1937-03-23

OFFICIAL REPORT


[Stage Direction]
i>ouse Of
Commons debates
[Stage Direction]
Tuesday, March 23, 1937


[Stage Direction]
Mr. W. H. MOORE (Ontario) presented the third report of the standing committee on banking and commerce, and moved that the report be concurred in.
Motion agreed to.

[Stage Direction]
Mr. A. M. YOUNG (Saskatoon) presented the fourth report of the standing committee on railways and shipping.	.


Hon. ERNEST LAPOINTE (Minister of Justice):: moved for leave to introduce Bill No. 78, to amend the Supreme Court Act.


Some hon. MEMBERS:: Explain.


Ernest Lapointe: The purpose of this amendment is merely to clarify the meaning of the present section 37 of the Supreme Court Act. Under that section there is a right of appeal per saltum when parties agree and with the consent of the court of final resort in the province. It is to make clear that the appeal must be from a judgment which is applicable to that court of final resort as well.
Motion agreed to and bill read the first time.



HAMILTON WEST BY-ELECTION

[Stage Direction]
On the orders of the day:
Mr. F. E. LENNARD (Wentworth):: Before the orders of the day are called I should like to direct the attention of the house to ami-130
a statement issued by the Prime Minister (Mr. Mackenzie King), which appeared in this morning's papers, with respect to the results of yesterday's by-election in Hamilton West.


Some hon. MEMBERS:: Order.


Frank Exton Lennard: Mr. Speaker, the Prime Minister made a misstatement of fact, and I should have the privilege of correcting it.


Mr. SPEAKER:: Order. I think that the hon. member's statement is not a proper one on the orders of the day.



ROYAL AIR FORCE


[Stage Direction]
On the orders of the day:
Mr. W. R. MACDONALD (Brantford City):: Mr. Speaker, I should like to draw the attention of the Minister of National Defence (Air. Mackenzie) to reports from London, England, which have recently appeared in the Canadian press, to the effect that there is now in operation a scheme for the training of pilots from Australia in the Royal Air Force, and that a similar scheme is being established in New Zealand. This article, which appeared on Alonday in the Brantford Expositor and other leading Canadian newspapers, is headed in one of these papers "British Air Force seeks Canadian Pilots" and reads in part as follows:
"There is already in operation a scheme whereby pilots are trained as cadets in the Royal Australian Air Force and then serve a term of years with the air force of this country," Sir Philip said. "Afterwards they revert to the Royal Australian Air Force Reserve."
"New Zealand is establishing a similar scheme and also a system whereby applicants are medically examined to ensure that they are not turned down when they come to this country."
In the closing paragraph, Sir Philip Sassoon, the Under-Secretary for Air in the imperial government, states:
We should welcome adoption of a similar system by Canada, from which dominion no

Royal Air Force

fewer than one hundred young men have come on their own and have been accepted for short service commissions. We welcome these pilots. They are first rate young men and we wish to do everything in our power to facilitate their entry.
I should like to know whether any steps have already been taken by Canada to enter into such an arrangement. If not, is it the intention of the government to enter into such a system?


Hon. IAN MACKENZIE (Minister of National Defence):: My hon. friend was good enough to give me notice of the question. A few minutes ago I laid on the table a return to an order containing exhaustive information in reply to a question asked by the hon. member for Kindersley (Mr. Elliott). The question my hon. friend has just raised is fully answered in that order, but if it is not I shall be glad to bring down supplementary information at a later date.



PORT OF VANCOUVER


[Stage Direction]
On the orders of the day:
Mr. ANGUS MacINNIS (Vancouver East):: I wish to direct a question to the Minister of Transport (Mr. Howe). For some time there has been more or less dissension on the Vancouver waterfront on the part of rival organizations, and the shipping federation has been brought into the matter. I understand that the city council of Vancouver has asked the Department of Transport or the federal government to appoint a commission or some unbiased authority to investigate the situation. I should like to know whether that request has reached the government yet and whether the minister is prepared to say what action will be taken in the matter.


Hon. C. D. HOWE (Minister of Transport):: The hon. gentleman kindly gave me notice of the question. I received, dated March 16, a telegram from the city clerk of Vancouver reading as follows:
The following resolution was adopted by city council March fifteenth: That the federal government be asked to appoint a competent unbiased authority on port and marine matters to make a survey of the situation on Vancouver waterfront with a view to ascertaining whether the handling of waterborne freight into and out of Vancouver is not so out of line with international practice as to militate against the best interests of the port.

In reply to the hon. member's inquiry I may say that the intention of the National Harbours Board of withdrawing from the British Columbia Shipping Federation has already been made known to the house. I am advised by the National Harbours Board that this policy is being worked out as rapidly as conditions will permit. No situation appears to exist at Vancouver which prevents the facilities of the port being fully used for the benefit of Canadian trade, nor does there appear to be necessity for any survey and investigation as requested.



THE PARLIAMENTARY GUIDE

[Stage Direction]
On the orders of the day:
Mr. GEORGES BOUCHARD (Kamou-raska):: May I ask the Secretary of State (Mr. Rinfret) whether the Canadian Parliamentary Guide has been printed this year? Is it true that it has been printed and distributed to the senators, and may we hope that it will soon be distributed among members of this house?


Hon. FERNAND RINFRET (Secretary of State):: The Parliamentary Guide is published by a private individual, though he is a member of the civil service. The publication is a private one. The House of Commons used to have an estimate out of which it bought copies of the Parliamentary Guide and distributed them to members of the house, but I understand that this year that estimate has not been introduced and the money has not been provided for the purpose. Neither the Secretary of State's department nor the printing bureau has anything to do with it, the publication being, as I say, a private one.


Right Hon. R. B. BENNETT (Leader of the Opposition):: I should like to inquire whether the Secretary of State has told us the whole story in view of the fact that the Parliamentary Guide has been distributed to the Senate.


Louis Édouard Fernand Rinfret: I will be quite frank; I have told everything I know about it. If there is something I do not know and which the leader of the opposition knows I shall welcome the information.


Richard Bedford Bennett: It is of such a character that I will communicate it to the hon. gentleman privately.


Mr. POULIOT:: Therefore he was right not to state it.

Canada-TJnilcd Kingdom Trade Agreement


Mr. STIRLING:: May I ask the Secretary of State out of what funds the copies of the Parliamentary Guide issued to the senators have been purchased?


Louis Édouard Fernand Rinfret: I would surmise that the distribution to the Senate has been made in the same way as it used to be made to members of the House of Commons, that is, out of a fund in the Senate estimates. I do begin to feel that there is something underlying all this in which the opposition is much better versed than we are. I wish to state most positively that I know nothing about the Parliamentary Guide except what I am now communicating to the house. It is published by a Mr. Normandin, who is employed in the printing bureau, but it is published at his own expense and to his own profit. The House of Commons used to buy a certain number of copies, but I understand from the clerk that this has been discontinued. The Senate also buys a certain number and distributes them to the Senators. The Secretary of State, however, has positively nothing to dc with it.


Richard Bedford Bennett: When was it discontinued?


Ernest Lapointe: We will all inquire now.



HALIBUT FISHERY


[Stage Direction]
On the orders of the day:
Mr. THOMAS REID (New Westminster):: I wish to direct to the Minister of Fisheries (Mr. Michaud) a question based on the following press dispatch:
The senate foreign relations committee has submitted to the senate for ratification a proposed convention with Canada regulating halibut fishing in the North Pacific ocean and the Bering sea.
Will that treaty be introduced at the present session for ratification along with the United States amendments?


Hon. J. E. MICHAUD (Minister of Fisheries) :: A joint commission which has been administering halibut fishing in the waters mentioned in that dispatch has made a recommendation to the government for some amendments to the existing convention. These recommendations were forwarded to the Department of External Affairs and are being considered at the present time.



INQUIRY FOR RETURN

[Stage Direction]
On the orders of the day.
Mr. E. J. WERMENLINGER (Verdun):: Mr. Speaker, before the orders of the day are called, I should like to ask the Postmaster General (Mr. Elliott), or some other minister who might reply in his stead, when answers will be tabled to the questions passed as orders for return on February 10 last, respecting a subject of interest to all the postmasters of the country, as well as to another question, concerning all the civil servants of Canada, which was passed as an order for return on February 22. As the end of the session is approaching, I would ask the Postmaster General or some other minister whether these returns are to be tabled shortly.


Ernest Lapointe: Mr. Speaker, I shall be glad to call the Postmaster General's attention to the remarks of my hon. friend. If one of the motions referred to concerns all the civil servants of Canada, as he has just said, it is no wonder that the return is not ready; indeed, it would be surprising if it were ready before next session.



WAYS AND MEANS

[Stage Direction]
The house in committee of ways and means, Mr. Sanderson in the chair.

[Stage Direction]
_ Customs tariff

ox 377a, et al. Wrought iron in the form of billets, bars, rods, sheets, strips, plates or skelp: rate of duty, free.
Mr. MACDONALD (Brantford):: When the house was in committee of ways and means last week the hon. member for Davenport (Mr. MacNicol) asked me and other members as to the effect of a certain change in tariff duties on a certain industry in Brantford, and suggested that I was interested in employment. I thank him for the reference, and assure him that I am very much interested in employment not only in Brantford but throughout the whole dominion. I should like however to draw the attention of the committee-and more particularly of hon. members from the city of Toronto, which is known, or at least claims, to have a corner on loyalty-to a certain advertisement that appeared recently in a magazine. Hon. members will recall that last year the Toronto Transportation Commission purchased twenty-seven motor buses to carry Canadian workingmen to and from
2052	COMMONS
Canada-United Kingdom Trade Agreement
their daily toil. Motor bus bodies are manufactured in Canada, and if the Toronto Transportation Commission do not know where, I can assure hon. members from Toronto that in Brantford we manufacture the very finest motor buses made in the world. The Toronto Transportation Commission were in the market for twenty-seven motor buses. They no doubt looked all over Canada, but, forgetting the principle so highly extolled by members from Toronto, of work for Canadian workmen, they purchased, to carry Canadian workingmen, buses made in the United States by United States workingmen.


Some hon. MEMBERS:: Shame.


John Alexander (1874-1948) Macdonald: I am
quite sure that hon. members from Toronto, whom I hold in high regard and am proud to count among my personal friends, were not parties to this transaction, but I do feel that it should come to the attention of the committee.
I hold in my hand a picture of these twenty-seven motor buses lined up in front of presumably Canadian factories. They are splendid buses. This picture appears in a Canadian trade journal printed in Toronto. The advertisement itself is in the form of an insert, in the centre of the magazine, and on the back of the insert showing these United States buses made by American workers to carry Canadian workingmen, is none other than a picture of the union jack. But, Mr. Chairman, looking further, I find that the Toronto Transportation Commission not only bought the buses in the United States, not only had the union jack placed around the picture of the buses, just as many hon. members, especially those from Toronto, are at times apt to wrap the union jack around them when they make an address, but had this insert, which could have been printed in Canada, printed where? In the United States of America.
When hon. members of this house, especially from the city of Toronto, inquire into employment; in other cities I feel that they should first see that their own house is in order. When Toronto practises what it preaches we may all say, yes, we will follow Toronto; but in the meantime we shall do what is in the best interests of Canada.
Mr. MacNI'COL:	I must first congratulate the hon. member on his zeal for the employment of workers in Canada. I must
[Mi. W. R. Macdonald.]
commend him for the speeches he has hitherto made in this house on behalf of Canadian workmen. If he keeps on along that line he will be changing his seat from that side of the house to this side, where the defenders of Canadian workmen are in the majority.
In reference to the item he has brought up I may say that personally I would much rather those buses had been made in Brantford by Canadian workmen than by workers in the United States. In that I support his zeal to have buses for Canadians made by Canadian workmen. I may tell him however that I am afraid the workmen themselves do not ride in the buses. The buses in Toronto are used to carry high class office assistants from Forest Hill village and the upper part of the city to their offices downtown. Most of the workers ride in the street cars.


John Alexander (1874-1948) Macdonald: Surely
Canadian workmen are good enough to make buses for the people of Toronto.
Mr. MacNICOL; No bus is too good for Canadian workmen. I would like to see them ride in the finest kind of buses. As for the magazine mentioned by the hon. member, I did not get the name. What was the name?


John Alexander (1874-1948) Macdonald: The name
of the magazine is Bus a-nd Truck Transport. I understand it is printed in Toronto, except for the insert.


Mr. MacNICOL:: I imagined the whole
magazine was printed in the United States, owing to the fact that the present government has largely crucified the magazine business of this country.


John Alexander (1874-1948) Macdonald: That is
not correct. The magazine, with the exception of the Toronto Transportation Commission advertisement, is printed in Canada.


John Ritchie MacNicol: The hon. gentleman will pardon me for recalling that the present government has crucified, I am told, the printing of fifty-two magazines in this country. They are now printed in the United States, so naturally I thought this magazine was ' printed in the United States. Otherwise I must again commend the hon. member for his support of Canadian workmen. I will recall to his mind the fact that yesterday Canadian workmen in Hamilton voted for a Tory candidate, and elected him. And while I do not want to see a by-election in the hon. member's riding I can promise him that if there should be one, the workman there would also vote for a Tory candidate.

Canada-United Kingdom Trade Agreement


Mr. DUNNING:: Now that we have had a speech from each side on the question of buses and magazines, I wonder if we could consider wrought iron, the item before the committee.


Mr. CHURCH:: The hon. member for Brantford (Mr. Macdonald) is labouring under a misapprehension. Just the other night his colleague from Brant (Mr. Wood) rose in this house and attacked the financial position of the city of Toronto, which is one of the most solvent cities in Canada, with a sinking fund of nearly 830,000,000 available to meet its obligations. It owns all its public utilities, which are operated at cost, and each one has a large surplus.


The CHAIRMAN:: Order.


Thomas Langton Church: I am coming to the item; I am pretty close to it. In reply to the hon. member for Brantford I may say that the city of Toronto operates its transportation system through a commission. The service is furnished at cost, and that commission is managed so efficiently that it does not find it necessary to exceed its estimates at any time. When the commission took over the transportation system it was found that the facilities were not sufficient to furnish the materials needed, and many of the orders had to be filled in Montreal and by the Westinghouse people in Hamilton. It is true that the commission have shops of their own in which a good deal of the work can be done, but wrought iron and many other parts must be brought in. Let me tell the hon. member that the steam railways cannot serve all the people and refuse commutation tickets, and if it were not for the buses a large portion of our population would not have any transportation service at all. The Toronto Transportation Commission is not asking for any favours in connection with wrought iron or anything else. This is the first time I have ever heard of Toronto getting anything free in connection with wrought iron or anything else.


Mr. SPENCE:: I am glad the hon. member for Brantford drew to the attention of members of this house from Toronto the fact that these buses bought by the Toronto Transportation System were purchased in the United States. Of course there may have been some reason for that; they may have called for tenders, and the tender from Brantford may have been much higher than the others. Personally, however, I should be glad to see
these buses bought in Canada even if they did cost a little more money. This again brings up the question of an irresponsible commission which is not under the control of the city council of Toronto or anyone else. They take it upon themselves to do this sort of thing without consulting the members of this house, the members of the city council or anyone. We have several commissions of the same type under this government, however, and they do not seem to be criticized.


Mr. HARRIS:: I should like to say just a word, Mr. Chairman. Perhaps the dumping provisions might be invoked in connection with these articles which contain a certain amount of wrought iron. Then if the tariff were made sufficiently substantial so that these goods could be manufactured in Canada, the Toronto Transportation Commission would not be able to buy these articles in the United States.


Mr. MAYBANK:: I move that these
apologies be accepted.


[Stage Direction]
Item agreed to.
Customs tariff-377c. Ingots, cogged ingots, blooms, slabs billets, u.o.p., of iron or steel, of a class or kind not made in Canada, when imported by manufacturers of forgings for use exclusively in the manufacture of forgings, in their own factories, under regulations prescribed by the minister: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
_ Customs tariff-ex 378. Bars and rods, of iron or steel; billets, of iron or steel, weighing less than 60 pounds per lineal yard:
(b)	Not further processed than hammered or pressed, n.o.p.: rate of duty, 10 per cent.
(c)	Cold rolled, drawn, reeled, turned or ground, n.o.p.: rate of duty, 10 per cent.
(d)	Hot rolled, valued at not less than 4 cents per pound, n.o.p.: rate of duty, free.
Charles Avery Dunning: This is a reduction in rate.


[Stage Direction]
Item agreed to.
_ Customs tariff-ex 378a. Bars or rods, of iron or steel, hot rolled, viz:
Bounds over 4£ inches in diameter and squares over 4 inches: rate of duty, free.
Item agreed to.
Customs tariff-ex 379. Bars or rods, of iron or steel, including billets -weighing less than 60 pounds per lineal yard, not rolled, as hereunder defined, under regulations prescribed by the minister:
2054	COMMONS
Canada-United Kingdom Trade Agreement
(e)	Bars of iron or steel, hot rolled, 5 inches in diameter and larger, when imported by manufacturers of polished shafting for use in their own factories: rate of duty, free.
(f)	Sash or casement sections of iron or steel, hot or cold rolled, not punched, drilled nor further manufactured, when imported by manufacturers of metal window frames, for use in their own factories: rate of duty, free.
Richard Bedford Bennett: Is there a change in this item?


Charles Avery Dunning: These are entry free bound.


[Stage Direction]
Item agreed to.
Customs tariff-380. Plates of iron or steel, hot or cold rolled:
(a)	Not more than 66 inches in width, n.o.p.: rate of duty per ton, $4.25.
(b)	More than 66 inches in width, n.o.p.: rate of duty, free.
(c)	Flanged, dished or curved, n.o.p.: rate of duty, 5 per cent.
(d)	With chequer, diamond or other raised pattern on contact surface: rate of duty, free.
Charles Avery Dunning: The present rate of duty is bound; there is no change, except on subitem (c).


John Ritchie MacNicol: I should like to suggest to the minister that when he reconsiders this item, perhaps next year, he might go into the advisability of extending the protection to include plates up to 78 inches in width. A goodly part of the steel plate business in Hamilton during the last year has been the rolling of plate between 66 and 78 inches in width. Owing to the fact that there is very little plate coming in from the old country at the moment, due to the war scare, that plant has been able to dispose of plate made in Canada up to 78 inches in width. I am convinced that it would be taking another step in the right direction if the minister would consider protecting plate up to 78 inches in width next year.


Charles Avery Dunning: I shall be glad to take note of my hon. friend's remarks. The concern that is making these larger plates is now running full time and, I think, doing very well. A year ago we helped the situation to some extent by restoring the dump provisions relating to this article which previously had been suspended. With respect to steel, and particularly steel plates of this size, the present world condition in regard to demand and manufacture renders it quite impossible to predict what might be the situation twelve months from now.


Richard Bedford Bennett: You cannot do anything about it twelve months from now; you are bound for three years, are you not?


Charles Avery Dunning: The rate is bound, yes.


Mr. STEWART:: I understood the minister to say there was no reduction here. I think there is.


Charles Avery Dunning: Not in the (a) section. There is a reduction in rate in the (c) section.


[Stage Direction]
Item agreed to.
Customs tariff-ex 381. Sheets, of iron or steel, hot or cold rolled:
(a)	'080 inch or less in thickness, n.o.p.: rate of duty, 7i per cent.
Charles Avery Dunning: There is no change in this item.


[Stage Direction]
Item agreed to.
Customs tariff-382. Hoop, band or strip, of iron or steel:
(a)	Hot rolled, -080 inch or less in thickness, n.o.p.: rate of duty, 5 per cent.
(b)	Hot rolled, more than -080 inch in thickness, n.o.p.: rate of duty per ton $3.
(c)	Cold rolled or cold drawn, -080 inch or less in thickness, n.o.p.: rate of duty, 7J per cent.
(d)	Cold rolled or cold drawn, more than *080 inch in thickness, n.o.p.: rate of duty, 121 per cent.
Charles Avery Dunning: There is a reduction of rate under (a) and (b). The present rate is bound under (c), and (d) shows a reduction in rate against Great Britain. I could give the detailed reductions, but I think hon. members already have them.


John Ritchie MacNicol: I should like to direct the attention of the minister to another matter with which I know he is acquainted already, because I have had reports from the people w7ho have written him and who have also written me, in reference to items 382, 383, 385 and 386.


Charles Avery Dunning: We have not reached those items yet.


John Ritchie MacNicol: But what I have to say in regard to this item applies to all four items. As I understand it, at the moment some of our manufacturers are having very great difficulty in obtaining the necessary raw products with which to carry on in Canada, particularly plates of the thicknesses referred to here, because in the United States they have little to export and at the moment we cannot import any considerable quantity from Great Britain. I am just wondering what we are going to do in Canada. At the moment it is not a matter of duty at all; it is a matter of sufficient production to supply us with plate of the thicknesses required to permit, for example, the galvanized iron plate plant at

Canada-United Kingdom Trade Agreement
Sarnia, and other similar plants, to continue in operation. Is there anything that can be done to provide these plants with their raw products?


Charles Avery Dunning: My hon. friend realizes, of course, that the difficulty he now mentions is practically world wide at the moment, and at the present time I see no prospect of its easing. As he says, it is not particularly a matter of tariff but rather of the extremely great world demand for this class of article. All I can say is that we are watching the situation and wherever it is possible to give any assistance by way of developing a source of supply we are glad to do so, although generally speaking the men engaged in this class of manufacture are alive to their own business and very much more efficient in regard to it than the government possibly could be. I think they are very much alive to the situation and are working on the matter at all times. Up to now I must confess that the condition has been growing steadily more difficult with respect to the supply of this class of material. That is true not only of this country but I believe of all other countries as well.


Richard Bedford Bennett: Mr. Chairman, I was waiting until another item was called, but since that item is now to be discussed I shall make my observations at this time.
In the first place, black sheets are produced in only one mill in Canada, for the purpose of galvanizing. That mill is at Hamilton, and belongs to the Steel Company of Canada. They have no iron ore, and import their iron ore or raw material from the United States. In the second place, they are unable to meet the Canadian demand-absolutely. In the third place, orders placed in England cannot be filled at the present time. Some orders placed in England last fall are being filled in part, and some cannot be filled. In the next place, black sheets are required for galvanizing, and are required in western Canada, not next summer, but now, with the opening of navigation. Great Britain does not supply these plates at the moment, because she cannot do so and at the same time meet her own domestic demands. Therefore there is but one market left to which the Canadian can turn, and that is the United States. Shall he be denied the right to buy in that market when he cannot buy anywhere else? Shall he have to pay an extra ten per cent to buy in that market? That is the issue.
We have met that issue in connection with Indian corn and other matters. When we have found the Canadian consumer confronted with an impossible situation we have at once enabled him to get his raw material by lessening the rate of duty and putting it upon a basis at least similar to that which prevailed in Great Britain under the preference. The rate on plates from Great Britain stands at five per cent. If my memory serves me correctly the rate on plates from the United States is 20 per cent, plus three per cent excise tax, making a total of 23 per cent. The British rate is five per cent, with no excise tax. The Canadian consumer is denied the right to buy in England; he cannot buy a plate. Canada has one factory, the orders of which more than cover its capacity. Shall the Canadian consumer in western Canada be without galvanized sheets? That is the issue.
I submit to the minister the matter can be dealt with simply by doing with the sheets exactly what we did with Indian corn from the Argentine. We could make a free rate for three months so that the sheets could come in from the United States, or-in order that no unfairness might be shown to those who have purchases-make it five per cent, which is the same rate as applies to England. The only difference would be that in purchasing from the United States one would have to pay the three per cent excise tax, making a total of eight per cent, and thereby discriminating against the purchaser to a certain extent.
The situation is one which cries for relief; it is not imaginary. The other day in my room a westerner who for twenty years has been meeting Canadian demands told me that he found himself unable to buy galvanized sheets.


Charles Avery Dunning: From British sources of supply.


Richard Bedford Bennett: No, not British sources of supply at all.


Charles Avery Dunning: The individual my right hon. friend mentions	has	been	filling	the
demand from a British source of supply.


Richard Bedford Bennett: He had to, because the preference was fifteen	per	cent.	The	realtruth of the matter is	that	in order to	giveEngland something for what they gave us, namely a free market for our products, in 1932 we did endeavour to give them a preference on steel. We	gave	a preference under the intermediate tariff to such an extent that they were able to get some business. The hon. member for Davenport has referred to another item which I shall not mention.2056	COMMONS
Canada-United Kingdom Trade Agreement
Why cannot the government do something for the Canadian consumer, who is crying for relief, and who wants galvanized sheets? Why cannot they do something? That is what I want to know. We did it in connection with Indian corn; why can we not do it for black sheets? There is only one house in Canada producing them, and that house is sold out and will not quote prices for future delivery. That plant is working to capacity, and yet here is a person crying for galvanized sheets; people are crying for them. They are very much in demand in western Canada, as every hon. member from that part of the country must know. Hardware firms which usually supply them are driven to the position of either importing galvanized sheets from the United States and paying a high duty, thereby putting out of employment employees in Canadian galvanizing plants, or doing without them. The hon. member for Davenport referred to a plant at Samia, but I shall not make special reference to it at the moment.
Aside from all that, why cannot the government ask the British government, in view of the fact that Great Britain is unable to supply us with what we require, to let us take down the tariff barrier for three months, in order that the supply may be made available for the Canadian galvanizer with his pots at Sarnia, or elsewhere as the ease may be? South Africa at once acceded to such a request when we asked them about com.


Charles Avery Dunning: They took a little time.


Richard Bedford Bennett: Yes-until they found out they were going to have no crop. As soon as they saw there was a crop failure they realized that Canadians had to have corn and they said, "As the corn cannot come from us, and you want to let it in, go ahead and do it "*-and we did it.
Here is the steel situation. Iron sheets are required for galvanizing. We cannot buy them in Canada; we cannot buy them from Great Britain, but we can buy them from the United States. But if we have to pay 20 per cent duty on them, together with a three per cent excise tax, the price of raw material will be so high that the galvanizer in Canada cannot possibly supply the market. That is the position. Why can we not do something to help out?
I suggest to the minister that the British government be asked to permit us for three months to import raw material from other countries. Someone will say, " You cannot get raw material from the United States." You can, because I know of a manufacturer who has quotations on it, and can obtain delivery in three weeks. I do not know

whether that supply will last long, but I do say that here is a situation created by world conditions, and that under that situation Canadians cannot get their supply. I should have said earlier in my remarks that some have a supply, or a partial supply, and can galvanize. Others cannot, however, because they have not the raw material. The answer of some people is, " If their credit was good enough they would have bought a supply and put it away in warehouses in England. Had they done that, they would have it now." We cannot ruin our business by showing favouritism of that kind, where business would depend on whether a man had a million dollars in the bank at a particular time. True, some of them were able to make purchases and to store those purchases in anticipation of a situation under which, if pressed, they could draw from their stores. But that is not this case. This is a condition exactly similar to that which obtained in connection with the corn situation in South Africa and the Argentine. I believe England is not unfair; at least I never found them so in the four and a half years we had dealings with them in connection with the trade agreement. They were always reasonable with respect to any request made. If we asked them for a period of two or three months, or as the minister may determine, to place black sheets on the free list, I have every reason to believe our request would be favourably considered- unless they have changed their general policy in dealing with matters of this kind.


Charles Avery Dunning: Mr. Chairman, I am sorry that I replied to the hon. member for Davenport (Mr. MacNicol) in connection with the item at present before the committee. I was not dealing with the matter to which the leader of the opposition is referring. It was my expectation that I would have to make detailed reference to that item when we reached it in the schedule, at a point about ten items beyond the one now before the committee. Perhaps it would facilitate the work of the committee if we were to pass along, and deal with the matter in proper order.


Richard Bedford Bennett: The hon. member for Davenport dealt with it, and that is the reason I did so.


Charles Avery Dunning: I did not understand the hon. member for Davenport to be referring to black sheets.


Richard Bedford Bennett: He was talking about sheets for galvanizing.


[Stage Direction]
Item agreed to.

Canada-United Kingdom Trade Agreement
Customs tariff-383. Sheets, plates, hoop, band or strip of iron or steel:	_
(a)	Coated with tin, of a class or kind not made in Canada, n.o.p.: rate of duty, free.
(b)	Coated with tin, n.o.p.: rate of duty, free.
(c)	Coated with zinc, n.o.p.: rate of duty, 7£ per cent.
"(d) Coated with metal or metals, n.o.p.: rate of duty, 5 per cent.
(e)	Coated with paint, tar, asplialtum or otherwise coated, n.o.p.: rate of duty, 5 per cent.
(f)	Coated with vitreous enamel, n.o.p.: rate of duty, 10 per cent.
(g)	Corrugated, coated or not: rate of duty, 10 per cent.
Richard Bedford Bennett: On three items there are no changes; on two there is a reduction of 2i per cent, and on one 5 per cent.


Charles Avery Dunning: That is right.


[Stage Direction]
Item agreed to.
Customs tariff-385. Sheets, plates, hoop, band or strip, of iron or steel, hot rolled, valued at not less than five cents per pound, n.o.p.: rate of duty, free.
Hugh Alexander Stewart: I think it would speed up the passing of these items if the minister would continue the practice he started of announcing when the item is called whether there is any change.


Charles Avery Dunning: I shall be glad to do that. In this case the reduction is from 5 per cent to free.


[Stage Direction]
Item agreed to.
Customs tariff-385a. Sheets, plates, hoop, band or strip, of rust, acid or heat resisting steels, hot or cold rolled, polished or not, valued at less than five cents per pound: rate of duty, free.
Item agreed to.
Customs tariff-ex 386. Sheets, plates, hoop, band or strip, of iron or steel, as hereunder defined, under regulations prescribed by the minister:
(a) Plates, when imported by manufacturers for use exclusively in the manufacture or repair of the pressure parts of boilers, pulp digesters, steam accumulators and vessels for the refining of oil, in their own factories: rate of duty. free.
(h)	Sheets, plates, hoop, band or strip, hardened, tempered or ground, not further manufactured than cut to shape, without indented edges, when imported by manufacturers of saws for use exclusively in the manufacture of saws, in their own factories: rate of duty, free.
(m) (i) Sheets of iron or steel, cold rolled, when imported by manufacturers for use exclusively in the manufacture of sheets coated with tin: rate of duty, free.
(ii) Sheets, hoop, band or strip, of iron or steel, hot rolled, when imported by manufacturers for use exclusively in the manufacture of sheets, hoop, band or strip, coated with zinc or other metal or metals, not including tin, in their own factories: rate of duty, 5 per cent.
(p)	Sheets of iron or steel, hot or cold rolled, with silicon content of -075 per cent or more, when imported by manufacturers of electrical apparatus, for use in the manufacture of electrical apparatus in their own factories: rate of duty, free.
(q)	Hoop steel, hot or cold rolled, plain or coated. -064 inch or less in thickness, not more than three inches in width, when imported by manufacturers of barrels or keys or by manufacturers of flat hoops for barrels and kegs, for use exclusively in their own factories: rate of duty, free.
Richard Bedford Bennett: In (a) there is a reduction of 5 per cent.


Charles Avery Dunning: There is a reduction in the rate in (h) from 5 per cent to free. There is no change in item (m) (i); this is binding the free entry. The next item is the one to which the leader of the opposition was referring a few moments ago. I gather from his remarks that the interested parties have made to him the same representations that they have made to me as representing the government. I had not an opportunity to tell the committee about this previously, but a difficulty has arisen due substantially to the circumstances to which the leader of the opposition made reference. As he says, there is only one mill in Canada manufacturing black sheets for galvanizing. Another mill is getting ready for and will be in production in the next few months. This mill will produce continuous sheets which will serve the same purpose. A number of those who have been purchasing black sheets in England for some years past now find their sources of supply very much delayed, if not denied to them altogether. The question arises whether or not some special arrangement should be made, having regard to the particular circumstances now prevailing. If I could be certain of all the facts, as the leader of the opposition evidently is, my answer would be different. I can only say that the facts are being carefully sifted and every effort will be made to meet the situation.
I would point out that there is no difficulty in reducing the rate under the intermediate tariff from 20 per cent to 15 per cent, but under the agreement we would have to reduce the British rate from 5 per cent to free because the 15 per cent margin must be maintained. As to whether that is quite fair, having regard to all the circumstances, or as to whether it is necessary to go further than that, I am not yet in a position to state. If it is necessary, in order to meet Canadian consumptive demand, to go further than that, then we must communicate with the British government, as we did with the South African government in the case of corn. I have no
2058	_	COMMONS
Canada-United Kingdom Trade Agreement
more reason to think that they will be difficult about the matter than has the leader of the opposition. I do know that we must be able to give them all the facts with respect to Canadian consumptive demand and Canadian sources of supply. On their part they will have accurate information as to the possibilities of meeting Canadian demand from British sources. They already know of that.
I can assure the committee that we are not losing sight of the problem. It is one of the problems which arise in the course of administration when we are faced with an upset such as the one which has taken place in the iron and steel industry of the whole world as a result of the tremendous armament programs. I can assure my right hon. friend that the matter is under consideration, the facts are being assembled and proper action will be taken.


Richard Bedford Bennett: Mr. Chairman, the minister says that if he was as sure of the facts as I am he would have no difficulty.


Charles Avery Dunning: Of all the facts.


Richard Bedford Bennett: The essential facts are all the facts that are necessary to be known if the government is in earnest in dealing with this matter. First, the interest that represented the matter to the minister was not, I think, the interest that represented the matter to me. I was approached by a representative of the consumers, not of the producers. The man who supplies most of the west with this material was in this city. He told me that he was unable to get his raw material, and wanted to know what he was to do to meet the demands of the consumers of western Canada.


Charles Avery Dunning: That is not the same man.


Richard Bedford Bennett: Certainly not. I assume the interests who saw the minister were the producers of galvanized sheets. The gentleman who saw me has been for the last twenty-five years the principal western distributor of this material. I do not know whether the minister saw him.
In order that there may be no question about the matter let us see what are the essential facts. Time is important. Every day lost, every hour lost, makes it more difficult to get raw material at reasonable prices from the United States. Prices of steel in the United States have gone up from S3 to S8 per ton, and will probably go higher. While we are investigating the cost of agricultural implements the prices of the raw materials

that enter into those implements have increased twenty-five per cent. That is the position which we have to face at the moment.
The first essential fact is that there is only one source of supply in Canada at the moment. The second essential fact is that the contemplated additional production will not be available during the next three months. That can be stated as a certainty. If it is available in three months, it will not be in a position to supply the requirements of black sheets for galvanizing.


Charles Avery Dunning: It is working every day turning them out.


Richard Bedford Bennett: To supply the requirements of these people.


Charles Avery Dunning: That is supplying Canadian demand.


Richard Bedford Bennett: That is the second factory, not the first-not the Hamilton plant. The minister said there was a second plant which would probably be in a position to increase its production during the next few months. I am pointing out that it is not in a position at the moment to meet the spread between the demand of the Canadian people and the production of the single factory at Hamilton.
The next essential fact is that they cannot get supplies from England. The British will not undertake deliveries in time to make galvanized sheets available in western Canada this season. The other fact is that, at the moment, you can get galvanized sheets- or may be able to get them-in the United States. The question of price is important, because it is dependent upon daily, almost hourly conditions; every hour lost imperils the opportunity of production by one plant with which the largest, or one of the largest, distributors in western Canada has placed his orders. These are essential facts. What facts should the British government know that they do not know, that the minister has, that cannot be presented? Shortly, the story is that Canadians in the west cannot get galvanized sheets for their requirements this spring unless we can bring in from the United States a quantity of raw material for the production of these sheets. In order to do that-


Charles Avery Dunning: That is not proven as far as I am concerned. That is my point.


Richard Bedford Bennett: I do not pretend that I have the facilities which the minister has at his disposal; for he has only to ring a bell and he can ascertain these facts within twenty-four hours. This country has a service of telegraphs and telephones quite adequate for that purpose. The known distributions in the

Canada-United Kingdom Trade Agreement
west can be communicated with, the supply they have on hand ascertained, and their prospective market known. The prospective supply is known to all. Just where the pots are located is known. Where they can be dipped is known. And the availability of supplies from Great Britain and Canada can be ascertained within a few hours. The gentlemen concerned who have been presenting this matter went home two weeks ago. I may add that I did not meet them.
The subject is of such pressing importance that the minister should ascertain the facts and communicate by cable with Great Britain before another rise in the price of raw material in the United States makes it impossible for these men to do business at all. It must be borne in mind that the raw material already purchased by other buyers will be profitable to them, because they will sell on a basis of market prices which will give them larger profits than they would otherwise obtain. In other words, those who have had foresight and have been financially able to acquire large supplies of raw material are going to reap a harvest, whereas those who have to purchase at an increased price must either face a loss, if they sell at a price as low as their competitors can afford to do, or sell at a price which their competitors will maintain for the sake of the larger profit that will accrue. That is why I think the matter is important and pressing and that cable communication with the British government is desirable, if the source of supply upon which western Canada relies for its galvanized plates is to be available this year. If it is not, then the other factor must be considered, namely the purchase of the galvanized plates from some other source, and that involves the question of the duty that has to be paid for the completed article as compared with the raw material. If the minister thinks that I was endeavouring to express full certainty about the facts, let me say that I was only pointing out that there are facts which are known to him and should be known to every member of the committee who desires to know them. There is no assumption on my part of knowledge of the facts but rather a statement of them to the committee in order that they may have an intelligent appreciation of the real issue, which is whether or not western Canada shall get galvanized plates at a reasonable price, whether we shall have to import galvanized plates from the United States or some other country, and whether the increased price of the raw material which has come about, insuring to the benefit of those who will be able to sell their products at a high price, is to continue after a reduction of the
tariff for the sole purpose of meeting such a situation. In the case of Indian corn or maize from South Africa we met the situation frankly. Such action was not taken solely by the present government; under similar circumstances, similar action was taken by the preceding government and would, I assume, be taken by any government when appropriate conditions arise. That state of things has now come about; delays are dangerous and will certainly involve increases in prices. Instead of wasting time in trying to find out what the facts are, the minister, knowing what the facts are, should take action so that this condition may not continue.


Charles Avery Dunning: Mr. Chairman, it is very helpful to have my right hon. friend's eloquence and forensic ability applied to the task of persuading me to be willing to do something which, I think every member of the committee knows, it would be my natural disposition to do in any event. My reference to full knowledge of the facts relates to this feature: I know that certain Canadian fabricators are getting their supplies to-day from British sources. I know of one Canadian fabricator who is in the position to which my right hon. friend refers. It happens that the large distributor in Winnipeg to whom he has alluded has for years obtained his supplies of galvanized sheets from the one fabricator and is in the difficult position to which my right hon. friend refers. I am not certain that there are not some smaller fabricators in the same position. If that is so, there is considerable merit in the contention.
One must remember two things. One is that the plant which is operating is running twenty-four hours a day-supplying what? Supplying Canadian demand. The second is that several of our largest fabricators of black sheets are securing their supplies at this moment from British sources with which they have had connection for many years.


Richard Bedford Bennett: Just how many? Let us see what the minister is going to say.


Charles Avery Dunning: There are three I could name.


Richard Bedford Bennett: Well, let us have them. I happen to know some of them. Who are they?


Charles Avery Dunning: I do not like particularly to give the names of concerns.


Richard Bedford Bennett: Why not? It is well known who is in this business.


Charles Avery Dunning: My right hon. friend can take that responsibility if he wishes.
2060	_	COMMONS
Canada-United Kingdom Trade Agreement


Richard Bedford Bennett: I shall be very glad to do so.


Charles Avery Dunning: At any rate I know that one of the very largest fabricators is getting supplies. One other I know is-[DOT]


Richard Bedford Bennett: Have they had any supplies delivered to them in the last three weeks?


Charles Avery Dunning: It is difficult to say.


Richard Bedford Bennett: No, it is not.


Charles Avery Dunning: I know that they do not regard themselves as being in immediate difficulty. A third I have in mind, who formerly relied on British sources and cannot now do so because of his purchasing arrangements, is being looked after, I am advised, by the Canadian source of supply. However, there is no need for us to argue about the matter. I could, have well imagined, had action been taken along the lines of the request of my right hon. friend before this item came up for discussion, that some hon. members would have condemned the government for letting down the tariff bars against the United States. We are very glad to know that the leader of the opposition has the great appreciation that he has of the nature of the problem, and, as I said at the outset, it will assist very materially in moving forward quickly in regard to it. It does not affect this item; it amounts really to creating an exception from this item for a temporary condition.


Mr. WARD:: My understanding of the tariff regulations has been that unless ten per cent of a commodity was produced in Canada the provisions of the tariff did not apply. Am I correct in that?


Richard Bedford Bennett: No.


Charles Avery Dunning: No, there is nothing of that kind. The hon. member is thinking of the dumping duty, not of the straight tariff.


Richard Bedford Bennett: The dumping duty would have no application if this were done now.
I do not see why the minister finds it desirable in dealing with this item to talk about forensic powers or abilities.
lyir. DUNNING: I admire them very much.


Richard Bedford Bennett: That is beside the issue. There is no need of discussing them. We are dealing with an item and a problem that is involved in it, and we want to deal with that problem on an intelligent, businesslike basis. When the hon. gentleman says that he knows of one firm that is receiving raw material, sheets, he is referring to General Steel Wares, 
who get their material from Baldwins, with whom they had a working arrangement; and as a matter of fact the president of the enterprise is one of the directors of Baldwins. At one time they had a branch here. What is the sense of saying that there is any secrecy about it? Everyone is thoroughly familiar with all the facts. They say they are receiving a portion of their deliveries, but they had large credits arranged for their supplies. They had foresight, and they will probably reap a substantial profit by that foresight. They are the only large producers of galvanized sheets, and they are not suppliers to the particular business in western Canada to which I have reference.
Surely this is not a question of suggesting what might have been done. When a minister of the crown, particularly the Minister of Finance, suggests that under other conditions some different course would have been taken, that is entirely beside the point. The question is, what course have we taken? That is the issue, and it will be found that during the five years we were in office we took but one course with respect to these matters. While we were developing Canadian industry and giving employment to Canadians we saw to it that if the time came when it was impossible to secure requirements for Canadians there would be proper provision for that very purpose. We made provision whereby it could be done; for the tariff is precisely for that purpose.
This is not a matter that has arisen to-day or yesterday; it has been known for weeks, and has been pressed upon the minister. He says he wants to know what the facts are. I say that he has had ample time to get the facts; and if we had been as dilatory in dealing with such a matter as that lapse of time suggests we should no doubt have been blamed, as we were with respect to other matters.
The corn matter did become acute and the South African government came to an agreement and action was taken. Up to the moment England has not been asked. The minister makes that abundantly clear from what he says. It takes time for the government to make inquiries there, and by the time these inquiries are made it will perhaps be too late to deal with the matter and the whole channel of trade of the country in this direction will have been disturbed by reason of that fact.
The minister must not think that because one speaks in this manner there is anything personal about it. There is no necessity for animadverting upon the poor way in which

Canada-United Kingdom Trade Agreement
the case may have been presented; I am trying to present the case. Nor is there any necessity to speak of what might have been done under other circumstances. All we can discuss is what has been done, and I have presented the matter as I have seen it. I may observe that I never in my life saw the person concerned except once. The papers are under my hand, because I brought them to the chamber in case it was necessary to use them should any controversy arise. The matter is of importance as involving the whole source of supply, and I would say frankly to the minister that if, as a result of any action taken, it becomes necessary to pay the high duty to obtain galvanized sheets from the United States mills I shall consider that we have made a capital mistake, when we can secure the raw material under the terms I have mentioned so that Canadian fabricators can produce the finished article and maintain continuity of life in the industry in question.
I am not unmindful of the difficulties. There is of course a galvanizing plant at Hamilton which is well known, being a branch of an English house. I believe it is one of the largest plants in the country.


Charles Avery Dunning: It is.


Richard Bedford Bennett: As far as I can remember it is probably the largest in Canada. But there are smaller plants. The one at Sarnia has three or fo.ur modern pots capable of doing as much galvanizing as two of the old pots; and as regards those at Montreal and other places, some of them are the very latest and others old. The question of improvements that have been made in galvanizing arises in this connection. In some of the plants in Canada the work can be done with greater celerity than was possible five or six years ago. Indeed, the improvements that have been brought about in galvanizing have been quite substantial, more especially in connection with galvanizing pipe. That question, however, does not arise at this particular moment. We are now dealing with the matter of sheets, and if as a result of the discussion the minister will continue his inquiries with as much zeal as possible under the circumstances, it will be appreciated by all those who are affected-and every consumer of galvanized sheets has a vital and direct interest in this transaction.


Charles Avery Dunning: Before allowing the
matter to pass I should say that I have positive knowledge of only one concern that is adversely affected to the extent portrayed. Any action would involve a specific length of time; my right hon. friend sees that.


Richard Bedford Bennett: Certainly.


Charles Avery Dunning: When I spoke of all the facts I had in mind that feature of it. The fabricators in Canada indicate what their capacity is, and we do know what our imports from Great Britain were last year. We do not yet know, however, to what extent these imports of last year will be diminished by the circumstances now prevailing and which are being looked into. But this much is clear. Some of the largest fabricators are still receiving their supplies from English sources.


Richard Bedford Bennett: My information is that they have not received any lately.


Charles Avery Dunning: I know of only one plant that is adversely affected by reason of not having made forward orders upon its English connections. From the point of view of my right hon. friend that is important because that particular fabricator supplied the largest distributor in western Canada; and the largest distributor in western Canada and the plant at Sarnia to which reference has been made are, of course, very much concerned. I can only assure my right hon. friend that the matter will not be lost sight of, and action can be taken very quickly so far as this government is concerned. But we want to be sure, when submitting a request to the British government on a matter of such importance, that we present all the facts in the best possible manner so that no question can afterwards be raised.


Richard Bedford Bennett: The minister realizes that, so far as the United States is concerned, the present tariff means a prohibition against these people.


Charles Avery Dunning: In order to make any entry from the United States effective, the dumping provisions also would have to be removed.


Richard Bedford Bennett: Yes, but they would not apply. The minister will find that they do not apply under present price conditions. But leaving that aside, the real issue is this, that they cannot maintain their pots at all if in order to secure their raw material they have to pay the present tariff, plus three per cent excise tax and eight per cent sales tax on these goods. The hon. gentleman is quite right in saying that the distributor in western Canada has had a contract for his supply of materials.


Charles Avery Dunning: And the supplier cannot fill it.


Richard Bedford Bennett: Exactly.


Charles Avery Dunning: Because the supplier did not protect himself.
2062	COMMONS
Canada-United Kingdom Trade Agreement


Richard Bedford Bennett: He could not secure the raw material.


Charles Avery Dunning: He accepted a contract without protecting himself with respect to raw materials.


Richard Bedford Bennett: He did what I suppose nine out of ten manufacturers do; they assume that they will be able to meet the situation with respect to orders as required. When he gave his orders, had they been filled he would have been all right; but they were not. Last year when I spoke on the budget I referred to the tariff board's report of October, and I also referred the other day to the question of sheets. I used the word "strips," but I am informed that technically that is not the proper word. I was talking about the continuous sheets used in automobile production. I did not know the situation until I was in Australia and when I came back I applied it to our conditions and found then what the position was. We are facing a reality which means a prohibition to this man if he has to pay twenty per cent plus three per cent as against his competitor who buys for five and no three per cent, and who by reason of his financial position is able to make arrangements which are denied the other person.


Charles Avery Dunning: My right hon. friend knows, of course, that this is not the first time this has been asked for.


Richard Bedford Bennett: I am not familiar with what took place before.


Charles Avery Dunning: I am fairly sure that

under circumstances not so extreme,, I admit -similar application was made to my right hon. friend's government.


Richard Bedford Bennett: That was another matter. The information given to the minister just now is not quite accurate in that regard. Something else was involved, the question of the release of the United States Steel Company's sheets at Ojibway, and an arrangement was made, which the minister can ascertain, by which they were distributed under conditions that worked a hardship upon some people by reason of certain undertakings that were given not having been implemented. After 1932 it may be so; I have no recollection.


Charles Avery Dunning: I can only say that in the representations made to me by those who are opposed-naturally, because of their own interest-to any action being taken, it was definitely indicated to me that representations made to my right hon. friend, or my predecessor perhaps, had been refused, and

always the Canadian demand had been met. Of course there never has been such an extreme situation as that now- existing.


Richard Bedford Bennett: I think if the minister will look into it during the dinner recess he will find it had to do with the Ojibway accumulation of sheets.


Charles Avery Dunning: Yes, that is a separate question, a different question.


Richard Bedford Bennett: After 1932 I can recall
no question arising of there being an ample supply at all times, and the imports from England are shown. The Hamilton plant did not begin to produce the black sheets until 1932 or since. I remember that when we were framing this item in the tariff, production in quantity had not arisen, and the question of production in quantity had to be considered. I do recall, now that the minister mentions it, that Mr. Boyd of the Sarnia plant was in London at the time certain arrangements were being made in connection with these matters, and he had some trouble which arose largely out of the difficulty in adjusting the United States Steel supply of plates that were permitted to be sold under conditions probably based upon an erroneous appreciation of the circumstances. I daresay the minister knows the story. They had a large quantity of plates and the plates were to be galvanized and sold under certain conditions so as not to glut the market. It was said that advantage was taken of it, and those who had bought in good faith and paid the duty contended that they were entitled to rebate. The treasury board considered it, and my recollection of the conclusion reached is that they had made a case for adjustment, and an adjustment was made. I cannot speak with clear recollection of that, but I do recall the story and I recall the release of that large quantity of United States Steel black sheets from Ojibway. They were galvanized at Hamilton. The question of the effect that sale had upon the distribution by General Steel Wares on the one hand and a certain plant on the other was a matter that was pressed upon us, and they showed us exact figures of the result of the sale of those goods at a rate of duty which was not the rate provided for when they entered this country, because they came in as raw material to be manufactured, and that was not done. I do not think there was any case such as this.


Charles Avery Dunning: There were certainly no
circumstances similar to these which now prevail. I concede that at once.
In (p) and (q) there is no change.


[Stage Direction]
Item agreed to.

Canada-United Kingdom Trade Agreement
Customs tariff-387c.	Steel grooved (or
girder) rails for electric tramway use, weighing not less than 75 pounds per lineal yard, punched, drilled, or not, of shapes and lengths not made in Canada: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-388.	Iron or steel angles,
beams, channels, columns, girders, joists, tees, zees and other shapes or sections, not punched, drilled or further manufactured than hot rolled, weighing not less than 35 pounds per lineal yard, n.o.p.; piling of iron or steel, not punched or drilled, weighing not less than 35 pounds per lineal yard, including interlocking sections, if any, used therewith, n.o.p.: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-388b. Iron or steel angles, beams, channels, columns, girders, joists, tees, zees and other shapes or sections, not punched, drilled or further manufactured than hot rolled, n.o.p.; piling of iron or steel, not punched or drilled, including interlocking sections, if any, used therewith, n.o.p.: rate of duty, $4 per ton.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-388d. Iron or steel angles, beams, channels, columns, girders, joists, piling, tees, zees and other shapes or sections, punched, drilled or further manufactured than hot rolled or cast, n.o.p.: rate of duty, 20'per cent.
Charles Avery Dunning: There is a reduction from 25 per cent to 20 per cent.


John Ritchie MacNicol: We cannot get them in now anyway.


[Stage Direction]
Item agreed to.
Customs tariff-388e. Iron or steel side or centre sill sections, of all sizes not manufactured in Canada, weighing not less than 35 pounds per lineal yard, not punched, drilled or further manufactured, when imported by manufacturers of railway cars, for use in their own factories: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-390c. Piston ring eastings of steel, in the rough as from the moulds: rate of duty, free.
William John Ward: I referred to this question a few days ago. I am sorry the Minister of National Revenue is not in his seat. This is a matter which concerns greatly the mining and lumbering industry of Canada. About three months ago, on representations made by the Caterpillar Diesel Tractor Company of the United States the commissioner of customs gave a ruling which removed the 25 per cent duty levied on the importation of
diesel engines. About three weeks ago, on representations made by the British trade commissioner, this ruling was cancelled. The information was given to me by men in the trade that this ruling was cancelled on representations by the Dominion Steel Company, which I believe is a branch of the great Dominion Bridge group, on the pretext that this firm was manufacturing diesel engines in Canada. May I point out that the United States company up to January of this year had manufactured some 22.000 or 23,000 diesel engines, which engines were admitted to Canada free of duty if they entered as part of a tractor.


Frederick George Sanderson: I am sorry to interrupt the hon. member, but I think he is out of order in bringing this matter up under the present item.


William John Ward: Well, I am not sure there is going to be an opportunity to discuss it later.


Charles Avery Dunning: There is an item under which it can be dealt with. It is 409m, and possibly the Minister of National Revenue will be here when we come to that.


William John Ward: There will be an opportuinty to discuss it then?


Charles Avery Dunning: Under item 409m.


William John Ward: ' Will the Minister of National Revenue be in his seat then?


Charles Avery Dunning: I cannot say. The hon. member can go and get him in the meantime.


William John Ward: Well, I shall defer my remarks until then.


[Stage Direction]
Item agreed to.
Customs tariff-392. Forgings, of iron or steel, in any degree of manufacture, n.o.p.: rate of duty, 17J per cent.
Charles Avery Dunning: A reduction in rate from 20 per cent to 17J per cent.


[Stage Direction]
Item agreed to.
Customs tariff-ex 392, 392a. Forgings of iron or steel, in any degree of manufacture, hollow, machined or not, not less than 12 inches in internal diameter; and all other forgings, solid or otherwise, in any degree of manufacture, of a weight of 20 tons or over: rate of duty, free.
Charles Avery Dunning: There is a combination there. There is a reduction on part of the item, on certain forgings.


John Ritchie MacNicol: Does this item cover locomotive steel? I am not finding any fault; I just want to know whether each of them or
2064	COMMONS
Canada-United Kingdom, Trade Agreement
all of them collectively refer to steel forgings for the manufacture of locomotives or railroad work.


Charles Avery Dunning: Not necessarily. My hon. friend will note the specifications-not less than 12 inches in internal diameter, and of a weight of 20 tons or over. The classification is pretty broad.


[Stage Direction]
Item agreed to.
Customs tariff-393. Tires, of steel, in the rough, not drilled or machined in any way, for railway vehicles, including locomotives and tenders: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-ex 394. Axles and axle bars, n.o.p., and axle blanks, and parts thereof, of iron or steel:	_
(a) For railway vehicles, including locomotives and tenders: rate of duty, 74 per cent.
Charles Avery Dunning: There is a reduction from 10 per cent to 74 per cent.


[Stage Direction]
Item agreed to.
Customs tariff-396.	Pipe, cast, of iron
or steel, valued at not more than 5 cents per pound: rate of duty per ton, $5.
Charles Avery Dunning: This is an old friend. There is a reduction in rate from $7 to $5 per ton.


[Stage Direction]
Item agreed to.
Customs tariff-396a. Pipe, cast, of iron or steel, n.o.p.: rate of duty, free.
Charles Avery Dunning: There is a reduction in rate from 5 per cent to free.


[Stage Direction]
Item agreed to.
Customs tariff-ex 397. Pipes and tubes, of wrought iron or steel, plain or coated:
(c)	Not joined, with plain ends, not more than 2^ inches in diameter, n.o.p.: rate of duty, 5 per cent.
(d)	N.o.p.: rate of duty, 12J per cent.
Charles Avery Dunning: There is no change under
(c); there is a reduction from 15 per cent to 124 per cent under (d).


[Stage Direction]
Item agreed to.
Customs tariff-ex 397(b), 398a. Pipes and tubes of iron or steel, seamless, cold drawn, plain ends, polished, valued at not less than 5 cents per pound; steel tubes, welded or seamless, more than 104 inches in diameter, with plain ends, when imported for use exclusively in the manufacture or repair of rolls for paper making machinery: rate of duty, free.
Charles Avery Dunning: This is a reduction on part of the previous item from 10 per cent to free.


[Stage Direction]
Item agreed to.
[Mr. MacNicol.l
Customs tariff-401. Wire, of iron or steel:
(a)	Barbed fencing, coated or not: rate of duty, free.
(b)	Twisted, braided or stranded, including wire rope or cable, coated or not, n.o.p.: rate of duty, 15 per cent.
(e)	Drawn flat or cold rolled flat after drawing, coated or not, n.o.p., not more than -25 inch in width and less than -1875 inch in thickness: rate of duty, 74 per cent.
(d)	Coated with zinc or spelter, curved or not, in coils, -144, -104, or -092 inch in diameter, with tolerance not to exceed -004 inch, and not for use in telegraph or telephone lines, n.o.p.: rate of duty, free.
(e)	Coated with zinc or spelter, n.o.p.: rate of duty, 10 per cent.
(f)	Single or several, coated, n.o.p., or covered with any material, including cable so covered: rate of duty, 15 per cent.
(g)	N.o.p.: rate of duty, 15 per cent.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-402a. Woven or welded wire fencing, of iron or steel, coated or not, n.o.p.; wire cloth or wire netting, of iron or steel, coated or not: rate of duty, 20 per cent.
Charles Avery Dunning: There is a reduction from 25 per cent to 20 per cent.


[Stage Direction]
Item agreed to.
Customs tariff-402b. Woven netting, of iron or steel, coated, made from wire of 17 gauge or heavier, with meshes not smaller than one inch and not larger than two inches, with specially strengthened joints, when for use exclusively on fur farms, under regulations prescribed by the minister: rate of duty, 124 per cent.
Charles Avery Dunning: There is a reduction from 15 per cent to 124 per cent.


Richard Bedford Bennett: The 10 per cent discount on British production applies to a tax of 15 per cent and over, does it?


Charles Avery Dunning: Not to 15 per cent; only when it is over 15 per cent.


Richard Bedford Bennett: I was uncertain whether it was over 15 per cent or on 15 per cent.


Charles Avery Dunning: Not including 15 per cent.


[Stage Direction]
Item agreed to.
Customs tariff-406. Coil chain, coil chain links, including repair links, and chain shackles, of iron or steel:
(a)	One and one-eighth inches in diameter and over: rate of duty, free.
(b)	Less than one and one-eighth inches in diameter: rate of duty, 15 per cent.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.

Canada-United. Kingdom Trade Agreement
Customs tariff-407. Silent chain and finished roller chain, of iron or steel, and complete parts thereof, of a class or kind not made in Canada, n.o.p., either chain of the type which operates over gears or sprockets with machine cut teeth: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-407a. Chains, of iron or steel, n.o.p., and complete parts thereof: rate of duty, 15 per cent.
Charles Avery Dunning: There is a reduction in rate on this item from 20 per cent to 15 per cent.


Richard Bedford Bennett: I should just like to point out that in reality when we deal with any of these items where the reduction is to 15 per cent or lower it is not fair to say there has been a reduction of 5 per cent. Twenty per cent less 10 per cent is 18 per cent, and the real reduction is not 5 per cent.


Charles Avery Dunning: Effectively, wherever less than 15 per cent enters the picture, that is correct.


Richard Bedford Bennett: Wherever the rate is lowered to 15 per cent or less, and it was over 15 per cent, the effective reduction is the difference less 10 per cent.


Charles Avery Dunning: That is right.


[Stage Direction]
Item agreed to.
Customs tariff-408. Malleable sprocket chain and link belting chain of iron or steel, including roller chain of all kinds for operating on steel sprockets or gears, when imported by manufacturers of agricultural implements for use exclusively in the manufacture of agricultural implements, in their own factories, under regulations prescribed by the minister: rate of duty, free.
Mr. McDONALD (Souris):: I notice that a great many parts for machinery are imported free, and I should like to know if the complete machine, the finished article, carries a duty. In that way the manufacturers are protected; they are permitted to get the parts free while there is a duty on the machine. Has the department taken any steps to see that the consumers are protected in that respect?


Charles Avery Dunning: In the case of farm implements, which I know my hon. friend has in mind, while the duty against the United States is 7J per cent generally, agricultural implements are free from Great Britain. This item of malleable sprocket chains and so forth has been free from Great Britain for many years, just as the machine itself is free.


[Stage Direction]
Item agreed to.
31X11-131
Customs tariff-409. Cream separators and complete parts therefor, including steel bowls: rate of duty, free.
John Ritchie MacNicol: Is there any change in
this?


Charles Avery Dunning: No; it is free entry
bound.


Richard Bedford Bennett: There are considerable
importations of cream separators into this country under the intermediate tariff. If one takes the trade returns and divides the number of machines into the valuation given it is apparent that there must be something wrong in the computation of the duty, because the price which is determined by dividing the number of importations from Sweden into the price received is so very low that the duty of 25 per cent added to it means nothing at all. It is difficult to understand but I think that matter properly belongs to the Minister of National Revenue, so I will deal with it at another time.


Charles Avery Dunning: Sweden is the principal
source, as my right hon. friend knows.


Richard Bedford Bennett: Quite so, though some
come from England.


[Stage Direction]
Item agreed to.
Customs tariff-409m. Internal combustion traction engines; traction attachments designed to become combined with automobiles in Canada for use as traction engines; complete parts of all the foregoing: rate of duty, free.
Charles Avery Dunning: I believe the hon. member for Dauphin (Mr. Ward) desired to say something on this item.


William John Ward: Item 428e deals with diesel
engines-


Charles Avery Dunning: If my hon. friend desires to discuss diesel engines in particular he will have the opportunity under item 428e.


Richard Bedford Bennett: Of course under this
item internal combustion engines are free across the board.


William John Ward: I am sorry the Minister of
National Revenue is not here, because it seems to me the matter to which I am going to refer reflects directly upon his department and the officials in charge of that department. I am not going to go over what I said in this house previously, but I should like to point out. that on investigation- and I have this from a reliable source-it can be proved that the firm that applied for the cancellation of the ruling that permitted these engines to enter free of duty have manufactured only one diesel engine in Canada. I

2066	COMMONS
Canada-United Kingdom Trade Agreement
am informed that this engine has not been sold and is not likely to be sold. Surely the commissioner of customs and his officials ought to investigate thoroughly matters of this kind before taking this action. The person who gave me this information informs me that in many cases where a dumping duty is applied, if I may refer to that for a moment, and where information is supposed to be gathered in the country of origin, no such information is gathered at all. These values are really set either by reference to an interested manufacturer in Canada or by a decision on the part of an official in one of the larger customs houses along the border. That is why I thought I should like the Minister of National Revenue to be here, because it seems to me it is time a little purging was done in that department in order to get rid of some of the trade exclusionists who disgrace it. It does seem too bad that we should sit here in parliament; the Minister of Finance should bring down his budget containing certain tariff items and this house should pass the resolutions, only to have the intent of the minister entirely defeated by the actions of some officials of the customs department. The time is coming when there must be a showdown on this question. If a commissioner of customs can cancel a ruling, really on the say-so of some interested person in Canada who has manufactured only one engine, which has not been sold and is not suitable to the Canadian trade, surely there is need for an investigation.


[Stage Direction]
Item agreed to.
Customs tariff-410b.	Machinery and apparatus for use exclusively in washing or dry cleaning coal at coal mines or coke plants; machinery and apparatus for use exclusively in producing coke and gas; machinery and apparatus for use exclusively in the distillation or recovery of products from coal tar or gas; and complete parts of all the foregoing, not to include motive power, tanks for gas, nor pipes and valves 10 J inches or less in diameter: rate of duty, free.
Charles Avery Dunning: There is a reduction in rate from 71 to free.


[Stage Direction]
Item agreed to.
Customs tariff-4101.	Ore crushers, rock
crushers, stamp mills, grinding mills, rock drills, percussion coal cutters, coal augers, rotary coal drills, n.o.p., and complete parts of all the foregoing, for use exclusively in mining, metallurgical or quarrying operations: rate of duty, 5 per cent.
John Ritchie MacNicol: Are we importing any considerable quantities under this item?


Charles Avery Dunning: I have the details. The imports total $582,000 worth of ore and rock

crushers; S5.200 worth of percussion coal cutters, coal augers and drills, and $527,000 worth of rock drills n.o.p., comprised within the item.


[Stage Direction]
Item agreed to.
Customs tariff-410n. Diamond drills and core drills, not including motive power, electrically operated rotary coal drills, and coal cutting machines, n.o.p., and integral parts of the foregoing, for use exclusively in mining operations: rate of duty, free.
Item agreed to.
Customs tariff-410u. Blowers of iron or steel, n.o.p., for use in the smelting of ores, or in reduction, separation or refining of metals, ores or minerals; rotary kilns, revolving roasters and furnaces of metal, n.o.p., for use in the roasting of ore, mineral, rock or clay; furnace slag trucks and slag pots, n.o.p.; and integral parts of all the foregoing: rate of duty, 12J per cent.
Charles Avery Dunning: There is a reduction from 15 per cent to 12J per cent.


[Stage Direction]
Item agreed to.
Customs tariff-410z. Machinery and apparatus, n.o.p., and complete parts thereof, for the recovery of solid or liquid particles from flue or other waste gases at metallurgical or industrial plants, not to include motive power, tanks for gas, nor pipes and valves 10J inches or less in diameter: rate of duty, five per cent.
Charles Avery Dunning: There is a reduction in rate from 7J per cent to 5 per cent.


[Stage Direction]
Item agreed to.
Customs tariff-412b. Flat bed cylinder printing presses, to print sheets of a size 25 by 38 inches or larger, and complete parts thereof; machines designed to fold or sheetfeed paper or cardboard, and complete parts thereof: rate of duty, free.
Item agreed to.
Customs tariff-412d. Offset presses; lithographic presses; printing presses ,gnd typemaking accessories therefor, n.o.p.; complete parts of the foregoing, not to include saws, knives and motive power: rate of duty, free.
Item agreed to.
Customs tariff-412b. Flat bed cylinder plete parts thereof: rate of duty, free.
Item agreed to.
Customs tariff-414c. Adding, bookkeeping, calculating and invoicing machines and complete parts thereof, n.o.p.: rate of duty, free.
Charles Avery Dunning: There is a reduction in rate from 15 per cent to free.


Richard Bedford Bennett: Are we doing any assembling of these machines in Canada? Is there any production of them?

Canada-United Kingdom Trade Agreement


Charles Avery Dunning: I have the figures for 1934 for adding, bookkeeping, and calculating machines, cash registers, and so on- 82,886,000. Last year we exported $322,000 worth.


Richard Bedford Bennett: Was that assembled material, or machines produced in Canada?


Charles Avery Dunning: The imports would give some indication. The total imports were valued at $892,000, of which $876,000 came from the United States, I have not any record of the assembling.


Richard Bedford Bennett: I looked into the matter once, and found that we were doing a substantial amount of assembling. Whether or not we are now producing, I do not know.


Charles Avery Dunning: Of course these exports
must qualify for British content to the extent of fifty per cent.


Richard Bedford Bennett: As the minister is aware, the labour in connection with the item is very high.


Charles Avery Dunning: Yes. The fact that we export to the United Kingdom, Australia, Sweden and to a small extent to the United States, would indicate that there is a high proportion of British content which, as my right hon. friend suggests, would be chiefly labour.


Richard Bedford Bennett: I think so, yes.


[Stage Direction]
Item agreed to.
Customs tariff-415. Electric vacuum cleaners and attachments therefor; hand vacuum cleaners; and complete parts of all the foregoing, including suction hose, n.o.p.: rate of duty, 5 per cent.
Charles Avery Dunning: There is a reduction from 12^ per cent to five per cent.


[Stage Direction]
Item agreed to.
Customs tariff-415d. Sewing machines, with or without motive power incorporated therein; complete parts of sewing machines: rate of duty, 5 per cent.
John Ritchie MacNicol: One moment, Mr. Chairman; we are getting along very nicely, and I do not wish to hold up the committee; as a matter of fact I want to help the minister all I can. I interpret the trade return to read that during 1936 more than 5,000 sewing machines were imported from Great Britain and about S,000 from the United States.


Charles Avery Dunning: The hon. member's figures are not quite correct. The total imports were 11,500 from all sources, valued at $452,000. My figures are for the fiscal year, whereas I believe the hon. member's are for the 311H-1314
calendar year. Of these machines 6,400 came from the United States, 4,800 from the United Kingdom and 300 from Germany. Sewing machine parts were imported to the value of $237,000, and we exported $1,500,000 worth of sewing machines and parts. The Canadian production was exported to Brazil, the Argentine, Jamaica and a small amount to the United States and the United Kingdom.


John Ritchie MacNicol: As a Canadian I am proud of the sewing machine plant at St. Johns, Quebec. The item indicates a cut of fifty per cent in the rate of duty, and I have been wondering if it would be beneficial or detrimental to employment in the city I have named. I know that we export two or three times as many as we import. This is a business which Canadians have been trying to foster, and I trust the decrease in the item will not materially affect employment in it.


Charles Avery Dunning: Generally speaking this
industry is an example of that unusual thing, a monopoly concerning which there is very little complaint from any source, either from customers or from the labour engaged in it. I assure the hon. member he need have no fear about the industry not being able to take care of itself.


John Ritchie MacNicol: I should imagine a monopoly would not be opposed to closing a plant. I trust there will be no such result in connection with the manufacture of sewing machines in Canada.


Charles Avery Dunning: So far as anything is certain in this uncertain world, I can assure the hon. member that it will not have that result.


[Stage Direction]
Item agreed to.
Customs tariff-422. Street or road rollers and complete parts thereof: rate of duty, free.
Charles Avery Dunning: There is a reduction from 10 per cent to free.


[Stage Direction]
Item agreed to.
Customs tariff-424. Fire engines and other fire extinguishing machines; chassis for same; complete parts other than chassis parts: rate of duty, free.
Item agreed to.
Customs tariff-425. Lawn mowers: rate of duty, 10 per cent.
Charles Avery Dunning: There is a reduction from 20 per cent to 10 per cent.


John Ritchie MacNicol: How many do we import f 'om Great Britain?
2068	COMMONS
Canada-United, Kingdom Trade Agreement


Charles Avery Dunning: We imported 2,500 lawn mowers valued at $40,400, of which 2,100, valued at $34,300, came from the United States, and 375, valued at $6,100, from the United Kingdom. The more expensive and higher capacity machines came from Great Britain. We exported 4,600 machines, or nearly twice as many as we imported, 1,200 of which went to the United Kingdom and the balance to Australia and New Zealand. We shipped one lawn mower to the United States. Our exports were valued at $6,950. In 1934, the last figures I have our production amounted to 27,700 machines, valued at $171,000.


John Ritchie MacNicol: Principally at Guelph?


Charles Avery Dunning: Brockville and Guelph, I believe.


Mr. GLADSTONE:: One of the largest manufacturers of lawn mowers in Canada is located in Guelph. They are at a loss to understand why at this time there should be a reduction of fifty per cent. They are required to import the special material they use because it cannot be made in Canada, and are now very anxious to know whether they can get some relief in connection with that imported material, the charges on which run at the rate of $4 per ton. Will the minister give some consideration to this matter?


Charles Avery Dunning: From the figures I gave it is apparent that so far as the ordinary hand lawn mower is concerned, the Canadian industry is quite capable of taking care of itself. The British negotiators of the agreement were more particularly interested in the heavy power-driven machines. I shall be glad to consider any request for easement in the duties on raw materials used by any concern which believes it is at a disadvantage by reason of paying duties considered to be out of all proportion.


John Ritchie MacNicol: The hon. member for Wellington South (Mr. Gladstone) has demonstrated what happens when tariffs are cut generally. The manufacturer of one product protests against the treatment given to the manufacturer of another product, and asks the minister to lower the duties on the materials he uses.


Charles Avery Dunning: When the process is started at the top it is quite easy to reduce all along the line, but the procedure is more difficult when you start at the bottom. At times it involves a geometric increase all along the line.


Mr. BARBER:: Does the three per cent excise tax apply to any of these items?


Charles Avery Dunning: No.


Robert William Gladstone: I have never found the price of lawn mowers to be exorbitant. I have told the manufacturers in Guelph that they may expect some compensation because of the changes being made by the Canada-United States and Canada-United Kingdom agreements. The markets for our natural products are being widened and as a result the people of this country will have a greater purchasing power.


[Stage Direction]
Item agreed to.
Customs tariff-427. All machinery composed wholly or in part of iron or steel, n.o.p., and complete parts thereof: rate of duty, 10 per cent.
Charles Avery Dunning: No change.


Thomas Langton Church: Mr. Chairman, I should like to refer to a matter which I have taken up with the customs department and the Department of Finance concerning the interpretation by customs of some items. It is all very well for us to pass these items as proposed by the Department of Finance, but we find that everything is quite different when we go over to the customs department to get an interpretation of the items. The small manufacturer in Canada is being discriminated against. I have in mind particularly small plants engaged in doing mechanical work for dentists and doctors and melting gold and platinum alloys and doing research work therein. Some of these plants are located at Fort Erie, Windsor and other points along the border. Because of a ruling of the department these plants are being almost driven out of business. Why? Because of the interpretation placed upon this item by the customs department. This same material can be imported free of duty from the United States, but the furnace with which it is manufactured must pay a duty of 15 to 35 per cent to enter Canada, plus a sales tax of eight per cent and an excise tax of three per cent. The result is that the doctors and dentists and refining and melting work go to Buffalo or Detroit to have their work done, B'hich work can be brought into Canada free of duty. These furnaces should come in free because they can't be got in Canada, for the melting of gold and platinum alloys.
I do not want to detain the committee but I think the position of these small -manufacturers should be made clear. We should try to keep this work in Canada and give the small man here a chance. A furnace of the type used by the people to whom I refer can be used for only one purpose, that is, the melting of metal. If it is imported by a mining company it is allowed to come in duty free, but when it is imported by these

Canada-United Kingdom Trade Agreement
small manufacturers it has to pay a duty of from 15 to 35 per cent, plus sales and excise tax. As I understand it, these furnaces will come under item 427a as not capable of being manufactured in Canada. One of these companies found that they needed a new type furnace, but because of the ruling of the department they were unable to get one. The Encyclopaedia Britannica gives the following definition for a worker in metal:
The art of extracting metals from their ores, refining them and preparing them for use, includes various processes as smelting, amalgamation, electrolytic refining, rolling and heat treating. It also applies to the structure of metals and alloys, to their constitution and its relation to their physical properties and to the thermal and mechanical treatment of metals.
Much of this work is being done in Buffalo. Rochester, Detroit and other cities along the great lakes, that should be done in Canada. I believe in Canada for the Canadians and our own work for our own workmen. This dental and other mechanical work should be done in Canada. I do not say that this is the fault of the minister because I know he is most sympathetic to the small manufacturers. I think the real fault lies with the customs officials who know very little about this metallurgy refining work and who place a duty of 15 to 35 per cent, plus 8 per cent sales tax, plus 3 per cent excise tax, against an article very necessary to these small Canadian manufacturers. I was over in Buffalo and other border cities a short time ago and I saw a company of this type employing more than one hundred men. They are getting a lot of work from Canada as a result of the unfair and unjust interpretation placed upon these items. These small plants are being forced to nearly close up and men are losing their jobs. They can go to Buffalo in fifteen or twenty minutes and have their work done there. I know the minister is most sympathetic to these matters, and I wish he would look into this particular case with the national revenue heads. These interpretations we allow another body to make are simply driving the small man out of business.


Charles Avery Dunning: I should be very glad to bring the hon. member's remarks to the attention of the Minister of National Revenue (Mr. Usley). If it is possible to do anything helpful, I am sure-


James Houston Spence: That is all the good it will do.


[Stage Direction]
Item agreed to.
Customs tariff-ex 427, ex 446a, et al. Motion picture projectors, arc lamps for motion picture work, motion picture or theatrical spot lights, light effect machines, motion picture screens, portable motion picture projectors complete with sound _ equipment; complete parts of all the foregoing, not to include electric light bulbs, tubes, or exciter lamps: rate of duty, free.
Charles Avery Dunning: A reduction in rate from ten per cent to free. It is a combination of two items.


Richard Bedford Bennett: Do we get any motion picture projectors from Great Britain?


Charles Avery Dunning: A very small amount, four or five hundred dollars' worth.


Frank Exton Lennard: Is this change made upon a request from motion picture interests in Canada, or is it a concession to interests in the old country?


Charles Avery Dunning: It was asked for from British Columbia-that is one place I remember quite distinctly; of course it was also asked for during the negotiations, by the British. Practically all of the apparatus included in this item is of a class or kind not made in Canada, There is a production here of certain pieces of motion picture apparatus, but it is very small.


Frank Exton Lennard: I wondered whether this was a request from Famous Players?


Charles Avery Dunning: No.


Richard Bedford Bennett: My figures show we got $23,568 worth of such machines from the United States and $425 of imports from England last year.


Charles Avery Dunning: That is right. I quoted just the British figure.


Richard Bedford Bennett: And Sl,200 worth from Austria, The preference does not seem to be of much service.


[Stage Direction]
Item agreed to.
Customs tariff 42; a. All machinery composed wholly or in part of iron or steel, n.o.p., of a class or kind not made in Canada; complete parts of the foregoing: rate of duty, free.
Richard Bedford Bennett: That was in the budget of 1936.


Charles Avery Dunning: It is just binding free entry.


[Stage Direction]
Item agreed to.
Customs tariff-427b. Ball and roller bearings: rate of duty, free.
Charles Avery Dunning: A reduction in rate from five per cent to free.


John Ritchie MacNicol: Is there any plant in Canada now making ball bearings? There used to be some plants.
2070	COMMONS
Canada-United Kingdom Trade Agreement


Charles Avery Dunning: There is not sufficient production for statistical purposes.


John Ritchie MacNicol: It is all under one group, anyway.


Charles Avery Dunning: That is to say, there are not three concerns manufacturing, and hence we have not a duty. We imported last year $735,000 worth of ball and roller bearings, of which $474,000 came from the United States, $109,000 from Sweden, and only $80,000 from Great Britain. This will give Great Britain a better opportunity.


Mr. ROSS (Moose Jaw):: Here is another respect in which the customs department has been operating in the way an hon. member referred to. I do not think that on this account we should hold up the Minister of Finance on his budget items, but we should all get ready for action when the revenue department's estimates come up.


Charles Avery Dunning: Order. The hon. member is encouraging insubordination!


Richard Bedford Bennett: Highly irregular.


[Stage Direction]
Item agreed to.	„
Customs tariff-427e. Machinery for dairying purposes, viz:-power churns, power milk coolers, power fillers and cappers, power ice cream mixers, power butter printers, power cream savers, power bottle sterilizers, power brine tanks, power milk bottle washers, power milk can washers; ice-breaking machines, valveless or centrifugal milk pumps, sanitary milk and cream vats; none of the foregoing machinery to include motive power: rate of duty, free.
Charles Avery Dunning: No change


John Ritchie MacNicol: What was the particular reason for the last phrase in the item, "to include motive power." In some of the items, I notice motive power is excluded.


Charles Avery Dunning: There is no change in either the wording of the item or the rate. It was precisely the same under the 1932 agreement, and as far as I know is not working any hardship.


John Ritchie MacNicol: Would not Canadian
motive power operate all these machines?


Charles Avery Dunning: I could not say as to that.


John Gordon Ross: Do the parts for these machines come in free?


Charles Avery Dunning: 
Richard Bedford Bennett: It does not include the motive power.


Charles Avery Dunning: No; it does not include the motive power.


John Ritchie MacNicol: Pardon me, the minister is right. I should have read, "none of the foregoing machinery to include motive power."


[Stage Direction]
Item agreed to.
Customs tariff-427d. Machines designed for making rigid composite box-ends of wood-consisting of a centre with separate nailing edges attached-from scrap or waste mill stock, and complete parts thereof, not to include motive power: rate of duty, free.
Charles Avery Dunning: There is no change.


[Stage Direction]
Item agreed to.
Customs tariff-427e. Automatic machines for making and packaging cigarettes, not to include tobacco preparing machines: rate of duty, free.
Item agreed to.
Customs tariff-428d. Magnetos and complete parts thereof when imported by manufacturers of internal combustion engines, for use exclusively in the manufacture of such internal combustion engines, in their own factories: rate of duty, free.
Item agreed to.
Customs tariff-42Se. Diesel and semi-diesel engines, and complete parts thereof, n.o.p.: rate of duty, free.
Item agreed to.
Customs tariff-428f. Air-cooled internal combustion engines of not greater than li h.p. rating, and complete parts thereof: rate of duty, free.
Item agreed to.
Customs tariff-ex 429. Cutlery of iron or steel, plated or not:
(b) Table knives and table forks: rate of duty, 15 per cent.
(e)	Penknives, jack-knives and pocket knives of all kinds: rate of duty, free.
(d)	Knives, n.o.p.: rate of duty, free.
(e)	Spoons: rate of duty, 15 per cent.
(f)	Scissors and shears, n.o.p.: rate of duty, free.
(g)	Razor blades; razors and complete parts thereof: rate of duty, free.
Charles Avery Dunning: There is no change.


[Stage Direction]
Item agreed to.
Customs tariff-430. Nuts and bolts with or without threads, washers, rivets, of iron or steel, coated or not, n.o.p., nut and bolt blanks, of iron or steel: rate of duty per one hundred pounds, 25 cents and 7J per cent.
Charles Avery Dunning: There is a reduction in
rates here-

Canada-United Kingdom Trade Agreement


Grote Stirling: A big one.


Charles Avery Dunning: -from fifty cents and
ten per cent to twenty-five cents and 7i per cent. Our imports were 27,000 hundredweight valued at $360,000, of which 26,000 hundredweight came from the United States and the balance from the United Kingdom. But we exported 45,000 hundredweight valued at $270,000, of which 34,000 hundredweight went to the United Kingdom. We export more bolts and nuts to the United Kingdom than we import from there; $190,000 worth went to the United Kingdom.


[Stage Direction]
Item agreed to.
Customs tariff-430a. Hinges and butts, of iron or steel, coated or not, n.o.p.; hinge and butt blanks of iron or steel: rate of duty per one hundred pounds, 75 cents and 5 per cent.
Charles Avery Dunning: This is a reduction in rate. The present rate is 75 cents per hundredweight plus ten per cent ad valorem; the new rate is 75 cents and 5 per cent ad valorem.


Richard Bedford Bennett: Merely a change of 5
per cent ad valorem.


[Stage Direction]
Item agreed to.
Customs tariff-ex 431b. Adzes, anvils, vises, cleavers, hatchets, saws, augers, bits, drills, screw-drivers, planes, spokeshaves, chisels, mallets, metal wedges, wrenches, sledges, hammers, crowbars, cantdogs, and track tools, picks, mattocks, and eyes or polls for the same: rate of duty, 10 per cent.
Charles Avery Dunning: There is no change.


John Ritchie MacNicol: I do not wish to miss an opportunity when I can find one of congratulating the minister, and I must compliment him on this item because of all this long list this item was carefully picked out to remain as it is, and I am in accord with his action. It does protect that nice plant down in Brockville of which the directors were and perhaps are yet Mr. Graham and Mr. Edwards and Mr. Fulford. I recall last year this item was carefully protected. I wish the minister would exercise the same care with reference to some other items and leave the rates of duty as they are.


Charles Avery Dunning: These congratulations, Mr. Chairman, are somewhat equivocal. I was unaware of the directorate of the plant to which my hon. friend has referred, but I do know that the largest producer who ever talked to me about this matter was the Hon. J. D. Chaplin, and he had every right to talk about it because he had a big business.	I should not have mentioned his
name in connection with it but for the delicate allusions of the hon. member for Davenport (Mr. MacNicol).


[Stage Direction]
Item agreed to. -
Customs tariff-ex 431b. Files and rasps: rate of duty, free.
Charles Avery Dunning: There is a reduction here, Mr. Chairman.
Air. AlacNICOL:	It places it right on
the free list. I was wondering if this would affect the plant at Port Hope which makes files. I do not know offhand.


Charles Avery Dunning: We have had no complaints.


[Stage Direction]
Item agreed to.
Customs tariff-431e. Machinists' or metal workers' precision tools and measuring instruments, viz:-calipers, micrometers, metal protractors and squares, bevels, verniers, gauges, gauge blocks, parallels, buttons, mercury plumb bobs, dividers, trammels, scribers, centre punches, pocket speed indicators, straight edges, key seat clamps and other clamps and vises used by toolmakers for precision work, precision tools and measuring instruments, n.o.p.: rate of duty, free.
Item agreed to.
Customs tariff-431d. Engineers', surveyors' and draughtsmen's precision instruments and apparatus, viz:- alidades; altazimuth surveying instruments; aneroid barometers, engineering, military and surveying; angle prisms; boards, military sketching; box sextants; clinometers; compasses; cross staff heads; curves, adustable, irregular, railroad and ship; curvi-meters; drafting instruments of all kinds, including fitted cases containing the same; dipping needles; drafting machines; heliographs; integrators; levels, tripod and hand or pocket types; levelling rods; liners, section; meters, portable, for hydraulic engineering; pantographs; planimeters; protractors; parallel rulers; parallel ruling attachments; poles, ranging; pedometers and paeeometers; plane tables, military and topographic scales, flat and triangular; slide rules; splines; straight edges, steel and wooden; tacheometers; tallying machines, pocket; tee squares, steel and wooden; telemeters; theodolites; transits, tripod and hand or pocket types; triangles of all types; tripods for use with any of the foregoing instruments: rate of duty, free.
Charles Avery Dunning: There is no change.


Edgard Jules Wermenlinger: What is the value of these instruments imported from the United Kingdom?


Charles Avery Dunning: The imports include
both (c) and (d). In the import classification machinists' precision tools are included with engineers', surveyors', and draftsmen's precision instruments. The imports reported
2072	COMMONS
Canada-United Kingdom Trade Agreement
amount to 898,000 of which 868,000 came from the United States and $16,000 from the United Kingdom. That covers the two items.


Edgard Jules Wermenlinger: There is a
difference between (c) and (d).


Charles Avery Dunning: Yes.


Edgard Jules Wermenlinger: I cannot take time to read 431d but apparently it covers the most important instruments that have been used in our civilization in both geographical and hydrographical developments. There is an important difference from the national standpoint between 431c and 431d. What is the value of these instruments from the United Kingdom as compared with Germany or Austria?


Charles Avery Dunning: I am sorry, but the trade statistics do not separately classify items 431c and 431d. The imports from Germany under these combined items were $13,000.


Edgard Jules Wermenlinger: Could we have that information at a later date?


Charles Avery Dunning: The items were separated in the last budget so that the trade statistics from now on will classify the figures separately and it will be possible next year to give that information. At present the items in the trade statistics are combined.


Edgard Jules Wermenlinger: This is my unlucky day; I am to get everything next year.


[Stage Direction]
Item agreed to.
Customs tariff-431e. Measuring rules and tapes of all kinds: rate of duty, 15 per cent.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-432. Hollow-ware, of iron or steel, coated or not, n.o.p.: rate of duty, 10 per cent.
Charles Avery Dunning: The reduction in rate is from 20 per cent. The total imports were 833,750, of which $30,000 came from the United States and the rest from the United Kingdom. The exports are not separately listed in the trade returns. In 1932, which is the last record we have, the production was $67,800.


[Stage Direction]
Item agreed to.
Customs tariff-432a. Kitchen and dairy hollow-ware of iron or steel, coated with tin, including cans for shipping milk or cream, not painted, japanned, or decorated: rate of duty, 15 per cent.
Charles Avery Dunning: The reduction is from 20 per cent. Imports were $34,000, of which $25,000 came from the United States and the rest from the United Kingdom.


[Stage Direction]
Item agreed to.

Customs tariff-432b. Hollow-ware, of iron or steel, coated with vitreous enamel: rate of duty, 17| per cent.
John Ritchie MacNicol: What were the imports from the United States in 1936?


Charles Avery Dunning: The total imports were $190,000, of which $91,000 came from the United States, $71,000 from Great Britain, and $15,000 from Germany. Our exports are not listed separately in the trade returns. Our manufactures of kitchen ware coated with vitreous enamel were just over a million dollars in 1934.


[Stage Direction]
Item agreed to.
Customs tariff-432d. Manufactures of tinplate, painted, japanned, decorated or not, and manufactures of tin, n.o.p.: rate of duty, 15 per cent.
Charles Avery Dunning: The reduction in rate is from 20 to 15 per cent. The imports were $360,000, of which $317,000 came from the United States and $34,000 from the United Kingdom. The total production in the last year of record is $582,000.


[Stage Direction]
Item agreed to.
Customs tariff-ex 432d, ex 339. Collapsible tubes of lead or tin, or lead coated with tin: rate of duty, 10 per cent.
Charles Avery Dunning: This is a new item representing a reduction in rate. Up to the present time these tubes, if wholly of lead, have been subject to 20 per cent from Great Britain, and if of lead and tin have been at the same rate under another item. The new rate proposed is 10 per cent. The imports were $51,700, of which $38,000 came from the United States and $13,500 from the United Kingdom.


[Stage Direction]
Item agreed to.
Customs tariff-433. Baths, bathtubs, basins, closets, lavatories, urinals, sinks, and laundry tubs of iron or steel, coated or not: rate of duty, 5 per cent.
Charles Avery Dunning: The reduction is from 10 per cent. The imports from the United States are slightly over $40,000.


[Stage Direction]
Item agreed to.
Customs tariff-ex 434, ex 434a. Motor rail cars or units for use on railways and chassis for same; complete parts of the foregoing: rate of duty, free.
Charles Avery Dunning: This involves, partly, a reduction in rate from 15 per cent to free. The item is a new one to cover motor rail cars or units for use on railways and chassis or complete parts thereof. Up to the present time rail cars or rail units have been dutiable

Canada-United Kingdom Trade Agreement
under item 434, but under the budget of 1935 chassis for such rail cars or units were granted free entry under the British preferential tariff. The item now under discussion goes further in that it makes the complete unit free when imported from the United Kingdom.


[Stage Direction]
Item agreed to.
Customs tariff-434b, ex 438. Steel wheels for use on railway rolling stock: rate of duty, 7i per cent.
Charles Avery Dunning: The reduction is from 15 to 7J per cent on part of the item; there is no change in the rest. Under the budget of 1935 pressed steel wheels for use on railway rolling stock were guaranteed a rate of 7} per cent from Britain, and all other wheels remained dutiable under 434 at the rate of 15 per cent from Britain.


[Stage Direction]
Item agreed to.
Customs tariff-ex 435. Locomotives and motor cars for railways, of a class or kind not made in Canada, and complete parts thereof, for use exclusively in mining or metallurgical operations: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-ex 438a. Automobiles and motor vehicles of all kinds, n.o.p.; chassis for the foregoing: rate of duty, free. _
Provided, that machines or other articles mounted on the foregoing or attached thereto for purposes other than for loading or unloading the vehicle shall be valued separately and duty assessed under the tariff items regularly applicable thereto.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-ex 438. ex 438a, ex 711. Electric trackless trolley buses and chassis for same; complete parts of the foregoing: rate of duty, free.
Charles Avery Dunning: The reduction is intended to bring the item to date so as to include trackless trolley buses, a form of transport which may conceivably have a wide use in [DOT]Canada in the future. The rate previously was 15 per cent, and it will be made free.


[Stage Direction]
Item agreed to.
Customs tariff-438b. Bearings, clutch release; bearings, graphite; bearings, steel backed non-ferrous; bushings, graphited or oil impregnated; ceramic insulator spark plug cores, not further manufactured than burned and glazed, printed or decorated or not, without fittings; commutator copper segments; commutator insulating end rings; discs of hot rolled steel, spun or forged, with or without centre hole, for disc wheels; distributor rotors, cam assemblies
and vacuum control assemblies; door bumper shoes; electric wiring terminals, sockets, fittings and connectors; gaskets of metal and asbestos, composite; ignition contact points; keys for shafting; lenses for head, tail, dome, signal and cowl or parking lamps; lock W'ash-ers; piston ring eastings in the rough, with or without gates and fins removed; steel bolts capped with stainless steel; switches for lamps, and parts thereof; vulcanized fibre in sheets, rods, strips and tubing; all the foregoing being of a class or kind not made in Canada, when for use in the manufacture of the automobiles. motor vehicles or chassis enumerated in tariff items 438a and 424, or for use in the manufacture of parts thereof, or for the replacement or repair of automobiles, motor vehicles or chassis enumerated in tariff items 438a and 424: rate of duty, free.
Charles Avery Dunning: Items 43Sb to 438h inclusive are without change.


[Stage Direction]
Item agreed to.
Customs tariff-438c. Ammeters; arm rests and wheel housing lining of indurated fibre, pressed to shape; axle housings, one piece welded, machined or not; carburetors and parts thereof; chassis frames; cigar and cigarette lighters, including base and parts thereof; control ventilator gear box; cylinder lock barrels, with or -without sleeves and keys thereof; dash heat indicators; fuel pumps and parts thereof; gasoline gauges and parts thereof; hinges, finished or not, for bodies; horns and parts thereof; instrument bezel assemblies and parts thereof; instrument board lamps; locks, electric ignition, steering gear, transmission, or combinations of such locks, and parts thereof; mouldings of metal, with nails set in position, lead filled or not; oil filters and parts thereof; oil gauges and parts thereof; pipe lines, bent to shape and equipped with fittings or not. and tubing therefor, for fuel, air, or liquid for actuating hydraulic brakes; purifiers for air, and parts thereof; purifiers for oil and parts thereof; radiator grills, assembled or not, but not polished or plated, and not to include finish or decorative moulding; radiator ornaments, unplated; radiator shutter assemblies, automatic; radiator water gauges; radiator shells, not plated, nor metal finished in any degree; shackles, bearing spring and parts thereof; speedometers and parts thereof: spring covers of metal and closing strips or shapes therefor; stampings, body, cowl, hood, fender and instrument board, of metal, in the rough,'trimmed or not, but not metal finished in any degree; starter switch assembly and parts thereof; steering wheels, and rims therefor; sun visor blanks of gypsum weatherboard; thermostats and parts thereof; throttle and spark buttons assemblies; vacuum tanks; windshield wipers and parts thereof; all the foregoing being of a class or kind not made in Canada, when imported for use in the manufacture of the automobiles, motor vehicles or chassis enumerated in tariff items 438a and 424 or for use in the manufacture of parts thereof, or for the replacement or repair of automobiles, motor vehicles or chassis enumerated in tariff items 438a and 424: rate of duty, free.
Item agreed to.
2074	COMMONS
Canada-United Kingdom Trade Agreement
Customs tariff-438d. Front and rear axles; brakes; clutches; internal combustion engines; steering gears; magnetos; rims for pneumatic tires larger than thirty inches by fire inches; transmission assemblies; steel road wheels; and complete parts of the foregoing, all of a class or kind not made in Canada, when imported by manufacturers of automobiles, motor vehicles or chassis enumerated in tariff items 438a and 424 for use only in the manufacture of motor trucks or motor truck chassis: rate of duty, free.
Item agreed to.
Customs tariff-43Se. Parts, n.o.p., for automobiles, motor vehicles or chassis enumerated in tariff items 438a and 424, not to include wireless receiving sets, die castings of zinc, electric storage batteries, parts of wood, tires and tubes or parts of which the component material of chief value is rubber:
(1)	Brake linings, and clutch facings whether or not including metallic wires or threads:
(a)	when made from crude asbestos of empire origin: rate of duty, free.
(b)	when made from crude asbestos of nonempire origin: rate of duty, 15 per cent.
(2)	Automobile and motor vehicle engines, stripped, n.o.p., and complete parts thereof, n.o.p.: rate of duty, free.
(3)	Parts, n.o.p., not electro-plated, whether finished or not: rate of duty, free.
Item agreed to.
Customs tariff-438f. Hot rolled strip of iron or steel with rolled or mill edge, not being of greater value than 2% cents per pound, of a class or kind not made in Canada, when imported by manufacturers of automobiles, motor vehicles or chassis enumerated in tariff items 438a and 424 or by manufacturers of parts of automobiles, motor vehicles or chassis enumerated in tariff items 438a and 424 to be used in the manufacture of such automobiles, motor vehicles or chassis, or parts thereof, in their own factories: rate of duty, free.
Item agreed to.
Customs tariff-438g. Motor cycles or side cars therefor, and complete parts of the foregoing: rate of duty, free.
Item agreed to.
Customs tariff-438h. Annular ball bearings nnd parts thereof, when imported for use only as original equipment in the manufacture of goods enumerated in tariff items 438a and 424, under regulations prescribed by the minister: rate of duty, free.
Item agreed to.
Customs tariff-439f. Children's carriages, sleds, and other vehicles; complete parts of ad the foregoing: rate of duty, 15 per cent.
Charles Avery Dunning: The reduction is from 22j per cent.


Mr. HEAPS:: What were the imports.
{Mr. Dunning.]


Charles Avery Dunning: There were 9.600 units
valued at $49,200, of which 8,700 units, valued at $37,400, came from the United Kingdom. The United Kingdom now has the principal part of the trade in carriages. As regards sleds and other vehicles and parts comprised within the item the situation is reversed. We imported $37,950 worth of which $33,800 came from the United States.


Abraham Albert Heaps: Has the minister the production in Canada of a similar class of goods?


Charles Avery Dunning: In 1935, baby carriages and sleighs, $302,000; children's vehicles and parts, $496,000; children's sleighs, $91,000.


Richard Bedford Bennett: We export some, do we not?


Charles Avery Dunning: They are not separately listed in the trade returns.


[Stage Direction]
Item agreed to.
Customs tariff-440j. Trawls, trawling spoons, fly hooks, sinkers, swivels, sportsmen's fishing reels, bait, hooks, and fishing tackle, n.o.p.: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-4401. Aircraft and complete parts thereof, not including engines, under regulations prescribed by the minister: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-440m. Engines and complete parts thereof, when imported for use only in the equipment of aircraft: rate of duty, free.
Charles Avery Dunning: A reduction in rate from 10 per cent to free. Our imports last year were $199,000. of which $99,000 came from the United States and $98,000 from the United Kingdom.


Richard Bedford Bennett: And we are not making any.


Charles Avery Dunning: No, only assembling
them, and this is to facilitate assembling.


Richard Bedford Bennett: It was only a revenue tariff.


[Stage Direction]
Item agreed to.
Customs tariff-440n. Complete parts for repair of engines enumerated in tariff item 440m: rate of duty, free.
Item agreed to.
Customs tariff-441e. Guns and rifles of a class or kind not made in Canada: rate of duty, 5 per cent.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.

Canada-United Kingdom Trade Agreement
Mr. THORSON:: Might I ask the minister to go back to item 409, cream separators? I should like to ask some questions.


Charles Avery Dunning: I am in the hands of the committee. I am not unwilling.


Some hon. MEMBERS:: No. *


Frederick George Sanderson: The hon. member of course is out of order.


Joseph Thorarinn Thorson: I quite appreciate that, but with the leave of the committee, I should like to ask some questions.


Frederick George Sanderson: I am in the hands of the committee.


Some hon. MEMBERS:: We passed that.
Customs tariff-445c.	(i) electric telegraph
apparatus and complete parts thereof: rate of duty, free.
(ii) electric telephone apparatus and complete parts thereof: rate of duty, 10 per cent.


Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-445d. Electric wireless or radio apparatus and complete parts thereof: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-445f. Electric dynamos or generators and transformers, and complete parts thereof, n.o.p.: rate of duty, 15 per cent.
Charles Avery Dunning: A reduction in rate from 25 to 15 per cent. The imports of dynamos or generators and parts amounted to $284,000, of which $209,000 came from the United States and $65,000 from the United Kingdom; transformers and parts, imports $81,000, of which $65,000 came from the United States and $15,000 from the United Kingdom.
We exported $223,000 worth of the articles covered by this item, of which $113,000 went to the United Kingdom. That is, we exported more to the United Kingdom than we imported from that country.


Richard Bedford Bennett: Under present conditions there will be no imports from the United Kingdom anyway. They are engaged in other work.


Charles Avery Dunning: Yes, that is my view, but the British government have hopes.


[Stage Direction]
Item agreed to.
Customs tariff-445g. Electric motors, and complete parts thereof, n.o.p.: rate of duty, 15 per cent.
Charles Avery Dunning: A reduction in rate from 25 to 15 per cent. Our total imports of electric motors and parts were $1,184,000, of which $925,000 came from the United States and $239,000 from the United Kingdom; the rest in small amounts from other countries.


John Ritchie MacNicol: None from Sweden?


Charles Avery Dunning: From Sweden $12,000.
Our exports are included in the total I gave under the previous item, and our production in 1934 was just short of $3,000,000.


John Ritchie MacNicol: On Saturday last the new building of the Toronto Stock Exchange was opened. I am told that many but not all of the motors used in that building, and there is a large number, were imported from Great Britain, and some from Sweden. A motor manufacturer in conversation told me that this reduction will be a considerable handicap, will considerably interfere with the production of motors in Canada. Of course it cannot be helped now, but it looks as if the duty has been reduced approximately 40 per cent. That is a fairly substantial reduction. Their labour cost in Great Britain is so much less than in Canada, and their plants are very large; I have been in some and will be again this summer. I wonder if this is not too substantial a reduction on a line of goods which Canadians have developed quite a capacity for manufacturing.


Charles Avery Dunning: We are exporting to the United Kingdom.


John Ritchie MacNicol: I know, but we are importing a lot too.


Charles Avery Dunning: Exports two to one of imports.


Richard Bedford Bennett: We are importing a lot of second hand motors from the United States and rewinding them.


Charles Avery Dunning: But not so much as before.


Robert William Gladstone: Circumstances alter cases. In contrast with the remarks of the hon. member for Davenport (Mr. MacNicol), last year there was a very considerable reduction in the rate of duty on electric washing machines coming into Canada from the United States. The manufacturers of these machines are desirous of receiving some consideration in the matter of their raw material, and particularly with respect to the electric motors, on which they would like
2076	COMMONS
Canada-United Kingdom Trade Agreement
to see the duty equalized with that on the motor in the washing machine. As it is now I believe these small motors carry a duty 5 per cent higher than on the motor included as part of the washing machine. The reduction in duty on electric motors coming from Great Britain is not helpful because no motors of the type used in washing machines are brought from England, nor can they be brought from there because the production of such fractional horse-power motors has never been developed in England, and prices there are considerably higher than in Canada or the United States where this type of motor is used so largely on small appliances. I would ask the minister to consider the question of equalizing the rate of duty on electric motors coming from the United States with the rate on motors coming in as part of a washing machine.


Charles Avery Dunning: That is a thorny question. It does not arise under this agreement; it arises under our general tariff. I recognize the force of my hon. friend's point, but there are many difficulties in the way.


[Stage Direction]
Item agreed to.
Customs tariff-ex 445k. Electrical instruments and apparatus of precision of a class or kind not made in Canada, viz:

meters or gauges for indicating and/or recording altitude, amperes, comparisons, capacity, density, depth, distance, electrolysis, flux, force, frequency, humidity, inductance, liquid levels, ohms, operation. power factor, pressure, space, speed, stress, synchronism, temperature, time, volts, volume, watts; complets parts thereof: rate of duty, free.
Charles Avery Dunning: A reduction in rate from 15 per cent to free. Our total imports were $130,000, these statistics covering electric meters and complete parts.


Richard Bedford Bennett: Largely used in aircraft.


Charles Avery Dunning: There are various classes of meters and meter parts. But the item does not include automobile ammeters.


[Stage Direction]
Item agreed to.
Customs tariff-4451. Electric storage batteries, composed of plates measuring not less than eleven inches by fourteen inches and not less than three-quarters inch in thickness; complete parts thereof: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-445m. Flame proof electric switch gear, for use underground in coal mines, and complete parts thereof: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.

Customs tariff-446. Electric steam turbo generator sets, 700 h.p. and greater, of a class or kind not made in Canada, and complete parts thereof: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-44Ga. Manufactures, articles or wares, of iron or steel or of w-hich iron or steel or both are the component materials of chief value, n.o.p.: rate of duty, 10 per cent.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-ex 446a. Cellulose acetate film reinforced with wire mesh: rate of duty, free.
Charles Avery Dunning: There is a reduction from 10 per cent to free. This is a new item, its purpose being to afford free entry of cellulose acetate film reinforced with wire mesh. This is merely a technical description of what might be referred to in simpler terms as windowing for poultry houses. This material, sold in England under various trade names, is to some extent displacing glass for window use. It is non

breakable, luminous, semi-transparent, said to be non-inflammable and is reputed to have the advantage of transmitting certain health-giving rays which are excluded by ordinary glass. So far as is known there is no Canadian manufacture.


[Stage Direction]
Item agreed to.
Customs tariff-ex 446 et al. Electric welding apparatus, not including motors: rate of duty, 10 per cent.
John Ritchie MacNicol: I should like again to congratulate the minister on seeing to it that the words "not including motors" are in this item. If he will follow my suggestions along these lines-I made this suggestion last year-instead of those of the hon. member for Moose Jaw or the hon. member for Melfort he will certainly help to provide work for Canadians.


Charles Avery Dunning: When my hon. friend from Davenport advises me to make a tariff item free, I am sure there will be joy among the angels.


[Stage Direction]
Item agreed to.
Customs tariff-446b. Steel bicycle rims, not enamelled nor plated: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-446c. Golf shafts of seamless steel, coated or not, but not chromium plated: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.

Canada-United Kingdom Trade Agreement
Customs tariff-446d. Bottles or cylinders of seamless steel used as high-pressure containers for gas: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-451. Buckles, clasps, eyelets, hooks and eyes, dome, snap or other fasteners of iron, steel, brass or other metal, coated or not, n.o.p. (not being jewellery): rate of duty, 15 per cent.
Charles Avery Dunning: There is a reduction from 20 to 15 per cent, qualified by what the right hon. leader of the opposition said a moment ago, that the 10 per cent discount will not apply on the new rate whereas it did on the old. The effective reduction, therefore, is from 18 to 15 per cent. Our imports amounted to $224,000, of which $186,000 came from the United States and $26,000 from the United Kingdom.


[Stage Direction]
Item agreed to.
Customs tariff-451a.	(i) Spring-beard
needles and latch needles: rate of duty, 10 per cent.
(ii) Needles, of any material or kind, n.o.p.: rate of duty, 10 per cent.
Charles Avery Dunning: This is a reduction from 15 to 10 per cent.


[Stage Direction]
Item agreed to.
Customs tariff-451b. Pins manufactured from wire of any metal, n.o.p.: rate of duty, 174 per cent.
Item agreed to.
Customs tariff-462. Philosophical, photographic, mathematical and optical instruments, n.o.p.; speedometers, cyclometers and pedometers, n.o.p.: complete parts of all the foregoing: rate of duty, 7J per cent.
Charles Avery Dunning: 
[Stage Direction]
Item agreed to.
Customs tariff-465. Signs of any material other than paper, framed or not; letters and numerals of any material other than paper: rate of duty, 10 per cent.
Charles Avery Dunning: There is a reduction from 15 to 10 per cent.


[Stage Direction]
Item agreed to.
Customs tariff-469. Machine card clothing: rate of duty, 10 per cent.
Charles Avery Dunning: This is the same reduction, from 15 to 10 per cent.


[Stage Direction]
Item agreed to.
Customs tariff-471a.	Pressed steel belt
pulleys, for power transmission, and finished or unfinished parts thereof, including interchangeable bushings: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-475b. Matrices for stereotypes, electrotypes and celluloids described in item 475a: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs	tariff-476.	Surgical	and dental
instruments of any material; surgical needles; X-ray apparatus; microscopes valued at not less than $50 each, by retail; and complete parts of all the foregoing: rate of duty, free.
Charles Avery Dunning: No	change.


[Stage Direction]
Item agreed to.
Customs	tariff-522.	Bovings,	yarns	and
warps, wholly of cotton, not more advanced than singles n.o.p.: rate of duty, 12i per cent.
Charles Avery Dunning: This is the first of the textile items. There is no change.


[Stage Direction]
Item agreed to.
Customs	tariff-522c.	Rovings,	yarns	and
warps, wholly of cotton, including threads, cords and twines generally used for sewing, stitching, packaging and other purposes, n.o.p.; cotton yarns, wholly or partially covered with metallic strip, generally known as tinsel thread: rate of duty, 15 per cent.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-522d.	Yarns and warps,
wholly of cotton, mercerized, number forty and finer, imported, under regulations prescribed by the minister, for sale to manufacturers, to be further manufactured in their own factories: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-522f.	Yarns and warps,
wholly of cotton, number forty and finer, when imported by manufacturers of mercerized cotton yarns, for use exclusively in the manufacture of mercerized cotton yarns, in their own factories: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-523. Woven fabrics, wholly of cotton, not bleached, mercerized, nor coloured, n.o.p., and seamless cotton bags: rate of duty, 15 per cent.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
2078	COMMONS
Canada-United Kingdom Trade Agreement
Customs tariff-523a. Woven fabrics, wholly of cotton, bleached or mercerized, not coloured, n.o.p.: rate of duty, 20 per cent.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-523b. Woven fabrics, wholly of cotton, printed, dyed or coloured, n.o.p.: rate of duty, 20 per cent.
Charles Avery Dunning: There is a reduction from 22i to 20 per cent. The specific duties were removed in the last budget. Our imports last year from the United Kingdom of printed cloths amounted to $1,105,000. In piece dyed cloths our imports from the United Kingdom were $1,750,000, and in woven fabrics, cotton yarn dyed, our imports from the United Kingdom were $394,000.


Abraham Albert Heaps: Has the minister the same figures for our imports from the United States?


Charles Avery Dunning: Yes. Our imports from the United States of woven fabrics of cotton, printed, were $311,000; of woven fabrics of cotton, piece dyed, $534,000. and of woven fabrics of cotton, yarn dyed, $131,000.


Richard Bedford Bennett: They carried a specific duty?


Charles Avery Dunning: Yes.


Abraham Albert Heaps: May I ask under what item denim would come?


Charles Avery Dunning: If it is wholly of cotton, the ordinary plain blue denim, it would be under this item.


Abraham Albert Heaps: I presume there are different colours, blue, green, and so on. Personally I should like to see this duty reduced a little further, because I do not see the necessity for this very' high protection on this class of goods, which is very largely manufactured in this country as well as in the United States. I believe there is very little denim imported from the United Kingdom. I understand further that in the corresponding item dealing with manufactured goods there has not been a reduction made, so that while there is a reduction under this item on denim coming into this country there has been no reduction in the duty on overalls and other finished articles. I understand some complaint has been registered with the department in this regard.


Charles Avery Dunning: No, the complaint was just the reverse.


Abraham Albert Heaps: I was trying to get my facts correct; but complaints have been made.


Charles Avery Dunning: By manufacturers of overalls.


Abraham Albert Heaps: I should like the minister
to discuss that aspect, and I was wondering if the matter could not be adjusted by bringing the tariff in both cases down to a proper level so that Canadian manufacturers would not be placed at a disadvantage.


Charles Avery Dunning: It will be remembered that a year ago the budget removed the specific duty on the raw material coming from Great Britain.


Richard Bedford Bennett: Under the preference.


Charles Avery Dunning: Yes. Last year also the specific duty was removed from the finished article in order that the advantage of the reduction might be passed on to the consumer. By this we are still further reducing the duty on the raw material from the United Kingdom to the manufacturers of overalls.


Abraham Albert Heaps: But I am told none of that material comes from the United Kingdom.


Charles Avery Dunning: I query the suggestion that plain denim is not imported and cannot be secured from the United Kingdom, rather than from the United States.


Abraham Albert Heaps: When I worked at my trade a number of years ago I used considerable quantities of denim and at that time none of it was purchased in the United Kingdom. It is practically all Canadian or United States production. There is not a great deal of it coming from the United States, because the Canadian manufacturer usually puts his price at a level where it does not pay to import denim. The price of denim is maintained at a certain figure, plus the United States cost of production, plus the tariff less a fraction of a cent, and as a rule, so far as price is concerned, the Canadian manufacturer in our secondary industries is practically at the mercy of producers of denim in Canada. lie has to pay the price they fix, and the price they fix is the one practically fixed by producers of denim in the United States, plus of course the tariff. If the tariff on overalls is reduced, and the tariff on denim is maintained, the overall manufacturers are placed at a disadvantage. My plea is that the minister reduce the tariff on denims, because I do not believe there is any need for the high protection given Canadian manufacturers of denims.
Let me give my reasons for making these statements. First of all, the Canadian manufacturer buys his raw material, or should buy it, at exactly the same price as the United States manufacturer. There is no duty on raw cotton entering Canada. I do

Canada-United. Kingdom Trade Agreement
not believe the cost of producing denim in Canada is any greater than it is in the United States, in spite of the greater production in that country.


Richard Bedford Bennett: It is cheaper in the southern states.


Abraham Albert Heaps: I think wages in the southern states are no less than they are right here in Canada.


Mr. BAKER:: Labour is much cheaper there.


Abraham Albert Heaps: Taking labour costs in the northern and southern states I would say that they are somewhat higher than those found in Canada.


Richard Bedford Bennett: But the figures do not show that.


Abraham Albert Heaps: I do not think much can be said about labour costs. If the manufacturer in Canada can import raw material duty free, I do not see why he must have a protection under the intermediate tariff. I would suggest to the minister, both from the general standpoint of reducing cost to the consumer, and giving the secondary manufacturer a fair opportunity, that the cost of denim be permitted to come down in exactly the same way as the cost of the finished article has done.


Charles Avery Dunning: The argument is rather circular in form, because we here propose a reduction. We are now considering the British agreement, and the proposal is to reduce the duty on denim as a part of the item. Of course I know what the difficulty is. It is that the overall manufacturers, who a year ago were quite ready to accept the reduction in duty on their fabrics, did not with the same good grace accept the reduction in duty on the finished overalls. That is the truth of the matter. Last year we removed the specific duty on the fabrics under the British preference, and we reduced the specific duty on overalls from three and a half cents to one and a half cents per pound weight. Now we are reducing the rate again with respect to the British preference. It will be 18 per cent net in future, allowing for the discount. In the budget item I propose to remove the cent and a half per pound on the finished overalls.


Richard Bedford Bennett: That is in the ways and means resolution.


Charles Avery Dunning: Yes, which is not presently before the committee. Our best judgment is that that is an equitable working of the reduction on fabrics and the finished commodity. I know that the overall manufacturer to whom
the hon. member (Mr. Heaps) refers wrote me in the matter. Like all manufacturers he wants his raw material free, and a tariff as high as possible on the finished product. That is a very human desire. Nearly every person who communicates with the Minister of Finance has that desire to a greater or lesser extent. In reply to the hon. member I can only say that a careful study of the matter leads me to the belief that the adjustments downward which have been made in connection with our raw material and the finished product are applied to meet the interests of all concerned.


Richard Bedford Bennett: What did we buy from England under the reduction of last year?


Charles Avery Dunning: I have not the figures, but I could get them.


Richard Bedford Bennett: I was only interested in the effect of the reduction. The contention of the hon. member has been that we cannot get denim from England.


Charles Avery Dunning: Denim is not separately classified, but is included with other coloured cotton fabrics.


Abraham Albert Heaps: What is the intermediate tariff on denims?


Charles Avery Dunning: It is 27^ per cent, plus 3i cents per pound.


Abraham Albert Heaps: Can the minister explain why there should be such a high tariff on denims coming into Canada?


Charles Avery Dunning: The United States agreement effected a reduction a year ago.


John Gordon Ross: When the minister was first answering the hon. member in connection with the tariff against denim he said that it depended on certain things; I understood him to mean the amount of cotton or wool in the denim.


Charles Avery Dunning: No; this denim is wholly of cotton.


Richard Bedford Bennett: It is overall material.


John Gordon Ross: I thought both cotton and wool were used.


Charles Avery Dunning: No, just cotton.


John Ritchie MacNicol: A moment ago the minister made the observation that the manufacturer wanted to have the duty as high as he could have it; what the manufacturer had in mind was trying to provide more jobs.


An hon. MEMBER:: Oh yes?


Abraham Albert Heaps: I still maintain the minister should seriously consider the duty imposed on denims. I used a great deal of this material at one time, and I know how the price
20S0	COMMONS
Canada-United. Kingdom Trade Agreement
has gone up and how it fluctuates all the time in view of our tariff structure. In 1930 when the tariff on the item jumped, some of the manufacturers in Canada refused to invoice goods to the secondary manufacturers. They shipped the goods, and when they felt the rate was going up they sent the invoices. The result was that the costs went up, too.


Charles Avery Dunning: I am afraid the leader of the opposition will have to answer the hon. member.


Abraham Albert Heaps: I happen to have seen correspondence in connection with the matter. I have never yet been able to discover why the textile industry in Canada requires an intermediate rate of 271 per cent.


Charles Avery Dunning: That is the intermediate
rate.


Abraham Albert Heaps: Our importations are chiefly under that rate, and in addition there is the excise tax of three per cent, bringing the whole rate to something over 30 per cent.


Richard Bedford Bennett: And in addition a specific duty of three and a half cents per pound.


Abraham Albert Heaps: We cannot justify so high
a tariff on articles in every-day use by the people of Canada.


Charles Avery Dunning: My hon. friend's original premise is wrong when he states that the importations come principally from the United States. In every classification of this item which I read, the imports from Great Britain are two and three times as great as those from the United States, and in some cases even more than that. The competitive factor in connection with textiles of this character is the British price.


Abraham Albert Heaps: My information is that so
far as denim is concerned, there is hardly any imported from the United Kingdom. The minister admitted a few moments ago that there was no item which would show the amount of denim imported from the United States and from the United Kingdom.


Charles Avery Dunning: Let us see if we cannot get a closer figure. Is denim a woven cotton fabric printed?


Richard Bedford Bennett: No.


Charles Avery Dunning: Is it a woven fabric,
cotton, piece dyed?


Richard Bedford Bennett: No.


Richard Langton Baker: Sometimes it is.


Charles Avery Dunning: Or is it yarn dyed? I
think piece dyed would more likely cover it.


Richard Langton Baker: It would not be woven; it would be piece dyed.


Charles Avery Dunning: Under that heading we
imported from the United Kingdom SI,750,000 worth, and from the United States S500,000. The price competitive factor is the imports from the United Kingdom.


Richard Bedford Bennett: On cotton textiles.


Charles Avery Dunning: 
Abraham Albert Heaps: I think the figures quoted by the minister prove my contention. The tariff on these items is so high that the Canadian manufacturer cannot afford to bring in these goods. Eight-ounce denim which will sell in the United States for 15 cents a yard will cost the manufacturer here the same price, plus whatever tariff is placed against the material. The Canadian manufacturer has freight charges to pay and other items of expense which make it impossible for him to bring in this material. The figures read by the minister would indicate that he cannot possibly import these goods from the United States.


Richard Langton Baker: How does Great Britain keep the cost down?


Abraham Albert Heaps: There is very little of this overall material brought in from the United Kingdom. I am told that they do not produce it there at all. The only competition is from the American manufacturer. The Canadian manufacturer finds it impossible to bring in these goods from the United States. I would venture to say that if the rate of duty was reduced from 27J to 22J or 17^ per cent, the minister would find that within twenty-four hours the Canadian manufacturer would bring down his price in conformity with the change in the tariff structure.


John Ritchie MacNicol: And throw a lot of men out of wTork.


Mr. DEACHMAN:: What were the rates on these items prior to 1930?


Richard Bedford Bennett: There was no specific duty at that time.


Charles Avery Dunning: The last time this item was dealt with was in the budget of 1928. At that time the rates were 20 per cent, 25 per cent, and 27i per cent ad valorem, with no specific duty. Under this proposal the rate will be 20 per cent as against Great Britain, exactly the same as it was in 1930.

Toronto General Insurance


Robert John Deachman: What about the United States?


Charles Avery Dunning: The present rate against the United States is 27i per cent ad valorem, plus 3i cents per pound. Of course, the British agreement does not touch the United States duty.


Robert John Deachman: What would be ad valorem equivalent of this rate?


Charles Avery Dunning: I have not that information at the moment. This is rather a difficult item to deal with, as there are so many classifications of material.


Robert John Deachman: Surely someone can tell us what would represent the ad valorem rate in connection with products such as this.


Charles Avery Dunning: My information has been made up for the purpose of dealing with the British rates.


Robert John Deachman: The British rate is not competitive to the same extent.


Charles Avery Dunning: If my hon. friend will wait until eight o'clock, I shall have that information.
Item stands.
Progress reported.
At six o'clock the Speaker resumed the chair and the house took recess.
After Recess
The house resumed at eight o'clock.


PRIVATE BILLS
[Stage Direction]
Mr. W. R. MACDONALD (Brantford City) (for Mr. Plaxton) moved the third reading of Bill No. 53, to incorporate Toronto General Insurance Company.
Thomas Langton Church: I do not see the mover of the bill here. I call the attention of the government to the very extensive powers for which this company is asking. Under section 8 it may make contracts of insurance in respect of accidents, automobiles, aviation, bonds, burglaries, credit, earthquakes, explosions, falling aircraft, fires, forgeries, guarantees, hail, inland transportation, machinery, plate glass, sickness, sprinkler leakage, steam boilers, tornadoes, and the weather. These are very large powers to be conferred on one company, and one which is putting up very little in the way of money or securities.
What rates are to be given by this company? Surely, if parliament is to give life and fire insurance companies such wide general powers their rates should be regulated, as I have always contended by a body similar to the board of railway commissioners. The arts and sciences, notably preventive medicine and surgery, have reduced the death rate over fifteen to twenty points per thousand within the last few years; large amounts of money have been spent by the dominion and provincial governments and by municipalities for purposes of fire prevention; and surely it is not desired that the same level of rates shall prevail as was in force years ago. This is a matter which I think the government could very well consider.
Under section 8 this company is empowered to deal in some nineteen different classes of insurance, most of which were never heard of in the olden days. Why should not the government consider some general policy to apply to all these companies? It is well known that some of them are started without the financial security they should have. They deal mostly with industrial workers, and charge very high rates. Let anyone who doubts this statement try to get insurance in any of the classes I have enumerated and at the rates charged. In the cities and towns the rates for burglary insurance have been raised because a number of places have been broken into, and in other classes of insurance there have been increases. If the federal government incorporates these companies under the general act there should be, I repeat, some body with power to control their rates, or they will become like some of the shark loan and mortgage companies.
I regret that the mover of the bill is not present, although I do not take objection to that; he is a good friend of mine and has no doubt looked into the bill more closely than anyone else. But take clause 9, dealing with subscription and payment of capital before commencing business. The company is to be allowed to commence business when it has $275,000 of its capital stock subscribed and paid for. What regulations are there for such companies? I should like to know; I raised the point last year. I am sure the time is coming when we must have some regulation. In the United States during the past four years there have been a number of federal investigations into companies such as these; many of them, quite illegally, took their trust funds and gambled with them all over the civilized world, and they could do so because they were under no form of regulation. No doubt the department of insurance is a good one and its superintendent

Federal Fire Insurance

is efficient, but this is not enough. The time has come for the government to consider laying down some policy along the lines I have suggested.
Motion agreed to and bill read the third time and passed.


FEDERAL FIRE INSURANCE COMPANY
[Stage Direction]
The house in committee on Bill No. 49, to incorporate Federal Fire Insurance Company of Canada-Mr. Macdonald (Brantford City) -Mr. Sanderson in the chair.
On section 1-Incorporation.
Abraham Albert Heaps: May I ask the minister or whoever is in charge of this bill whether it has received the approval of the government or of those in charge of measures of this kind?


Charles Avery Dunning: These bills, incorporating Wellington Fire, Federal Fire, Gore District Mutual, Sterling Insurance, and Sons of Scotland, have all been examined by the superintendent of insurance, have been to the committee on banking and commerce, and have been returned here without amendment. They comply with all the conditions of the Department of Insurance.


Abraham Albert Heaps: The superintendent of insurance has approved of these measures?


Charles Avery Dunning: Yes. In some cases in these bills there are conditions to be complied with before the incorporation can be proceeded with. For instance, in the case of a provincial company which is by statute becoming a federal company, the protective provisions are inserted at the instance of the superintendent of insurance in order to ensure that everything is regular. I have not personal knowledge of them, I might say, but I have confidence in that official.


[Stage Direction]
Section agreed to.
Sections 2 to 10 inclusive agreed to.
Bill reported, read the third time and passed.

[Stage Direction]
The house in committee on Bill No. 50, to incorporate the Wellington Fire Insurance Company-Mr. Macdonald (Brantford)-Mr. Sanderson in the chair.
Sections 1 to 5 inclusive agreed to.
On section 6-Classes of insurance authorized.
Thomas Langton Church: I would call the attention of the committee to the fact that the incorporators of this Wellington Fire Insurance Company are the same as the incorporators of Federal Fire Insurance Company, the bill previously before the committee; they are all good people, though, and they are asking for the same powers as those provided in the other bill. All these companies are from Toronto. Why do they want a federal charter? They are doing only a local business. Why are two companies being incorporated for the same purposes? I don't want to oppose them but I want to secure information. There should be proper control over rates and for that purpose I submit that we ought to have a federal department.
Why do these people want two charters? By no stretch of the imagination can it be said that either of these bills is for the general advantage of Canada; they are merely for the promotion of local business. Here we have two companies seeking incorporation on the same day. One of the bills has passed through practically all its stages in this house and nothing has been said about it. No wonder the condition of affairs in Canada to-day is what it is in connection with these insurance companies. There is a long list of classes of insurance in which this company may engage, all set out on page 2 of the bill, and I think we should have an explanation either from the minister or from the sponsor. Does the government propose to pass further general regulations to control these companies? Can some five or six persons come here and obtain two separate charters in one evening, one in the name of the Federal Fire Insurance Company and the other in the name of the Wellington Fire Insurance Company, without one word of explanation from some responsible person or any government policy?


Mr. WOODSWORTH:: It is a peculiar circumstance that we should be asked to incorporate at the same time two companies having the same set of directors. I do not know anything about this bill but it does strike me as a rather peculiar arrangement, and I support the suggestion of my hon. friend that there should be an explanation.


John Alexander (1874-1948) Macdonald: Both of
these companies were incorporated under provincial authority and are now doing business under provincial charters. It is now their intention to extend their operations beyond the province of Ontario and for that reason they wish to have incorporation under the federal parliament. The applicants are directors or officers of the existing companies and the

Wellington Fire Insurance
intention is that when the new companies are incorporated, organized and entitled to do business, they will take over the assets and business respectively of these provincial concerns. It is merely a matter of extending their charters, giving them dominion jurisdiction, whereas at present their charters are only provincial. I am advised that both companies intend to surrender their provincial charters and operate under dominion jurisdiction.


James Shaver Woodsworth: That is not in the
slightest an answer to the question. There have been two companies operating under provincial charters and they now seek dominion incorporation. What I said was-and I simply followed the hon. member for Broadview-that we should be told why there should be two companies operated by the same board of directors and doing work apparently in the same field.


Mr. DONNELLY:: Does the hon. member mean that the Federal company and the Wellington company have the same directors?


James Shaver Woodsworth: If the hon. member will turn to the bill we have passed he will see that those seeking incorporation are:
Herbert Begg, insurance director; William Robert Begg, manufacturers' agent; William Henry Buscombe, insurance executive; John Gordon Hutchinson, insurance executive, and George Alexander Gordon, insurance executive, all of the city of Toronto, in the province of Ontario, together with such persons as become shareholders of the Company, are hereby incorporated under the name of "Federal Fire Insurance Company of Canada" hereinafter called "the Company".
When we come to this bill for the incorporation of Wellington Fire Insurance Company we find that the persons enumerated in section 1 are:
Herbert Begg, insurance director; William Robert Begg, manufacturers' agent; William Henry Buscombe, insurance executive; John Gordon Hutchinson, insurance executive, and George Alexander Gordon, insurance executive, all of the city of Toronto, in the province of Ontario, together with such persons as become shareholders of the company, are hereby incorporated under the name of "Wellington Fire Insurance Company" hereinafter called "the Company".
These are both fire insurance companies and there seems to be no reason why there should be this duplication, when both companies are out to do the same type of work and apparently in the same field.


Joseph Thorarinn Thorson: It may not necessarily follow that the shareholders of both of these provincial companies are the same persons. It 31111-1321
may be a matter purely of convenience to pick out these particular persons as the incorporators of the dominion company in each case.


James Shaver Woodsworth: It is quite true that the shareholders may be different; we do not know anything about that. All we can go on is the enumeration of the names of those seeking incorporation, and I submit that we should have some definite information before we pass the third reading.


Abraham Albert Heaps: There should be some definite statement in this committee before we adopt a measure of this kind. I do not think we should be asked to incorporate two different companies having the same set of directors and both doing the same business. If either the minister or the hon. member who sponsors the bill is unable to give us any information at this stage, the logical thing is to allow the matter to stand until that information can be given.


Charles Avery Dunning: The sponsor of the bill evidently cannot give the definite reasons why the incorporators are the same in both these bills. One can only take it that these two separate provincial companies have at present the same or substantially the same personnel in their directorates, and the two companies separately are seeking federal incorporation. What apparently some members of the committee desire to know is why the two companies should not amalgamate if they are owned by substantially the same people. That information, it seems, was not given in the banking and commerce committee. I was not present in that committee and therefore have no knowledge of the circumstances, but if it is deemed important to have it I think the bill should stand tonight so as to give the sponsor an opportunity to secure full information. I do not think that parliament particularly wants to force amalgamation. It may well be, as the hon. member for Selkirk has suggested, that the shareholders are substantially different although the directors are the same. There may be circumstances of which we are unaware and we ought to be made aware of those circumstances.
Progress reported.


CONSIDERED IN COMMITTEE- THIRD READINGS
[Stage Direction]
Bill No. 51, to incorporate Gore District Mutual Fire Insurance	Company-Mr. Edwards.
Bill No. 52, to incorporate Sterling Insurance Company of Canada-Mr. Parent (Quebec West and South).
2084	COMMONS
Sons oj Scotland Benevolent Association

[Stage Direction]
The house in committee on Bill No. 54, to incorporate the Sons of Scotland Benevolent Association.-Mr. Reid-Mr. Sanderson in the chair.
On clause 1-Incorporation.
Jean-François Pouliot: Are the ladies and gentlemen mentioned in that clause real good Scotch people? It is a Scotish benevolent association? I should like to know if they are all Scots?


Charles Avery Dunning: The sponsors are. Section agreed to.
Sections 2 to 16 inclusive agreed to. Preamble agreed to.
'On the title.


Joseph Thorarinn Thorson: Will the sponsor of the '.bill be good enough to explain the title?


Thomas Reid: It is rather late to start explaining now after the preamble is carried.


Joseph Thorarinn Thorson: It is a misnomer.


Thomas Reid: I do not think the hon. member is in earnest. I shall be glad to tell him after it is through.
Bill reported, read the third time and passed.


INDUSTRIAL LOAN AND FINANCE CORPORATION
[Stage Direction]
The house in committee on Bill No. 57, reflecting Industrial Loan and Finance Corporation-Mr. Yien-Mr. Sanderson in the chair.
On clause 1-Loans of S500 or less: aggregate charge.
Mr. McIYOR:: I do not wish to be discourteous to the Senate nor to the hon. member from the other side of the house, the sponsor of this bill. The other night I said a similar bill was unchristian, but that was not fair to the hon. member for Cartier. I will say that this bill is inhuman. Within the last few days I have read some of the advertisements of corporations of this type, and they are very misleading. They seem to be 'brotherly, very inviting and very sympathetic to those in distress. Once you get into their clutches, however, it is a different story. To me passing a bill of this kind is like hitting a man when he is down. Often in my youth, and occasionally later on, I I Mr. Dunning.]
engaged in the manly art, and it was always considered a brutal thing to hit a man when he was down; a person who did that sort of thing was called by a special name. I think a corporation or financial concern that will hit a man when he is in financial trouble is most inhuman, and we, the representatives of the people, should not tolerate it. I say they are inhuman because anyone who plans or contrives to reap a rich harvest from his fellow-men who are in deep distress and liable to lose their all, deserves that word. If the hon. member who is an expert in the administration of lethal gas could give these people a few drops of that gas, not enough to be fatal, I think it might be a very good thing.
My personal view is that the borrower should be protected. If our provinces are not able to pay four per cent I am sure hon. members will agree that individuals should not be asked to pay the rates demanded by these companies. I wonder if hon. gentlemen realize that there are companies which seek to extract from those in financial trouble not four per cent, not ten per cent, not twenty per cent, but 27i per cent and, judging by the experience I have had in the past, before you get out from under, it may cost more than thirty per cent and perhaps nearly fifty per cent.
I had one experience that causes me to rise in my place to-night and protest against companies of this kind. I knew of a hard working man who got into debt, perhaps through listening to a high pressure salesman, and he was faced with the possibility of losing all his property and working a great hardship on his family. Along came these financial concerns, saying: We will get you out of your trouble. They say: Consult us and your financial difficulties will be removed. It is like jumping from the frying pan into the fire. I do not wish to make it any stronger, but I could not call myself fair and honest to my fellowmen if I did not register the most vigorous possible protest against the incorporation of companies of this kind. I voted for the other bill because it was sponsored by an hon. member in this comer of the chamber. It was sent to a committee, but I hoped it would never be returned to this house.


Thomas Langton Church: Mr. Chairman, I agree with what has been said by the hon. member for Fort William. I have been opposing bills of this kind for the last ten years, because ninety-five per cent of these loans are made to the industrial workers of the country, who are not getting one bit of support from this parliament. We have legislation protecting

Industrial Loan and Finance
the farmers, the fishermen and everyone else, legislation which I supported and would support again, but the industrial worker receives no protection at all. These companies are principally engaged in local business. Not by the widest stretch of the imagination could it be said that their operations are provincial, let alone federal, yet they come to this parliament for incorporation; the bills are referred to a committee and sent back here; these* companies are exempt from the operations of the Usury Act, the Interest Act, and the Companies Act and given the widest power to hold up people at two per cent per month, and all that sort of thing. We are not going to stand for it any longer.
Last year a bill with a preamble almost identical with the preamble of this bill was opposed by the Minister of Finance. That bill was considered on June 9, 1936, and the minister said:
The government holds the view that in these times of declining interest rates it is doubtful wisdom for parliament to incorporate more companies empowered to charge these high rates of interest. It is true that the general legislation enacted a few sessions ago endeavoured to set maximum rates and it is natural that the companies incorporated by parliament should in their advertising attach some importance to that fact. The impression has gone abroad, among certain sections of the public at all events, that parliament, by the general legislation now on the statute books, has authorized the charging of the maximum rates. I know that such was not the intention, and for this, among other reasons, the government was gratified to see the study being given to this matter by a committee of the other house. However, for the reasons I have indicated, the government cannot accept the solution proposed by that committee.
It is evident, Mr. Speaker, that this matter of interest rates and the conditions applying to small loans must again engage the attention of parliament. It is the intention of the government to initiate, between now and the next session of parliament, a further examination of the matter with a view to amending the existing general legislation. In the meantime, I must oppose the second reading of the bill. . . .
Nothing has been done since then. This session these companies did not introduce their bills in this house; apparently they learned a lesson last session, when three or four of these bills were talked out or voted down. This time they went to the other house, where the bills passed all stages. Now we are asked to deal with them here. I am opposed to these companies; I believe these bills run contrary to the policy of the government. We have set up a body or commission to loan money for home improvements, and committees have been formed in the larger centres. The Ontario legislature
recently passed legislation exempting the repairs and improvements from municipal taxation, and now this parliament is going to kill that work of incorporating a number of these useless companies. They are well named shark loan companies. I do not know any other legislature where they could get charters. They would be laughed out of the* British parliament; they were put out of the* United States, some of them, following an investigation conducted by the government of that country some four or five years ago.
These are the companies that are putting in the bailiffs. They sue people in the courts, and some of these poor people are sent to gaol. Already there are thousands of people in gaol for debt, and now we propose to add to that number by passing legislation of this kind. The time has come to vote down these bills. We are not sent here to represent these shark loan companies; we are sent here to protect the poor industrial workers. One of the things the government had to face in the by-election in Hamilton West yesterday was the feeling held by the industrial workers who have lost their equities in their small homes in that city. The industrial workers are not going to stand it any longer. Some of these shark loan companies have such bad names that they are now attempting to change them here to another name. They do not like to do business any more under the old name. Although I have never done business with these companies, I often receive literature from them. I am not in need of a loan, but three or four times each month I receive their circulars through the mails. How they get into the mails franked, I do not know. I called the attention of the Postmaster General (Mr. Elliott) to it last year.
The cities and towns are getting sick and tired of these companies. Despite the high-taxes a man is asked to pay, they attempt, to charge two per cent per month. The parliament of Canada should vote this sort of thing down, right away. The bill, every section of it, should have the six months' hoist. I am surprised that any hon. member familiar with conditions in the industrial cities and towns of Canada should introduce a bill such as this. The workers in those industries have no protection, and yet we sit here and propose to pass a bill which will do them an injustice.
This type of company has been severely criticized by some of the division and county courts judges. One judge said a few days ago that he wished some members of parliament who pass such acts would visit his court to see

Industrial Loan and Finance
how legislation of this kind is adversely affecting men, women and children in the province of Ontario. I wish some hon. members of the house would visit some of the division courts or police courts and see for themselves the effects of it. These companies take chattel mortgages, bills of sale, liens and other forms of security a,nd then, in some way or another they get the person who has obtained the money into court. Our judges have not been slow to criticize this sort of legislation. In the olden days hon. members of the house would have opposed a bill of this kind.
I do not know where the government stands in the matter. Last session they told us they would have a policy next year; where is that policy? This session they tell us the same thing, and no doubt next session we will be told the same thing again. The government of the day is responsible for this measure. So long as the party opposite is the party in power, it will be responsible for the preamble of the bill. As such they should lay down a policy to-night, as they promised a year ago, as evidenced by the observations appearing at page 3550 of Hansard for 1936.


Mr. STEVENS:: Unfortunately, when this bill was before the banking and commerce committee I was required to attend another committee which has been sitting almost continuously, dealing with the prices of agricultural implements; and as a result I could stay in the banking and commerce committee only a very few minutes. While there I expressed my views, and in doing so referred to the fact that the original act to which this measure is an amendment exempted the company from control of the Interest Act, the Money Lenders Act, and the Loan Companies Act. In the few minutes in which I appeared before the banking committee, not having the act under my hand, I was not in a position definitely to establish my assertion. The superintendent of insurance, who was adviser of the committee, intimated that I was quite wrong and that the present bill was not in that category. I was pretty sure I was right but I did not have the act under my hand; subsequently, however, I had the opportunity to look at the original act.
It will be noted that the bill purports to amend paragraph (b) of subsection 1 of section 5, chapter 68 of the statutes of 1930. I have that statute under my hand, and I find that paragraph (b) of subsection 1 of section 5 reads as follows:
Notwithstanding anything contained in the Interest Act or in the Money Lenders Act or in paragraph (c) of section 63 of the Loan Companies Act . . .
fMr. Church.]
Then it goes on to describe the powers. So that I was right when I drew the attention of the committee to that fact. The committee, at least while I was there, disregarded that fact, and the bill is now reported to the house. That is one of the reasons I rise once more to protest against the passing of this type of legislation.
The other evening, when the bill was before the house, at least two of its supporters were rather inclined to ridicule the stand taken by some hon. members and myself, intimating that we were perhaps ill informed and somewhat prejudiced, and suggested that the broad, minded thing to do was to let the bill go to a committee. Some of us argued that if we were opposed to its principle we ought to express our opposition then on the motion for second reading. However, our views did not prevail and the bill went to the committee. While voting that the bill be sent to a committee, a number of hon. members expressed a good deal of doubt as to the wisdom of passing this type of legislation.
I wish now to refer briefly to one or two arguments advanced which, I believe, influenced hon. members in their support of the measure. For instance, it was said that if we do not pass the legislation, companies can incorporate under provincial acts, and that if they can incorporate under provincial acts they can secure much wider and less restricted powers than those granted by parliament. Therefore they suggested it was in the interests of poor, suffering humanity that this two-per-cent-per-month bill should be passed, in order to save the people from the looser legislation of the provinces.
Any company incorporating under a provincial statute is subject to the federal Interest Act, and if we turn to the British North America Act we find that the exclusive power of control of interest rates rests with this parliament, Parliament proposes, by this measure and its sister act, to take these companies out of its jurisdiction-literally to legislate them out of our own jurisdiction. That is what we are doing.
I wish hon. members would seriously consider this, because to me it is a vital principle. The only control parliament has over these companies is the control it has through the Interest Act. Now then, by these very acts we are legislating ourselves out of the control of these companies. It is one of the most subtle pieces of legislative chicanery that has come to my attention. In association with other hon. members, over and over again I have spoken against this form of financial company. Up to this session we have

Industrial Loan and Finance
never been able to get hon. members in any number to become seized of the enormity of the practices of money lending sharks. I am not saying that this particular company should be described as a money lending shark, but I do say that those who charge usurious rates of interest ought to be placed in that category. There is an air of decency about these companies. I do not know about this particular company, but some of these companies are subsidiaries of American companies.


Mr. VIEN:: Not this one.


Henry Herbert Stevens: The other company was, and it is similar to this one. I am speaking about them in a general way.


Thomas Vien: We are talking about this one now.


Henry Herbert Stevens: I may say to the hon. member that I know what I am talking about just as well as he.


Thomas Vien: Mr. Chairman, I want to correct a misstatement of fact, which I am sure my hon. friend will accept gracefully.


Henry Herbert Stevens: I have accepted it.


Thomas Vien: No.


Frederick George Sanderson: Unless the hon. member is speaking on a point of order, he is out of order.


Thomas Vien: I want to correct a misstatement of fact, and I rise to a point of order.


Henry Herbert Stevens: I accepted the hon. member's explanation.


Thomas Vien: This company is not a subsidiary of any foreign company.


Henry Herbert Stevens: I accepted that explanation long ago. We could have saved considerable time if the hon. member had noted that. What I am saying is that certain of these companies, similar to this company, are subsidiaries of American companies. While those in charge of these companies may not be disreputable, I do say that the rates of interest charged, whether by this company or by the money lending sharks so-called, are rates which this parliament dare not sanction.
So much for that part of the question. Let us see what this bill is doing. It is proposed to add a subsection to section 5 of the original act. Let me point out to hon. members just what we are doing. In the first place, we are legislating ourselves out of control of this company by making it no longer subject to the Interest Act. Under the original act this company could make loans secured by
the assignment of chattel mortgages, and so forth, charging not more than 7 per cent per annum, and could deduct in advance the interest on all its loans. I shall read only parts of the section in the original act. It continues:
(ii) charge, in addition to interest as aforesaid, for all expenses which have been necessarily and in good faith incurred by the company.
And again:
-when a loan authorized by the said subparagraph (i) has been made on the security of a chattel mortgage, or of subrogation of taxes, be entitled to charge an additional sum equal to the legal and other actual expenses disbursed by the company-
It has been argued that we are bringing this and other companies under more restrictions, but this bill merely places certain limits upon loans under $500. On other loans this company can charge 50 per cent by running up the expenses.


James J. Donnelly: That is what they are doing now.


Henry Herbert Stevens: Of course it is. Under this bill they are to be limited to two per cent per month. I wanted to draw attention to what we are actually doing. We have not by any means relieved the country from the danger of loan sharks, as the unrestricted provincially incorporated companies are not affected in any way by this legislation. In the second place, as I have stated already, we are sanctioning this company to carry on notwithstanding the Interest Act, the Moneylenders Act and the Loan Companies Act. My submission is that this is a policy which this parliament ought not to adopt. As I said before, this parliament should consider seriously the necessity of providing loans for industrial workers similar to those provided by the rural credits act.


Jean-François Pouliot: Mr. Chairman, the other bills pass through the house like a scene from moving pictures. We should consider this bill very carefully. It consists of only one section, which contains forty-eight lines. There are only three sentences, and if the bill is read too fast it canno't be understood. I intend to read it very slowly in order that everyone may be able to understand it. The section to be added reads:
(iv) whenever the company, under authority of this act, makes a loan of five hundred dollars or less-
That is exactly what the hon. member for Kootenay East (Mr. Stevens) was saying.
-subparagraphs (i), (ii) and (iii) of this paragraph (b) shall not apply.
2088	COMMONS
Canada-United, Kingdom Trade Agreement


Joseph Thorarinn Thorson: What are those subparagraphs?


Jean-François Pouliot: I will come to that in a moment. I continue:
Instead, the company may, with relation to such loan, make against the borrower an aggregate charge, expressable as a percentage of the principal money loaned, which charge shall be deemed to include all interest on the loan, all charges thereon or therefor of every nature and kind other than interest, all disbursements (except for registration fees as hereunder provided) made in connection with the loan and all other fees, charges or services whatsoever arising out of or incidental to the loan.
Could you understand that, Mr. Chairman? No one can understand it. No one can know the real intent of this legislation. The sponsor of this bill (Mr. Vien) is a very eminent lawyer and I am sorry he did not take more time to clarify the language of the bill. If this bill is referred to as shark legislation it is because it has too many teeth.
Section stands.
Progress reported.



[Stage Direction]
The house again in committee of ways and means, Mr. Sanderson in the chair.

[Stage Direction]
Customs tariff-523b. Woven fabrics, wholly of cotton, printed, dyed or coloured, n.o.p.: rate of duty, 20 per cent.
Charles Avery Dunning: The information for which the hon. member for Huron North asked just before six o'clock is being prepared and is not quite ready. Due to a change in tariff treatment of the United States in the past fiscal year it is difficult to get comparative figures with any great ease. I will give the information later in the evening.


Abraham Albert Heaps: Will the minister allow this
item to stand?


Charles Avery Dunning: I could, but I can give
the information on another item. I am quite certain it will not make any difference to the views of hon. members as to this item.


Abraham Albert Heaps: I wish to discuss further the tariff and tariff rates, but so long as I have the opportunity upon another item I have no objection to this being passed.


Charles Avery Dunning: May I point out to my
hon. friend that the matter he has raised is really not at present before the committee because it relates to the intermediate tariff. As I have explained before, this schedule affects the British preferential rate only. Later on, on the budget items, of course there will
[Mr. Pouliot.j
be an opportunity for the hon. member to discuss what he has in mind, particularly as this same item will again come before the committee, after the British agreement is disposed of, with respect to other tariffs.


Abraham Albert Heaps: I do not wish to discuss the same thing twice over. Under the circumstances I will raise the matter when it comes under the ordinary items of the budget.


[Stage Direction]
Item agreed to.
Customs tariff-ex 523b. Shadow cretonnes, wholly of cotton, with printed warp and plain weft: rate of duty, 12£ per cent.
Charles Avery Dunning: There is a reduction in rate. Shadow cretonnes from Great Britain have entered in the past under item 523b at 22J per cent. The new rate will be 12i per cent with respect to this particular class of cotton goods. Inasmuch as it is a new item we have no available data on this classification.


Robert John Deachman: Is the product made in Canada?


Charles Avery Dunning: Not to any extent.


[Stage Direction]
Item agreed to.
Customs tariff-ex 523b. Gabardines, wholly of cotton, with not less than 280 ends and picks of ply yarn per square inch: rate of duty, 12J per cent.
Charles Avery Dunning: Gabardines are also a new item, designed to segregate the gabardines fabrics from item 523b. Formerly these gabardines entered at 221 per cent duty. In future they will enter at 12J per cent. So far as our information goes, they are not manufactured in Canada.


Robert John Deachman: It is purely a revenue item. What is done is to reduce the duty substantially on what is wholly a revenue item. That, I take it, is the effect of the change.


[Stage Direction]
Item agreed to.
Customs tariff-ex 523, ex 523a, ex 523b. Woven fabrics, wholly of cotton, composed of yarns of counts of not less than 80 and not more than 99, including all such fabrics in which the average count of the warp and weft yarns is not less than 80 and not more than 99: rate of duty, 12J per cent.
Charles Avery Dunning: There is here a reduction of rate, also a new item affecting woven fabrics wholly of cotton, of counts 80 to 99. Following the conference of 1932 there was incorporated in the schedules a new item, 523c, which provided for the entry under the British preferential tariff of cotton fabrics composed of yarns of counts of 100 or more.

Canada-United Kingdom Trade Agreement
The object of that item was to permit free entry of a type of cotton fabric not then made in Canada, and not likely to be produced economically in the dominion. The item then created may be said to relate more particularly to very fine cotton shirtings of a certain kind and to certain laws, muslins, voiles and marquisettes. The item has proven of considerable value to United Kingdom exporters, as evidenced by the fact that the imports under it in 1935 were valued at $340,000, and in 1936, $424,000.
The United Kingdom industry has always asked that it should be given greater liberty with regard to these counts than was provided by the item in the 1932 agreement. There were many articles which just failed to qualify before, by virtue of the counts from 80 to over 100. During the recent negotiations the United Kingdom authorities pressed very hard for a new item which might be described as covering a middle band of these fine fabrics, that is fabrics made of yarns 80 or finer in count, at a rate of 12J per cent. Canadian cotton mills are working to some extent in fabrics of this fine quality, but we think that a rate of 124 per cent against the British production of these finer quality cotton products is justified.


Richard Bedford Bennett: Have we any record of our production of these fine counts?


Charles Avery Dunning: We have no separate
record, no.


Mr. WALSH:: Has the minister had any communications from any of the mills in Canada that are interested in this particular item?


Charles Avery Dunning: On this particular item?


William Allen Walsh: No, who are interested in this particular item?


Charles Avery Dunning: I have no recollection of any. When I say that, my hon. friend will of course understand that my correspondence on all these matters is very large, but I have no recollection of any relating to this particular item.


[Stage Direction]
Item agreed to.
Customs tariff-523c. Woven fabrics, wholly of cotton, composed of yarns of counts of 100 or more, including all such fabrics in which the average of the count of warp and weft yarns is 100 or more: rate of duty, free.
Charles Avery Dunning: No change is made in 523c.


[Stage Direction]
Item agreed to.
Customs tariff

523e. Woven fabrics wholly of cotton with cut pile, n.o.p.: rate of duty: 15 per cent.
Charles Avery Dunning: There is no change.


[Stage Direction]
Item agreed to.
Customs tariff-ex 523e, ex 561. Fabrics with cut weft pile, wholly of cotton or of cotton and artificial silk: rate of duty, 5 per cent.
Charles Avery Dunning: This is a reduction in rate. Again it is extracting fabrics of cotton weft pile, wholly of cotton or of cotton and artificial silk, from the general item of which they formerly formed a part. This classification is entirely new, and is intended to deal only with cut pile fabrics wholly of cotton or of cotton and artificial silk.


Richard Bedford Bennett: There is a great difference between the two, of course.


Charles Avery Dunning: Yes, but it is convenient to group them. They are not available in Canadian manufactures so far as I am aware.


Richard Bedford Bennett: There is a great distinction between cotton and artificial silk.


Charles Avery Dunning: Yes, but they must be of weft pile. The common factor is the cut weft pile.


Richard Bedford Bennett: The common denominator.


Charles Avery Dunning: The reduction will be
from 15 to 5 per cent.


Richard Langton Baker: Are these goods not manufactured in Woodstock, Ontario?


Charles Avery Dunning: I have no knowledge
of them being manufactured anywhere in Canada.


[Stage Direction]
Item agreed to.
Customs tariff-523f.	Woven fabrics of
cotton, not coloured, when imported by manufacturers of typewriter ribbon for use exclusively in the manufacture of such ribbon in their own factories: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-525. Woven fabric, wholly of cotton, specially treated and glazed, when imported by rubber manufacturers for use in their own factories, exclusively as a detachable protective covering for uncured rubber sheeting: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-528. White cotton bobinet, plain, in the web: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
2090	COMMONS
Canada-United Kingdom Trade Agreement
Customs tariff-529. Embroideries, lace, nets, nettings, bobinet, n.o.p., fringes and tassels, wholly of cotton: rate of duty, 20 per cent.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-529a. Lace and embroideries, wholly of cotton, not coloured, imported by manufacturers for use exclusively in the manufacture of clothing, in their own factories: rate of duty, 7J per cent.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-530. Lace and embroideries, wholly of cotton, coloured, imported by manufacturers for use exclusively in the manufacture of clothing, in their own factories: rate of duty, 7i per cent.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-532. Clothing, wearing apparel and articles, made from woven fabrics, and all textile manufactures, wholly or partially manufactured, composed wholly of cotton, n.o.p.; fabrics wholly of cotton, coated or impregnated, n.o.p.: rate of duty, 25 per cent.
William John Ward: Is not 25 per cent a high rate of duty as between Canada and Great Britain? I am disappointed that there should be this high rate on clothing and wearing apparel.


Charles Avery Dunning: In respect of this item, one and a half cents per pound duty was removed in the last budget, irrespective of the agreement feature. The imports from Great Britain of cotton clothing, the completed article, are not and cannot be very great because of the style factor. The important import from Great Britain in connection with cotton and artificial silk is not the completed article, but the fabrics and the yarns that go to make up the fabrics. My hon. friend will see, if he looks at the items we have passed, that with respect to the fabrics and the yarns low duties prevail. They are the commodities that come in. The style factor enters in connection with the intermediate tariff much more largely than under the British preferential tariff for the reason that we have an affinity with the United States in matters of style, particularly with regard to women's cotton and silk clothing represented by the item now before us.


William John Ward: That is very good as far as it goes, but does not this 25 per cent protect the Canadian manufacturer to that extent and enable him to charge that much more? If the farmers, the fishermen, the miners and others engaged in the primary industries

are to survive they must be enabled to buy, in the lowest possible markets, their textiles, boots and shoes, machinery and all the material that is necessary in the processing of our natural resources.
When we sell our goods in the markets of the world we have to meet competition from countries where there is a low standard of living and a low scale of wages. That, at any rate, is what we have been told; that is what is so loudly proclaimed in this house by those who speak for the manufacturers. Daily they remind us that the manufacturers are in danger of being put out of business and that our workmen may lose their homes and suffer a reduced standard of living if we lower the tariff. Well, is not the farmer in the same position? He must compete in the markets of the world over which he has no control, and must sell his products in competition with the very countries in which we are told these very same conditions exist. But when he comes to buy his requirements he buys in a market never less than fifty per cent above the price at which the same goods could be purchased in the markets of the world. He is at a tremendous disadvantage. But apparently the noisy crowd we have from Toronto and other manufacturing centres have got the ear of even our good one-time free trader in the person of the Minister of Finance. I do suggest that the free traders and those representing the agricultural areas of Canada must express more vigorously the views of the people they represent. It seems to me that a duty of 25 per cent between Canada and Great Britain is entirely too high.


John Ritchie MacNicol: You have far too much influence in this house now.


John Gordon Ross: What was the tariff in 1930 under this item?


Charles Avery Dunning: In May 1930 the duty on this item was 22J per cent, and in September it was increased to 25 per cent, plus 3 cents per pound. The specific duty was eliminated at the last session.


Richard Bedford Bennett: It was cut in two first.


Charles Avery Dunning: 
Robert John Deachman: 
Robert John Deachman: Well, if my hon. friend was not in Hamilton he must have found out anyway that during the Liberal regime wages went up fourteen per cent, whereas during the regime of the high protectionist policy to which he is devoted wages declined sixteen per cent, and still he votes for protection. The question I asked the minister was: Is this clearly an item on which the effective protective rate is increased?


Richard Bedford Bennett: Of course it is.


Robert John Deachman: The raw materials are reduced, but in this item there is an increase in the effective rate of protection. While my hon. friend admits he is not a free trader, and while I with equal frankness say emphatically I am, I do not think my hon. friend will admit that he is a high protectionist.


Charles Avery Dunning: Not for a moment.


Robert John Deachman: Yet that rate stands higher to-day than in 1930, and very substantially higher when all the relevant circumstances are taken into account.


William Allen Walsh: Is the 3 per cent also added to this?


Charles Avery Dunning: No.


William Allen Walsh: The 3 per cent would represent a further concession, would it not?


Charles Avery Dunning: There is no 3 per cent excise tax with respect to importations from Great Britain.


William Allen Walsh: But with respect to these goods manufactured in Canada there is?


Charles Avery Dunning: No, it is a duty on imports entirely, but it does not apply to British imports.


John Gordon Ross: It is just an additional tariff.


William Allen Walsh: The item represents a reduction then?


Charles Avery Dunning: No. There was a reduction last year. The item has stood exactly as it is since a year ago.


William Allen Walsh: And the minister has had no complaints from any of the textile mills?


Charles Avery Dunning: The textile mills are not affected by this item. This affects the manufacturers of clothing, not the textile mills. Item agreed to.
Customs tariff-ex 532. Handkerchiefs, wholly of cotton: rate of duty, 15 per cent.


Robert John Deachman: This item illustrates
what I suggested a moment ago. This has been brought down from 25 to 15 per cent, I understand?


Charles Avery Dunning: Yes.


Robert John Deachman: Here is an item which is the raw material of manufacturing, cotton fabric for covering books-


Charles Avery Dunning: My hon. friend is on the wrong item. This is a reduction on your handkerchiefs.


[Stage Direction]
Item agreed to.
Customs tariff-ex 532. Woven fabric, wholly of cotton, for covering books: rate of duty, 15 per cent.
Robert John Deachman: On this item there has been a straight reduction of 40 per cent in the tariff for the advantage of the Canadian manufacturer. But as I pointed out in regard to the item of clothing, which is wholly a consumers' item, no reduction has taken place. There is an increase of protection.


Charles Avery Dunning: If my hon. friend had
listened to me when I described the effective competition, and if he will look at the budget resolutions, he will find that that very item comes back again from the consumers' point of view in the budget resolution which we shall reach by and by.


Robert John Deachman: Our attention was
called this afternoon to the fact that we are discussing the items as they appear, and I am dealing now with the item here, following that suggestion.
2092	COMMONS
Canada-United Kingdom Trade Agreement


Charles Avery Dunning: If my hon. friend would not argue from the particular to the general he would be right. But if he is going to argue from the particular to the general he must embrace in his discussion what is being done both in the Canada-United Kingdom trade agreement and in the budget resolution, from the point of view of the consumer.


Robert John Deachman: Then may I discuss
the two?


Charles Avery Dunning: Just in the interest of
understanding what I am trying to do.


Robert John Deachman: I have not yet had an explanation from the minister why an item which is wholly for the use of the manufacturer should be reduced, while a substantial consumers' item remains higher than in 1930.


Charles Avery Dunning: If my hon. friend will
come back to this on the budget item, we shall be able to consider the whole matter together much more intelligently.


Robert John Deachman: My difficulty is that
we do not come back to this in the budget items. I cannot find it there.


Charles Avery Dunning: I assure my hon. friend it is there; page 9 of the ways and means resolution, item 532, clothing, wearing apparel, et cetera.


George William McDonald: I should like to ask our protectionist friends whether it is not true that on all goods which they export from this country they get a drawback of the duties paid on the raw material. If that is true, can they blame us who represent rural constituencies for wanting to get our goods and implements of production as cheaply as we can so that we can meet competition in the outside market? I see here that there are lower duties on raw materials, but on finished articles the duty is not nearly so low.


William Allen Walsh: I want to come back to that excise tax. A certain quantity of these goods is manufactured in Canada. In order to manufacture them raw material is imported. When the manufacturers import their raw material I presume they pay the 3 per cent excise tax.


Charles Avery Dunning: Not from Great Britain.


William Allen Walsh: But if they import their raw material say from the United States, if it happens to be raw cotton, or from Egypt, the 3 per cent excise tax is charged?


Charles Avery Dunning: Provided the importation is from a foreign country; not from Great Britain.
[Mr. Deachman.J


William Allen Walsh: And that goes into the cost. So that when you have a duty of say 25 per cent you have to bear in mind that in Canada the manufacturers also have to pay an excise tax of 3 per cent, which probably the manufacturer in the other country has not to pay. so the 3 per cent is a factor that we have to bear in mind.


[Stage Direction]
Item agreed to.
Customs tariff-537. Rovings, yarns and warps, wholly or in part of vegetable fibres, not more advanced than singles, n.o.p., not to contain silk, artificial silk nor wool: rate of duty, 12 J per cent.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-537a. Rovings, yarns and warps wholly or in part of vegetable fibres, including yarn twist, cords and twines generally used for packaging and other purposes, n.o.p., not to contain silk, artificial silk nor wool: rate of duty, 171 per cent.
Charles Avery Dunning: A reduction in rate from 20 per cent to 17^.


[Stage Direction]
Item agreed to.
Customs tariff-537b. Linen thread, for hand or machine sewing: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-537d. Rovings, yarns and warps, rvholly of jute, not more advanced than singles, n.o.p.. not to contain silk, artificial silk nor wool: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-537e.	Rovings, yarns and
warps wholly of jute, including yarn twist, cords and twines generally used for packaging and other purposes, n.o.p.: rate of duty, 25 per cent.
Charles Avery Dunning: There is a reduction in rate from 27i to 25 per cent.


[Stage Direction]
Item agreed to.
Customs tariff-539. Cordage, exceeding one inch in circumference, wholly of vegetable fibres, n.o.p.: rate of duty, 17i per cent.
Charles Avery Dunning: 
[Stage Direction]
Item agreed to.
Customs tariff-ex 540.	(a) Woven fabrics,
in the web, wholly of flax or hemp, not to include towelling and glass cloth of crash or buck, with or without lettering or monograms woven in, nor table cloths and napkins of crash with coloured borders: rate of duty, free.

Canada-United Kingdom Trade Agreement
(b) Articles wholly of flax or hemp, such as sheets, pillow cases, table cloths and napkins, towels and handkerchiefs, but not to include towels or glass cloths of crash or huck, with or without lettering or monograms woven in, nor table cloths and napkins of crash with coloured borders: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-541a. Woven fabrics, wholly of jute, n.o.p.: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-541d. Canvas in the web, wholly of flax or hemp, or both, plain woven, not coloured, not further manufactured than impregnated with weatherproofing or preservative materials, suitable for manufacturing into tents, awnings, tarpaulins, hatch covers and similar articles, weighing not less than 18 ounces and not more than 26 ounces per square yard: rate of duty, 15 per cent.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-542. Woven or braided fabrics not exceeding 12 inches in width, wholly or in part of vegetable fibres, and all such fabrics with cut pile, n.o.p., not containing silk, artificial silk nor wool: rate of duty, 20 per cent.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-542a. Woven or braided fabrics not exceeding 12 inches in width, wholly or in part of vegetable fibres, n.o.p., not to include silk, artificial silk nor wool: rate of duty, 22J per cent.
Charles Avery Dunning: There is a reduction in rate from 25 to 22J per cent.


James Houston Spence: It is just interference.


[Stage Direction]
Item agreed to.
Customs tariff-542b. Linen fire hose, lined or unlined: rate of duty, 15 per cent.
Charles Avery Dunning: There is a reduction in rate from 25 to 15 per cent.


Robert John Deachman: Are these goods made in Canada?


Charles Avery Dunning: Yes, there is one producer in Canada.


[Stage Direction]
Item agreed to.
Customs tariff-547. Bags or sacks of hemp, linen or jute: rate of duty, 15 per cent.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-548. Clothing, wearing apparel and articles made from woven fabrics, and all textile manufactures, wholly or partially manufactured, composed wholly or in part of vegetable fibres but not containing wool, n.o.p.; fabrics, coated or impregnated, composed wholly or in part of vegetable fibres but not containing silk, artificial silk nor wool, n.o.p.: rate of duty, 25 per cent.
Charles Avery Dunning: There is a reduction in duty. The present rate is 25 per cent plus 3 cents per pound; the specific duty of 3 cents per pound is being taken off entirely.


Robert John Deachman: What was the rate under this item in the tariff of May, 1930?


Charles Avery Dunning: It was 22J per cent against Great Britain in 1930.


William John Ward: To satisfy my curiosity,
would the minister tell us what this clothing is that is made from woven fabrics composed wholly or in part of vegetable fibres?


Charles Avery Dunning: These are mixtures. Here are a few of the commodities: collars and cuffs composed of vegetable fibre; quilts, counterpanes, and so on; handkerchiefs wholly of hemp, flax or vegetable fibre; clothing and wearing apparel; diapers; textile manufactures generally, of vegetable fibre.


William John Ward: I protest; I think the duty is entirely too high.


Charles Avery Dunning: Well, we are taking off 3 cents a pound.


William John Ward: Of course the duties imposed from 1930 to 1935 were so extreme that we should not compare this Liberal policy with the policy in effect during those years, which was so ruinous to most of the people in this country. I see the hon. member for Waterloo South (Mr. Edwards) in his seat The other day he told us about the number of additional employees who were put to work in Kitchener following the higher tariffs imposed by the previous government. He did not tell us, however, that from 1930 to 1933 the woollen manufacturers of Kitchener were able to buy their wool for just 33^ per cent of what that wool cost in 1929, though in 1933' woollen fabrics were 92 per cent of the price of 1929. They were buying their raw material at one-third the former cost and selling the finished article at almost one hundred per cent of the previous price. The hon. member did not tell us those things, nor did he tell us that wages were not maintained in Kitchener at the 1929 level.


Mr. EDWARDS:: My hon. friend will have to absolve me from blame; I did not know anything about Kitchener. If he will confine himself to South Waterloo I may answer him.
2094	COMMONS
Canada-United Kingdom Trade Agreement


William John Ward: My hon. friend is not very far from Kitchener.


John Gordon Ross: I agree entirely with the hon. member for Dauphin, and I want to tell the Minister of Finance that he made a slight mistake a moment ago. I do not pretend to be as apt an exponent of free trade as my hon. friend from Huron North, but I believe in it as sincerely as he does, and I consider the tariffs contained in this budget, not only against Great Britain but against other countries as well, far too high in many cases and they should be lowered.


William Allen Walsh: The more I listen to the arguments on the other side of the house the more sympathy I have for the Minister of Finance.


Charles Avery Dunning: I do not need it.


William Allen Walsh: Last evening we listened to a suggestion from another minister with regard to the political pressure that was brought to bear on him in connection with a certain measure that was to come before the house. To-night we see the Minister of Finance somewhat harassed by his own supporters.


Charles Avery Dunning: Oh, no; not at all.


William Allen Walsh: They are arguing for a policy of free trade, and they are supporters of the government which is responsible for this budget. Is the Liberal party in Canada a homogeneous party or is it a party made up of members who seek to be elected on their individual records as free traders, protectionists and what not?


Richard Bedford Bennett: Mostly what nots.


William Allen Walsh: The Minister of Finance has brought down a budget imposing certain duties. If my hon. friends from the west would go to industrial centres like Cornwall and similar places, where the people are dependent on industry for their very existence, or speak even to the farming communities in the terms that they have used in this house, I am afraid they would sound the death knell of the Liberal government in this country. I have every sympathy for our western friends, and I do not say that as a platitude. I recognize the fact that the west is growing a product which it has to sell in the world markets, and certainly I would give every assistance possible to enable our farmers to trade in that market to the best advantage.
But I ask my hon. friends to be a little sympathetic to those of us in the east who have been associated with industry all our lives. I ask them to show a little consideration for the working men in our factories and

for the farmers who are dependent upon these centres of population. That is all I am asking. I am not asking for high protection; I am not a high protectionist. I believe in protection just sufficient to enable an industry to earn a reasonable profit and give employment to as many as possible. That is all I am arguing for in this house, and I would ask my hon. friends not to seek to establish themselves at the expense of entire communities in the eastern part of Canada. Be a little more sympathetic towards those who have to earn their living in factories and to the farmers who depend upon these factory workers for the marketing of their products.
I think there is a common basis on which we might work. I grant that in the past certain duties have been much too high. I am ready and willing to have those duties brought down to an equitable basis, but I am not willing on any class of goods that can be manufactured in this country to bring down the duty to a level that will force our industries to close. My hon. friends may think that on this side of the house we are exaggerating the picture. I am not exaggerating the picture when I tell the committee that already one industry in this country has closed, as a result of competition from across the border. As the Minister of Finance knows, two factories manufacturing velvet have had to close their doors, thereby putting men and women out of employment and on to the relief rolls. No wonder the Minister of Labour has to come to the house and report an increase of the numbers on relief, and an increase in unemployment. That is the reason for it.


Mr. GRAY:: When did he do that?


William Allen Walsh: According to his own reports.


Ian Alistair Mackenzie: His last report was the very opposite.


William Allen Walsh: Look up the report for the month of February last and compare it with February of the previous year. Compare the actual conditions.


John Gordon Ross: Those employed in industry, or those on relief?


William Allen Walsh: The point I make is this: I am asking hon. members from the west to give the east a little more consideration. I feel they can do that without jeopardizing their own position, or their influence in their respective constituencies.


John Gordon Ross: Just a word in reply to the hon. member for Mount Royal.


James Houston Spence: Another free trader.

Canada-United Kingdom Trade Agreement


John Gordon Ross: Yes, and proud to be one, too. The hon. member intimates that by lowering the tariff we will put people out of work. So far in Canada we have never had a real demonstration of whether or not a lowering of the tariff will put people out of work, but we certainly have had one which has proved conclusively that the more you raise the tariff the more people in industry you put out of work. In 1930 the present leader of the opposition went from one end of Canada to the other and told the people that he would make the tariff fight for them, that it would get them jobs.


John Ritchie MacNicol: And he did.


John Gordon Ross: All we have to do is look at the records, and we find that from year to year as the tariff went up, employment in industry went down. At the same time there was a decrease in the amount of wages paid in industry, and the amount paid to each person declined. Hon. members need not tell us that we are endeavouring to ruin Canadian industry by lowering the tariff, because every time tariffs have been lowered in Canada, Canadian industry has employed more people and paid more wages. Those are the facts.


Alexander McKay Edwards: Does that apply to the furniture industry, too?


John Gordon Ross: What we want is a demonstration-it is what we would like to have-of what lowering the tariffs in a substantial way would do towards building up industry in eastern Canada, giving more people employment, and giving them more money for the work they do in industry.


James Houston Spence: Why don't you be fair, and admit that in the last five years there was
a depression.


Joseph Thorarinn Thorson: Mr. Chairman, a moment ago the hon. member for Mount Royal (Mr. Walsh) made a statement to which I wish to take exception. He spoke of the agricultural population as being dependent upon persons engaged in industry. It is time the people of Canada came to a proper realization of the attitude that ought to be adopted towards the real wealth of this country. I make the statement, without fear of successful contradiction, that industry in Canada depends upon agriculture, has always depended upon it, and will always depend upon it. Ever since the beginning of the industrial revolution, industry has depended upon agriculture.


Richard Langton Baker: And agriculture upon industry.


Joseph Thorarinn Thorson: It would not have been
possible to bring about the industrial revolution had it not been for the fact that in other parts of the world there were large areas capable of producing surplus foods and raw materials. That made possible the division of labour that took place and the increase of wealth throughout the world that resulted from that division of labour. The industrial revolution could not have taken place in Great Britain if it had not been for the fact that in this new world there were large areas capable of producing surplus foods and raw materials. Ever since that time industry has depended upon agriculture and upon those primary industries that are concerned with the production of primary products, whether food or raw materials. I believe this country ought therefore to come to a proper realization of the kind of tariff and fiscal policy which it ought to follow.
During the previous regime a totally different attitude was adopted. It was urged that by raising the tariffs and making our manufactured goods in Canada we could solve our unemployment problem, but there was a complete failure of these policies. I think the time has now come when this country should adopt policies that will increase our real wealth. Our real wealth consists of our primary production, but that wealth is of no value to the people of Canada unless we devise policies which will put it into circulation. We cannot put our basic wealth, the primary production of Canada, into circulation unless we are prepared to buy manufactured goods from abroad. The sooner we learn that lesson the better for the whole of Canada; for by that method we will increase our total wealth, we will increase the purchasing power of our primary producers, and they will be better able to buy the manufactured goods of those who are engaged in the secondary industries.
Those of us who believe in a policy of lower tariffs do not wish to harm industry. We believe there is a certain value in having diversified occupations in this country, and we are prepared to pay a certain price for the benefit of such diversified occupation. But we are not going to pay too big a price. We have been paying much too big a price in the past. I suggest that the hon. member for Mount Royal looked at the picture from the wrong end. When he spoke of agriculture being dependent upon industry he saw the picture in reverse for, in my opinion, industry depends upon agriculture. Indeed, the whole of Canada depends upon the welfare of those who produce our basic wealth. That basic wealth is the primary production of Canada.
2096	COMMON'S
Canada-United Kingdom Trade Agreement


William Allen Walsh: Coming back to the item
under discussion may I say that with the greater part of what the hon. member for Selkirk has said I find myself in complete agreement. I recognize the value of primary industry in any country. I do not seek to place emphasis wholly upon secondary industry for the development of our country. But I was earnestly asking our western friends to recognize the fact that there is a secondary industry in Canada, and that that secondary industry must be protected if it is to survive. If the item under discussion carries too high a tariff, then the Minister of Finance and the officials in his department are in a better position to know that fact than any hon. members sitting to the right or the left of Mr. Speaker.
I feel perfectly confident that no minister of finance will seek at any time deliberately to injure any industry in this country. I have confidence that no minister of finance will seek to grant such protection to the secondary industries of this country as to enable them to make excessive profits. In erecting a tariff structure it is difficult to avoid going too far in one direction or the other. What we should seek to do is to find the happy medium where industry would receive that amount of protection which would guarantee its existence.
I want my hon. friends from the west to realize that there is no one in the east who does not recognize the value of the western farmer, or the value of the farming population of this country. The secondary industries are dependent upon the purchasing power of those engaged in the primary industries, just as they are dependent upon reasonable tariffs. If the secondary industries had not the purchasing power of those engaged in the primary industries, they could not survive no matter how much protection they were given. They are absolutely dependent upon two factors. First, the purchasing power within the country, a large part of which is in the hands of those engaged in primary industry; and second, a measure of protection, not necessarily high. They should be given sufficient protection to enable them to manufacture the im.pl emueuts necessary to those engaged in the primary industries for the carrying on of their operations effectively and cheaply.
I hope I have made myself abundantly clear. I am not asking the minister to raise one item; I am simply pointing out the danger of going so low as to squeeze some industries out of existence. I have a letter before me- no doubt the minister has a copy on his file- which states that two companies have been

forced to close their doors. This action was not necessary because the duty was placed too low, but because certain industries in another country are taking advantage of the regulations in order to bring goods into this country.


Joseph Thorarinn Thorson: What country does the hon. member refer to?


William Allen Walsh: The United States. They are dumping first-class goods into this country by stating that they are seconds. In that way the goods are brought in at a lower valuation. The velvet industry may not make very much profit, but it can survive if the competition is fair. But in this instance the competition is not fair. I think the minister should endeavour to get these duties set at a point where the manufacturer can exist, and where they will be fair to those engaged in primary industry. Iam ready to assist him as much as I can in that particular objective.


Charles Avery Dunning: Now that there has been a general discussion, I wonder if we could again abide by the rules in committee and discuss only the item before the chair. We are supposed to be dealing with item 548.


Mr. GLEN:: Mr. Chairman, I think the latitude which has been allowed to-night with regard to the discussion of free trade and protection might well be allowed in connection with this item. When I listened to the hon. member for Mount Royal (Mr. Walsh) speak to-night I could not help but think of the many complaints I have received from farmers in the west. He spoke of two companies which had been put out of business, but I can tell him of two thousand farmers who have been put out of business during the last six years. In my business I meet men every day who complain about the high protection and the discrimination against the west in favour of the industries in the east against which they have to contend. The hon. member stated quite reasonably that he is not in favour of increased protection, but I wonder if he remembers the remarks which have been made by some of his colleagues. Only the other day the hon. member for Greenwood (Mr. Massey) referred to the bonus given to the farmers as a dole. If the hon. member did not hear that, I can assure him it was said.


Richard Bedford Bennett: It was said that industry in this country was on the dole.


James Allison Glen: The kind of speech we have just listened to from the hon. member for Mount Royal is just the sort of thing that creates friction between the east and the west.

Canada-United Kingdom Trade Agreement


Richard Bedford Bennett: The statement was that industry was on the dole.


James Allison Glen: That was not the statement made by the hon. member. He said that we were willing to accept these doles. The farmers of the west are given some consideration in the sale of their grain, and then we find members of the Conservative party complaining that we are getting a dole. We are not getting a dole, we are simply getting the consideration in the sale of our wheat which we never had before.


William Allen Walsh: Would the hon. member quote from Hansard rather than put words into the mouth of an hon. member who is not present?


James Allison Glen: At the moment I cannot give his exact words, but that is the meaning of his words.


Richard Bedford Bennett: That is a vastly different thing. The hon. member has no right to make such a statement.


James Allison Glen: That remark was made in reply to the hon. member for Moose Jaw (Mr. Ross). That remark just bears out the feeling in the west with regard to the protection given to the central provinces. I can remember the leader of the opposition (Mr. Bennett) saying that when he got into power there would be a scientific reduction of the tariff. All the scientific reduction we got was a raise to the high heavens. As I said before, it is this kind of talk that is creating dissension in the west. People in the west, and in the maritimes if you like, feel that they should receive the same treatment as the central provinces. From 1930 to 1935 the industries of this country received considerable benefits from this government, and surely the time has come when the west should have its share.
Some people complain that there are no free traders in this parliament. There are plenty of free traders. The Liberal government was elected on a policy of lower tariffs, and we feel that effect should be given to this policy. That is what those of us who have thought over the matter believe should be done. We contend that in lower tariffs is to be found a solution for the unemployment problem. We do not believe for one moment that industries are likely to suffer. The time has come to give a demonstration of what freer trade and lower tariffs mean to this country, after the experience we have had under protectionism.


[Stage Direction]
Item agreed to.
Customs tariff-ex 548. Woven dress linens containing not more than 15 per cent by weight of cotton yarns for decorative effect: rate of duty, free.
Charles Avery Dunning: On woven dress linens, the whole item is made free. I think it might have left a rather better taste in the mouths of some hon. members who have just spoken if we had then been discussing the present item.


Robert John Deachman: Is the product made in Canada?


Charles Avery Dunning: So far as I know, no. There is the question of the combination of linen and cotton, which may involve some mixed cotton production.


[Stage Direction]
Item agreed to.
Customs tariff-549c. Haircloth, composed of horse hair in combination with any vegetable fibre: rate of duty, free.
Charles Avery Dunning: There is a reduction in the rate for haircloth for those who desire to wear it.


[Stage Direction]
Item agreed to.
Customs tariff-551. Yarns, composed wholly or in part of wool or hair but not containing silk or artificial silk n.o.p.: rate of duty, 15 per cent, and, per pound, 6 cents.
Item agreed to.
Customs tariff-551a. Yarns and warps composed wholly of wool or in part of wool or hair, imported by manufacturers for use exclusively in their own factories, n.o.p.: rate of duty, 10 per cent, and, per pound, 5 cents.
Item agreed to.
Customs tariff-551c. Yarns and Warps, composed wholly of hair, or of hair and any vegetable fibre, imported by manufacturers for use in their own factories: rate of duty, free.
Item agreed to.
Customs tariff-552. Felt, pressed, of all kinds, in the web, not consisting of or in combination with any woven, knitted or other fabric or material: rate of duty, 15 per cent, and, per pound, 5 cents.
William John Ward: What are these?


Charles Avery Dunning: The specific duty of 7i cents per pound, is reduced to 5 cents per pound. The ad valorem remains as it is. The production in Canada of felt goods involved includes hair felt, shoe felt, woollen and cotton felt, paper-makers' felt, harness felt, padding, insoles, and then there is a miscellaneous item. The ad valorem incidence of the double duties following the deduction for direct shipment was practically 20 per cent.

2098	COMMONS
Canada-United Kingdom Trade Agreement


William John Ward: I am informed by those who should know, men engaged in the papermaking industry of Canada-


Richard Bedford Bennett: The question is, do they know?


William John Ward: -that felt manufacturers in Canada are exporting these felts for papermaking to Sweden and selling them at the present time at just half of what they are being sold for in Canada. If that is so, while manufacturers were complaining only a short time ago about the dumping of goods in this country, here are our own Canadian manufacturers dumping in the far away country of Sweden, I am told, at just half the price they charge paper-makers in Canada.


Mr. CASSELMAN:: What evidence have we of that fact?


Charles Avery Dunning: I am interested in the information that the hon. member has. Perhaps he will give it to me in greater detail and let me check up on it. I should be surprised to learn that these felts are being sold by Canadian manufacturers in Sweden at half the price at which they are sold to our own paper-makers, who, I know, are pretty close buyers.


Mr. McCANN:: The information that has just been given with reference to felts is, I believe, hardly correct. In my constituency, Kenwood Mills Limited are large manufacturers of the felts used in paper mills. It is true that they export a considerable quantity to the United Kingdom, and I understand that this lowering of the tariff will not hurt them in the least. They have as large a business in this country as they can carry on, and in addition they ship a very considerable quantity to British manufacturers for papermaking purposes. I can hardly believe that they are not more astute than to sell to Sweden at fifty per cent of what they can get for the felts in this country, when they are rushed night and day in manufacturing for our own and British use.


[Stage Direction]
Item agreed to.
Customs tariff-553. Blankets of any material, not to include automobile rugs, steamer rugs, or similar articles: rate of duty, 20 per cent, and, per pound 5 cents.
Charles Avery Dunning: This is a reduction in rates on blankets from 221 per cent and 10 cents a pound to 20 per cent and 5 cents per pound.


Robert John Deachman: Can the minister give us the ad valorem equivalent of these two nates?


Charles Avery Dunning: You want the ad valorem incidence of the combined duties?


Robert John Deachman: Yes.


Richard Bedford Bennett: It depends on the value of the blanket, of course.


Charles Avery Dunning: It is very difficult to generalize.


Robert John Deachman: The average could be taken on the total importation of blankets.


Charles Avery Dunning: The total duties paid, after allowing for the direct shipment discount, were very close to $100,000 on an invoice value of $250,000. It will be understood, of course, that necessarily I am generalizing.


Richard Bedford Bennett: That is forty per cent.


Charles Avery Dunning: Thus the ad valorem incidence of the double duties was about 40 per cent.


Robert John Deachman: That is the average?


Charles Avery Dunning: That is the average.


Richard Bedford Bennett: We import only a certain kind of blanket into this country.


Charles Avery Dunning: Upon last year's values the new combination duties will yield about 23 per cent on the average, as near as we can ascertain. Sometimes it is a little misleading to take an average with respect to articles covering a wide range of values.


Richard Bedford Bennett: What was the rate in May, 1930?


Charles Avery Dunning: Ad valorem rates have been unchanged since 1928. That is to say, the present ad valorem is below the rates in force in May 1930. The specific duties were first added in September 1930, at 20 cents under the British preference and reduced from 20 to 10 cents following the conference in 1932. That 10 cents is now cut by this agreement to 5 cents specific, and the ad valorem rate is reduced to 20 per cent.


Richard Bedford Bennett: It is still higher, though, than it was in 1930.


Charles Avery Dunning: If the average is correct in its application 'to ad valorem and specific combined, it will be just about the same as it was in 1930.


Robert John Deachman: Can the minister give the percentage of wage cost in the production of blankets? I believe that in respect to this item the figures will be available to him. I have contended that that information should be given in respect to all these items so that we can see it before we discuss the items in

Canada-United Kingdom Trade Agreement
the house. For instance we might find out that the wage cost in this item is approximately 25 per cent. Suppose that were true, I should like to submit to the hon. member for Mount Royal (Mr. Walsh) this question: If the wage cost in the production of blankets is 25 per cent of the selling price of the blanket, how much then does he think would be an adequate gift from the gentlemen of western Canada to the manufacturers of eastern Canada in connection with the protection of that item?


Some hon. MEMBERS:: Carried.


Robert John Deachman: Has the minister the information available?


Charles Avery Dunning: I have not the information regarding wage costs in the manufacture of blankets. Indeed I think it would be very difficult to get at it accurately, because many of the plants manufacturing blankets are manufacturing other articles as well. I doubt very much whether it would .be possible to split up the labour cost in very many of the mills that manufacture, among woollen commodities, blankets and other items. I do not believe I have any approximation of it.


Robert John Deachman: Can the minister give
the total for the woollen industry?


Charles Avery Dunning: I want to give the hon.
member what I have, but I doubt whether he can extract from it what he is seeking. The number of establishments manufacturing woollen cloth in 1934 was sixty-six, paying salaries of S4.730.000. There were thirty-four establishments manufacturing woollen yarns, with 2,464 employees, receiving SI,700,000 in that same year. In carpets, mats and rugs, there were twenty-seven establishments, paying wages of S995.000. In woollen goods not elsewhere specified, in which from the bureau of statistics point of view blankets would be included, there were twenty-four establishments, paying wages of 81.033,000. As regards the total of woollen textiles, I am always a little suspicious of the separation which I have just given because I do not think it is possible statistically to take accurate account of the overlapping of various products in one establishment.


Richard Bedford Bennett: Not unless you have
separate cost sheets.


Charles Avery Dunning: Unless there are separate cost sheets; and anyone who looks into the industry knows that it is all but impossible in a number of smaller establishments to get that information. The total in woollen textiles in 1934 was 151 establishments. This is apart from the hosiery and knitted goods.
These 151 establishments employed 10,636 people, and paid 88,459,000 in wages. The only comparable item in the other statistical record-I know that my hon. friend is familiar with these statistics, much more so than I am-is a table of costs of materials used, gross value of production, and value added by manufacture. He is familiar with that, but I do not know whether it will help him to get the information he wants.


Richard Bedford Bennett: That is given in the year book for the whole of Canada.


Robert John Deachman: Can the minister give
me the total production of woollen goods? He has given the wages and salaries for the item in connection with which he mentioned
88.459.000.


Charles Avery Dunning: The total production of
that classification apart from hosiery and knitted goods?


Robert John Deachman: Yes.


Charles Avery Dunning: The value at factory of
total production in the woollen textile industries was 833,872.000 in 1934. I am not sure that that does not include some overlapping into the knitted goods. We have attempted to show them separately, and that is the closest I can come to it.


Robert John Deachman: It is twenty-five per
cent.


Richard Bedford Bennett: The classification covers
all woollen goods. Wages did not cover the whole but only part of it; and speaking from memory, my recollection is that the year book gives a higher figure than that.


Charles Avery Dunning: These are year book
figures.


Richard Bedford Bennett: The minister has given
the total woollen textiles as 833,000,000. The classification for wages is not the total for the woollen textile industry. I have the figures.


Charles Avery Dunning: 
Charles Avery Dunning: I am afraid that information such as my hon. friend refers to, based on that investigation by the tariff board, would be quite out of date if he has in mind the rates of wages and so on prevailing at that time and as indicated in that report. However, I shall be glad to have the matter examined prior to taking up the general tariff items to see whether I can give information that will satisfy the hon. gentleman.


Abraham Albert Heaps: I do not believe that this investigation by the tariff board would be out of date to-day.


Richard Bedford Bennett: The evidence presented (to the Turgeon commission contains some information on that point.


Charles Avery Dunning: Yes, possibly. I should say to the hon. gentleman that the report to which he refers was made in 1935, and it covered the situation as it existed in 1933 and 1934. I will bring it down for what it is worth.


Abraham Albert Heaps: I should like to have more than the wage scale, because the wage scale *does not give the labour content accurately in a yard of goods. Taking similar types of *goods, I want to be able to find out if I possibly can the difference in labour content between a yard of goods produced in Canada and a yard produced in the United States, :also in Great Britain.


Charles Avery Dunning: My hon. friend is aware that in the report in question the tariff board practically gave up all hope of arriving at accurate information with regard to the point to which he refers. They did not regard it as possible because of the very wide ramification of differences between a yard of one material and a yard of some other material, however closely the two might be related from the standpoint of the user and from the standpoint of production costs.

From the standpoint of production costs, if my hon. friend looks up the report in question he will find that the board pointed out the great difficulty in arriving at accurate information, in regard to each class of goods, of the weight and value of the raw material entering the finished product in relation to the labour cost. If I remember aright, the board's report indicated that about 140 separate classifications would be involved for yarn alone on the basis of count. It is a most complex question. But I shall be glad to furnish the report of the board; in fact, it is available to my hon. friends now; it is part of the records of the house.


Richard Bedford Bennett: When I made the reference to the 198th day of the Turgeon inquiry, of course it has not reached the 198th day; but in the brief that was filed, and in the oral presentation made between reading chapters from Adam Smith and John Stuart Mill by Mr. McRuer, there was a statement in respect to labour cost in connection with the production of cotton and other textiles. I do not know that it is of any particular value, but at least it is there and in the brief filed by Mr. Kellock on behalf of the textile industry. The matter was there gone info at some length.


Charles Avery Dunning: But they disagree with each other very widely.


Richard Bedford Bennett: Naturally.


[Stage Direction]
Item agreed to.
Customs tariff-554. Woven fabrics, composed wholly or in chief part by weight of yarns of wool or hair, not exceeding in weight six ounces to the square yard, n.o.p., when imported in the gray or unfinished condition, for the purpose of being dyed in Canada: rate of duty, 17} per cent, and, per pound, 7} cents.
Item agreed to.
Customs tariff-554a. Woven fabrics, consisting of cotton warps with wefts of lustre wool, mohair or alpaca, generally known as lustres or Italian linings, n.o.p.: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-554b. Woven fabrics, composed wholly or in part of yarns of wool or hair, n.o.p.: rate of duty, 22} per cent and 12 cents per pound.
Provided, however, that the sum of the specific and ad valorem duties imposed by this item on imports under the British preferential tariff shall not be in excess of 50 cents per pound.
Charles Avery Dunning: There is a reduction in rate from 27} cent and 17 cents a pound to 22} per cent ad valorem plus 12 cents per

Canada-TJnited Kingdom Trade Agreement
pound, provided that in no case shall the sum of the two duties be in excess of 50 cents per pound.


John Ritchie MacNicol: Is this the item covering filter cloth or wool for mines?


Charles Avery Dunning: Not yet.


Robert John Deachman: Will the minister be good enough to state the ad valorem equivalent of these two rates? I think the reduction is reasonably substantial, and I should like to have it on record.


Charles Avery Dunning: The ad valorem incidence of the specific duty varies considerably of course according to the type of cloth, so that the net effect of the reductions cannot be easily seen. It can, however, be summarized accurately. For example, total duty on a 10 shillings per yard Yorkshire worsted is likely to be within 2 shillings, or 20 per cent, which compares favourably with our own-that is the British-import duties. The total Canadian duty on typically heavy woollens from the Dewsbury-Batley valley is under the new agreement likely to be still in the neighbourhood of 50 per cent.
That is the Yorkshire Post's view of the new duties from the export point of view; I give it without necessarily endorsing it. It is one view of the subject. There is a wide range of possible differences.


Richard Bedford Bennett: The only proof of the
pudding is in the eating in these cases.


Charles Avery Dunning: Yes, but the reduction is substantial.


Richard Bedford Bennett: It would be with someone suffering from dyspepsia.


Charles Avery Dunning: I can give my hon. friend the combined weight of the duties bearing upon this item averaged under four headings of goods which come under the item, for two successive years. On flannels the total ad valorem incidence in 1935 was from 46 to 48 per cent, and in 1936 it was 46-3 per cent. On overcoatings the ad valorem incidence was 41 to 43 per cent in 1935, and 4T9 per cent in 1936. On tweeds the ad valorem incidence was 41 to 43 per cent in 1935, and 41-6 per cent in 1936. On worsteds and serges the ad valorem incidence of the combined duties was 36 to 38 per cent in 1935, and 37-4 per cent in 1936.


Richard Bedford Bennett: That is after the budget of 1936?


Charles Avery Dunning: 
Richard Bedford Bennett: On what basis of price? Because the rise of wool prices changed it.


Charles Avery Dunning: On the average value per pound in 1936.


Richard Bedford Bennett: But that is wholly unfair.


Charles Avery Dunning: That is the closest we can come to it. The rise was in 1935.


Richard Bedford Bennett: But the rise is now; it took place in the Australian wool crop.


Charles Avery Dunning: It is taking place every day.


Richard Bedford Bennett: But the rise has been phenomenal; it is twice what it was the previous year on some classes of wool.


Charles Avery Dunning: Twice what it was in
1935.	Part of that increase is reflected in the figures I formerly gave. We cannot tell how much is there reflected; that is one of the difficulties in answering specific questions such as the hon. member for Huron North asked, because by the end of this year, dependent on the price of wool very largely, these figures may turn out to be quite an incorrect calculation of the incidence of the combined ad valorem and specific duties. But for what they are worth, and having regard to the qualification just made, I give them. On flannels, 35-7; on overcoatings, 32-7, on tweeds, 32-2; on. worsteds and serges, 30 per cent.


[Stage Direction]
Item agreed to.
Customs tariff-ex 554b. Filter press clotli of wool: rate of duty, 20 per cent.
John Ritchie MacNicol: Is this the material
used in the mines for filtering purposes?


Charles Avery Dunning: No, this is not the clotb used in mining. There is a special item in the tariff for that. This is a new item for
2102	T|	COMMONS
Canada-United, Kingdom Trade Agreement
filter press cloth of wool. Filter cloth made entirely from human hair is already enumerated in the tariff under item 549e. Filter cloth of wool up to the present time has been dutiable at 27i per cent plus 17 cents per pound. Imports have not been separately recorded, nor is there any available data as to the value of Canadian production. It is known, however, that filter cloth of wool is manufactured in Canada. The proposal is to grant a rate of 20 per cent ad valorem, which is a reduction from 27J per cent ad valorem plus 17 cents per pound specific.


Mr. LOCKHART:: How much of that cloth came into Canada during the past year?


Charles Avery Dunning: Unfortunately, this being a new item, there are no separately recorded statistics.


[Stage Direction]
Item agreed to.
Customs tariff-554c. Woven fabrics, composed wholly or in chief part by weight of yarns of wool or hair, not exceeding in weight four ounces to the square yard, when imported in the gray or unfinished condition, for the purpose of being dyed or finished in Canada: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-554f. Woven fabrics, composed wholly or in part of yarns of wool or hair, commonly known as billiard cloth: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-555. Clothing, wearing apparel and articles made from woven fabrics, and all textile manufactures, wholly or partially manufactured, composed wholly or in part of wool or similar animal fibres, but of which the component of chief value is not silk nor artificial silk, n.o.p.; fabrics, coated or impregnated, composed wholly or in part of yarns of wool or hair, but not containing silk nor artificial silk, n.o.p.: rate of duty, 30 per cent.
Charles Avery Dunning: There is a reduction in rate; the specific duty of 18J cents per pound is entirely eliminated. In future it will be a straight ad valorem duty, as is the case in all comparable items in other classes.


Richard Langton Baker: In this class of items were the words "wholly or partially manufactured" previously included, or is that an innovation?


Charles Avery Dunning: It is exactly the same designation.


Richard Langton Baker: There will be no trouble in connection with the administration of such items? I thought there might be some danger
fMr. Dunning.]
of bringing in what might be called partially manufactured goods which might simply mean paying the duty practically on the value of the cloth alone. Is that not a new phrase?


Charles Avery Dunning: No, it is not.


[Stage Direction]
Item agreed to.
Customs tariff-556a. Melton cloth, imported by manufacturers of tennis balls for use in the manufacture of tennis balls, in their own factories: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-556b. Slipper cloth, woven, napped on one or both sides, wholly or in part of wool, not to contain silk or artificial silk, weighing not less than 22 ounces per square yard, when imported by manufacturers of indoor footwear, to be used exclusively in the manufacture of such articles in their own factories: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-557b. Garnetted material wholly of silk, artificial silk or similar synthetic fibres, produced by chemical processes, obtained by disintegrating cocoons, yarns or fabrics, prepared for use; filaments or loose fibres wholly of silk, artificial silk or similar synthetic fibres produced by chemical processes, not more advanced than in the form of sliver; waste portions of unused fabrics, wholly of silk, artificial silk or similar synthetic fibres, n.o.p., not to include remnants nor mill ends: rate of duty, free.
Charles Avery Dunning: There is a reduction here from 5 per cent to free.


[Stage Direction]
Item agreed to.
Customs tariff-558b. Rovings, yarns and warps, wholly of artificial silk or similar synthetic fibres, produced by chemical processes, not more advanced than singles, not coloured, with not more than seven turns to the inch, under such regulations as the minister may prescribe:
fa) Produced from cellulose acetate: rate of duty, 5 per cent.
(b) N.o.p.: rate of duty, 20 per cent.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-558c. Rovings, yarns and warps, wholly or in part of silk, n.o.p., including threads, cords or twist for sewing, embroidering or other purposes: rate of duty, 15 per cent.
Charles Avery Dunning: There is a reduction from 17J to 15 per cent.


[Stage Direction]
Item agreed to.

Canada-United Kingdom Trade Agreement
Customs tariff-558d. Rovings, yarns and warps, wholly or in part of artificial silk or similar synthetic fibres, produced by chemical processes, n.o.p., including threads, cords or twist for sewing, embroidering or other purposes, not to contain silk; artificial silk yarns, wholly or partially covered with metallic strip, one pound of which shall contain not less than 10,00(1 yards; under such regulations as the minister may prescribe:
(a)	Produced wholly from cellulose acetate: rate of duty, 71 per cent.
(b)	N.o.p.: rate of duty, 25 per cent.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-558f.	Rovings, yarns and
warps, wholly of spun artificial silk or similar synthetic fibres, produced by chemical processes, not coloured, imported by manufacturers for use exclusively in the manufacture of cut-pile fabrics, in their own factories: rate of duty, free.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-560a. Woven fabrics wholly or in part of silk, not to contain wool, not including fabrics in chief part by weight of artificial silk, n.o.p.: rate of duty, 22-J per cent.
Charles Avery Dunning: 
[Stage Direction]
Item agreed to.
Customs tariff-561. Woven fabrics wholly or in part of artificial silk or similar synthetic fibres, produced by chemical processes, not to contain wool, not including fabrics in chief part by weight of silk, n.o.p.: rate of duty, 274 per cent.
Charles Avery Dunning: There is a reduction in rate from 30 per cent.


[Stage Direction]
Item agreed to.
Customs tariff-565.	Embroideries, lace,
braids, cords, chenille, gimp, fringes and tassels, whether containing tinsel or not, nets, nettings and bobinet, n.o.p.: rate of duty, 22J per cent.
Charles Avery Dunning: There is a reduction from 25 to 22i per cent.


[Stage Direction]
Item agreed to.
Customs tariff-ex 565. Plated or braided lines and cords, non-elastic, whether of tubular or of solid construction, not exceeding one inch in circumference, wholly or in chief part by weight of vegetable fibres: rate of duty, 174 per cent.
Charles Avery Dunning: There is a reduction from 25 to 17$ per cent.


[Stage Direction]
Item agreed to.
Customs tariff-567. Clothing, wearing apparel and articles, made from woven fabrics and all textile manufactures, wholly or partially manufactured, n.o.p., of which silk is the component of chief value: rate of duty, 274 per cent.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-567a. Clothing, wearing apparel and articles, made from woven fabrics and all textile manufactures, wholly or partially manufactured, n.o.p., of which the component of chief value is artificial silk or similar synthetic fibres produced by chemical processes: rate of duty, 25 per cent.
Charles Avery Dunning: No change.


[Stage Direction]
Item agreed to.
Customs tariff-568. Knitted garments, knitted underwear and knitted goods, n.o.p.: rate of duty, 20 per cent.
Charles Avery Dunning: There is a reduction from 25 to 20 per cent on knitted goods of all kinds.


Richard Langton Baker: Has the minister taken into consideration what this will mean in the additional quantity of goods that will be imported? For some time past there has been a gradual increase in knitted underwear coming into this country from England. I am not personally interested in this matter at all, but this is a line with which I have been acquainted in my business for fifty years, and naturally I have some little knowledge of it. There has been some increase in our importations of women's knitted underwear.


Charles Avery Dunning: Of silk or wool?


Richard Langton Baker: Of wool. I have tabulated figures obtained from the Department of Trade and Commerce, and I find that the importations into this country of underwear and knitted goods, under the different headings, totalled 250,000 dozen during 1935. That means a great deal of labour. I am only thinking of the labour end of it, because this is one kind of work which, during the hard times, kept things going in many households in which the people otherwise would have been on relief. The girls and young men were able to work in the factories and earn enough money to keep the households off relief, but in 1935 the importation of these goods reached the point I have mentioned.
No doubt this reduction of five per cent is intended to increase the volume of our importations from Great Britain; if that is not the intention, what is the use of the reduction? This is clearly a class of goods that gives work to many people, and I think it is a serious matter. As I have said, I have
2104	COMMONS
Canada-United Kingdom Trade Agreement
no personal interest at all in this question. I did not like hearing a remark to that effect passed the other evening, because I think it is quite right for any hon. member to give information to the house even if he has a personal interest in a matter, because if he has a personal interest he also has personal knowledge.


Charles Avery Dunning: I agree entirely.


Richard Langton Baker: Something of that kind was said the other night, and I think perhaps that thought restrains many hon. members from speaking on questions with which they are well acquainted. In my business I have had some knowledge of goods of this class for fifty years, although I have not a cent's worth of personal interest now. In 1935, as I have said, we imported some 250,000 dozen of knitted underwear and other knitted goods, which means a very great deal of labour, and no doubt this reduction will bring about an increase in our imports.


Charles Avery Dunning: I should like to give my hon. friend the information I have with respect to knitted underwear of wool, which is the principal item to which he is referring. In 1936, a year later than the figures he gave, we imported from the United Kingdom
518.000	worth of these goods. During the
previous year our production of knitted underwear was divided into several items, and here is the value of some of the items: SI,032.000; $364,000;	$1,592,000;	$325,000 ;	56,282,000;
$523,000; $249,000; S2,109,000 and S129.000. These figures all have to do with knitted underwear.


Richard Langton Baker: I know our production is very large, but nevertheless in 1935 we had
250.000	dozen of knitted underwear and other garments coming into this country, and I fear that the importations will increase, which will mean less labour here.


Abraham Albert Heaps: May I ask if we export anything under this heading?


Charles Avery Dunning: We export a little. Our exports of cotton underwear totalled $106,000. We even shipped $29,000 worth to the United Kingdom. Our exports of wool underwear amounted to only $11,000, most of which went to Newfoundland.


Richard Langton Baker: Is the minister not concerned about the removal of this additional five per cent? Does he not fear that a larger quantity of these goods will be brought in from the United Kingdom, which will mean less work for our people here?


Charles Avery Dunning: No, I am not worried about it. I have given a great deal of

thought to the matter, and I do not share my hon. friend's concern.


Richard Langton Baker: If that should occur, what would be the next move?


Charles Avery Dunning: We will cross that bridge when we come to it.


Richard Langton Baker: I look forward to this becoming a matter of considerable concern, and I predict that this reduction will bring about *too large an importation of underwear from England.


[Stage Direction]
Item agreed to.
Customs tariff-568a. Socks and stockings:
(i)	of wool: rate of duty, 20 per cent, and, per dozen pairs, 30 cents.
(ii)	n.o.p.: rate of duty, 20 per cent.
Charles Avery Dunning: There is a reduction in
rate here. The former rate was 30 per cent ad valorem, and 75 cents, per dozen. It is cut to 20 per cent ad valorem and 30 cents per dozen. I know I will be asked as to the ad valorem incidence, and I believe I have that information somewhere. The ad valorem incidence of the combined duties approximated 44 per cent, after making the usual deduction for direct shipments. On the basis of last year's values the ad valorem incidence of the compound duties now provided should work out at almost exactly 25 per cent ad valorem.


Grote Stirling: Would the minister give
the figures of imports and exports in production?


Charles Avery Dunning: Under this heading the
total imports in 1936 were valued at $364,000, of which $357,000 came from Great Britain. Our exports are not separately listed in the trade returns. Our production in 1935 is a combination of a number of items, of which the following will give an idea: $2,000,000; $1,000,000;	$59S,000;	8215,000;	$98,000;
$615,000; $69,000 and $86,000. That is the total of our own production.


Richard Langton Baker: In 1935, from the United
Kingdom we imported in round figures, $350,000 worth of hosiery of different classes.


Charles Avery Dunning: In 1936?


Richard Langton Baker: In 1936 it was more than
that; I have the figures for 1935. That was a matter of 86,200 dozen. That quantity of hosiery would give a great deal of labour, and certainly we can make hosiery in Canada. It is true' that in 1935 we produced
6,194,000	dozen, or $20,000,000 worth, practically all of which was consumed in the country. I view with great alarm the cut in the duty. The minister will realize that it is a very heavy cut, from 75 cents a dozen to 30

Canada-United Kingdom Trade Agreement
cents a dozen, in addition to the ad valorem cut. It is important to have foresight of the situation; we must realize that this will mean great increases in importations from Great Britain, and in that case just that much less labour in Canada for workers in hosiery mills. These mills constituted one of the greatest supporters of households in Canada during the depression years and were the means of keeping families otf the welfare lists. Does not the minister view with alarm the fact that this great cut will mean larger importations from Great Britain? I doubt if there is anything in the tariff which has been cut to so great an extent as this item.


Abraham Albert Heaps: Would the minister give the committee the corresponding tariffs on the same class of goods in 1930?


Charles Avery Dunning: In May, 1930?


Abraham Albert Heaps: Yes.


Charles Avery Dunning: The classification then
was so widely different from the present one that it is rather difficult to get at it. The closest I can come is to quote the British rates and classifications, as they then prevailed. They were these:	Goods of cotton, 20 per
cent; of wool, if over SI,50 a pound, 27^ per cent; of wool, if over 90 cents a pound and up to $1.50 a pound, 25 per cent; below 90 cents a pound, 20 per cent. If they were of silk or artificial silk they carried at that time a duty of 25 per cent. So the whole classification was different prior to 1930.


Richard Langton Baker: May I draw the minister's
attention to a fact of which he is no doubt cognizant. In the new schedule we find only the words "socks and stockings of wool"; is that not correct?


Charles Avery Dunning: Yes.


Richard Langton Baker: And the n.o.p. item is the
second one?


Charles Avery Dunning: Yes.


Richard Langton Baker: What is meant by "socks and stockings of wool"? The previous item contained the words "socks and stockings wholly or in part of wool"; is it not a clerical error to have the present item worded differently?


Charles Avery Dunning: The customs department has been compelled to rule on the point, and I can give the hon. member the substance of the ruling. The ruling is that the meaning shall be "substantially of wool" and the meaning of that, again, is that the major component, by weight, is to be of wool.


Richard Langton Baker: Will that be the ruling of the
National Revenue department on the new tariff?


Charles Avery Dunning: Yes, that is now the ruling of the Department of National Revenue.


Richard Langton Baker: In other words, the interpretation of the item will mean that there must be 50 per cent or 75 per cent wool?


Charles Avery Dunning: More than 50 per cent, by weight, of wool.


Richard Langton Baker: Of course the minister understands that the question of wool in the production of socks and stockings is not of such great importance, because other fabrics are used. Is it possible to go back to the original wording of "wholly or in part of wool"?


Charles Avery Dunning: No, not now.


Richard Langton Baker: It is not at all possible?
' Mr. DUNNING: No.


Richard Langton Baker: Was this item particularly requested by the United Kingdom representatives?


Charles Avery Dunning: This form of wording? Mr. BAKER: Yes, and was this change in the tariff offered by the Canadian government?


Charles Avery Dunning: Partly one, and partly the other. Erom an administrative point of view, the old wording was very unsatisfactory. If you say "wholly or in part of wool" the question immediately arises "what part of wool"? Under the present arrangement a customs ruling is involved, whereby there must be 50 per cent, by weight, of wool before it can come in under this classification.


Richard Langton Baker: May I draw the minister's attention to the fact that interpretation of "wholly or in part of wool" would mean that if there was any wool in it, it would come in at 30 cents and 20 per cent. But in the other class there is no 30 cent rate. This is vastly different.


Frederick George Sanderson: Shall the item carry? Mr. BAKER: I am not satisfied with it.


Robert John Deachman: Speaking as a Liberal, if I may do so, I find it difficult to defend an item where the rate of duty is higher upon the socks bought by the working man than upon those bought by the cabinet ministers. Under the present item I would expect that a very low grade of sock would come in at approximately 35 per cent, and a higher grade at about 20 per cent. What justification would there be for imposing the higher duty upon the poorer class of goods?


Charles Avery Dunning: I do not acknowledge the hon. member's premise.


Richard Langton Baker: No, he is wrong. May I
ask how the hon. member works it out?
2106	COMMONS
Canada-United Kingdom Trade Agreement


Robert John Deachman: I work it out on the basis of socks at $3 per dozen and it comes to 30 per cent; then, at $18 a dozen, we get a rate of approximately 22 per cent.


Charles Avery Dunning: But I am not accepting those theoretical figures. The figures are those for which socks are entered for duty purposes, and while I have not the information before me there was an endeavour on the basis of typical importations to evolve a duty for socks of wool under the definition I have just given, which would get away from the great disparity which existed under the former tariff, and which has been materially reduced under the proposal here. This is one of the broadest reductions of duty contained in the whole list.


Robert John Deachman: I congratulate the
minister upon this substantial reduction, but at the same time I would point out that when you are bringing in socks valued at $3 per dozen, you have a rate of 23 per cent, and on the expensive socks valued at $9 per dozen the duty is something like 30 per cent.


Charles Avery Dunning: It is not only on the value; it is also on the weight.


Robert John Deachman: If the minister wants real information I can show him the invoices.


Richard Langton Baker: I think the hon. member for Huron North is mistaken, as socks of wool are as a rule the expensive socks. The n.o.p. item would cover the odd importation of silk socks, but the large volume of importations would be under the other item.
I have had fifty years' experience in this line of business. There has been a great deal of talk about the high duties which were put on in the session of 1930. I do not intend to make a political speech, and I shall deal only with the practical side of this question. Despite the alleged high duties which were put on at that time, since 1932 the people of Canada have been able to purchase their socks and stockings at a lower price than ever before in the history of the dominion. I am not talking from the theoretical point of view; I am giving the actual facts. If I do say so, I am speaking as one who knows something about this matter. The tariff was never higher and since 1932 the people of Canada never bought better stockings for their money. We must not run away with the idea that tariffs increase the prices of our commodities. Competition makes the price, and competition was keen.


Mr. TOMLINSON:: Were the benefits
passed on to the employees of the knitting factories?


Richard Langton Baker: The newspapers of the past week contained the annual statements of two knitting companies. One made no money at all; the other did not make enough to pay dividends.


William Rae Tomlinson: How about the Circle Bar Knitting Company in Kincardine?


Richard Langton Baker: I hold no brief for any particular knitting company. I have been in the game for fifty years, and I know what occurred since 1932.


Mr. McLEAN (Melfort):: Surely the hon. member knows enough of the history of Canada to realize that in the years following 1932 the people found it extremely hard to buy socks of any kind?


William John Ward: The hon. member has just referred to a certain period when we had the highest tariffs in the history of this country. I would direct his attention to the fact that in that period the prices of raw material were at rock bottom. In 1932 there was no market at all in western Canada for wool, and it sold for as low as 3 cents a pound. Cotton was selling in Texas for 6 cents a pound. If the prices of socks and stockings did not go up, it was because the raw materials were available at low prices, rather than because of any protection given the manufacturers. I have lived on a farm most of my life and it has often been my job to wean calves. I have found that the longer a calf is allowed to suck a cow, the harder it is to wean. That is exactly what is happening in this country. The manufacturers have been sucking the cow of western Canada, and we are now finding it very difficult to wean them. When there is a suggestion of lowering the tariffs, the hon. member stands up in fear and trembling and says that these companies are going out of business to-morrow.


Richard Langton Baker: I did not make any such statement.


William John Ward: Is he afraid to go out at night because he might see a shadow? Every time there is a suggestion that tariffs should be reduced, hon. members of the Conservative party get up in fear and trembling and say that these great institutions will be put out of business.


[Stage Direction]
Item agreed to.
Customs tariff-568b. Gloves and mitts of all kinds, n.o.p.: rate of duty, 20 per cent.
Item agreed to.

Questions
Customs tariff-572. Oriental and imitation oriental rugs or carpets and carpeting, carpets and rugs, n.o.p.: rate of duty, 30 per cent.
Item agreed to.
Customs tariff-573. Enamelled carriage, floor shelf and table oil-cloth, linoleum, and cork matting or carpets: rate of duty, 15 per cent.
John Ritchie MacNicol: Would the linoleum or oil-cloth covered by this item be used in the manufacture of carriages covered by item 439f?


Charles Avery Dunning: The description is
carriage, shelf and table oil-cloth, enamelled, as distinct from floor oil-cloth.


John Ritchie MacNicol: Would that be used in the manufacturing of children's carriages?


Charles Avery Dunning: It is the thin type of oilcloth used for a number of purposes and generally referred to as carriage oil-cloth.


[Stage Direction]
Item agreed to.
Customs tariff-578. Regalia, badges and belts of all kinds, n.o.p.: rate of duty, 22^ per cent.
Item agreed to.
Schedule IV agreed to.
Progress reported.
At eleven o'clock the house adjourned, without question put, pursuant to standing order.
Wednesday, March 24, 1937