy was as the right hon. gentleman suggested. Then you would have governments controlling policies without continuity. What we wish to secure is a policy based upon the economic conditions of the country, not a policy of the bank based upon policies of a government. That is what the right hon. gentleman desires.
What I should like to ask is: Are the institutions created by governments themselves to be made by their very constitutions so powerful that in the matter of national policies they can regard themselves as wholly beyond the direction of a government, where those policies are the result of the will of the people as expressed by their representatives in parliament? In no way could it be possible to have more clearly defined the difference between the right hon. gentleman opposite and myself. The Prime Minister will notice that at the moment, I am not suggesting the government should own the bank. I am not at the moment discussing the question of ownership, at all. As I said last night, I think

Bank of Canada
the question of ownership is debatable. I am however discussing the question of control of policy, and I do say that with respect to policies, whether they relate to trade, to shipping, to marketing, to finance, to defence, or to any other phase of a country's economy, those policies, if they are the expression of view of a government representative of the people, should be capable of being carried out without interference from any institution whatever, but rather with the sympathetic cooperation of all institutions. That is the only way in which in a country we can have either democratic or responsible government.
I should like to be very frank and concrete in what I am saying, and in order that the Prime Minister will not think I am in any way seeking to misinterpret his point of view or the point of view of any hon. gentleman opposite, I should like first of all to present the matter as I think he sees it. He knows that he will have the appointment of the governor and of the deputy governor of the bank, and he knows also that those who are likely to be appointed as directors will be governed very largely by the point of view of the governor of the bank. He has asserted -although I believe this evening there has been some modification-that the governor would in all probability be some one who would come from the old country.


Richard Bedford Bennett: No, I have not modified any statement with respect to the governor.


William Lyon Mackenzie King: What I have said I believe still stands. I think to-night my right hon. friend did go as far as to say that possibly a Canadian could be found for the position.


Richard Bedford Bennett: I said that yesterday, too.


William Lyon Mackenzie King: I beg your pardon?


Richard Bedford Bennett: The right hon. gentleman did not follow me. My statement is in Hansard. What I said was that without experience which could be gained by giving him an opportunity, there was no one in Canada who I thought at the moment could be appointed. I said if there were an appointment made tomorrow it would have to be made under circumstances which would enable the appointee to have five or six months' experience in England, or elsewhere.


William Lyon Mackenzie King: I shall not discuss the question whether or not the one to be appointed governor is to be one whose residence has been in England or in Canada. For the purposes of my argument it is sufficient to say that the Prime Minister will appoint
the governor, and that he will appoint someone who, he believes, holds sound views on economic and financial questions, and views which are sound because in accordance with his own. I believe that is a reasonable assumption.
A few evenings ago, I spoke about an imperial trade policy, and the Prime Minister took strong exception to the use of the word "imperial." He said that I was seeking through the use of that word to create some prejudice. I used it because it is the word in common use to signify what is meant. I notice the right hon. gentleman said he had not used it, but I looked up his language in. the particular address he delivered, and-


Richard Bedford Bennett: I did not use it that
night.
Mr. MACKENZIE. KING:	Not that
night. I find what he did use in the address I refer to was the expression "common policy," and by a common policy he meant a policy for all parts of the empire. To my way of thinking a common policy for all parts of the empire is what is meant when we speak of an 'imperial policy. The word "imperial" expresses in a very short, concise and complete manner what is meant by the expression "a common policy for all parts of the British Empire." I believe the Prime Minister-and he has never denied it-believes in his heart of hearts that in the matter of trade a common policy for all parts of the British Empire would be in the best interests of the peoples of the British Empire, and I believe further that his tariff policies have been designed towards the end of bringing about a common trade policy throughout the different parts of the empire. That is his point of view, and he is entitled to it. I wish he would debate the matter openly, and let us argue the question as to whether or not that policy would be as good for Canada as what we describe as a world trade policy. A world trade policy, not an empire trade policy, represents the point of view held by hon. gentlemen on this side of the house. We do not believe that the interests of the British Empire, and those of Canada in particular, are going to be furthered by any common trade policies for all parts of the empire, whether they be called imperial or common policies, or by any other name. We believe in a policy of trading with any and every nation that will trade with us, as best for the empire and best for Canada as a part of the empire. Let us assume that the appointee to the position of governor of the bank would be a gentleman holding the same point of view as is held by the Prime Minister,

Bank of Canada
honestly believing that the right thing to do is to encourage trade within the British Empire and to develop channels of trade throughout the different parts of the empire so that for the most part trade would necessarily flow in empire channels rather than between this country and countries, generally, throughout the world. Is it not altogether probable that the governor of the central bank would find it possible to further that common or imperial trade policy by the opportunities which would be afforded him and his institution, as for example, in dealing with matters of exchange? Would he not, by artificial means, through the manipulation of exchange, be in a position to further the policy which the government has in view, and which, in matters of trade, he and the Prime Minister would hold in common? I am perfectly sure that an institution of the character of a central bank which has to do with a nation's credit, which has to do with the issuing of the nation's currency, which has to do with the regulation of exchange and with great problems of international exchange, could, by artificial means, direct the trade of this country through particular channels and away from other channels.


Richard Bedford Bennett: May I say to the right
hon. gentleman that that could be done only by parliament giving them the money with which to do it. The stabilization of exchange could not be done without the aid of parliament.


William Lyon Mackenzie King: The Prime
Minister may seek to answer in that way. I believe he is beginning to see the force of what I am saying. In connection with imperial policies of trade or finance may I observe that both are clearly and closely interlocked. No one knows better than the Prime Minister that the facilities which banks afford to importers and exporters determine very largely in what direction and from what sources trade is to flow. Look at the picture as it is beginning to disclose itself. We have, first of all the Bank of England, which stands at the centre. Then there are the central banking institutions already in existence in Australia, New Zealand and South Africa. I believe it is a fact that at the head of each one of these central banks is a gentleman associated- with the Bank of England, or one who has had previous associations with the bank of England. If in Canada we have at the head of our central bank another gentleman who has been trained by the Bank of England, and whose associations are with that bank, what would be more natural than that these central banks within the British empire,

all trained from the London point of view, and all embued with the idea that a great imperial or intraempire trade is the thing to be fostered, should do their utmost further to develop trade in that way to the exclusion of every other? As I say, so long as the Prime Minister, himself, is in office, I can see how he may well entertain the view that there is not likely to be any danger experienced of a character which would lead to any conflict between his government and this new banking institution. But let us assume for a moment that there is a change of administration, and let us assume that a government is in office in Canada which wishes to develop trade throughout the world, trade by Canada, with all the nations of the world, foreign as well as British nations, and does not believe it to be restricted by artificial means in the interests either of Canada or of the empire to have trade so as to confine it mostly to channels within the British Empire. Then according to the Prime Minister's reasoning, and the grounds he adduced for giving this bank the constitution he is giving to it, we are face to face with this following situation:	The bank is to
maintain continuity in its financial policy- an imperial financial policy to support an imperial trade policy-and is not on any account to change its policy because there has come into office a government with other policies which have been approved by the people. The words are as plain as the English language can make them. The Prime Minister said:
What we wish to secure is a policy based on the economic conditions of the country, not a bank based on the policies of the government.
The policies that any government would have would be policies based on the economic conditions of the country, especially where they were policies that had been presented to the people, and which the people had approved, and which as a consequence the people would have a right to expect that every institution which exists in the land would harmoniously help to further to the largest possible extent. I see there a very great danger. Possibly the Prime Minister will come back with this reply, that parliament can always alter the statute which it has made. But, as he himself is so fond of saying, we are obliged to deal with conditions and not with theories, and we know that parliament consists of two houses and that the approval of both houses is necessary to the amendment of any statute. We know that at the present time the other house of parliament is one which represents very strongly the point of view of the Prime Minister of the day, and it will

Bank of Canada
probably be many years to come before the other house on some of these matters of trade and finance, is at all likely to be in sympathy with a House of Commons which might be differently constituted from the present one.
In such circumstances what will the position be? If there are no directors of the bank who are appointed by the government itself and whose duty it is to protect the national interest from the point of view of the government, an incoming administration which has trade policies different from those of the present administration, unless it were so fortunate as to find in the governor of the bank a gentleman who would be quite prepared to accept the policies of the government on important national matters and seek to further them, would find itself in a position where it might not be able to carry out the very policies which the country had sent it into office to further. This is the time to mention that possibility. It is the point I brought to the Prime Minister's attention last night. I do not think he has given a satisfactory reply to it.
The obvious thing to be done in these circumstances is to provide that at least a certain number of directors shall be appointed by the government of the day, and that these directors, who will not own shares, should sit on the board to cooperate in shaping the policies of the bank and to see that at all times, with respect to great national policies, those of the bank and those of the country are brought as much as possible into common accord.


Mr. NICHOLSON:: Will the right hon. gentleman permit a question in order that laymen in the house may get a clear idea of what he has in his mind? Will he suggest that the governor and deputy governor and even the directors representing the public should be changed with a change of government in this country, in other words be made political appointments? His argument suggests to me as a layman that he feels that the governor, the deputy governor and a majority of the board of directors should be changed or dismissed with each change of government.


William Lyon Mackenzie King: I have said nothing about the governor and nothing about the deputy governor, so my hon. friend may set his mind at rest in that regard. It is admitted that the present Prime Minister will appoint a governor and I assume he will be a person who is sympathetic with the prime minister's fiscal and other policies. I have said nothing about the governor or the deputy governor.
As to the directors, the present proposal is that they shall all be appointed by the shareholders. No one of the directors is to be an appointee of the government. My first point is that, regardless of which party may be in office, it is advisable that the government itself should appoint some of the directors, that some of the directors should feel that their appointment is made by the government, just as other directors will feel that their appointment is made by the shareholders. The persons appointed as directors by the shareholders will doubless feel that they have a special obligation to the shareholders. Surely it might be considered just as honourable that a number of directors to be named by the government should feel that they owed a special obligation to the government of the country which has appointed them. I am suggesting that the board of directors should be divided as between those nominated by the shareholders and those nominated by the government. I suggest that course as a means of avoiding a possible conflict between the bank and the government, or between what I may describe as the money power on the one hand and the political power on the other.
I say that, if we ever come to one of those great issues into which the world is all too quickly heading, of a conflict between money power on the one hand and political power on the other, there can be but one answer to a conflict of that kind, and that is the ultimate control by the political power and not by the money power. By the provisions of this bill we are placing pretty much all control in the hands of the money power.


George Brecken Nicholson: Does the right hon. gentleman suggest that the directors he refers to should be political directors in the sense that they should be appointed and dismissed politically


William Lyon Mackenzie King: The answer is in the terms of the amendment.


Mr. IRVINE:: I believe there are real
grounds for the fears of financial domination which have just been expressed by the right hon. leader of the opposition (Mr. Mackenzie King) but I think that the fears he expressed in regard to financial imperialism might better be discussed when we are dealing with that clause of the bill which empowers the Bank of Canada to affiliate or have relationships with the Bank of International Settlements.
As to the possibility, or likelihood-I think that is a better -way to put it-of the financial powers seeking control of the central bank, in my opinion there is every likelihood that-
Bank oj Canada

they will do so, and in trying to prevent that I have already joined with hon. gentlemen to my right in endeavouring to get this institution established on a publicly owned basis. But for reasons which the government have given in regard to a different viewpoint and a different policy they have refused to grant that, so I am not sure that the amendment now before the house would be of very much advantage. For instance, this is a private bank and there is no attempt to camouflage it as being anything else. As such the bill provides the means which are in keeping with private ownership as to how the directors and the officials shall be appointed. The amendment seeks to depart from the principle of private ownership, which is the basis of the legislation before us, and to make appointments on an entirely different basis so that if the amendment carried we would have a directors' board one-half viewing themselves from the point of view of the banking business and the other half perhaps from an entirely different viewpoint. It is just possible that in that way we would have more confusion than we would have by allowing the board of directors to be appointed as the bill assumes, on a proper private ownership basis. I can conceive that there would be times when if a clash did arise the members of the board would take advantage of that situation and blame each other instead of frankly accepting the responsibility which belonged to them as directors of the institution.
With regard to financial policy I would submit to the committee that this parliament has control of the financial policy and has stated that policy in section 25. I think that is the important feature controlling the policy of the central bank. And that is in the power of this parliament. We have not come to that section yet, however. It is not left to the governors or directors of the bank to say what principle shall direct the financial policy which the central bank is to follow. Section 25 of the act takes care of that.
I pointed out yesterday, and I think it is necessary to emphasize it again, that the central bank grants no new powers to the-financiers but rather takes some of their powers away. There can be no doubt that up to this time the chartered banks and the chartered banks' bankers have had control of both credit and currency in Canada and have' exercised any control that has been manifest-over all these years. Now this bill before the committee takes a good deal of that control out of their hands and places it in the hands of the government, and to that extent
fMr. Irvine.]
the bill is so much better than anything we-have had so far in the dominion.
Let me call the attention of the committee to the number of instances provided in this bill where powers have been taken which once were exercised by the chartered banks, powers which private institutions have been deprived of. First, the provisional board of directors must be appointed by the government. Now there was no such proviso in regard to the directors of the chartered banks when they controlled the credit of Canada. Then there are three of the permanent board of directors who are to be appointed by the government. I do not think anyone will argue that that is not an advance on what used to be the situation. Next, the first governor of the bank is to be appointed by the governor in council, and subsequent governors have to be approved by the governor in council.
I do not know whether it is proper to say what I am about to say, and if it is not I shall take it back; but the only way to find out whether it is proper or not is to say it, I think that if the government make as good appointments in connection with the governor and other officials of the bank whom they will have to appoint as they have made in the appointment of the deputy minister of finance, we shall have no cause to complain about the management of the bank.
The next provision is that the governor, the appointee of the government, has power to veto any by-laws. Next, all action of the board and the executive must be concurred in by the governor. Next, the deputy minister or a substitute for the deputy minister will be a member of the board without voting power. If it is merely desired that we should have someone there to give warning I am certain that warning will be forthcoming. The next provision is that complete regulations governing the bank have been laid down by parliament, as I have emphasized; and the most important principle in the direction of financial policy is section 25 to which I have referred. That is really the principle which will largely direct the policy the bank will follow. Then all profits except four and one-half per cent on capital invested go to the receiver general. There is another restriction which we did not find when the bankers were controlling the policy of the country; under the chartered banks they went off with all the profits they could make and therefore had only one incentive in every enterprise, namely, to . make more profits. Moreover, the commercial banks are not allowed to have financial interest in the capital stock of the present bank, and that is also a restriction of their financial control

Bank of Canada
of the country. Again, parliament's consent must be obtained before there can be an increase in the capital of the central bank, and the Minister of Finance has full control of the share personnel. Finally, no person other than the minister shall vote for more than fifty shares. These are all restrictions and curtailments of financial power which heretofore had absolutely no existence in financial legislation in Canada.
While therefore, as I have said, I wanted to see this a publicly owned bank, nevertheless I must say that my right hon. friend (Mr. Mackenzie King) and his following to the right have not had anything to say hitherto in regard to the control of the financial interests of Canada, though up to this time financiers have exercised authority, without any restriction, over the whole financial structure of the country.
Amendment (Mr. Ralston) negatived: yeas, 35; nays, 60.


[Stage Direction]
Section agreed to.
Sections 10 to 13 inclusive agreed to.
On section 14-All action must be concurred in by governor or deputy.
James Layton Ralston: Before we proceed with
section 14 I wash to propose an amendment, to insert a newr section, 13 (a). This is an amendment which I proposed in the committee on banking and commerce. It was considered by that committee for some time and the Minister of Finance asked that it stand and that consideration be given to it after the bill had been reported from that committee to the house. Accordingly, I will now move the amendment:
13-A. The deputy minister of finance, or in case of his absence or incapacity at any time, such other representative of the Department of Finance as the minister may name for the time being, shall, by virtue of his office or of such nomination as the case may be, have the right to protest against any act or decision of the board or of the executive committee (except a decision nominating a commissioner as hereinafter provided for) which he may consider to be contrary to law or against the interests of the state, by filing such protest in writing with the board or the executive committee as the case may be, and with the minister, and any such protest, unless the same is not concurred in by the minister within two days shall have the force of a suspensive veto so that nothing shall be done under the authority of or pursuant to such act or decision until the merits of the protest shall have been decided upon by a commission of three persons constituted as follows: one person to be named by the board and one person to be named by the minister within seven days after such protest, and one person, to be the chairman to be chosen jointly by the minister and the bank,
and in default of agreement on such last mentioned person within seven days after such protest, such chairman shall be the chief justice or acting chief justice of the Supreme Court of Canada; the decision of such commission to be made within seven days after the commission has been constituted or within such further time as the minister and the bank may agree upon and the decision of the commission shall have the full force and effect of a decision of the board of directors in respect of which no protest has been filed.
The effect of the new clause is to incorporate in this bill a provision which is found in a large number of charters constituting *central banks. I shall read the list that I have before me. It includes Austria, Czechoslovakia, Denmark, Esthonia, Germany, Greece, Hungary, Italy, Japan, Poland, Portugal, South Africa, Jugoslavia. The provision is intended for the purpose primarily of preserving state interests. One could conceive of a situation in which even the governor might vote to take a certain action and the provision is that the deputy minister, who is by this bill made a non-voting member of the board, nay if he considers such action to be against the interests of the state or contrary to law, that is contrary to the constitution of the bank, file a suspensive veto or protest with the board, and unless the suspensive veto is not concurred in by the minister within two days, that shall operate to suspend the action of the board until the difference is composed between the government and the directors of the bank.
If, of course, the provision had been carried with regard to public ownership or if the provision had been carried whereby a majority of the board were government appointed, this would not be necessary, but I am endeavouring in every way possible to have the national interests as opposed to what my right hon. leader speaks of as the money power, made dominant in connection with this organization. Therefore, if we cannot have provision whereby the national interests may take the initiative and positive action, I believe this provision helps at least to some extent to provide that the national interests may be asserted in order to prevent action which may be regarded as detrimental to the interests of the state.
As I said, this is not by any means a new provision. The Prime Minister and those who are familiar with central bank organizations will know it is contained already in a large number of acts. It seems to me that I cannot emphasize again too strongly what has already been emphasized from this side of the house, namely, that the control of the currency and credit of our dominion and the stabilization of the value of our currency
Bank of Canada

are matters which should after all be under the direct control of the state and of the government as representing the people of Canada. I therefore beg leave to move the amendment.


Richard Bedford Bennett: I do not intend to say
anything because the matter has been fully discussed in the committee. The illustrations to which reference has been made are illustrations under conditions which are so different from ours I do not think the matter calls for any discussion, and the conclusion arrived at in the committee reflected the mind of the majority. If the deputy minister and the government in a country and democracy such as this do not take steps to protect the public interest I entirely lose my appreciation of the situation.


James Layton Ralston: I do not think my right
hon. friend ought to dismiss the matter as quickly as that. The point is that the deputy minister is the one who has power to assert and protest. I do not think he is going to need it, but this is giving him power which he does not have under the bank as constituted by the legislation. At the moment he has no power except to sit in the board of directors and hold a watching brief. This gives him power to assert the interests of the state by registering a protest which has the effect of a suspensive veto in any matter which is regarded as prejudicial to the national interests.
My right hon. friend says that if the deputy minister is not sufficiently seized of the importance of the state's interests he does not see any possibility of protecting the interests of the state. The purpose of this amendment is for that very reason, to give the deputy minister power to assert the state interests as predominant over the interests of a private bank.


Henry Elvins Spencer: I should like to ask the Prime Minister this question: When the bank is set up and the deputy minister is taking his seat on the executive of the bank-


James Layton Ralston: He is not a member of the executive.


Henry Elvins Spencer: He takes his seat without a vote. If something comes up with which he disagrees and he advises the government through the Minister of Finance, in what way is the government in a position to exercise influence on the governor to get the board to change their mind?


Richard Bedford Bennett: In practice there has
never been any difficulty so far as the Bank of England is concerned, for instance, nor so

far as the Bank of France is concerned. I can only give those two illustrations. The financial policy in general of France the Bank of France has carried out from time to time except where there have been grave doubts as to government at all and matters of that sort, but the bank continued to carry out the general policy.


Ian Alistair Mackenzie: The Bank of England very often decided government policy.


Richard Bedford Bennett: The hon. member for Vancouver Centre suggests that the Bank of England frequently decides the policy of the government in Great Britain. I suppose by that he means to indicate that the experience of those who are the directors of that bank and of the governor is so great and ripe that the government are glad to avail themselves of it. I cannot think of anything other than that that he can have in mind.


Ian Alistair Mackenzie: Morley's Life of Gladstone has several references to that.


Richard Bedford Bennett: One can get something more recent than that if the hon. member so desires.


William Lyon Mackenzie King: Ramsay MacDonald.


Richard Bedford Bennett: Yes; between 1914 and 1921 there were many cases in which it is recorded that the view at first of the officials and directors of the bank was not the same as that of the government, but in most cases the records indicate that the government after discussion accepted the view of the bank. As is pointed out in the book to which reference is made, there was no collision; there may have been differences and sometimes they were acute, but they were always adjusted.


William Lyon Mackenzie King: Was there not a situation that arose when the right hon. Ramsay MacDonald was head of the government, which resulted in the resignation of his government?


Richard Bedford Bennett: No; his government resigned on account of the Campbell case in connection with the prosecution. His government, as the right hon. gentleman will remember, resigned in consequence of the Campbell matter. That is what brought about the difficulty.


William Lyon Mackenzie King: No, I mean the resignation of the Labour government just before the formation of the present national government.

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Richard Bedford Bennett: I thought the right hon. gentleman referred to the first resignation.


William Lyon Mackenzie King: No.


Richard Bedford Bennett: As to the last resignation, this is my information: the balance of trade was running so strongly against that country it became necessary in the opinion of the then chancellor of the exchequer, now Lord Snowden, that immediate action should be taken. My information, for what it may be worth-and the reminiscences so indicate-is that the bank entirely agreed as to the necessity of immediate action being taken. It will be recalled that there was a discussion that went on well into the night between the chancellor, the governor and, shall I say the city men, because the heads of some of the great banks were also consulted. In the end immediate action was thought desirable, and as is well known, Mr. MacDonald formed the national government. I do not think there was any difference of opinion; it was because of entire agreement between the bank and the then chancellor of the exchequer as to the seriousness of the situation, if my information is correct. I think probably no factor was more potent in bringing about the result than the broadcast speech of the chancellor of the exchequer, Lord Snowden, with respect to the matter.


William Lyon Mackenzie King: Was there not at the outset a question of the bank indicating pretty directly the terms upon which credit could be obtained, and of what was taken to mean the only terms, and so really forcing the hands of the government in the matter?


Richard Bedford Bennett: I dare say the sources of information of the right hon. gentleman are perhaps as full as mine, but my information is that when the situation became acute and the demand upon the bank's gold supply became very great the chancellor of the exchequer was of the opinion that something drastic should be done, and that an effort should be made to adjust balances and bring about, shall I say, a surplus in the budget. The bank pressed their position very strongly, but I think those of us who know Lord Snowden do not believe for a moment that he became acquiescent to anything other than conviction that he was doing what was right; and the speech that he made, which most people think was the determining factor in the election,-I think I can recall the matter now, although I must speak subject to correction, for I have not looked it up recently-the speech he then made over the wireless indicated that the savings of the people, the money derived from their savings certificates, was being utilized by the administration borrowing it for the purpose of supporting the so-called dole. He pointed out that it was absolutely essential that there should be a readjustment with respect to all the public services to bring about equilibrium between income and outgo. I have been told and read, but probably the right hon. gentleman has read and been told also, that that was a more decisive factor than any other in bringing about the result, in the sense that those who suffered voted for a national government, a most amazing spectacle. Perhaps the right hon. gentleman remembers the speech made about it by Mr. Churchill in which he referred to their having said, "We voted for England," and the speech made by the then Mr. Philip Snowden in which he quoted the famous lines from Swinburne.


Ian Alistair Mackenzie: That was his last budget speech?


Richard Bedford Bennett: His last budget speech, yes. I do know that there is no doubt that the bank, the bank officials, do exercise a very considerable influence on the financial policy of England. But it must also be remembered that the bank is utilized as the fiscal agent of the government, and the relations between them are the relations of a government and its fiscal agent, which of course must be very intimate. This bill contemplates that this bank will act without fee as the fiscal agent of the Dominion of Canada. Therefore the relations between the bank and the Minister of Finance will necessarily be very close. This bill is predicated upon the assumption that the bank is an instrumentality of government, and that it will use its best efforts to forward the interests of whatever government there is. I think if the right hon. gentleman would pause for a moment he would realize that the argument he made a few minutes ago is destructive of his own theory; for assuming, as he says, that I appoint the governor for a term of years and he is not of the same financial school as the right hon. gentleman, and that he succeeded to office, then he would find a governor who was not in accord with his general views. The right hon. gentleman therefore suggests that the government should appoint the directors. So I appoint the directors. Where is he then? They also reflect my mind. The result is that instead of having a board of directors that may be for all I know entirely friendly to the views of the right hon. gentleman, it is not improbable
Bank oj Canada

that on a cross section of the shareholders throughout the country, with whom fifty shares is the maximum holding, there will be as many people of the viewpoint of the right hon. gentleman as there would be of mine, for instance. If you take it on the balance of probability there are perhaps those who would say there would be more. Therefore it seems to me that I have done a greater service to the right hon. gentleman by providing for this .position than if I provided that the directors should be appointed by the government and be there for a term of years. The change of administration would then find not only the governor but the board of directors set in their ways, making it much more difficult for the right hon. gentleman to deal with the situation than otherwise.


William Lyon Mackenzie King: Does not the act provide that the directors retire in rotation?


Richard Bedford Bennett: Yes, but the shortest term is two years, then three, four and five years. This one further point I think may be useful in that regard. It is true that the directors retire in rotation, and they are elected from the whole body of shareholders. I have no reason to believe that they will all be of one political viewpoint, any more than the right hon. gentleman has. I think that is one of his best assurances.
Just one word more. It is erroneous to say that we are taking control away from parliament. Any parliament can be called together and do anything it pleases to this bank. The contingency that the right hon. gentleman has suggested, that the Senate might interfere, will only leave wider scope and greater opportunity for the right hon. gentleman, if the time ever comes, to exercise those reforming qualities with respect to that body that were interfered with by providence on a previous occasion.
Amendment (Mr. Ralston) negatived on division.


[Stage Direction]
Section agreed to.
Sections 15 and 16 agreed to.
On section 17-Capital and shares.
Ian Alistair Mackenzie: On division.
Section agreed to on division.
Sections 18 to 20 inclusive agreed to.
On section 21-Business and powers of the bank.


Richard Bedford Bennett: I desire to move an
amendment to section 21 to make it accord

with the provisions of the Bank Act, thereby enabling the Bank of Canada to deal with securities issued by a school corporation or parish trustees or securities issued pursuant to the statutes of a province. It is the same provision that we added to the Bank Act to meet the situation in the province of Quebec, having regard to the designation they give to their form of security. The effect of the amendment is to provide uniformity between the Bank of Canada Act and the Bank Act. I move:
That paragraph (i) of subsection 1 of section 21 of Bill No. 19 be struck out and the following substituted:-
"(i) make loans or advances for periods not exceeding six months to chartered banks on the pledge or hypothecation of the foregoing classes of securities, bills of exchange or promissory notes, or of Canadian municipal securities, or of securities issued by a school corporation or parish trustees, or of securities issued pursuant to the statutes of a province making provision for the payment thereof and the interest thereon by the province, or of gold or silver coin or bullion, or documents of title relating thereto;"


[Stage Direction]
Amendment agreed to.
Richard Bedford Bennett: Then there is a word to
be added in paragraph (m), after the word "bank" in the third line. I move:
That clause (m) of subsection one of section twenty of Bill 19 be amended by inserting after the word "bank" in the third line of the said clause the words "or from any bank incorporated under the Quebec Savings Banks Act."
It will be recalled that there are two banks in the country to which this applies, one the saving bank in Quebec and the other the savings bank in Montreal, and the amendment proposed brings these two banks within the provisions of that subsection as far as deposits are concerned.


[Stage Direction]
Amendment agreed to.
Section as amended agreed to.
Sections 22 and 23 agreed to.
On section 24-Sole right of note issue.
Ernest Lapointe: I have an amendment
to move to this section, Mr. Chairman. I desire to move that section 24 be amended by striking out subsection 4 thereof and substituting therefor the following:
(4) The form and material of the notes shall be subject to approval by the minister: Provided that said notes shall be printed in both the English and' Trench languages.


Richard Bedford Bennett: That would not be an
amendment; that is the present provision.


Ernest Lapointe: No, it is quite different.

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Richard Bedford Bennett: I raise the point of
order. The section reads:
Provided that notes in either the English or the French language shall be available as required.
The proposed amendment is that the notes shall be printed in both languages, but that is provided for here. There can be no question about it. An amendment cannot be in the terms of the section itself.


Ernest Lapointe: The amendment is that tne English and French shall appear on the same note.


Richard Bedford Bennett: That is not what it says; that is the point exactly. It is clear that it does not say that.


Ernest Lapointe: Everyone in the committee understood what was meant.


Richard Bedford Bennett: I am only raising the
point; that is not what it says.


Ernest Lapointe: I am quite willing to
change it.


Richard Bedford Bennett: I wish the hon. gentleman would make that clear, because as the amendment stands it is what is here already.


Ernest Lapointe: To meet the wishes of
the Prime Minister I will substitute the words, "provided that each said note shall be printed in both the English and the French language."
My remarks in support of this amendment will be very brief. It is needless to argue either the legal or the constitutional issue, since, after I moved a similar amendment in the banking committee, the Minister of Finance moved the proviso that now appears in subsection 4. I am quite willing to admit that this is a recognition of the principle, and my only reason for proposing the amendment has to do with the question of method, of better policy, .perhaps even of better taste. It has been recognized by the provision inserted in the bill that since there are banks in this country issuing notes in both English and French, now that the Bank of Canada will have the exclusive privilege of issuing notes it is only fair that the notes should be issued in French as well as in English. I hardly need to refer to the fact that these notes are legal tender; they are so described in this very section. Under section 133 of the British North America Act both English and French are used in the courts, not only those of the province of Quebec but also in all the federal courts. There are federal courts in Canada; the exchequer court sits 74726-268
everywhere. So these documents, being legal tender, certainly should be issued in both languages.
As I said before, it is a question as to the best method to be followed. Everywhere in the world where a similar situation exists, in order to show the duality of language in such countries both languages, and in certain countries .three languages, are used on the notes issued by the banks. For instance, in Belgium they have both French and Flemish on the notes. In Switzerland, where there are three official languages, French, German and Italian, the notes are issued with the three languages appearing thereon, and the same thing happens wherever a similar situation exists. It is so in South Africa, in the Irish Free State and in all the other countries of the world. Canada would be the only country whose national currency would be issued in two languages but not on the same note; there would be a portion of the notes printed in English and a portion of the notes printed in French. I do not think that is a good way to do it. What would be the result? There are many in Canada who did not speak the other language until after they had reached a certain age, when they took the trouble to learn it; these would like to have both languages. So far as I am concerned I would prefer to have both languages. The French notes will be circulated largely in the province of Quebec while the English notes will be circulated principally in the other provinces. Will it be a good thing to emphasize that situation, to make Quebec more French and the rest of Canada more English? I do not think it will. With regard to other countries, do you think it would be a good thing to have notes printed exclusively in French circulated in some European countries where the people do not know the conditions here, and where it might be thought that Canada is an entirely French country?
From whatever point of view you consider it I do not think the method adopted by the government is the best method. Let us admit that it may become a cause of friction in some places; if notes are offered to some people who do not like the language in which the notes are issued there may be disagreeable incidents. There may be something said or done which would not be conducive to peace and harmony in the country. Why should we take that risk? I must apologize for showing that I have a ten dollar bill in my pocket, but I have one which I am holding in my hand. Who will suffer if the notes of the Bank of Canada are issued in the same way as the notes of the Banque Canadienne Nationale or

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the Banque Provinciale du Canada, whereon appear the words "ten" and "dix," and "will pay to bearer" and "paiera au porteur"?


Mr. VALLANCE:: Give it to Hansard.


Ernest Lapointe: No thanks. Who would suffer if that suggestion were accepted? I cannot understand how anyone could object to the issue of notes being made with both languages on the same notes, instead of having a parcel of English notes in one place and a parcel of French notes in another. The other system is that provided through the amendment suggested by the banking and commerce committee. It is merely the matter of choice between two methods, and I plead with you, Mr. Chairman, and through you to the members of the committee, to adopt the only fair and reasonable choice, and the one which will not cause friction among Canadians.


Richard Bedford Bennett: It is perhaps unnecessary
to say that I am not unmindful of the discussions which have taken place in the public press with respect to this matter. I am not unaware, and I fancy very few members in this chamber can be unaware, of the acute feeling which has developed through those discussions. Those in the province of Quebec who have not agreed with the views put forward by the hon. member for Quebec East (Mr. Lapointe) to the effect that the notes of the Bank of Canada should each be engraved in two languages, have been denounced publicly as traitors to their race, and have been subjected to attacks of a character which I very greatly deprecate. I therefore am not unaware of the seriousness of this situation, nor do I propose to hesitate for a single moment in directing the attention of this committee to every phase of the matter, and the reasons which now necessitate a review of the constitutional situation.
When the government was called upon to frame that section of the bill which deals with note issue it will be observed that subsection 4 of section 23 read as follows:
The form and material of the notes shall be subject to approval by the minister.
It was hoped by the use of those words to
avoid any discussions such as those which have been going on during the last few weeks in the newspapers published in this country. It was further proposed that when the section was reached the minister would indicate it was the intention of the government to follow the constitution and to provide that notes should be available engraved in both the English and French languages. Therefore it was with some degree of, shall I say regret, that one observed that on March 15 last the

hon. member for Quebec East gave notice of his intention to move an amendment in terms similar to the amendment moved to-night.
That matter came up for consideration at the meeting of the select standing committee on banking and commerce held on June 5, 1934. And in No. 16 of the minutes of proceedings and evidence, at page xiv these words appear:
Consideration of amendment proposed by Mr. Lapointe on March 15, last, viz:-
That section twenty-three of Bill 19 be amended by striking out subsection (4) and substituting therefor the following:
(4) The notes shall be printed in the English and French languages and their form and material shall be subject to approval by the minister.
Motion to amend declared lost.
The names being called for, they were recorded as follows: Yeas: Messieurs Casgrain, Howard, Lapointe, Mackenzie (Vancouver Centre), Ralston, Raymond.-6. Nays: Messieurs Baker, Chaplin, Coote, Ernst, Fraser (Cariboo), Hackett, Irvine, MacMillan (Saskatoon), Robinson, Smoke, - Spencer, Stanley, White (London). White (Mount Royal).-14. Messrs. Dorion and' Gagnon announced that had they not been paired they would have voted against the amendment.
The motion to amend was again declared passed in the negative.
Consideration of amendment proposed by Mr. Rhodes on May 31 last, viz:'-
That subsection (4) of section twenty-three of Bill 19 be amended by adding thereto the following: Provided that notes in either the English or the French language shall be available as required.
Motion to amend declared carried.
The names being called for they were taken down as follows:	Yeas:	Messieurs Baker,
Casgrain, Chaplin, Coote, Ernst, Fraser (Cariboo), Hackett, Howard, Irvine, Lapointe, Mackenzie (Vancouver Centre), MacMillan (Saskatoon), Ralston, Raymond, Robinson, Smoke, Spencer, Stanley, White (London), White (Mount Royal).-20. Nays: 0. Messrs. Dorion, Gagnon and Jacobs announced that they were paired and that if they had voted they would have voted in favour of the amendment.
The amendment, therefore, as it now appears in the bill was unanimously adopted by the committee. That is the position. To-night a motion has been moved which, in its original terms was exactly similar to that provided by subsection 4 of section 23. The amendment as moved was:
The notes shall be printed in the English and French languages, and their form and material shall be subject to approval by the minister.
The amendment has since been amended, and as it now appears for the consideration of this committee it states that each note shall be printed in both languages. The choice therefore is between notes printed in English and notes printed in French, or each note being

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engraved in English and French. This raises a question of very serious moment, and is one which has engaged the attention of this house on previous occasions. As I said a moment ago it is a question which has involved many, many hard words being spoken and written. Section 133 of the British North America Act is as follows:
Either the English or the French language may be used by any person in the debates of the houses of the parliament of Canada and of the houses of the legislature of Quebec; and both those languages shall be used in the respective records and journals of those houses; and either of those languages may be used by any person or in any pleading or process in or issuing from any court of Canada established under this act, and in or from all or any of the courts of Quebec.
The acts of the parliament of Canada and of the legislature of Quebec shall be printed and published in both those languages.
The interpretation of that section, so far as I know, has not been a matter for judicial consideration, but by common consent those who are members of this parliament have always been enabled on request to secure the proceedings of this parliament, whether in the form of debates, bluebooks or otherwise, in the French language, and equally in the English language. There was therefore an equality so far as these things were concerned. I shall refer to one debate in particular that engaged the attention of the house, that of the twenty-fifth of February, 1907, when a motion was moved by the gentleman who is now the Deputy Speaker, and there participated in that debate the hon. member for Labelle. It is a matter of satisfaction to know that twenty-seven years after that resolution was moved in this house on another matter the question now raised is being considered and the gentlemen to whom I refer, who were present twenty-seven years ago, are present this evening. The motion read as follows;
That it is in the interest and for the -wellbeing of the dominion, and in accord with the spirit of the confederation agreement of 1867, that the French language, which in virtue of the constitution is official, be placed on a footing of equality with the English language in all public matters-for instance, in the coinage of moneys and in the administration of postal affairs.
The words, it will be observed, are, "be placed on a footing of equality with the English language." To that on the twenty-fifth of February Sir Wilfrid Laurier moved in amendment:
That all the words after "that" be struck out and the following be substituted in place thereof:
74726-268J
"The French language is, in fact, as well as by the constitution, on a footing of equality with the English language.
In the course of the debate Sir Wilfrid Laurier used these words;
Of course, there are some great occasions in which it-
The French language.
-must be spoken, there are occasions of a public character when it ought to be spoken. But to affirm, as he does, that the French language should be used upon every occasion, and that every public document should be printed on one side in French and the other side in English is, I think, going a little too far. For instance, I understand that my hon. friend wants bank notes to be printed either in French or in English.
Note the words, "either in French or in English":
For my part I never yet saw an occasion where a bank note printed in English was not properly understood by the French people; and I am quite sure that a bank note printed in French would be understood by the English people to be exactly what it means. But I see no reason why a bank note should not be printed in French. Since we have been in office we have not had occasion to issue a new form of bank notes, we have taken the old form as we found it, we have continued the form of the old bank notes. I do not see any reason why, if we were to issue a new form, we should issue it in one language rather than another. But I would say to my hon. friend that it is far better that we should be conservative in these matters and not to change our forms every now and then.
For nine years the hon. gentleman who has just spoken occupied high office, and in 1930 just before leaving office a contract was entered into between the government and the bank note company that engraves Canadian bank notes, and provision was made for the engraving of all the notes that this country requires for a period of five years, the notes of the Dominion of Canada, notes for $50, $100, $500, $1,000, for all the notes that were legal tender in Canada and are the notes of the Dominion of Canada, including also the one dollar bills, the banks not having any power to issue such; also the two dollar bills and the four dollar bills, and of course the five dollar bills as well, although the banks have power to issue bills from five dollars upwards. Was any such provision as is now mentioned in this amendment contained in that contract?


Mr. DUPUIS:: There was no Bank of Canada then.


Richard Bedford Bennett: There was the Dominion of Canada whose notes were the same as the Bank of Canada's notes. Was any such effort made to do that then? No. Therefore, sir,
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is it unfair to say that it is quite apparent that this has nothing to do with a question of business but it is a political issue pure and simple?


Ernest Lapointe: I deny that. I throw that back in your teeth.


Richard Bedford Bennett: I make it perfectly clear, Mr. Chairman, that if after nine years in office the hon. gentleman raised no such question in this house, did not assert for a single moment the desirability of following the course which is now being adopted by this government, did not even approach the matter, why is it other than a political question when now, after the government has indicated it proposes to follow the constitution and engrave the notes in English and in French, we should be met by a motion that each note must be engraved in both languages?
It is a very serious matter. It is one of the most serious that this country has had to consider for a long time in view of the discussions that have been taking place in the public press of Quebec. Shall those who sit on one side of the house and follow the constitution be branded as traitors in the Liberal press? That is what has been going on in this country, and confronted with that situation this government, desiring to follow the course which I mapped out for myself when I was elected leader of this party-when I went to the old province of Quebec in the first speech that I made there I said "I propose to follow the constitution. With respect to your rights and your privileges, everything that the constitution affords to you as a minority or as a majority I propose to observe."
Nothing is more fatal than a departure from a constitutional right. Nothing is more fatal than an effort to impose upon a majority the will of a minority if the rights are established by law. Since when has it become the law of Canada that the will of a minority shall prevail over that of the majority? Since when did it become conducive to the rights of minorities that they should insist that the constitution should be disregarded and the rights of majorities taken from them? That is the question. It was that that was in the mind of Sir Wilfrid Laurier when he said, "I see no reason why one language should be preferred over the other." It was that that was in the mind of that great French Canadian when he said that equality was guaranteed by the constitution. As I intimated in my first address in the province of Quebec, by that I stand; by that this government stands or falls. Equality under the law. Equal
IMr. Bennett.]
rights. The notes in French, the notes in English; engraved in French, engraved in English, even as Sir Wilfrid Laurier said.
On July 1 next this country will celebrate the sixty-seventh anniversary of our confederation. Successive governments have come and gone; successive prime ministers have come and gone; successive parliaments have been elected and have disappeared; but for the first time in a statute of this country dealing with the question of the issue of dominion notes this government has placed a minority on the basis of equality under the law. And what is more, the hon. gentleman who has just taken his seat intimated in the committee that in the amendment moved by the Minister of Finance there was a fulfilment of the constitution, and he nods his head now in acquiescence.


Ian Alistair Mackenzie: He said
so to-night.


Richard Bedford Bennett: He not only asks this '
committee to afford equality under the law by concurring in the amendment proposed by the government, which was their original intention under the section as it reads, so that there would be no controversy or discussion, but having projected the question into the debate he has admitted that the proposals of the government met the constitutional obligation. Who says nay to that? No one. Then, sir, my statement to this house is that no man is doing justice to bis own people and to the future who suggests that there should [DOT] -be inequality under the law. Equality is provided for by statute; equality is provided for by the government-equality under the law, the engraving of a French note, of an English note: equality. But the hon. member for Quebec East says: No, no; not that, not equality. I now demand that the constitution shall be amended, disregarded, flouted, and that this committee shall, instead of following it, maintaining the rights of minorities in all their strength and vigor under the law, substitute therefor disobedience to the constitution, disregard for it in any event, and that equality, as established by law, shall be departed from.
That is what we are asked to do; that is what my fellow Canadians from Quebec are asked to do. But the history of the world in dealing with the rights of minorities is clear-that when you invite any parliament to disregard the rights of majorities by pressing for rights which are not granted by the constitutions, you thereby invite a departure from the rights granted by the constitution. That is what you do. And to-night we are asked to vote for a resolution which is an

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invitation to take action subversive of the rights of minorities as granted by the constitution. I will not do it. My promise was clear and it will be observed. This government stands or falls by the maintenance under the law of equality to those to whom the constitution has granted equality under the terms of section 133. By that we stand; by that we fall. And, as the years go by, when we think of the agitation now being carried on for amendments to the British North America Act, and the manner in which we have steadily stood by the rights of minorities as guaranteed by the constitution, when we recollect the statements made as to the contractual obligations of the constitution, how are the members of this committee to go out and say to the people of this country that we asked parliament to disregard these contractual rights, if they be such? That is the question; that is the question stripped of everything.
Our statutes for years have been published in separate volumes; our order paper every day appears in the English and French languages; our Hansard appears in the English and French languages; all documents which any member has a right to see, to read, to possess, he may receive in either language. And having regard to that provision, I suggest that hon. members should think carefully before they disregard the provision of the law, so clear, which for sixty-seven years has been observed-observed, mark you. In 1896 I supported the remedial measure and I have never offered apologies for having done so, because under the constitution it was provided that this parliament should take action in the event of certain contingencies. When the privy council said that those contingencies had arisen, when they so declared and this action was taken, I supported it. And in the old province of Quebec to-day the proceedings of the legislature are printed in separate volumes. I go into the library and receive statutes in English and in French. I receive reports from day to day of various departments, and some of them are so beautiful-illustrations and typography -that one values them apart altogether from the information they contain. Moreover, in that legislature bills are printed in English and in French.
I do not propose to labour the question. I have endeavoured to intimate to the committee the principles that have governed us in our approach to this matter. It has not been lightly done; it has not been done in caprice nor for political reward nor hope of reward. It has been done because we thought
and still believe that under the section I have read, the minister approving of the form and material, these notes should be issued. When this amendment seeks to impose, as it does, not equality under the law but a certain form by which, however small the bill, there shall be engraved upon it two languages and not that the bill may be available in either, the committee, I do submit, has a very serious responsibility.
I am not going to dwell further upon the matter. My duty is to discharge my obligations to my fellow citizens under the constitution, and that I will do. And when I see my fellow citizens from Quebec, who have been subjected to these attacks in the daily press, so vicious in character, so uncalled for, denounced as traitors to their race because they dare to assert their constitutional rights as members, rather than endeavour to obtain for themselves other than the equality which the law provides, I ask-[DOT] is it fair, is it right, is it just? When we have observed the constitution-observed it, mark you, for the hon. member for Quebec East admits that-then why project this question into the discussion if not for political reasons? Why do it? That having been done, I cannot but think that the responsibility for it is one which those who have created and must accept it will live long enough some day to regret.


William Lyon Mackenzie King: After what we have listened to from the Prime Minister, I think it might be well to remind the committee of the section which is under consideration, and of the exact nature of the amendment which has been moved. The subsection under discussion reads:
The form and material of the notes shall be subject to approval by the minister: Provided that notes in either the English or the French language shall be available as required.
The words, "that notes in either the English or the French language shall be available as required," are words which were put there by the government of the day. The Prime. Minister himself has stated to us this evening that his government is responsible for that provision. The provision is that there shall be notes in English and in French. In so doing the Prime Minister says that he has followed the constitution.


Richard Bedford Bennett: That is admitted.


William Lyon Mackenzie King: He has said repeatedly that the hon. member for Quebec East (Mr. Lapointe) in the amendment he has moved has admitted that the right hon. gentleman as Prime Minister has in what he is doing followed the constitution and observed
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all constitutional obligations. My right hon. friend has, however, gone on to say that the hon. member for Quebec East now demands that the constitution should be amended. Can my right hon. friend substantiate that statement?


Richard Bedford Bennett: Certainly.


William Lyon Mackenzie King: The hon. member for Quebec East makes and has made no demand for any amendment of the constitution.


Richard Bedford Bennett: Certainly.


William Lyon Mackenzie King: Not at all.
Nothing is further from the mind of the hon. member for Quebec East; he has made no request for any amendment of the constitution. The amendment that is before the committee at the present moment is one which relates to the method by which the requirements of the constitution may be carried out so as best to serve the convenience of the public and best to make for harmony and good-will between the different elements of the country. The Prime Minister's method of complying with the constitution is to issue two sets of notes, some in French and some in English; that is what the provision of this bill now under consideration requires. The method which the hon. member for Quebec East proposes is that the notes should bear on the face of them as to their denomination the French as well as the English language. The question is simply one of the method which will best serve the convenience of the people of the country and make for harmony; there is no question of the constitution in the matter. It must be a relief to the Prime Minister to find that I am not arguing for adherence to the constitution at present. He is the one who is asserting that particular aspect. But it is quite clear that what is involved here is simply a difference of method in issuing notes, having regard to what will best serve the public convenience and national unity.
May I ask hon. members: What, apart from all other considerations, would, as a matter of fact to most of us who are English speaking, be the most convenient method to have followed as respects moneys that are to issue from this central bank assuming, as is to be the case, that it is going to issue all the currency? Will it be more convenient for us to receive our payments in bills, some wholly in French and others wholly in English, or will it be more convenient, whenever a bill is received, to find that its denomination is in both languages? That is the whole question. These bills will circulate from one

end of Canada to the other; when payments are made in different localities, bills in French must be accepted equally with bills in English, because each are legal tender. Is it not going to make for greater convenience all round that, when moneys are sent from one part of Canada to another, there should be no possibility of any question arising -when a bill is received, because of its being in one language rather than in another, because having the two languages on its face it will be readily understood by all, than rather, as will otherwise frequently happen, sometimes understood by some and often not understood by large numbers of persons. Think too of the inconvenience to local banks all over Canada which will have two sets of notes, one set in French and one in English. That is the whole question.
The Prime Minister said-and I resent very strongly the statement he made-that the hon. member for Quebec East was trying to raise a political issue.


Ernest Lapointe: That is an infamous lie.


Richard Bedford Bennett: The hon. gentleman's
language will have to be altered. He is not holding a meeting somewhere. He said that something is an infamous lie. He must withdraw that language.


William Lyon Mackenzie King: Mr. Chairman-


Richard Bedford Bennett: I am raising a point of
order and I must press it.


William Lyon Mackenzie King: There has been a great deal of talk-


Richard Bedford Bennett: He is trying to get away from it but this is something he cannot get away from. He must withdraw those words.


Ernest Lapointe: I said that anyone who
said I am doing this from a political point of view utters an infamous lie. I said that. I did not mention anybody in particular, but I will withdraw the statement if it is against the rules of the house.


William Lyon Mackenzie King: I was saying,
when I was interrupted by the Prime Minister, that he stated that the hon. member for Quebec East was seeking to raise a political issue. May I say that the one who is seeking to raise a political issue is the Prime Minister himself and that his whole speech this evening was an effort to raise a political issue.
In order that the committee may get back again to the real point, which is the one involved in the amendment, the question of public convenience, of what is the best method and what is likely to serve the interests of

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good will and harmony as between all parts and all races of this country, may I refer to what has taken place with respect to the postage of Canada. Unlike my hon. friend the member for Quebec East, I do not happen to have a ten dollar bill in my pocket; but I have a two cent stamp.


Richard Bedford Bennett: Is it not a five?


Some hon. MEMBERS:: A five cent piece.


William Lyon Mackenzie King: I am sorry I have not a five cent piece, but 1 have a two cent stamp and I notice that the wording upon it appears in both English and French. I happen to have a three cent stamp as well, so that we are getting to the five cents by degrees. This is not a postage, but a national revenue stamp a three cent excise stamp, and I find that it also is in both English and French. Both of these, the excise stamp and the postage stamp, are issued by the present administration. As I understand it, all the postage stamps and also all the excise stamps of Canada also the postal notes and money orders are at present being issued by the government in both languages. This is being done for what reason? Because of a belief in equality. I wish to ask hon. members, if they are interested in equality, and what is the most obvious manner of asserting equality, whether the evidence of equality is not greater in a document or token that on its face is printed in the two languages rather than in what is proposed by this measure, namely, two sets of documents or tokens, one in one language and the other in the other postage or revenue stamps or money orders or postal notes or bank notes issued as is proposed in the amendment rather than as is proposed in the provision of this bill as drafted by the government. I do not think it is necessary to say more than that. I have no desire to indulge in heroics. If one wished to follow the Prime Minister it would not be difficult in a discussion on this subject to rouse very quickly many racial passions. The hon. member for Quebec East in his remarks made it very clear that what he was seeking to do was not to raise a political issue but to avoid political issues being raised.


Some hon. MEMBERS:: Oh, oh.


William Lyon Mackenzie King: Hon. members should take the trouble to read in Hansard tomorrow what the hon. member for Quebec East said, as they could not possibly have heard him or they would not be jeering at the moment. He said that in the event, in some parts of Canada, of notes in French being
handed to someone unable to speak the French language, difficulties and unpleasantnesses might arise between the party tendering the notes and the one asked to receive them. In directing attention to that, was my hon. colleague trying to create a political issue or was he trying to prevent political issues from arising? That was and is his sole purpose. These notes are going to be circulated in largest numbers, may I point out, in the largest financial and urban centre we have in this country, the city of Montreal. Out of that city to other parts of Canada will flow a larger number of the notes of the Bank of Canada than from any other centre in Canada. Is it not probable that a very large proportion of those notes from the city of Montreal will be notes printed in French? I should like to know whether good will and harmony between the two races and all parts of the country, and that good understanding which is at the basis of everything previous in our national life, will not be better preserved by having these notes go out bearing on their face the denomination in both languages, rather than large quantities going out in French and other large quantities in English. That sums up pretty much the whole question that is before us.
In conclusion I submit it is extraordinary that the Prime Minister of this country should seek to make a political issue out of a matter of this kind and that in so doing he should direct a personal attack upon the hon. member for Quebec East. I wish to say that there i? no man in Canada. I do not care to which side of the house we look, who has done more in the course of his life to further good will as between all races and classes in this country than my hon. colleague the former Minister of Justice. And I say further that there is not an hon. member of the parliament of Canada, either of the present or any previous parliament, who has done as much in his life to further international good will as has my hon. friend the former Minister of Justice. It ill becomes the Prime Minister to try to attribute to one so experienced and so honoured in our public life a motive as low and base as that which the Prime Minister has nut forward, a motive which the member for Quebec East is incapable of thinking of, let alone acting upon, in any personal or public matter.


Mr. BOURASSA:: It seems to me that in this heated debate we are losing sight of what I might call the broad, practical aspect of this question. As a political issue-well let us be
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frank about it, all political leaders and all politicians are endeavouring to make the best they can out of every question. In my experience, it has always been done, and provided it is done honestly and honourably nobody can find fault with that, and no party should throw stones at the other. The hon. member for Quebec East (Mr. Lapointe), in all sincerity-in that regard I entirely endorse what the leader of the opposition (Mr. Mackenzie King) has said-in his sincere desire to present the question in the least passionate manner has somewhat minimized the issue. But I am afraid that on the other side the Prime Minister (Mr. Bennett) disquieted as he rightly is, from appearance at least, by the tone of some of the papers in the province of Quebec, has rather exaggerated what 1 would call the electoral or racial aspect of this question. I have known the province of Quebec for a long while. I do not believe that the exalted tone of some of the papers in the province of Quebec represents the feelings of the sensible mass of the people.


Mr. QUINN:: Hear, hear.


Joseph Henri Napoléon Bourassa: The average French
Canadian farmer or artisan or business man is prepared to take all the dollars he can earn and make the best use of them, especially at the present time, whether they are printed in French or English or Chinese or any other language. I also believe that some of those staunch supporters of British rights-"this is an English country, nothing but English"-* would not spit on a bill printed in French if it helped them in buy'ing a bottle of Scotch whisky. So I do not take very seriously that aspect of the question.
But there are serious aspects. I shall not discuss the constitutional issue. If I ventured to express an opinion on what I might call the legal aspect, I am afraid the Prime Minister is absolutely right. I think the amendment as framed by the Minister of Finance (Mr. Rhodes) conforms strictly to the letter of article 133 of the British North America Act.


William Lyon Mackenzie King: We all agree to that.


Joseph Henri Napoléon Bourassa: Of course the ex-Minister of Justice, with his knowledge of law, admits it. That does away with three-quarters of those extravagant and heated expressions of opinion which appeared in the irresponsible papers of the province of Quebec; and in the province of Quebec, as elsewhere, most of the papers are irresponsible. It was stated that this amendment of the Minister 
of Finance is a step backward. Of course I have a very simple mind and a limited experience both in reading law and in parliamentary government, but I cannot get it into my head that this legislation, declaring for the first time that bills and money shall be printed in French, is a backward step in the acknowledgment of the French language. But I leave that aside also. I simply ask the members of this committee, on both sides of the house, to think of a broader aspect which relates to the principle of the issuing of currency. For centuries past as well as in present times, in every country, the issue of currency, the means of exchange between individuals, is an exercise of the right of sovereignty. Therefore the bills or coins which represent that means of exchange should first bear the stamp of the sovereign. In this respect it will be a great advantage to do away with those bills that are at present going right and left having on them pictures of many gentlemen, some of them good, honest people, some of them


Mr. POWER:: Less honest.


Joseph Henri Napoléon Bourassa: -high-class crooks who should foe in peniteniaries, but whose pictures occupy the place of that of the sovereign on these bills of exchange which we call money. Therefore I hope the next bills will bear the stamp of the king-not the king of England, not the emperor of the British Empire, but the king of Canada, as we acknowledge him.


Felix Patrick Quinn: Who is that?


Joseph Henri Napoléon Bourassa: It is King George for
the time being. Where is the hon. member from? So long-I say it for my hon. friend's satisfaction-as we think proper to consider King George as our king. Now the other more modern significance of coins and money bills is to express nationality. In our day sovereignty and nationality are supposed to work together, and money bills, as postage stamps, which circulate the world over, which the nationals of any country carry with them when they travel abroad, are supposed to signify that the country from which those postage stamps or bills come is governed by this or that sovereign, or this or that institution, if it is a republic, and that it is peopled by individuals speaking a certain language. Now, whether we like it or not, this country was for a century and a half a French speaking country. After the conquest and cession it continued to be French speaking under a foreign government. The rulers of Great Britain, at a period when racial and religious prejudices were much

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stronger than they are to-day, were nevertheless convinced that it was impossible for a conquering power to rule a foreign nation composed of civilized beings according to the tenets and with the use of the language of the conquering nation. So that even under that old, stubborn king, George III, they acknowledged the French language as the language of civil life and even of legal life in Canada. And, with a slight interruption in 1840, when the French language was suppressed by an act of the British parliament, the French language has remained one of the official languages of Canada.
In Belgium, as the hon. member for Quebec East pointed out, both the Flemish and the French languages are official. The language of the majority is Flemish, but the right of the Walloon minority to speak its language has been observed. There, curiously enough, it is the majority that has had to fight for the expression of its rights in various matters of administration which I need not relate to-night. In Switzerland there is a large majority of German speaking people; about one-third of the population is French speaking and there is an extremely small minority of Italian speaking people. Do not imagine that those people always agreed on language or racial matters. I happened to be in Switzerland just about a week before the war broke out. In French Switzerland the sympathy for France was just as strongly expressed as the sympathy for Germany was expressed in German Switzerland. There have been quarrels, quibblings and difficulties in the use of languages in Switzerland, as we have had them here. Nevertheless, belonging to an old civilization and having old traditions, they realized that it must not be a matter of oppression by one as against the other, and they have settled once for all that those documents expressing the broad nationality of the people should bear testimony to the understanding which has existed between them for centuries. Therefore their money bears all three languages. That is not the case with their postage stamps, because it would be too complicated to have three languages on postage stamps. So they agreed on one word, the Latin word Helvetia, which expresses the name of the country for the three nationalities. On all other documents the three languages are used.
Now let us come back to our present situation in Canada. When I have discussed this issue-and I have discussed it often in the last thirty years, not only in parliament but still more frequently before English speaking audiences in Ontario, Manitoba, Saskatchewan and even British Columbia-I have never
presented the question as a constitutional matter or as a question of right on the part of French Canadians. That is where I think most of our fellow citizens in the province of Quebec, especially in those heated expressions of opinion appearing in the press or occurring during speeches, are wrong. Why put it on, the basis of law? Why put it on the basis of a right exacted by the minority, if possible, from the majority, instead of basing it on common sense, in the general interests of Canada? In all those matters which express in material fashion the characteristics of the Canadian nation there has been the constant thought in my mind that if we want to preserve this confederation of ours for the generations to come, whether they speak French or English, German or Polish or any other language; or whether we consider it primarily from a British point of view as one of the "essential elements of the British Empire, let us not forget that the everlasting obstacle, to that preservation is the constant and tremendous penetration of American thought, American civilization, American language and American influences of all sorts. I have always considered that everything which tends to differentiate the Canadian nationality from the American nationality, and show to the outside world, to the passer-by, to the traveller, whether he is of English, German or French origin, that we want to express the difference of our civilization and its component elements from that of the United States, should be encouraged.
What is the main difference between Canada and the United States? Is it climate? Is it production? Is it social habits? Is it literature? That may be the case to a large extent in the province of Quebec, though I am sorry to say that it becomes less so from day to day. As regards English speaking Canada, however, let my good friends on all sides of the house make what we call in Catholic theology their examination in conscience. Do they realize to what extent from year to year their children are becoming more and more American? Do they realize that the so-called American literature of the cheapest kind is being circulated in Canada to a degree to which the circulation of English literature cannot be compared? I admit that in connection with a small measure of this nature we cannot counteract that influence, but I repeat that everything should be encouraged which will remind the children of Ontario, of Quebec, of New Brunswick or of Saskatchewan that Canada is something different from the United States, that in Canada there are elements of ethnical, culture
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and social civilization which differentiates the Canadian nation as a whole from the great American nation to the south. Do you not think that is the best permanent service we can render not only to ourselves and not only to Canada but, I repeat, to the British Empire?
It is not by the strength of arms, by the influence of money or by diplomacy that Great Britain has kept Canada within her great empire. We have remained a part of the British Empire because, after many years of misunderstandings, England succeeded in gaining the confidence of that portion of the Canadian nation which is of French origin, which speaks French and which desires, not in a spirit of arrogance but on the contrary in a spirit of confraternity, to stamp its character on the nation with its language, not to the detriment of the English language or of English culture but rather in unison with English culture. We do not desire to do what the Norman conquerors did in England. They imposed the French language on the great English nation for five centuries, but that did not prevent English civilization from emerging out of that conquest and developing that magnificent policy with which we are all proud to be associated. In this country of ours, principles of liberty and cooperation should prevail over any idea of the imposition of the will of a majority on the minority or the arrogant demand of a minority from an unwilling majority. Whether we belong to the majority or the minority, let us all consider these things from a broad Canadian point of view, from a broad British point of view and from a broad international point of view.
I repeat that in a small matter of this kind we cannot do a great deal, but by this means every Canadian, wherever he may travel, will show that under the sovereignty of King George, which we freely acknowledge -not because he is the king of England but because he is our king and because we wish to keep him our king-we have freedom to express ourselves in French or in English, and that our civilization is the result of the unison, the amity and the cooperation of those two great races. Do you not think it is better to have that expressed every time and everywhere than to leave it to the narrow interpretation of the French speaking Canadian or the narrow interpretation of the English speaking Canadian to say, on one side, "we are French" and on the other "we are English"? Let us say, "we are all Canadians," and we make use of those two great instruments of civilization, those two great expressions of human thought, the

French language and the English language, to prove to the world that two races can live in amity, can understand each other, can make concessions to each other without always quibbling about legal texts or endeavouring to show that a majority is oppressing a minority or that a minority is endeavouring to wrest, through political squabbles and intrigues, privileges for which it should not ask. It is in that spirit, Mr. Chairman, that twenty-seven years ago, as the Prime Minister has reminded us, I upheld with quite the same degree of fervour the request of the hon. member for Mont-magny (Mr. LaVergne). It is in the same spirit that ill through my somewhat agitated life I have always endeavoured to bring the French Canadian to understand the English and the English to understand the French Canadian, because so long as we do not understand each other we will not accomplish anything good, but if we do understand each other we can accomplish wonders.


The CHAIRMAN (Mr. Smith, Cumberland) :: The question is on the amendment.
Amendment (Mr. Lapointe) negatived: yeas 42; nays 69.


Ernest D'Israeli Smith: I declare the amendment lost.


Charles Gavan Power: I was paired with the hon. member for Muskoka-Ontario (Mr. Mc-Gibbon). Had I voted I would have voted for the amendment.


John Vallance: I was paired with the hon. member for Wentworth (Mr. Wilson). Had I voted, I would have voted for the amendment.


James Layton Ralston: I was paired with the Minister of Finance (Mr. Rhodes). Had I voted, I would have voted for the amendment.


Mr. MURPHY:: I was paired with the hon. member for Northumberland (Mr. Fraser). Had I voted, I would have voted against the amendment.


Mr. TURNBULL:: I was paired with the hon. member for Yorkton (Mr. McPhee). Had I voted, I would have voted against the amendment.


Mr. HOWARD:: I was paired with the hon. member for Grenville-Dundas (Mr. Cassel-man). Had I voted, I would have voted for the amendment.


Mr. DUBUC:: I was paired with the hon. member for Halifax. Had I voted, I would have voted for the amendment.

Civil Service Committee Report


Mr. GARLAND (Carleton):: I was paired with the hon. member for Russell (Mr. Goulet) :	Had I voted, I would have voted
against the amendment.


Mr. CHARTERS:: I was paired with the hon. member for North Wellington (Mr. Blair). Had I voted, I would have voted against the amendment.


Mr. ANDERSON (Halton):: I was paired with the hon. member for Toronto West Centre (Mr. Factor). Had I voted, I would have voted against the amendment.


Mr. CANTLEY:: I was paired with the hon. member for Richelieu (Mr. Cardin). Had I voted, I would have voted against the amendment.


Mr. SAUVE:: I was paired with the hon. member for 1'Assomption-Montcalm (Mr. Seguin). Had I voted I would have voted against the amendment.


The CHAIRMAN (Mr. Smith Cumberland) :: Section carried.


Richard Bedford Bennett: I move that the committee rise, report progress and ask leave to sit again, beginning with section 26.


William Lyon Mackenzie King: What will be the other business?


Henry Elvins Spencer: Is section 25 carried? We could not hear you.


Ernest D'Israeli Smith: It is carried.


Richard Bedford Bennett: Let it stand, then, Mr. Chairman.
Section 25 stands.
Progress reported
On motion of Mr. Bennett the house adjourned at 10.58 p.m.
Monday, June 25, 1934