1935-02-06

QUESTIONS

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

Mr. CAMPBELL:: What is the amount of revenue received from the bullion tax levied on the gold producers in each of the provinces each month since the tax was put into effect?


Mr. RHODES:: British
Date	Ontario	Quebec	Columbia1934-	$	%	$April	
96,035 56	14,661 57	-May	
536,130 08	38,936 77	21,147 66June	
542,514 42	165,086 42	24,152 40July	
555,008 06	50,330 57	26,045 40August	
553,924 20	74,528 30	32,352 43September	
500,442 32	57,271 23	42,040 80October	
518,284 34	103,692 41	26,601 03November	
515,202 69	70,581 35	35,495 75December	
463,518 78	65,808 97	36,112 811935- January	
586,641 90	93,076 98	38,086 004,867,702 35	733,974 57	282,034 28
The above totals are subject to adjustment in respect of income tax. IMr. Parent.]

Questions as Orders for Returns
LA BALE DBS HA! HA! QUE., HARBOUR MASTER


Mr. ROBERGE:: 1.	Who was the first harbour master of the harbour of la Baie des Ha! Ha! county of Chicoutimi ?
2.	On what date was he appointed?
3.	On what date was he dismissed and for what reason?
Mr. DURANLE.AU:
1.	James W. Foster.
2.	August 31, 1921.
3.	He was not dismissed. On April 9, 1925, he tendered his resignation and it was accepted.


ROYAL CANABIAN MOUNTED POLICE PATROL BOAT
Mr. DUFF:: 1.	Were tenders called for by the government in 1934 or 1935 for a patrol boat for the R.C.M. Police?
2.	If so, to whom was the contract awarded and at what price?


Mr. GUTHRIE:: 1. Yes.
In 1934.-(a) Patrol boat Acadian. Contract awarded to W. C. McKay & Sons Ltd. Shelburne, NS., $6,148.
(b) Birmal boat Advance-Contract awarded to the Crude Oil Engine and Engineering Co., Montreal, who hold the Canadian licence from the Birmal Boat Company, England, for building thus type of boat. Boat built by the Canadian Vickers, Montreal, P.Q., $4,950.
In 1935.-Improved Acadian type (now building)-60 foot. Contract first awarded to Wm. Heisler, Indian Point, NS., the lowest tenderer, but as he could not fulfil the terms of the contract, it was then awarded to the Shelburne Shipbuilders, Shelburne, N.S., the next lowest tenderers. Price $12,720, including sales tax.



QUESTIONS PASSED AS ORDERS FOR RETURNS


Mr. MACKENZIE (Vancouver):: 1.	How many miles of the trans-Canada highway remain: (a) unconetrueted; (b) partially constructed?
2.	Of such, how many miles remain to be
completed:	(a) in Ontario; (b) in British
Columbia?
3.	What is the total estimated' cost of completing the trans-Canada highway?
4.	Of such total cost, what is the estimated cost in: (a) Ontario; (b) British Columbia?


BUTTER IMPORTS FROM NEW ZEALAND AND AUSTRALIA
Mr. MULOCK:: 1. What were the quantities of butter imported into Canada during the years 1931
to 1934, inclusive, from (a) New Zealand; (b) Australia?
2.	What were the prices of the butter each month during the above mentioned years at the Canadian port of entry?
3.	What were the duties, dumping penalty, or other taxation imposed per pound each month during the above period?


Mr. CAHAN:: Return tabled herewith.


BUILDING OF NEW .ARMOURY IN MONTREAL
Mr. MICHAUD:: 1.	Has the federal government made an offer to the city of Montreal for the construction of an armoury in Baldwin park in the east end of that city?
2.	If so, when was such offer made, through whom, and was it accepted?
3.	Was the offer made subject to conditions?
4.	If so, what are the conditions?


Charles Hazlitt Cahan: Return tabled herewith. MOTIONS FOR PAPERS
NOTRE-DAME DE l'iSLE-VERTE, QUE.-WHARF ROAD


Mr. POULIOT:: For a copy of correspondence, reports, deeds, plans, sketches, relating to the building of a fence by the Department of Public Works last year, on the property of Mr. Dionne, on a road leading to the wharf at Notre-Dame de l'lsle-Verte, Quebec.



INVITATION TO THE U.S.S.R. TO ENTER LEAGUE OF NATIONS

Jean-François Pouliot: For a copy of the telegram addressed on or about the 15th September, 1934, by Canada and several other countries to the U.S.S.R. inviting it to enter the League of Nations, and of the signatures which were affixed to it.



RIVIERE-DU-LOUP, QUE.-WHARF

Jean-François Pouliot: For a copy of all correspondence, letters, reports, plans, concerning the extension to the wharf of Riviere-du-Loup, Quebec, since 1931.



PUBLIC WORKS, NEW BRUNSWICK

Mr. MICHAUD:: For a copy of all correspondence, letters, telegrams, and other documents, exchanged between the dominion government or any member or any department thereof and all other persons relating to the following items of schedule "A," chapter 59, 24-25 George V, the Public Works Construction Act:	Item 19,
Campbellton. New Brunswick, wharf repairs; item 32, Dalhousie, New Brunswick, post office; item 41. Escuminae, New Brunswick, breakwater extension; item 49, Fredericton experimental farm, New Brunswick, new dormitory; item 75, harbours and rivers (New Brunswick only); item 98, Moncton, New Brunswick, public building.
Beam Traiders


Mr. BENNETT:: The hon. gentleman who makes the motion is not in the house. I wish to speak to him in regard to certain requirements.


Mr. SPEAKER:: Stands.



BEAM TRAWLERS


[Stage Direction]
Mr. I. 1). MACDOUGALL (Inverness) moved:
That, in the opinion of this house, in the interests of the fishermen of Nova Scotia, no permits should be granted or renewed with those who own and operate beam trawlers in the province of Nova Scotia.
He said: Mr. Speaker, although I am deeply interested in the subject matter of the motion standing in my name I do not know whether it would be parliamentary for me to proceed with it at the present time, because of the fact that it has been given very close attention by the committee on price spreads and mass buying, and on account of the fact that the question is somewhat controversial. All I desire is to have the question brought to the attention of the select standing committee on marine and fisheries, where I and every other hon. member will have the opportunity to discuss it fully and frankly.
Those of us who have given some thought and study to the historical background of the Canadian confederation realize that at the preliminary meeting held at Charlottetown in 1864, when the province of Nova Scotia was asked to join the Canadian union it was made a sine qua non by Sir John A. Macdonald that the control of the fisheries of the province should be vested in the central or federal power. That may or may not be generally known by hon. members, but it is a fact.
That was strenuously opposed by Sir Charles Tupper of Cumberland, who did not desire to have the control of what was then, and what still can be made, one of our most important industries vested in the federal power. Sir John A. Macdonald, however, with his prophetic vision, saw the possibility of a Canadian union. He looked ahead to the time when British Columbia would enter confederation; he knew, as we all know, that in dealing with the problems pertaining to the fisheries of British Columbia and Nova Scotia there would be divergent interests, and he considered it prudent, in a national sense, that the fisheries should be controlled by the central power. Eventually Sir Charles Tupper agreed with him and after the consummation of confederation the control of our fisheries was vested in the central power. 
I realize that this is a controversial resolution; I realize that there are Conservatives and Liberals who will oppose it, but the fact is that so far as the fishermen of the island of Cape Breton are concerned their condition is worse than that of the industrial population of any other part of Canada. I make that statement advisedly, because I know whereof I speak. Only a few months before I went to the hospital I was in the county so ably represented by my tolerant friend from Richmond-West Cape Breton, the Minister of Finance (Mr. Rhodes), which was represented many years ago by my grandfather, first as provincial secretary in the legislature and later, after confederation, in the federal House of Commons. I found that in one district, where the people depend entirely upon the fisheries industry for the maintenance of life, there was dire distress on every hand. We hear a good deal about the right of workingmen to a living wage, but the most fundamental right of all is the right to live. I found that in that district they were not able to support a school, because the company that has control over these beam trawlers in the province of Nova Scotia has a monopoly. We might as well be fair and frank about it; they have a monopoly of the fishing industry in the province of Nova Scotia. There may be those who are spineless enough to disagree with me, but I think whatever may be said of me when I quit public life it will be agreed that I always had the spunk to say what I thought, whether a Conservative liked it or a Liberal liked it. To-day the fact is that we have a monopoly of the fishing industry of the province of Nova Scotia, and a United States controlled monopoly at that. These people dictate the prices of fish to the shore fishermen, when they can sell their fish, and in many cases they cannot sell it at all. Along the shores of the county so ably represented by my hon. friend from Cape Breton North-Victoria (Mr. Johnstone) last summer the price of hake was 35 cents a hundred pounds. I would be casting pearls before swine to talk about fish in this part of the country, but I can tell hon. members that you cannot get anything better to eat than hake. The fishermen go out at three o'clock in the morning and bring back two hundred pounds of hake, for which they do not receive enough to pay for the gasoline for their motor boat. That is a fact, and the same condition exists all along the coast of Inverness and Richmond. The very essence of a monopoly is the power to fix prices, and in Nova Scotia that power is vested in a United States controlled corporation.

Beam Trawlers
I say there is an obligation on the part of this government to take some action. Something was done by the previous government; in 1927 a commission was appointed, consisting of eminent men, to investigate the fishing industry of the maritime provinces.
I believe they went into this question fairly, dispassionately and without prejudice of any kind, and four of the five members of that commission agreed that the beam trawler should be abolished. Even Judge Maclean, although he dissented from the view of his colleagues, did not do so very strongly. It was proposed by the then government that a duty should be levied on beam trawler caught fish landed in Canadian waters, and that was done. Unfortunately it was by order in council, and that order in council ultimately was held by the courts to be ultra vires.
As a private member it is not open to me to move that a duty be imposed on beam trawler caught fish; everyone familiar with the rules of this house knows it is not competent for a private member to do so, but I would point out that after this commission heard evidence in different important fishing centres of the maritime provinces their findings were endorsed by Liberals, Conservatives, Progressives, Labour men, and everyone else. On consulting the record I find that petitions were presented to the commission, urging the abolition of beam trawlers, from many communities in both Nova Scotia and New Brunswick.
As I have said, Mr. Speaker, I know this is a controversial question, and I want to say frankly that I am not a socialist. I do not believe in the confiscation of private property. The fishermen of the maritime provinces believe to-day that by curtailing for a time the operations of the trawlers they would derive great benefit, and I believe it is the duty of the government to make arrangements with the beam trawler owners whereby operations of those boats may be suspended for two years. Give the shore fishermen of the maritimes a chance to live; that is all they are asking. They are not looking for doles, but are anxious and willing to work. They have a product which is needed right here in the city of Ottawa, in Toronto and in Montreal, one which is not produced on a competitive basis, as is coal, or some other commodities. If they are given any chance to make a living I will say that those fishermen in the maritimes will not want doles, or anything else. They are looking to this government, just as they have looked to previous governments for the right to live. I agree with what the hon. member for Antigonish-
Guysborough (Mr. Duff) said only a few nights ago, namely, that never since the maritimes entered the Canadian union have the interests of the fishermen been considered, whether by a Liberal or a Conservative government. There has never been a proper appreciation of the importance of the industry to the people of Nova Scotia. The time has come when we should consider earnestly the measures to be taken to give these people a chance to live.
In my observations I do not wish to be provocative because I know there are those who will oppose the resolution. However if they become too strenuous in their opposition I shall reserve my right to reply. May I say frankly I am not looking for votes but have spoken in all good faith. I have no interest whatever in the fishing companies of the province of Nova Scotia, but I have a very keen interest in the fishing hamlets of that province. I say the population in those hamlets has in the past forty years been reduced by 47 per cent. It is time something was done by those under whose control the fishing industry was placed when the maritimes became part of the Canadian union. They should try to do something to see that these people are given their rights, and the right not only to work but to live. They can earn a profitable living if they are given the proper encouragement and opportunity, and if they have a chance to sell their fish.
I submit the house should consider carefully this question relating to the licensing of beam trawlers, and I would urge that the fishermen of that province can earn their own living without the dole or any other assistance if they are given the opportunities they were promised when in good faith the province of Nova Scotia entered the union.
Mr. WILLIAM DUFF (Antigonish-Guys-borough):: Mr. Speaker, with very much that the hon. member for Inverness (Mr. Mac-dougall) has said I am in accord. His resolution reads:
That, in the opinion of this house, in the interests of the fishermen of Nova Scotia, no permits should be granted or renewed with those who own and operate beam trawlers in the province of Nova Scotia.
The matter of licensing or permitting trawlers equipped with whait has been known either as a beam or an otter trawler is one about which there has been a great deal of controversy during the last few years. To-day however it seems to me that there is not so much reason as there has been in the past to fear this method of fishing.
Beam Trawlers

In the beginning may I make my position clear. For some forty years I have consistently and without change opposed the method of catching fish by what is known as either a beam or an otter trawl. I have never changed that view, and my reason for opposing such methods has been that because of the operation of these trawlers a great deal of fishing gear belonging to ordinary deep sea fishermen has been destroyed, and in my view the feeding grounds of the fish have been harmed because the beam trawl runs along the bottom of the ocean. Then, in the operation of the trawls large quantities of small fish are either caught and brought to land to be used in the fertilizer plants or are thrown overboard after having been picked out from among the larger fish on board the trawler. Most of those fish are dead when they are thrown into the sea. Then of course there is the interference with the market of the offshore and inshore fishermen.
However, as I said a moment ago, I believe that at this time we have not as much cause for worry as we had a number of years ago. In his motion the hon. member asks the government not to renew licences to those who own and operate beam trawlers. I do not wish to criticize the manner in which he has put his motion, but I would remind him that there is no such thing as a beam trawler now being licensed by the federal government. I agree with him that when speaking about these vessels he no doubt had in mind the fact that the ordinary term used is the term "beam trawlers"; but they are not beam trawlers, they are what are known as "otter trawlers".
In order to clear the situation perhaps I may be permitted to give the history of this particular way of catching fish. I do so because there has been a good deal of talk among people generally and a great amount of worry among the fishermen regarding this method of catching fish.
As far back as 1839 the first vessels were equipped with what are known as beam trawls. These vessels operated in the North sea and adjacent to England and France. An arrangement was arrived at between the French and English governments whereby these vessels could fish only under certain regulations. At that time only sailing vessels were used to carry on this particular type of fishing. The beam trawl consisted of a large net at the mouth of which was a beam about forty feet long. As I said a moment ago, in those days only sailing vessels were used, and had not the beam been used it would have been im-

possible to keep the mouth of the net open to catch the fish.
Later, I believe in the year 1880, the fishermen of England and Scotland decided to improve the method of fishing, and as a result a man named Otter devised what is known as the otter trawl. That is the trawl now used by the steam vessels or trawlers running out of Nova Scotia and licensed by this government. The otter trawl still has the bag to catch the fish, but instead of having the beam or long piece of wood to keep the mouth of the trawl open it has two boards, and as the steamer steams ahead these boards keep the mouth of the trawl open so that the fish may come in. Although the hon. member mentions beam trawlers in his resolution I am sure he means the method of trawling adopted by certain vessels now licensed by the federal government.


Mr MACDOUGALL:: It is a synonymous term.


William Duff: Fishing by this method has
been developed to a great extent not only in Great Britain but in a number of foreign countries. The ships which fished in the first instance in the North sea have not confined their operations to those particular waters. After a few yearn fishing became so intensive that they were compelled to go further afield in order to get catches. These vessels now under the British flag, the Portuguese flag and the flags of other countries not only go as far as Iceland, but also come over on the grand banks of Newfoundland and other banks where our Nova Scotia sailing vessels operate during the spring and summer season. To show you, sir, the extent of the fisheries in those foreign countries, may I say to you that at present there are 1,229 large steam and motor trawlers operating out of England or under English registry; 347 from Scottish ports; 154 from Irish ports, 236 from Holland!; 17 from Portugal; about 250 from France; 50 from Belgium; 1 from Denmark; 335 from Germany; and 184 from Sweden, making a total of 2,976 steam and motor trawlers. So you will see, Mr. Speaker, that in those countries this method of fishing is carried on to a very appreciable extent.
Now on this side of the water this method of catching fish by beam or otter trawl only started in 1905. During the years from 1905 down to the present, certain vessels have been operating, and they were first chartered by three or four companies in the province of Nova Scotia, being vessels owned in the old

Beam Trawlers
country which were operated here in the early spring and then returned to their English owners some time in the fall.


Richard Bedford Bennett: May I ask the hon. gentleman a question, for information? Do any of these foreign trawlers come to our shores?


William Duff: In reply to the Prime Minister I may say that they only come to our shores for supplies. I think my hon friend from Cape Breton South (Mr. MacDonald) and my hon. friend from Cape Breton North-Victoria (Mr. Johnstone) will agree with me when I say that when these vessels come to Sydney or North Sydney for coal supplies or salt they leave a good deal of money in these places, but of course, as the Prime Minister knows, these vessels can only fish in international waters, and the only effect which these trawlers have on the Canadian fishing industry is that they destroy the gear of the ordinary fishing vessel anchored on>
the banks, because these trawlers operate by night as well as by day and cannot see where our vessels have their trawls moored; and they also help to destroy the feeding grounds where the fish come to the banks and where our fishermen go to secure their catch.
As I said a moment ago, in 1905 both Canada and the United States decided to adopt to a certain extent this particular method of fishing, and only last year there were 115 of these trawlers operating out of Portland and 49 out of Boston.
Our position to-day, I might say to my hon. friend from Inverness, is rather an enviable one. I want to say again that I have always opposed this method of fishing, and if I had my way there would be no trawlers operating from the province of Nova Sootia; but still, as my hon. friend from Inverness admitted in the last of his remarks, if something were done to prevent these trawlere from getting a licence, their owners should be compensated for the money they have invested in the industry. I agree with him as far as that goes.
For several years, as I have said, trawlers were brought from the old country and operated by Canadian firms. Several delegations came to Ottawa to interview previous governments in the matter. A delegation came to the Conservative government, I think in 1920, came from the county in which I live; and about three years ago another delegation came here protesting against the use of this method of catching fish. But if we look at the statistics, Mr. Speaker, we find that although there were some twelve trawlers in operation in 1908 and up to about 1930, there are now
only two operating. Four licences were granted last year, but only two of these trawlers are operating.


Mr. SHORT:: Three licences were granted last year.


William Duff: Three licences were granted last year, but only two trawlers are operating. The reason for that in my opinion is that the people of Nova Scotia have endeavoured in the last two years to look after this danger in their own way. I remember discussing this matter with a good many people. My hon. friend from Inverness said that he was not interested in the political aspects of the thing, nor did he have any money invested in the industry. I am interested and am looking after both aspects, because to a small degree I have a financial interest in the industry in the province of Nova Scotia. In discussing this method of catching fish by beam trawler with the people with whom I am interested,
I used the argument that was adduced by the hon. member for Inverness. I said that the people in these various countries had invested their money in foreign trawlers from Great Britain, Portugal and other places that came to the banks adjacent to Nova Scotia to catch fish, and I said that as long as people from these other countries could use their trawlers there for catching fish there was not much use in trying by restrictive methods of this parliament to refuse licences to two or three trawlers owned or operated by Canadians as far as deep sea fishing is concerned. I suggested another method of control, and I think that method has borne fruit; I believe my hon. friend from Digby-Annapolis will agree with me in that. He knows that previous to the year 1929, the deep sea fishing fleet of Nova Scotia wa3 operated by sail only. The vessels left home in the middle of March and fished, most of them, until about the first of October. They did try to fish during the winter months when there is a big market for fresh haddock and fresh cod, but travelling by sail alone, when they gave up the salt fishing about the first of October, they found that the winter fishing for fresh fish did not work out very well because in stormy weather, if they did not get back to port a short time after catching their fish, the fish would not arrive in very good condition. But due to the cooperative methods that were adopted, and adopted voluntarily by a certain class of people in the province of Nova Scotia, and particularly in the county in which I live, these people decided that if they were to carry on the fresh fish business and compete
Beam Trawlers

with the trawlers they would have to put diesel engines in their vessels so that they could go out on the banks and get back to port with their catch as quickly as possible. The result has been that in the province of Nova Scotia we have built up a splendid fleet of fishing vessels of a particular type manned by the hardy fishermen of Nova Scotia, than whom there are none better in the world for deep sea or off-shore fishing.
I hold in my hand an article from the Canadian Fisherman, which gives a picture of one of the latest models of sailing and diesel powered fishing vessels. This vessel was built in my own town last year, and equipped with a 300 horsepower engine. To indicate to you, Mr. Speaker, the cooperative methods that we follow in Nova Scotia you will perhaps not think me egotistical or boastful when I say that I own one sixty-fourth of this vessel in which I have a five hundred dollar interest. That is the way we carry on our operations in the part of the province from which I come. To-day there are some twenty-three vessels equipped with diesel engines and they can take their place practically with these otter trawlers, which fish in a different way. As you no doubt know, Mr. Speaker, these sail and diesel engine trawlers do not operate the beam trawl but the line trawl. It is true, and I agree with my hon. friend from Digby-Annapolis (Mr. Short), that under certain weather conditions the fishermen on the sail and diesel engine trawlers cannot fish in the same way as the otter trawler can. But knowing the fishermen of Nova Scotia as he does, knowing the men on these vessels that sell goods to his own firm, he will agree I think that it is but seldom that the fishermen on these vessels cannot go and catch cod just as the fishermen on the otter trawlers can.
In view of that fact I do not think the danger is so serious as we are sometimes led to believe. In my opinion, the people who own the two or three otter trawlers will not buy new ones if anything should happen to those they now own, because at the moment these twenty-three diesel boats can bring in all the fish and more than all the fish which the Canadian people are consuming or will consume for a number of years.
We did make an attempt in this parliament to regulate this method of fishing. The hon. member for Digby-Annapolis, the then hon. member for Cape Breton South, Mr. MacDonald, a gentleman who is now in the other chamber, and I, were a subcommittee of the marine and fisheries committee in 1929 to deal with this very matter. There
(Mr. Duff.]
was an agitation at that time to have beam trawling discontinued and we met and submitted certain recommendations. These recommendations were embodied in a bill now known as chapter 42, an act to amend the Fisheries Act, which was passed on June 14, 1929. As a believer in freedom, I could not see my way at that time to recommend to the Minister of Marine that we should lay down the principle that these vessels should not operate at all, but we did make certain recommendations. What are they? Subsection 4 of section 69 reads:
(4)	The minister may determine the number of such vessels that shall be eligible to be licensed.
(5)	Regulations may be made under the provisions of section forty-six of this act,-
(a)	prescribing the form of licence;
(b)	specifying the evidence to be submitted with an application for a licence;
(e) fixing the conditions under which a licence shall be issued;
(d) making any other provisions respecting licences.
In these suggestions, which were afterwards put into law, I think we went a great way, because I felt, as I think my colleagues on that subcommittee felt, that if the Department of Fisheries were of the opinion that more fish were being caught by these otter trawlers than should be caught, and that if their operations were a detriment either to the deep sea fishermen or to the inshore fishermen operating in smaller boats than those I have mentioned, and that these people would be materially affected to their disadvantage, the department would have power either the next year or at any time to restrict or prohibit the granting of licences. In other words, under this act they could grant one licence or several licences or none at all, and the fact remains that since that time in 1929 the department has granted very few licences to otter trawlers.
I say therefore that although I am strongly opposed to the method of fishing in this way I do believe that the people of Nova Scotia, perhaps with some help from this parliament in the way of bounties on fish, or in the way of loans to shipbuilders or owners of vessels or those wanting to build ships, as I suggested in my speech on Monday, could build up a sufficient fleet, either a deep sea fleet or shore fleet to operate off the coast of Inverness or off Cape Breton or Guysborough or Halifax or Lunenburg or as far west as Yarmouth, and that in a very short time the owners of these beam trawlers would realize that the cod fish caught by these vessels operated by sail and diesel power are much superior to

Beam Trawlers
those caught by the otter trawler with the net dragging along the bottom of the ocean for three or four hours. The fish caught in that way are not equal to those caught by the other method.
I am opposed to the otter trawler method of fishing, but I do not think we have anything to worry about. One reason why the people who operate these boats wish to have them continued is the consideration of continuity of supply. There is something in that argument-not a great deal but something, or there was a few years ago. With the type of vessels which Nova Scotians are building today, the high powered vessel of .three hundred horsepower, equipped with diesel engines that can operate in almost any weather; with the cold storage plant which my hon. friend's company has at Halifax; with the plant taken over by this government a short time ago; with the splendid cold storage plant in Lunenburg and the cold storage plants at Liverpool, Shelburne and Yarmouth, there is no danger so far as continuity of supply is concerned. Indeed, the trouble is that we can catch more fish than the market will absorb, so far as fresh fish is concerned, and I do not think we need fear very much the one or two otter trawlers now licensed. I know from my own experience that these vessels have never paid. The sailing vessels and the diesel operated boats, except on rare occasions, have paid a fair dividend, and they are more economically operated than the otter trawlers. Personally I do not see much danger. However, I will say this to my hon. friend. If he would like to have the matter discussed, if he or any other member of the fisheries committee thinks that there is danger to the fishermen of Nova Scotia, I do not think I need assure him that my interests have been and are both financially and politically with the boat fishermen of that province, whether they are the deep sea or inshore fishermen, and I desire that they get the greater consideration.


Mr. THOMAS CANTLEY (Pictou):: I
presume that most hon. members will think me ill-advised if I attempt to controvert the arguments brought forward by hon. gentlemen who have spoken on this subject. Be that as it may, and though my county is not a fishing county, except in regard to two branches of the industry, lobster fishing and winter smelt fishing, it appears to me that we might as well go back to the days of the spinning wheel and destroy all the power looms and resort to the old method of pioneer days as to refuse to make progress by modern methods of fishing. The world does move and we have to move with it.
The hon. member for Antigonish-Guys-borough (Mr. Duff) referred to the effect of the trawlers in British waters. May I remind him that a British commission investigated that whole question some years ago. My reading is not that their fishing grounds were depleted but that they were improved by the action of the trawlers. The statement that they were depleted by the trawlers is not correct. My hon. friend who represents Anti-gonish-Guysborough shakes his head, but that is the fact. It had been found that the trawler stirs up the bottom of the ocean and that due to this an additional quantity of fish food is made available.
Another fact of some importance is this: there have been operating for years on the coast of Nova Scotia forty, fifty or sixty French trawlers. What is the use of talking about curtailing or stopping our own trawlers when we are powerless to deal with foreign trawlers operating within three miles of our coast? Those foreign trawlers are protected by a French government gunboat which comes out in the beginning of the season and remains with them until they return home in the latter part of September.


William Duff: And a hospital ship.


Thomas Cantley: Yes, quite so. These foreign trawlers have three seasons: one in the bay of Biscay; one on the east maritime coast of Canada, and one in the north sea off the coast of Norway. They are thus occupied practically the entire year.
There is still another fact of some importance, that of our coal used in bunkering. These French trawlers take practically forty thousand tons of Nova Scotia coal each season. I remember one boat coming in to the Scotia coal docks at North Sydney on a Wednesday to replenish its bunkers. I said to the captain: "Are you nearly full?" He replied, "Yes; I will be back on Saturday with my cargo completed and I will fill up my bunkers to take me home." On Saturday morning he came back completely filled up with fish, and after filling up his bunkers he went home. In view of these facts, what is the use of attempting to control the most efficient method we have to-day of fishing? In my judgment what we want to do is this. The difficulty of my hon. friend who moved the resolution is that his people are poor fishermen. I do not want to say this in a deprecating way, but the fact is that their boats are not efficient or well com structed. In my judgment perhaps the best thing the government could do for the fishing industry in Nova Scotia would be to subsidize or otherwise aid in the building of a fleet of
Beam Trawlers

forty or fifty so-called baby trawlers of about sixty or seventy tons, equipped with diesel engines, and give them to the fishermen of Nova Scotia on delayed terms of payment. I commend that to the consideration of the hon. member for Antigonish-Guysborough, the hon. member for Inverness, and the government as well.
I shall, I know, be followed by the hon. member for Digby-Annapolis (Mr. Short) whom we all regard as an authority on the fresh fish business of this country, which I am not. As I stated at the outset I cannot see the advantage of opposing improved conditions whether they be in the fishing industry, the iron and steel industry or in any other in this country, and I believe the best thing this government can do for the fishing industry in my province is to proceed along the lines I have indicated and help them to get efficient fishing boats, well equipped for carrying on their business in the most effective way.


Harry Bernard Short: This trawler question is one that has been before the house a number of times When it was last discussed on July 15, 1931, I thought it would be practically settled for some time because the government at that time announced their policy in connection with it. The present Minister of Finance (Mr. Rhodes), who was then Minister of Fisheries, made this statement as reported in Hansard of July 15, 1931, page 3790:
I am satisfied, and I wish to state very clearly that I accept it as beyond reasonable doubt at least, that if we are to enlarge our production of fish in Canada to cover this market, and to supply large quantities to the United States, we must have the trawler as an adjunct to our industry in order to take up the slack of which I have spoken.
That was the policy of the government in July, 1931, and I do not think it has changed since. As the hon. member for Antigonish-Guysborough (Mr. Duff) stated, a recommendation was made by the fisheries committee to the last parliament in June, 1929, that the matter of licensing these trawlers be left to the discretion of the Minister of Fisheries. At that time they decided that six trawlers were necessary to give us a sufficient supply of fish for our Canadian market. Since then the number has been reduced. Two years ago four licences were issued; last year there were only three and part of the time only two of those three trawlers were fishing. It is ridiculous to think this country is going to prohibit the use of trawlers when the country to the south of us have 115 large and 137 medium ones and their medium ones

are about the class of the three that are fishing in this country. They fish practically the same grounds as we do and we are not allowed to fish with three, as the hon. member for Antigonish-Guysborough stated. As to the number of trawlers that other countries are using, I have the same figures as my hon. friend has given so I will not repeat them. But during the summer months and late into the fall we have on our grounds some forty to fifty French trawlers three times the size of the ones that we use' and they are allowed to fish on the same ground that we do. We cannot prevent them because the ground is international Moreover, they can come in and fish within three miles of the shore while there is a restriction on Canadian trawlers that they cannot fish within twelve miles of the shore.
I presume the only reason why this matter is being brought up again is that it is suggested that the trawling companies have a monopoly of the fishing industry of this country. The hon. member for Inverness (Mr. Macdougall) made that statement to-day. The trawling companies have no monopoly whatever of our fishing industry; there are many other large concerns besides them. The Maritime National Fish Company is the only company operating trawlers in Nova Scotia but there are many other large concerns operating there as well. The total catch of fish during the season 1933-34 was 212,000,000 pounds and the Maritime National Fish Company handled 32,000,000 pounds. Is that a monopoly? My hon. friend speaks about this interfering with their fishing in Cape Breton. It does not do so in any way, shape or form. The island of Cape Breton could not in the winter time supply the markets of this country if they had them all to themselves. They have not the fish there at this season. They are now bringing in fresh cod from Newfoundland; these are coming into the island of Cape Breton right along. Only last week 55,000 pounds of fresh cod were brought in to North Sydney, Cape Breton, processed and shipped from there to other parts of Canada. That interferes with the markets much more than the trawler The company that operates trawlers never would have gone into the trawler business if they could have secured sufficient supplies from the boats and sailing vessels, because catching fish by trawler is a more expensive operation than catching them by vessel or hand line boat. That was proven in 1931 I think it was, when a conference was held by the department with the vessel owners and boat fishermen and those interested in the trawlers; it wras shown that trawler-caught

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fish cost considerably more. We had no market for our fresh fish in this country prior to 1910 when the first trawler was operated in the fresh fish business. The hon. member for Antigonish-Guysborough speaks of trawlers coming in in 1905, but they were brought here by a salt fish concern, Robin, Jones and Whitman of Halifax and Gaspe; I think they were the first who brought an English trawler out. I do not know just the date, but a company in which I was interested afterwards bought that trawler in 1910. We bought it because we found we could not get from the boat fishermen a continuous supply of fish for the markets of the west. Prior to 1910 our fish markets in Montreal, Toronto, and the large centres in Canada were supplied from Boston, Gloucester and other United States fishing centres; not a carload of fresh fish came from the maritime provinces, because we could not supply the markets with fish on the days they required it. In the old days Friday was the only day in the week on which people ate fresh fish, and if you could not get your fish there for the Friday market it was a loss. They tried to get the producers in the mari-times to supply them, but sometimes they missed getting them there for the Friday and the dealers said, "We cannot depend upon you"; the result was they got their supplies from the United States.
Furthermore, that company is the largest purchaser of fish from the boat fishermen. The trawlers do not begin to catch all the fish they sell. I have figures here that were supplied to me the other day, showing the purchases of fish by this octopus of which the hon. gentleman speaks, this great American concern that monopolizes the fishing industry of Nova Scotia. During the year from April 1, 1933, to March 31, 1934, they purchased from the trawlers 18,617,000 pounds and they bought from the hook and line fishermen 14,365,000 pounds. That is, they purchased outside nearly as much fish as they caught themselves. For the nine months ended December 1, 1934, they purchased from the trawlers 11,984,000 pounds and purchased from the hook and line fishermen 14,242,000 pounds; that is they purchased from outside fishermen nearly 3,000,000 pounds more than they caught themselves. Therefore I say they are the biggest help that the boat and vessel fishermen have. In addition to their three trawlers they have had under charter this winter ten of the large Lunenburg schooners, so they have given employment not only to their own men but to outsiders. In their plant in Halifax they employ 150 to 200 men processing these fish. Most of these men are married and have 92582-35
families, so that a great deal of money is disbursed in labour.
Then as to their purchases. I have figures showing what this octopus has done for the province of Nova Scotia during the past five years. Their expenditures for the five year period from 1928-29 to 1932-33 were as follows:
Fish purchases	$4,386,754
Packing materials	 1,093,884
Freight and express paid	 866,883
Refrigeration and storage	 364'213
Payrolls including salaries	 1,831,079
General expenses, including taxes. 475,710

In addition to the amount here shown as freight and express paid, probably three times that amount is paid to the railroads for goods sold f.o.b. I wonder if these figures are of interest to the fishermen of Nova Scotia. I wonder if that expenditure is any benefit to the country. There is not another industry I know of in which the money is so well distributed as in the fishing industry.
I am not actively in the fish business now and have not been for the past three years, but I still have the interests of the industry at heart, and I think I have done as much for the fishing industry and the boat fishermen of Nova Scotia as anyone in the industry. One section of the county which I represent is interested largely in fishing, and I feel that I have as many friends in that section of my constituency as in any other. I am certainly considered not as an enemy of the fishermen in any way, but as one of their best friends. If we are to continue to hold our Canadian market, I feel that it is absolutely necessary to have a certain number of trawlers, in order to ensure continuity of supply. This matter has been dealt with pretty fully before the price spreads and mass buying committee; as the hon. member for Inverness (Mr. Macdougall) said, they have not yet made their report, and I think this is an inopportune time to discuss the matter here. It should have been left until the commission's report is received and we see what conclusions they come to concerning it.
Before I close I should like to put on record the attitude of the government in connection with the trawler situation in 1931. On July 15 of that year the then Minister of Fisheries (Mr. Rhodes) made this statement in regard to compensation as reported at page 3791 of Hansard:
If we pass a regulation to provide that all trawlers shall be built in Canada, and those now here be disposed of, the government will

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have to compensate. A fairer method would be to license the trawlers we now have, deciding that hereafter any trawler to be licensed must be built and owned in Canada.
I may say to my hon. friend that, with that reservation, I am prepared to recommend to my colleagues in the government that as a matter of policy this be adopted with regard to the trawler question.
If their trawlers are to be put out of business there is no question but that the company will be entitled to compensation, and if this government is prepared to compensate I feel sure that the company operating these trawlers would be only too glad to hand them over to the government and take their chance of getting their supplies of fish from other sources. They went into this business when conditions were different from the conditions of to-day. At that time we had not the heavy motors in the fishing vessels that we have to-day. Then in the winter season we * could not get our supplies except by steam trawlers, and that was why this company went into the trawler business. We now have sailing vessels with heavy motors, and under ordinary conditions we could get a fairly good supply of fish. So if the government are prepared to compensate the company for the trawlers they now have I believe they would be glad to go out of the trawler business, because it would be cheaper to get their supplies from the other vessels. But while they have this investment in these trawlers which they brought out from the old country in good faith, and for which they were given Canadian registry, I see no reason in the world why the trawlers should not be operated.
I understand that my hon. friend wants this matter referred to the committee; I presume it will come up for discussion later on, so I do not propose to say anything further at present.


Hon. J. L. RALSTON (Shelburne-Yar-mouth):: Mr. Speaker, I shall take up the
time of the house for only a few moments in connection with this resolution. My own views with regard to the matter are on record in Hansard for 1932. I appreciate, as all hon. members do, the amount of controversy which has been waged in connection with this vexed question, and I know that regardless of the arguments which may be made in favour of the trawlers by the trawler companies there is a deep rooted conviction in the minds of the fishermen that the trawlers are damaging their business and their livelihood. There may be a difference of opinion as to whether that belief is well founded. The commission, to which the hon. member for Inverness (Mr. Macdougall) has referred,

recommended by four to one that the trawlers should be abolished. The fifth member, the chairman, recommended in effect that trawlers should be maintained only so long as they were necessary reasonably to supply the market. Mr. Justice Maclean, in the report of the royal commission investigating the fisheries of the maritime provinces, at page 115 said:
The number of trawlers in use should not exceed that number which will produce from time to time, the market requirements in excess of boat and vessel production.
That seems to be the question most discussed to-day and the real question of fact at issue. The fishermen say the trawlers glut the market, or in other words that they put too many fish on the market and thereby reduce the price. The trawler people say that the trawlers are absolutely necessary to maintain a continuity of supply, to preserve the market and the demand for fish. I suppose that -question of fact will exist as long as these two methods of fishing prevail. Two years ago I submitted to this house that, on the information I had before me, it would seem that the condition laid down by the minister, which was read by the hon. member for Digby-Annapolis (Mr. Short), namely that the trawlers would be licensed only so long as they were required to take up the slack, had been complied with, and that the time had come when the shore fishennen could supply the market.
My suggestion at that time was not accepted. I put on record then certain evidence which I had with regard to the conditions of the fishermen, and I suggested that the best thing this government could do in the interests of the fishermen, as I understood their position, was either to refuse licences to trawlers entirely or to reduce the number of licences to the point where boat fishermen would have the first chance to supply the market. Nothing was done at that time, but in another year, as the hon. member for Digby-Annapolis said, one trawler less was licensed, and in a subsequent year still another licence was dropped so that now there are only three licensed trawlers with only two in operation.
Now we come to the situation to-day, and I should like to put on record the history of trawler regulation, which is very short. In 1928, I think, four members of the Maclean commission reported in favour of the abolition of trawlers, with the chairman making a qualified recommendation to the effect that trawlers should be maintained only as long as they were necessary in order to supply the market. Following that, in the fall of

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1929, the then Minister of Fisheries (Mr. Cardin) made a tour of the province of Nova Scotia, particularly; he visited every fishing community and heard the representations of the fishermen and the fishing companies with regard to trawlers and other phases of that industry. After mature consideration a regulation was passed by order in council, by which it was provided that a tax of one cent per pound would be imposed on fish landed from foreign built trawlers, and a tax of three-quarters of a cent per pound on fish landed from Canadian built trawlers, with the further proviso that no licences would be issued to foreign built trawlers after April 1, 1932. That was regarded by the trawler companies as a very drastic step; I know my hon. friend from Digby-Annapolis felt it very keenly, as did the company with w'hich he was connected.


William Duff: It was provided in the 1929 regulation that no vessels other than those of Canadian registry should operate.


James Layton Ralston: I did not give a date, but my hon. friend is right; the order in council was passed late in 1929, after the visit of the then Minister of Fisheries to the province of Nova Scotia.
As I say, Mr. Speaker, there was a good deal of feeling about that regulation. The trawler companies thought it was exceedingly severe. They claimed, as the hon. member for Digby-Annapolis has said, that the trawlers were already operating at an expense greater than that to which boat fishermen were put in the matter of the cost of production, and this regulation imposed a further expense by way of a licence fee of one cent per pound, which they said practically put them out of business so far as operating trawlers was concerned. The reply was that they could use Canadian built trawlers and thus save at least a quarter of a cent a pound. Instead of going out of business, however, as they threatened, they preferred to resort to the courts, and the order in council was set aside by the Exchequer Court of Canada on the ground that it exceeded the provisions of the statute on which it was founded.
No action was taken by the present government to reinstate that order in council; the act was not amended in order to validate it. Instead the policy to which my hon. friend from Digby-Annapolis has referred this afternoon was laid down by the succeeding Minister of Fisheries (Mr. Rhodes). That policy was this: We are not going to impose a licence fee on trawlers by way of a poundage charge. We are going to impose a flat licence fee of S500 a boat. That is one thing. Then we are going to licence as many trawlers as 92582-35i
we think fit; but we lay down the principle that the number of trawlers to be licensed is the number necessary to make up for any deficiency in the supply of fish by the shore fishermen. We are also going to see that the trawlers shall be marked in such a way as to make it more certain that they can be recognized and identified in case damage is done to the gear of the fishermen. The other provision to which the hon. member referred was probably set out by the minister in his speech; I do not remember that it was included in the order in council, but it was to the effect that no new licences would be granted except to Canadian built trawlers.
That is the regulation which has been in effect, to which my hon. friend from Inverness is directing his remarks this afternoon. I say that the question to-day is which way that condition of fact, raised in Mr. Justice Maclean's report and mentioned in the present order in council, is to be decided. If the shore fishermen are gettiilg sufficient quantities of fish to supply the market, then there is no need for trawlers. If the shore fishermen are hurt in their business and their prices reduced on account of a glut on the market produced by trawlers, then no licences should be granted. If on the other hand to maintain the fishing industry and to maintain the market it is necessary to have trawlers to supplement the supply of shore caught fish, then there is ground for maintaining a certain number of trawlers.
Instead of putting this matter to the house this afternoon my hon. friend has very wisely, I think, proposed referring it to a committee for the purpose of having the point considered. But let me say now that if I had been asked to vote on the question this afternoon I would have voted for his resolution on the assumption that the shore fisherman can handle the situation.
Let me point out to the house however that this matter has been referred to the Maclean commission, it has been referred to the Jones commission, it has been discussed from time to .time by the government, as the government has been dealing with licences; it is now before the price spreads commission and the hon. member now proposes to refer it again to the fisheries committee. I would say that at that rate we are not making much progress in connection with this matter of trawlers. However if my hon. friend wishes it I am quite willing to support the motion sending the matter to a committee for purposes of consideration of all the facts. That will give no immediate relief. But I should
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like to urge something which can and will be of immediate benefit and which is a matter of immediate urgency.
These men who are fishing in opposition to the trawlers and who claim to 'be affected by them are fishermen of the province of Nova Scotia. At certain seasons of the year they engage in catching cod, pollock, haddock, hake, etc., and in the other seasons they are lobster fishing. I have made representations to the Minister of Fisheries and I have no doubt other hon. members have made similar representations with regard to the great losses which have been recently suffered by those men through loss of lobster fishing gear due to the extraordinary storms which have lately prevailed upon the Nova Scotia coast. I wish to take this opportunity to urge upon the Minister of Fisheries that which I have already urged upon him by way of letters, and to urge upon this house the immediate consideration of the claims of those men for loss of boats, traps and equipment due to the storms which prevailed upon the Atlantic coast only a short time ago.
I have before me newspaper clippings showing that in many cases from 50 per cent to 80 per cent of lobstermen's gear has been lost. As I said these lobstermen are the same men we are dealing with in the present resolution; they catch ground fish through tthe summer and lobsters in the winter and spring. Fifty per cent to 80 per cent of their rgear has been lost. Those men put their gear in the water in December, and then a storm comes along and destroys it. They have prospects of going out fishing again as soon as the rough winter weather subsides, probably about the middle of March. A great many of them will find themselves not only without gear but without credit, and I submit no more helpful action could be taken on behalf of the fishing industry. This is the way to prevent unemployment: it solves the relief problem. These men want to be self dependent they do not want relief if they can get some sort of grant to help them fit out and pay their own way.
I could mention that long ago, in 1882 I think it was, a grant was made to fishermen of the province of Nova Scotia for the purpose of assisting them in the restoration of their gear which had been lost by reason of an unprecedented storm. I have under my hand a letter referring to the loss of two .boats at the Hawk, Cape Sable island, not only the gear but the boats themselves. At Wedgeport besides loss of quantities of gear eight boats went to the bottom, and worse than that, four men were lost from that one

little town. That was a storm which will be long remembered by the fishermen in that part of the country.
I want to urge upon the minister as strongly as possible not the protracted but the immediate consideration of the claims of all these men, because he gives twice who gives quickly. In this same connection I received a telegram this morning, and I believe the minister received one similar to it. It came from the secretary of the Yarmouth board of trade. That body has considered the matter serious enough to bring it to the attention of the authorities. It is addressed to myself and is as follows:
Following is copy of telegram to Premier Macdonald and Minister of Fisheries. Please use influence carry recommendation into effect. Representatives five fishery communities on behalf two hundred fishermen in dire need direct relief to-night petitioned Yarmouth board of trade for financial assistance. Extreme stormy weather destroyed lobster equipment and fishermen unable provide replacement. To prosecute industry necessity for fishermen to obtain financial assistance. On behalf these two hundred fishermen and some three hundred others whose petitions coming in daily urgently request governmental assistance as whole communities dependent on welfare of industry. Yarmouth board of trade unanimously passed resolution to-night favouring direct relief for fishermen by proper governmental authority. Kindly place matter before department to end that investigation may be made and relief available and fishermen thus assured of credit to further prosecute lobster industry earliest possible moment.
I do not think one could add much to that businesslike telegram except to say that those of us who represent fishing communities know well the hardships which are experienced in connection with it. I believe every hon. member representing a fishing district will have some knowledge of incidents such as this, where a fisherman goes out into the Atlantic eighteen miles from Cape Sable island to Seal island, locates there with his family and puts out in his little boat day after day in the wintry winds and storms which blow around that bleak and isolated spot in December and January weather. Those men have lost practically all of that which they call capital. To operate in the cod and lobster industry they have to have from S600 to $900 a year in cash in order to prosecute their calling, and they are asking this country for assistance to stake them to a new outfit to replace what the unprecedented storm has taken. Mr. Speaker, in view of the fact that assistance is given to others engaged in primary industries, the very insignificant

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amount which would be needed for the purposes I have mentioned ought to be readily granted.


Hon. GROTE STIRLING (Acting Minister of Fisheries):: Mr. Speaker, in some ways I
regret that the hon. member for Inverness should have brought this matter to the attention of the house at the present time. This has been a most contentious question, but as has been pointed out by some hon. members who have taken part in the debate there are indications that those who were extremely opposed to each other are showing some signs of nearing an agreement.
When one remembers that 50 or 60 years ago steam was first applied to the fishing industry and steam trawlers first came into existence in Europe, and that at that time this same sort of controversy raged for many years it makes one wonder whether or not this may be a problem similar to that which existed when the internal combustion engine was applied to vehicular traffic. It was not until 1910 that the first steam trawler appeared in Canada. By 1912 there were two, and in the next year there were five. Had it not been for the intervention of the war undoubtedly there would have been a greater number of trawlers operating on the Atlantic coast. In 1926, however, the number had increased to eleven. Then in the post-war depression the agitation against the trawler method of catching fish became extremely violent, and it was necessary for the government to give close attention to the question. It was brought to its attention with such force in 1927 that a commission was appointed to take into consideration the matter under dispute. As the hon. member for Shelburne-Yarmouth (Mr. Ralston) pointed out, the majority were in favour of the abolition of steam trawling, and the chairman held the view that it should be permitted under certain circumstances. That report was submitted to the select standing committee on fisheries, and as a result of the consideration given to it the Fisheries Act was amended in 1929, and certain regulations were passed under those amendments which were subsequently put into operation. Those regulations contained the proviso that the trawlers should pay a fee of one cent a pound but when in the subsequent season, with five of them operating, four refused to pay that licence fee, the case came before the court and the court ruled that the regulations were ultra vires, and the regulations had again to be amended. They were so amended in 1931, and instead of the licence fee being collected
on the poundage of fish taken, a licence fee of $500 was imposed on the trawler. In the order in council authorizing that regulation appeal's the following clause:
That the applicant for such licence shall furnish the Minister of Fisheries with evidence that will satisfy the said minister that he cannot obtain an adequate supply of suitable fish to enable him properly to conduct and develop his business from the hook and line fishermen, and that if the licence is granted, the extent of his purchase of fresh fish from the said fishermen will not be adversely affected.
Following that, four licences were granted. One of the companies, however, which had. a licence went out of existence, and consequently only three were operating. Again market conditions had not improved and the question had to be reconsidered. A very strong agitation came from boards of trade and associations as referred to by the hon. member for Inverness (Mr. Macdougall), and their representations were opposed as strongly by the board of trade of Halifax and the mayor of Halifax who desired this small number of licences to be retained. The matter was again reviewed, and I should like to draw the attention of the house to some of the points which it was necessary to consider.
The trawlers were procured when there was no law restricting their number or regulating their use. Hence, refusal of licences would be largely tantamount to their confiscation.
It is generally conceded that it costs more to land fish with trawlers than by hook and line. Hence their need is to maintain a continuous supply and also because they catch much larger quantities of haddock proportionately than do the hook and line fishermen, which fish are mainly desired on the-fresh fish markets, and particularly in the United States markets.
Because the fish cost more, it is not the trawler-caught fish that fix the price on the markets, but rather the hook and line caught fish.
If the trawler licences were refused there is no assurance that the place that their catches now take on the markets would be filled by the inshore fishermen. Apart from sales to the United States, whenever it would be more convenient for the Montreal and Toronto wholesalers to obtain their supplies from the nearby United States ports, there would be nothing to prevent their doing so. The much smaller transportation charge from these nearby ports would in a measure offset the import duties.
The schooner has become more competent in recent years owing to the installation of the diesel engine, and the plain fact seems to be
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that it is doubtful, if conditions keep on as they are, whether trawlers can very long stand their competition.
The trawler operators are amongst the largest purchasers of fish from the hook and line fishermen, and they maintain that this is possible only because of having the trawlers and keeping a continuous supply on the market.
The main landings by the trawlers are during the late winter months when the hook and line fishing is reduced to a minimum. If it were not for the necessity of holding trained crews together, trawlers would probably be laid up during the summer months.
Then to emphasize what I said at the beginning with regard to the introduction of steam in the fishing industry, I would draw the attention of the house to the fact that no other country is restricting trawler operations. Out of European ports about 5,000 trawlers are operating, while out of United States ports usually there are about 300. These latter trawlers as well as a large number from France and sometimes from other European ports fish on the banks adjacent to our coasts, so that even if our trawlers were withdrawn it would decrease the amount of trawling on these banks by a very small proportion only, and so far at least as the United States markets are concerned it would make competition therein more difficult.
After the consideration given to the whole matter it was decided to limit the number of licences to the Maritime-National Fish Company to three, and that the licence to the Leonard Fisheries would be renewed, but as the latter company ceased to operate there have been only three trawler licences issued, and they are still in operation.
Owing to the fact that this question, contentious as it is, has been before the price spreads commission and in that sense is sub-judice, the government at present awaiting the report of that committee, it seems to me not undesirable that this resolution should pass to the select standing committee on fisheries where it could be held pending the receipt of the report of the price spreads commission and for such longer time as is necessary for the government to consider the report so brought in.


Mr. L. W. JOHNSTONE (Cape Breton North-Victoria):: Mr. Speaker, in regard to
the motion introduced by the hon. member for Inverness (Mr. Macdougall) I have very little to say. It does not affect my riding to any very great degree. We have a number of fishermen in my constituency and yet I have never had a complaint from any one of

them with regard to the trawlers, which do not interfere with them to any great degree so far as I have been able to judge. The trawlers come into our ports and get their supplies and coal in the port of North Sydney.
I agree with the hon. member for Shel-burne-Yarmouth (Mr. Ralston) that something should be done to relieve the conditions now existing among the fishermen. I was sorry I was not able to take part yesterday in the discussion that was held recently in regard to the establishment of refrigerator plants and bait warehouses for looking after the curing of fish and the supplying of bait. Those are two very important questions, but to my mind they are of minor importance in comparison with the larger question of relief for the fishermen. Only to-day I have a letter from some fishermen in my constituency asking me to do something in the way of a breakwater so that after they come in from a hard day's fishing they would not have to jump out of their boats and stand waist high in the cold water in the month of October to haul their boats ashore. Through the kindness of the Minister of Public Works I have succeeded in getting four or five hauling engines installed in different places along the coast of Victoria county and they have been a great boon to the fishermen. One can imagine what a hardship it is for fishermen to have to drag in their boats standing in cold water after coming in from a long fishing trip, but with one of these hauling engines all they do is to step ashore and start the engine and the boats are hauled ashore. That is one of the few things we have been able to do. I had a letter last year from a merchant asking me whether it was possible for the government to provide a sum of money for the purpose of helping the fishermen in the spring or in the fall when they go fishing, because, he said, they were destitute; they had no proper equipment, neither rubber boots nor boats. Their lines were crippled and their boats destroyed. This all happened after a very heavy storm in Victoria county. Now, I think that there should be something in the form of a government loan to those engaged in the fishing industry, which is a very important occupation in this country. The farmers of Canada, judging from the bills which are before the house to-day, are largely protected, but apparently the fishermen are excluded from these loans which are being given to the farmers. I think it is up to the government and the members of this house to see that fishing, which is an industry second almost to none in this country, should receive proper care and attention.

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I am sorry that this subject did not come up before. I do hope however that before this house gets through we shall be able to go to the fishermen and say that we have done something for them and that this talk has not been all useless. I hope that we shall be able to tell them that we have evolved a practical method by which the fishermen can be assisted, not only in connection with bait and refrigerator plants, but by means of a loan which will enable them to obtain boats and to get whatever equipment is necessary. This is a serious matter with them, because I know that to-day there are people who cannot go fishing because they have not the materials-lines, proper clothing and often boats. I am very glad that the subject has been brought up. I feel responsible for not having introduced it before but I am glad of this opportunity to say something on behalf of our fishermen.


Mr. FINLAY MacDONALD (Cape Breton South):: I have a perfectly open mind on
this question, not being particularly interested from a sectional point of view, as to the desirability of continuing trawlers. On this as on the other question which we have already discussed, I think the matter must be approached on a wider basis. If we have to deal with this question at all, and if it is to be referred to the committee on fisheries, no doubt it will receive proper attention there. But in my opinion if we are to discuss the fisheries in the way they should be discussed, and if we are to give the industry that assistance to which it is entitled, we shall have to deal with the matter in a larger way than is contemplated either by this resolution or by the one that preceded it.
I may be mistaken-and in this I have the misfortune to differ from my friend from Antigonish-Guysborough (Mr. Duff), who I confess knows very much more about the fishing industry than I do, and who is more deeply interested in it-but I must say that the little consideration I have been able to give the matter convinces me that the future of this industry lies along the fresh fish business. My own ideal would be that for every car of fresh meat that goes from Ontario down to Nova Scotia there should be sent back a car of fresh fish, or more than one car if necessary. I believe that there is a market in Canada sufficient to absorb all the fresh fish that we can catch in the maritimes. But two or three things are necessary. As has been said, we must make the people of upper Canada fish conscious. There ought to be some way of putting before them
the desirability of this food. Those of us who live in the maritime provinces and who have eaten fish caught fresh from the salt water, and who have also had opportunities to eat the choicest meats that come from the other provinces, know that as a palatable article of diet a fresh fish caught from the ocean is far superior to any choice piece of meat that can be obtained from any animal.
It is of course a matter of regret -that the present condition of our fisheries is so deplorable. The fishermen are destitute. One would hardly believe that in the short space of twenty-five or thirty years there could be such a lowering of the standard of living among our fishing population as has taken place in the maritime provinces. At that time there were numerous little fishing villages scattered all along the shores, and the men engaged in that business, although they worked only in the summer, could live through the winter and enjoy all the comforts of the home. To-day some of these villages which were most prosperous in the early days, are living on relief, and if one were to believe the stories that come in during the winter months, it is almost inconceivable that such conditions could exist.
In addition to educating -the people of upper Canada to the value of this food, very many other things are necessary. The fishermen of the maritimes must be lifted out of the condition in which they now find themselves. This government can be very generous to the farmers of the west, and with that we have no quarrel. We in the east realize that the great wealth of Canada comes from the western plains and that the large exports from that territory furnish -the chief source of wealth in this country. A very considerable and laudable effort is being made to help the destitute farmers of the west, but I venture to say that their destitution is not more severe, nor are their conditions more serious than those in which the farmers and the fishermen of the east are placed to-day. And if we are to treat those farmers in the west so generously-and we are all heartily in favour of that-we should certainly extend equal generosity to those hardy men who go down to the sea in ships. Further, those fishermen must be fitted out with equipment and plant because they are engaged in a very hazardous occupation. As the hon. member for Shelburne-Yarmouth (Mr. Ralston) has pointed out, this year the winter has been a particularly severe one on the fishermen, the result being that many of them have lost their entire plant, boats, ne-ts, lobster traps,

Beam Trawlers
all of which have gone, and they have no resources left with which to set themselves up in business again.
In addition to the fishermen being equipped to catch fish there must be the secondary stage of equipping them with the necessary facilities for processing their fish, keeping them fresh, thus enabling them to put their fish in a proper condition on the Canadian market because that is the one to which I look for the efficient development of Canadian fisheries. There must also be given to them cheap transportation as is now given to the Toronto packers who are supplying us with meat products. Transportation cost might very easily be lowered, for example if a car that came east with meat went back loaded with fish.
We have first the catching of the fish, the processing of it, the creation of a market through education and lastly the transportation and the placing of that fish on the market in the best possible condition. How are we going to do this? What is the best method of doing it? For my own part I am satisfied that there is only one method that will ever be successful in dealing with the whole question of fisheries, and that is the creation by the government of a commission that will handle the entire problem. A large amount of money may be necessary, but it is available. The commission should consist of a number of persons who would have full charge of the production, processing and transportation of the fish, and the education of the people of the west in the eating of it. That I am convinced is the solution of our troubles and it is the one idea I have in mind, feeling as I do the great necessity for doing something. Looking over our past history and seeing that we have done nothing all these years while the fishing industry has been steadily deteriorating, I think it would be very well if when we come to consider this question in committee-and I presume it will be referred to a committee- we consider the much wider and more important question of dealing with this problem in the way I have indicated through a commission composed of experts who can deal with the matter of the fish from the time they leave the sea until they reach the tables of our friends in western Canada.


Mr. F. P. QUINN (Halifax):: As previous contributors to the debate have already stated, this question of the competition of the beam or otter trawler with the shore fishermen has been a contentious one for many years. Perhaps a useful purpose will have been served by the hon. member for Inverness (Mr. Mac-dougall) in bringing the resolution before the 
house this afternoon; if no other advantage can be gained he will have at least the satisfaction of bringing to the attention of hon. members some of the deplorable conditions of the maritime provinces.
To give the house an idea of how difficult it is for hon. gentlemen to arrive at a conclusion as to what is best in dealing with the resolution now under consideration, may I point out my particular situation? Just a few minutes ago we had read to the house by the Acting Minister of Fisheries (Mr. Stirling) a statement that only a few years ago this government or the preceding one was petitioned by the Halifax board of trade and also by the mayor and council of that city to permit a certain number of trawlers to operate. That is the expressed opinion of those in control of the city of Halifax, but the constituency which I represent includes the city and county of Halifax, and the inhabitants of the county of Halifax, east and west along a shore line of 142 miles, are chiefly engaged in the pursuit of fishing, being called, as has already been stated, shore fishermen, those who fish in small boats out of the different harbours and coves along the shore. All of those fishermen are opposed to the beam trawler competition which they have to meet. I need not elaborate or try to explain the operation of the beam trawler as against that of the shore fishermen because the matter has been very clearly defined by previous speakers and particularly by the hon. member for Antigonish-Guys-borough (Mr. Duff). But this is the position we are in; the question is a contentious one and it is very difficult for parliament to decide just what to do.
I was particularly interested in the statements of the hon. member for Digby-An-napolis (Mr. Short) who knows as much about the fishing industry as does any other hon. member. I paid especial attention to his remarks in refutation of the statement that the companies operating these otter trawlers held a monopoly of the fishing business in Nova Scotia. He quoted figures to disprove that statement. I was not aware of them and they were very interesting to me. Another statement made by the same hon. member which was rather interesting-and I thought perhaps that statement should settle this question and prove that there was no necessity for any further discussion in the matter-was that the company in which he had been interested or is interested and which operates these two steam trawlers was willing to discontinue its operations provided it was recompensed for the capital invested in these trawlers. I thought that was a fair state-

Bearn Trawlers
ment, and I think if that suggestion were carried out it would settle the argument once for all. But since it seems to be the general opinion that the whole matter should be left in the hands of the special committee on fisheries I concur in that suggestion. I think it is the proper body to deal with the question. I hope the committee will give it the consideration to which it is entitled and will bring in a recommendation as to the operation of beam trawlers, and, if they are to be discontinued, as to how the companies who own and operate them should be recompensed for the capital invested in these trawlers.


Hon. CHARLES MARCIL (Bonaventure):: The fisheries question is often referred to as something of interest primarily to the maritime provinces, and sometimes British Columbia. But there is a part of the province of Quebec which is also interested, that is the three counties of Gaspe, Bonaventure and Matane. I am glad my colleague from Gaspe (Mr. Brasset) said a few words the other night on the motion of the hon. member for Gloucester (Mr. Veniot) in regard to bait. I was much interested in the suggestion made to-day by the hon. member for Cape Breton South (Mr. MacDonald) that there is a broader view to be taken of this fishery question, not confined to beam trawlers but extending to the condition of the industry and the fishermen as a whole. The position in which the fishermen of Nova Scotia and New Brunswick find themselves to-day applies equally, or to a greater degree, to the fishermen of Quebec, because our fishing season in Quebec is much shorter than in those provinces, especially Nova Scotia where they have winter fishing. Our winter fishing is practically confined to the upper ranges of the baie des Chaleurs and to smelt fishing. There is no doubt there has been a great deterioration in the fishing industry of eastern Canada, and that something should be done to restore it. I heartily support the suggestion made by the hon. member for Inverness (Mr. Macdougall) that this matter be referred to the select standing committee on marine and fisheries. I hope that the question raised by the hon. member for Gloucester will be again taken up by that committee. Some twenty-five or thirty years ago I voted for and upheld the proposition made by Sir Louis Davies, who was then one of the outstanding representatives of the maritime provinces, to establish a system of bait freezers throughout Canada. That became law and we had experience of that not only in Quebec but I understand in Nova Scotia and New Brunswick as well. Unfortunately the system was based upon the
cooperative idea, but the fishermen did not seem able to agree about the operation of the freezers, they gradually disappeared and the whole scheme fell down. Now the hon. member for Gloucester (Mr. Veniot) suggests that the government should start over again and re-introduce the system. Without bait the fisherman is of course handicapped at every turn. In Quebec at present the local government have undertaken to establish a number of bait freezers in the counties of Gaspe and Bonaventure, and I suppose Matane as well, for the purpose of furnishing the fishermen with the bait which is indispensable.
It is unfortunate that in that maritime part of Quebec province there is any conflict of jurisdiction, but there always has been. Away back in 1897 when I had the honour of being a candidate for the legislature of Quebec against the then premier of the province that was a burning issue. The provincial government contended that the fisheries of the province, especially the salmon fisheries, were under the jurisdiction of the province; the federal government took the opposite view. The privy council on one occasion gave authority to the province as regards the issue of licences for salmon fishing, which as the house knows is one of the important industries of Bonaventure and Gaspe counties from which come the famed Gaspe salmon, second to none in the world. To-day the fisheries of Quebec are under provincial jurisdiction, but there has been a steady appeal made during the last three or four years by the fishermen of Gaspe, who take a very active interest in this matter, that there should be more cooperation between the federal and the provincial governments concerning fisheries. Public sentiment in those two constituencies is very strong that some of the federal benefits which are extended to British Columbia and the maritime provinces should also be extended to the maritime parts of Quebec; that we should have biological stations and other means of helping the fisherman to carry on his calling. The fishermen of Quebec, although under provincial control except as regards seasons and other regulations, contribute their part towards supplying the fishermen of the maritime provinces and British Columbia with the assistance which the federal government gives them. I was glad to hear the former Minister of Fisheries (Mr. Rhodes) declare that he is prepared to give all the federal assistance that can be given to the fishermen of Quebec. I hope the minister now in charge of that department (Mr. Stirling) will take that same view, because after all
Beam Trawlers

this is a national industry, and the prosperity of one part of Canada affects all parts. If one great national industry is stagnant in one province it reacts upon the whole body.
I think the suggestion of having this matter referred to the select standing committee on marine and fisheries is a good one, but I hope it will not be confined merely to looking into the matters of beam trawlers and bait, but will take into consideration the whole industry. Ever since I have been in this house we have been helping the west. When I came first there was practically nothing in the west. We have been developing it. I voted for all the transcontinental railways and every other railway built in the west. We looked on the west as the great granary of the world. Sir Charles Tupper and Sir George Foster and those other great leaders that the maritime provinces sent to the parliament of Canada laid before us an entrancing view of the future of that western country. We created two or three new provinces out there; we gave them all they wanted, all they asked, and now when they are being tried sorely we are willing to come to their assistance. But we must not forget that the fishermen of Canada were the pioneers of this country. Our first fishermen came from Brittany and the channel islands and they settled in the maritime provinces and in Quebec. We have in Paspebiac, in my constituency, the old firm of Robin, Colas et Cie, which is now controlled by Robin, Jones and Whitman of Nova Scotia. This was the first company in British North America to obtain a British charter to go into the fishing business after Canada came under British jurisdiction. A few years ago, in company with Sir Henry Thornton, I had the pleasure of visiting their old office in Paspebiac where I was shown the original documents of incorporation, which indicates that this industry was started when the west and Ontario were wildernesses, and when the province of Quebec was inhabited merely along the rivers. At that time Canada was only in its inception; the province of Quebec and the provinces by the sea constituted Canada.
We must not overlook the fact that something is coming to the fishermen of the maritime provinces. After this question has been considered by the fisheries committee and the government, this or any other government, I hope the suggestion that has been advanced this afternoon will be accepted and a body of competent men appointed to develop this industry as it should be developed. Our fisheries, along with farming, mining and lumbering, constitute the basic industries of the

country. When our fishermen and our farmers are prosperous our railways will be prosperous, our factories will be busy, our workingmen will be employed and everything in the country will boom. I believe we have overlooked the fisheries; they have not received the attention or the consideration they deserve, and I think the hon. member for Inverness (Mr. Mac-dougall) and the hon. member for Gloucester (Mr. Veniot) should receive the thanks of this house for having directed attention to this question. I want to assure our colleagues from the provinces by the sea that the members from Quebec are prepared at all times to aid any efforts they may put forth to restore the fisheries to a sound position. To-day the situation of these fishermen is preoarious and very alarming. In my own constituency the catch has been poor, the prices low and transportation costs high, and the industry has suffered a very great deal. Anything that can be done by the fisheries committee, by the government or by a permanent commission to aid that industry will meet with my hearty support, and, I hope, the general support of all members.


Mr. MACDOUGALL:: I do not intend to speak at any great length after the discussion we have had this afternoon. I should like to tell hon. members, however, that when I placed this resolution on the order paper I did so because I considered it one part of a general scheme for the improvement of the fisheries of the maritime provinces.
I listened to the remarks of the acting minister, who suggested that this resolution be referred to the fisheries committee. I am quite in accord with that suggestion, because it will give an opportunity to certain people who are particularly interested in the primary producers to appear and give their views in regard to the operation of beam trawlers and their effect on the fishing industry.
This afternoon the old argument has been repeated, that in asking for the abolition of beam trawlers you might as well ask people to return to the old spinning wheel. Well, in some parts of the country it might be a good thing to return to the old spinning wheel. I might point out, however, that the underlying principle in regard to the installation of machinery in industry since the industrial revolution has been that it would better the conditions of mankind. When we come to the point where the man-made machine is putting the God-made man out of work, as the beam trawler is doing in the province of Nova Scotia to-day, I say we must curtail and curb the activities of that machine.

Income Tax Exemptions
Hon. members have said that the abolition of these trawlers would not help the fishermen. Let me tell my hon. friends that last .year 18,000,000 pounds of fish caught by beam trawlers were landed and sold in the province of Nova Scotia. What would that have meant to the fishermen if there had been no beam trawlers? To furnish this quantity of fish would have required ten Nova Scotia-built power vessels during the winter months and a total of 250 fishermen, with a fleet of several hundred small vessels during the summer months. It would have required a bait supply of from 1,500,000 to 2,000,000 pounds, which would have furnished employment for scores of net fishermen along the shores.
As 1 have said this is only one part of a general scheme to improve the condition of the fishermen in the province of Nova Scotia. I want to say to hon. members of this house, irrespective of their party politics, that the people of Nova Scotia are wholly in earnest about this matter, and that constructive steps must be taken by the Department of Fisheries here, who have control over the fishing industry of our province. If they cannot control that industry then in the name of God let them hand it back to the province of Nova Scotia, and we will find men who can control it.
I accept the suggestion of the minister, and accordingly I move that this resolution be referred to the fisheries committee.
By leave of the house, motion (Mr. Mac-dougall) referred to the standing committee on marine and fisheries.



INCOME TAX


Mr. A. E. MUNN (Vancouver North) moved:: That, in the opinion of this house, it is expedient that the government should consider the advisability of amending the income tax exemption clause to read as follows:

That in all cases income tax exemptions as applied to married and single persons should not apply to others than Canadians or British subjects.
He said: Mr. Speaker, my ambition is to help the Minister of Finance (Mr. Rhodes) secure more revenue. During the 1933 session I introduced a resolution which the minister gallantly accepted, and I do not think he has regretted that step because I feel sure it has brought in quite a large amount of revenue.
Before proceeding, Mr. Speaker, I should like to amend my resolution by adding the
words "resident in Canada for five years" after the words "Canadians or British subjects." If people from foreign countries after living here five years have not shown any intention of becoming naturalized I do not see why they should be allowed tax exemption similar to that given Canadians and British subjects. I am of course referring to the ordinary tax exemptions whereby a man in receipt of an annual income of $2,000 or $3,000 is permitted a certain exemption, and the remainder is taxed.
In my view this suggestion should be put into effect. Through its operation I believe a greatly increased amount of taxation would be collected from people who can well afford to contribute. I should have mentioned in the resolution that the persons indicated should not be allowed tax exemption after five years' residence in Canada and under the conditions I have outlined. With this amendment I shall be content to let the matter stand without entering into a lengthy discussion. I simply offer the matter for consideration.


Edgar Nelson Rhodes: Mr. Speaker, I had an appointment this afternoon which occupied my time until only a very few moments ago. I had not anticipated this resolution would be moved to-day, in view of the fact that there are on the order paper a number of resolutions which in the oi dinary course of events would have been considered before it was called. Had I known it would be reached to-day I should have been better prepared to make a complete statement of my views.
Had the hon. member supported his resolution with argument and presented facts which would warrant the acceptance of the resolution by the house, I should have been better pleased.


Albert Edward Munn: We do not need any argument.


Edgar Nelson Rhodes: The hon. member has contented himself with moving the resolution, and nothing which he has said so far as I am concerned calls for a reply. However, having regard to the circumstance which I mentioned, namely that I had not anticipated a discussion of the subject this afternoon, I shall proceed to make some general observations.


Albert Edward Munn: May I tell the minister that I did not expect the resolution to be reached this afternoon.


Edgar Nelson Rhodes: My answer would be that there is only one minister of finance but there are numerous hon. members each of whom may move his resolution when he
55b
Income Tax Exemptions

chooses and each of whom has plenty of time in which to prepare any statement he may wish to make.
There is a very grave objection to the acceptance of the principle contained in the resolution, namely that it would invite retaliation on the part of other countries. The whole tendency in taxation matters has been that there should be reciprocal arrangements between the different countries so that credit may be given in one country when in fact income tax has 'been paid in another, an arrangement which exists between Canada and many other countries. If we were to put into effect the resolution before the house we might expect retaliation from the United States.


Mr. YOUNG:: Do not provoke them.


Edgar Nelson Rhodes: It is but fair to point out that beyond question there are many more Canadians resident in the United States than citizens of the United States resident in Canada. I make special reference to the United States because of the fact that this resolution applies only to foreign countries; it does not apply to British countries. In effect its application would be confined to the United States.


Mr. NEILL:: No.


Edgar Nelson Rhodes: If as the hon. member apparently assumes it would involve an increase in revenue there might be some virtue in the suggestion, because if I mistake not the hon. member's idea is to assist in increasing the revenues, as he had advocated at previous sessions. If the resolution were carried in its literal terms and taxation were imposed as provided by it, all the income of foreign residents in Canada would be involved; because he specifically states that the income tax exemption shall not apply. I take that to mean that he would tax the wages and small salaries of those who would be affected by the application of the tax. Information I have received from the income tax branch is to the effect that the machinery which would be required to deal with the collection of incomes now exempt, namely incomes in the smaller brackets, would involve an expenditure which would be greater than the amount returned to the treasury. In the lowest bracket of those who pay income tax in Canada there were in the year 1932-33 631276 persons who paid income tax amounting to $416,776.46. That sum is exactly 1-5 per cent of the total amount collected from individuals. These figures would indicate that from the large number of persons in the lower brackets we received only a small per-

centage of the total tax collected. One could only hazard a guess as to how many thousands might be included among those who would be called upon to pay income tax if the government were to accept this resolution and to bring down legislation based upon it. But I submit that even if it meant many thousands, their income in the main would be in the lower brackets, because my hon. friend would remove the exemptions; and the amount of money therefore which we would receive into the treasury would be only a fraction of the total income tax collected. As I have said, the officials of the income tax branch advise me that the probabilities are that the costs of collection and the machinery of collection which it would be necessary to set up in order to deal witfi it would involve a greater outlay than the treasury would receive in income as a result, of its application.
I might point out further that with respect to the number I have given, those who are in the lower brackets represent forty per cent of the total number of income taxpayers in Canada, and yet, as I have indicated, the amount collected from them represents but 1'5 per cent of the total income tax collected. I do not stress that angle, although I think it is fair that we should respect the advice given to us by those whose business it is to deal with the collection of income tax.
Should the resolution be adopted and the principle it asserts be put into operation, not only would we be certain, as I have indicated, to invite reprisals on the part of our friendly neighbour to the south, to the detriment, on balance, of Canada and Canadian citizens because of the reasons I have given, but I would point out that at the moment we are in negotiation with our friends to the south in matters of trade, and it would strike me as being a very inopportune time to take a step of this kind while those negotiations are in progress. I do not know that I would stress that phase of the argument, but I do submit that it certainly is not good neighbourliness and it would not be good tactics, bearing particularly in mind the fact that a similar attempt has not been made by the United States to deal similarly with Canadian residents in that country.


Albert Edward Munn: In other words, be very careful you do not offend them at the present time.


Edgar Nelson Rhodes: No, that is not the argument at all, Mr. Speaker. I just leave it to the common sense judgment of the house whether, when you are in the midst of negotia-



C, 1935

[Stage Direction]
Income Tax Exemptions
tions, it would be good judgment to take legislative action by parliament directed against practically only one country in the world, namely, the United States. If it were a matter of general application applying to all the world, and arguments could be made in support of the resolution, that would be one thing; but in fact it applies, and it might as well say so in terms, to one country so far as any value to the treasury is concerned, and to one country only, namely our neighbour to the south. I should be the last to subscribe to the doctrine that Canada should not legislate for itself, but I do say that if we expect to conduct negotiations in a friendly manner with a view to a successful issue between Canada and the United States we would be very ill-advised at this time to take a step such as is suggested, which could be open to only one construction. I do not stress that point. 1 mention it incidentally, but I do think that on the merits, on balance Canada would be the loser if we were to attempt to pass this resolution and to base upon it legislation bringing it into effect.
I should have dealt more completely with the subject and given more facts and figures, as I have indicated, had I had the slightest idea that this resolution was coming up to-day. But I trust that I have given to the house sufficient indications that we would be very unwise to accept this resolution or the principle which it embodies, if not at any time, certainly at this moment, and I trust therefore that in the judgment of the house the resolution will not be accepted.
Alan Webster Neill: Mr. Speaker, the Minister of Finance (Mr. Rhodes) said thait he had not been able to give that attention to this motion that he would have liked, and apparently someone in his department furnished the information on which he largely rests in his remarks. Whoever drew up the brief or prepared the data appears to have gone upon the idea that, if he could not produce one good argument against the proposition, the next best thing to do would be to produce a lot of poor argument hoping that the cumulative effect of six poor arguments would be as great as one sufficient argument. The Minister of Finance himself said from time to time as he brought forward the various arguments that had been placed in his hands, evidently feeling compelled by his sense of fairness and his sense of logic: "I would not stress that point." The idea seemed to be that by giving a number of poor arguments it would result in the same force as one substantial argument, which is not I think logical.
The minister asks someone to produce a reason for this resolution, to advance some argument in favour of it. I would suggest this, that it would encourage people to naturalize, a very good thing indeed in this country. We have only to think back to the war, when I saw men who had been in the country far beyond five years and who were deliberately not naturalizing because they could draw eight or nine or ten dollars a day while Canadians at the front were getting $1.10 a day. The old age pension law requires people to be twenty years in Canada before they can get a pension, and I know of people who had lived many years in Canada and became naturalized only a few weeks before they applied for a pension. Some had lived in Canada for twenty years without thinking Canada good enough to become a citizen of it in that time, but when it was a question of getting an old age pension then they rallied around and sought to be citizens of this country.
This resolution would encourage people to become naturalized. Some people deliberately do not naturalize in order to evade their responsibilities, and it is not desirable to have in any nation a large body of aliens standing aloof from the interests of the country which has supported them for ten or fifteen years.
If they were encouraged to naturalize they would probably come, as men will, to take more interest in the country and more interest in its government. On the other hand, if they do not naturalize, then this resolution if adopted and carried into effect would produce some revenue for the Minister of Finance.
I suppose we are in the habit of thinking of immigrants as poor people, ithe man with the sheepskin coat, and so on, who would be drawing only a few dollars in wages, and as the minister says, the cost of collecting the small amount would not pay. But rich aliens also come to this country and stay in it for many years, people with large incomes who do not bother to become naturalized. The trouble that the minister suggests in regard to the cost of collecting from men drawing a small wage could easily be got rid of by having an exemption of, say, $500. But I think that the proposition which the hon. member for Vancouver North (Mr. Munn) had in mind was rather to take the exemption off the man who had a good income. If a man had $5,000 or $6,000 and you took the exemption of $2,000 off, the last $2,000 of his income would be dealt with much more lightly than if that exemption remained, and it is in such cases that the crown would benefit from increased revenue. Of course, as the '
Income Tax Exemptions

hon. member said, it would be necessary to put in a provision that it would not apply to aliens for the first five years, because that would not be fair. But after they had completed the period within which they could qualify for naturalization, then I ask the minister or anyone else, why should they not naturalize? If the country is good enough for them to make a livelihood in, if they get the protection of our laws, why should they not naturalize? There is no reason that I know of which can stand investigation. The minister spoke about retaliation and said that we had a working agreement, so to speak, that the foreigners in each country should not be taxed on their incomes. I think that applies particularly to Britain.


Edgar Nelson Rhodes: Surely my hon. friend
must be aware of the fact that I made no such statement. I did not say that they were exempt from taxation but that they were given credit in one country for the tax paid in the other. The hon. member likes to be accurate, according to his own assertion. He is assuming that foreigners are not to be taxed. They are taxed. But this resolution calls upon those to pay taxes who otherwise would be exempt because of the exemption clauses.


Alan Webster Neill: Yes, but there is an exemption of one or two thousand dollars, and for their children four or five hundred, and the motion proposes to take these exemptions off so that they will pay more seeing that they choose to live in the country without becoming citizens of it. The minister says it would apply almost entirely to the United States and would be regarded as an unfriendly action. That is not so. It would apply to every nation, and whether in its working out there might be more Americans here than nationals of other countries, that is a matter of detail. But no nation takes umbrage at such action unless it is deliberately directed against itself.


Edgar Nelson Rhodes: I did not say it was an unfriendly act; I did not use such a word or such an expression


Alan Webster Neill: I think I am justified in putting such an implication on it, when he said that it was an undesirable time to take such action because there might be retaliation.


Edgar Nelson Rhodes: That is a different matter.


Alan Webster Neill: Well, something that provokes retaliation would naturally be unfriendly. My point is that a nation would naturally take offence at a resolution such as this if we made it apply to that nation exclusively. If we made it apply only to the United States they

would certainly take offence, but when we say that it applies to everyone in the whole world they cannot take umbrage. And the actual details would not concern them. The suggestion was made that it might provoke retaliation against Canadians living in the United States, and it was pointed out that there are-more Canadians living in the United States-than there are Americans living in Canada. I do not know that it would be a dreadful thing if Canadians in the United States did pay more income tax. At any rate we are legislating for Canadians in Canada and not for Canadians in the United States, and I do not think it would do any harm particularly. I would also point out to the minister that after all the resolution only proposes that the-government should consider the advisability of the matter, and if he allowed the resolution to pass it would be open to him after thorough consideration of it to decide against it if he came to that conclusion. But seeing that it has not had full consideration, seeing that he himself states that he would like to have given it more consideration, I suggest that he might let it go through and it would be left to his own judgment to deal with it as he saw fit after thorough consideration.


Albert Edward Munn: I did not intend this to be personal in any way, and I do not think the Americans will stand the heavy end of the penalty. I was not after the fellow in the lower brackets in particular. A good many people in Canada who are not Canadians or British subjects are earning from five to ten thousand dollars a year and are subject to these exemptions, and they are the fellows I am after. I have not in mind those receiving - six or seven or eight hundred dollars a year. But that is a detail that could be taken care of.
The minister says that his officials tell him that if this were put into effect the results would not meet the extra expense. I doubt that statement very much; I do not think it has been carefully considered. I discussed the matter with one of the best tax auditors in Canada, one of the very best, and he calculated that if it were put into effect by the federal and provincial authorities it would bring in at least another million dollars in taxation throughout Canada.
I do not want to antagonize anyone. The minister says that he does not wish to adopt the motion at the present time, and I shall be pleased to withdraw it and let it stand at that. But it is something which the tax officials might keep in mind. There is a leakage, because there are taxes which we should get and

Questions
are not getting. With the consent of the seconder I beg to withdraw the resolution and let the matter stand.
Motion (Mr. Munn) withdrawn.



BRITISH IMPORTS OF RUSSIAN TIMBER

[Stage Direction]
On the orders of the day:
Mr. T. F. AHEARN (Ottawa):: I wish to ask the government a question based upon a dispatch appearing in the Montreal Gazette, of to-day's issue, February 6:
Canada To Lose Lumber Trade Deal Concluded Between Great Britain and Soviet
50 Per Cent of Canadian Export to Britain in 1935 Threatened (By The Canadian Press)
Vancouver, February 6.-Contract between British Timber Distributors Ltd., and Soviet Russia has been signed, including the "fall clause," H. R. MacMillan, president of the H. R. MacMillan Export Company, Ltd., reported to-day upon receipt of a cable from London to that effect.
^Closing of the deal between British Timber Distributors Ltd., and the Soviet Union means that eastern Canada and British Columbia will lose 50 per cent of their market for lumber in Great Britain, according to an estimate made by H. R. MacMillan in Montreal on January 11, in discussing the British-Soviet negotiations which were then in progress. Canada exported nearly one billion feet to Great Britain in 1934.
My question is: Has the government been
informed that such an agreement has been concluded?


Edgar Nelson Rhodes: I have not seen the dispatch in question but I will bring the matter to the attention of the Prime Minister (Mr. Bennett) as Minister of External Affairs, or of the Minister of Trade and Commerce, and it will be taken as notice of a question.
On motion of Mr. Rhodes the house adjourned at 5.55 p.m.
Thursday, February 7, 1935