1937-02-02

Right Hon. W. L. MACKENZIE KING (Prime Minister):: Mr. Speaker, yesterday afternoon I crossed the floor of the house to express to the right hon. the leader of the opposition (Mr. Bennett) and the hon. member for St. Antoine-Westmount (Mr. White) my thanks and those of my colleagues for their expressions of sympathy on the loss which we and our party had sustained in the death of a much revered member of this house, the Hon. Charles Marcil. While talking with, my right hon, friend he handed me a communication he had just received from the press gallery informing him that only an hour or two before one of his own supporters Mr. Herbert Wilton, the member for Hamilton West, had passed away. This word was the more startling in that as late as Friday of last week Mr. Wilton had taken part in one of the debates of this house. I rise to express to my right hon. friend and to those who sit about him the sincere sympathy of all hon.
members on this side of the house in the loss they have sustained. Mr. Wilton had been in the house only a short time. He was returned at the last general election and as a consequence had been here for less than a year. His election at the age of sixty-seven years to represent the city of Hamilton must have been in part a recognition of the public services which for several years he had rendered in the civic affairs of that city, first as alderman and subsequently as mayor. It was evidence as well of appreciation on the part of his fellow citizens of his public spirit as disclosed in the many activities with which at one time or another his life was concerned.
Having been for so short a time a member of this house many of us did not have the privilege of more than a passing acquaintance with Mr. Wilton. However we had the opportunity of hearing him speak on several occasions, and I believe the impression he left on all hon. members was that he was a man not only of pleasant personality, but of high purpose and one who had sincerely at heart the interests of his fellow men. He leaves behind a wife and several children. I am sure the sympathy of this house in the fullest measure will go out to all who have been so suddenly and so greatly bereaved. Again may I express to hon. gentlemen opposite the deep sympathy we feel for them in their loss.


Right Hon. R. B. BENNETT (Leader of the Opposition):: Mr. Speaker, on behalf of those who are associated with me, as well as for myself, I wish to express our grateful appreciation of the kind and sympathetic words spoken by the Prime Minister (Mr. Mackenzie King), in his capacity as leader of the House of Commons, concerning the loss we have sustained in the passing of one of our numbers.
I can add little to what has been said by the leader of the government. Mr. Wilton was first known to me last year when he was a candidate for Hamilton West. I learned that he had touched the life of his community at many points. He had been a journalist, which is the kindergarten and high school-very often the university- from which the men who come to this house graduate. He had been a telegrapher and more latterly had been interested in business in a larger way. He had served his city as aider-man and had been an enterprising and devoted mayor. Many desirable improvements were made in the city of Hamilton through his initiative. Mr. Wilton was of a most friendly disposition; he was kind and considerate, and most thoughtful of others. Perhaps that fact,
The late Herbert Earl Wilton

together with the long years of faithful service he had rendered to his fellow citizens, enabled him to survive the deluge of 1935.
We will miss him greatly, not only because of his friendly and kindly disposition but because he possessed what is characteristic of so many of his type, common sense. He had sound judgment and a keen appreciation of public opinion. The people of Hamilton will mourn one who was their friend, and those who have known difficulties and trouble will sorrow greatly because of his passing. We will miss his sterling sense. I recall not long since reading what a great man said respecting a statesman of his day who had not had the benefits of academic training, but who was regarded in his own country as one of the foremost men of his time. This distinguished commentator said: "I would rather have half an hour of his common sense expression of opinion on the problems of my country than the considered opinion of many others for long periods of time." Mr. Wilton was to us not only a valued colleague, not only a friend, but one whose common sense could be said to be a cross-section of the great community in which he lived. His loyalty to Hamilton was perhaps his distinguishing characteristic, and his willingness to help that community in any possible way was always manifest.
We are reminded that in the midst of life we are in death; for it was only on Friday last that Mr. Wilton was in this chamber, and now he has passed from us. I am sure that his wife and children will read with satisfaction and pleasure, tempered of course by their great sorrow, of the fact that in the chamber in which he served so short a time he had made so many friends, and that he merited the views expressed by the right hon. the Prime Minister in the statement which he has made to-day. As our expression of the sense of loss we have sustained is conveyed to the bereaved they will have the assurance of our recognition that he who now has gone from us made some contribution in this chamber to the public life of the country he loved so well.


Mr. J. S. WOODSWORTH (Winnipeg North Centre):: Mr. Speaker, the late Mr. Wilton did not belong to our group, but he sat in close proximity to us, and I sometimes think that proximity is a rather severe test of a man's qualities. I feel that in the short period he was in the house he revealed himself to us as being friendly and kind. I can think of no other words that would better describe him. We join with the Prime Minister (Mr. Mackenzie King) in tendering to his wife and children our very deep sympathy in what must have been to them the very great shock of his sudden demise.


Mr. J. H. BLACKMORE (Lethbridge):: Mr. Speaker, during the short time the late Mr. Wilton was in the house he impressed me as being calm, sane, open-minded and progressive. We cannot but regret the loss to us and to those who loved him. May we join our voices to those who have spoken already in his honour.



CRIMINAL CODE


Hon. ERNEST LAPOINTE (Minister of Justice):: Mr. Speaker, by leave of the house, I move, seconded by Mr. Elliott (Middlesex):
That pursuant to the motion passed by the house on January 28, the special committee thereby appointed to study the subject matter of Bill No. 6, intituled an act to amend the criminal code, be composed of the following members, namely, Messrs. Barber, Bertrand (Laurier), Blair, Clarke (Rosedale), Girouard, Hall, Hamilton, Howden, Hyndman, Macphail (Miss), McCulloch, McIntosh, McPhee, O'Neill, Plaxton, Raymond, Sinclair, Taylor (Nanaimo), and Veniot, and that standing order 65 be suspended in relation thereto.


[Stage Direction]
Motion agreed to.


Ernest Lapointe: That the special committee appointed to study the Dominion Elections Act, 1934, and amendments thereto, and the Dominion Franchise Act, 1934, and amendments thereto, be instructed to study and make report on the methods used to effect a redistribution of electoral districts in Canada and in other countries and to make suggestions to the house in connection therewith.


Mr. JEAN FRANCOIS POULIOT (Temis-couata) (Translation):: Mr. Speaker, the question to be considered is the redistribution made in 1933 of the electoral districts of Canada. I should like to make a gift to the library of the House of Commons of a report on all the federal redistributions effected in the province of Quebec between 1853 and 1933. This report contains, first, a list of the 16 counties in which no change for federal purposes was made during that period. Then, a list of former constituencies, to the number of five, which are to-day joined to other electoral districts but which had not been altered since 1853. The next list covers six constituencies in which alterations made as a matter of form only, left the former boundaries intact. The next one comprises two

Elections and Franchise
constituencies enlarged by additions of territory. Then there is a list of fifteen united constituencies. Between 1853 and 1933 three constituencies were given a new name. Six new constituencies were formed outside the urban districts. The report also contains a summary of the changes made in former boundaries of constituencies and a statement giving in slightly greater detail the changes effected at each redistribution. There is appended to it Act 16, Chapter 152, a bill introduced by Hon. Augustin Norbert Morin, on October 1, 1852, to increase popular representation in parliament.
In order to realize the effects of the redistribution of 1933 it is essential to trace the history of each redistribution in each district from 1853 to the present day. The act of 1853 was reproduced in the statutes of 1860 and, in addition to the documents already mentioned, there is the complete text of the description of each electoral district, the original description of each district as given in the act of 1860, and the complete text of all subsequent changes up to 1933. There is also a list of the changes made in the electoral districts of Quebec from I860 to 1903. That is the first part of the report.
The second part gives the history of each redistribution from 1860 on, together with a table showing all the electoral districts of the province of Quebec in 1860 and the description of each one as it appears in the statute of 1860. It will be found on examination that in some cases there has been no change from 1853 to 1933.
After the statute of 1860 we come to the first Conservative gerrymander, in 1872, in which changes were made in three ridings. The art was then in its infancy. Later on, under Sir John Macdonald's administration, a second gerrymander was carried out in 1882 by the statute 45 Victoria, chapter 3, which altered the boundaries of six constituencies.
We come now to 1892 and 1893, when the Conservative party, which was at death's door, effected a shameful readjustment of seats both in Quebec and1 in Ontario. It was a real electoral orgy. The boundaries of 23 ridings were completely altered by removing Liberal parishes from counties to which they had belonged since 1860 and replacing them by Conservative parishes, in order to create Conservative strongholds in Quebec. It is when passing judgment on this shameful legislation of a dying and rotten government which sought to change the electoral boundaries of the old provinces of Ontario, Quebec and the maritimes that Sir Wilfrid Laurier stated on April 29, 1892, on page 1862 of Hansard: "That is a gerrymander with a vengeance."
We now come to 1903. The only alterations the Laurier government made in that year to the gerrymander of 1892 and 1893 consisted in putting back the old parishes in the electoral districts from which they should never have been removed.
In 1914, under the Borden administration, seven constituencies were reunited, one was divided, changes were made in five others, new boundaries were fixed for six ridings and twelve new electoral districts were created in Montreal.
In 1924, the government then headed by our present Prime Minister (Mr. Mackenzie King) took steps to have the boundaries of the eighty-year-old federal districts respected. This necessarily involved a rectification of the new provincial subdivisions created in 1922.
We then come to the shameful redistribution of 1933, which did not give the results expected of it by the Tory government of the day which was swept away in the province of Quebec. The important thing, sir, is to have a table showing the population of each electoral district before and after the gerrymander of 1933. I have such a table here, and I add it to the report which I now hand to the clerk with the request that he submit it to the proper person and have it kept in the records of the House of Commons in case it might prove useful.


[Stage Direction]
Motion agreed to.


[Stage Direction]
On the orders of the day:
Mr. THOMAS VIEN (Outremont):: Mr. Speaker, in November last a conference was held between representatives of the federal and provincial authorities on the question of bringing about a greater uniformity between dominion and provincial companies acts. I should like to ask the hon. the Secretary of State (Mr. Rinfret) if it is the intention of the government to table a report of the findings of that conference.


Hon. FERNAND RINFRET (Secretary of State):: Mr. Speaker, I must thank my hon.
friend for being kind enough to give me notice of his question. In the course of a recent debate the hon. member for Kootenay East (Mr. Stevens) also alluded, to this matter. I may say that it is not the intention of the government this session to table an official report of the conference, which has not completed its work, but I have

Companies Acts

here a few notes which it may be of interest to place on record, if the house will permit.
Following a resolution unanimously adopted at the last dominion-provincial conference the Secretary of State convened a committee of officials of the dominion and the provinces to prepare a draft of a new companies act or of amendments to the present act for the purpose of endeavouring to secure uniform laws dealing with companies throughout Canada. The first meeting of this committee was held at Ottawa, November 3, to November 7, 1936. There were present representatives of various departments of the dominion government and representatives of governments of eight of the provinces. British Columbia did not find it possible to have a representative present at the time selected for the meeting, but it is expected that the province will be represented at future meetings.
The committee made excellent progress in a preliminary study of the questions, and the representatives have submitted reports to their respective governments. Subcommittees were set up to deal with particular branches of the subject. Some of these subcommittees have already had meetings to prepare their reports for the consideration of the committee, and others are expected to meet during the next few months. It is hoped that these subcommittees will be able to report to a subsequent committee meeting which will be held during the coming summer or early in the autumn.
The committee reviewed very carefully the prospectus sections of the present Dominion Companies Act and decided to recommend the adoption of prospectus sections which are based very largely on those in the present dominion act. Since the amendments suggested by the committee in regard to the prospectus sections dealt largely with form and not with the substance of these sections, I have not considered it necessary to recommend amending legislation at this session of parliament. It appears possible that the committee, at its next general meeting, may make such further progress as to enable it to submit to the government a draft bill which would deal with other important provisions of the present act, and which might involve a general revision of the act.
In addition to dealing with the question of proposed legislation, the committee has been able to make substantial progress in arranging for a better exchange of information on questions of administration not only of the companies acts but also of the securities acts of the provinces.
[Mr Rinfret.]


Richard Bedford Bennett: I was interested in the statement made by the Secretary of State (Mr. Rinfret). It will be recalled that the late government, with the aid of Mr. Fraser of Toronto, prepared a draft companies act which was circulated amongst all the provinces because they had agreed to a uniform companies act. The question at issue, which was not settled, was whether or not incorporation should be by letters patent or by what is the equivalent in a very limited sense of letters patent, under the seal of the Secretary of State, or by memorandum and articles of association. The statement made by the minister did not seem to cover that phase of the matter, or what has been done in consequence of the previous agreement to have a uniform act and the steps taken in that regard by the Secretary of State, who engaged Mr. Fraser of Toronto to assist in it.


Louis Édouard Fernand Rinfret: No mention was made of that work at the conference last fall, of which I have given a very much summarized report. I thank my right hon. friend, however, for the remarks he has just made, and will take note of them.


Hon. C. H. CAHAN (St. Lawrence-St. George):: I may say that the various provincial governments refused to agree upon any amendments such as those proposed. British Columbia, as I have stated in the house, refused to agree because they wished to retain their present form of act, which was drafted in accordance with the English companies act. Nova Scotia took the same ground. The government of Quebec said that they were not prepared to accept incorporation by letters patent because they believed that, under a decision of the judicial committee of the privy council, a grant of incorporation by exercising the prerogative right of the crown, which was then vested in the lieutenant governor, gave the companies so incorporated powers far beyond those which could be created by legislation in the province of Quebec. Soi that there was no unanimous consent by the provinces, with the result that I went ahead and made my own draft and placed before this house an almost entirely new companies act which was accepted and passed by the house and the senate and became law.
FINANCIAL ASSISTANCE TO MANITOBA On the orders of the day:


Mr. J. A. GLEN (Marquette):: Is the government in a position to make a statement regarding the request of the Manitoba government for financial assistance?

Home Improvement Loans-Mr. Dunning
Hon. CHARLES A. DUNNING (Minister of Finance): I do not think any good purpose would be served by a statement at the moment, which could not go further than the statement made by the premier of Manitoba a few days ago.



GOLD CLAUSE OBLIGATIONS


[Stage Direction]
On the orders of the day:
Charles Hazlitt Cahan: Will the Prime Minister inform us whether the government has received a complete copy of the recent decision of the House of Lords, which is briefly mentioned in the press, relating to the payment, in the currency of the country of the payee, of bonds expressed to be payable in gold, and if so, will he be so kind as to lay a copy upon the table of the house?


Jean-François Pouliot: Is it a decision, or just an opinion?


William Lyon Mackenzie King: Perhaps my colleague the Minister of Justice (Mr. Lapointe) had better answer that question.


Ernest Lapointe: We are expecting the text of the decision on the first boat coming from Great Britain.



SALES TAX ON FLOWERS

[Stage Direction]
On the orders of the day:
Mr. GORDON GRAYDON (Peel):: Would the Minister of Finance (Mr. Dunning) care to indicate whether the government is giving consideration to the removal of the sales tax on cut flowers and other horticultural products?
Hon. CHARLES A. DUNNING (Minister of Finance): I am sorry that it is quite impossible for the government to give any indication prior to the budget with respect to taxation proposals or the consideration of them.



HOME IMPROVEMENT LOANS


[Stage Direction]
Hon. CHARLES A. DUNNING (Minister
of Finance) moved the second reading of Bill No. 11, to increase employment by encouraging the repair of rural and urban homes.
He said:	I need add little on the motion
for second reading to the information which I placed before the house when the financial resolution which preceded the introduction of
31111-30}
the bill was under consideration. It will be much more convenient to take up the details in committee of the whole, and I hope the house will soon move to that stage in order that we may go into the .proposal in detail.
In the meantime I desire to indicate that while of necessity the guarantees will be administered by the Department of Finance, the organization of the cooperative community effort which is necessary if the objective is to be attained will be, and in fact is, in the hands of the National Employment Commission, which reports to my colleague the Minister of Labour (Mr. Rogers). It is because this function is all-important in relation to the attainment of the objective that I devote a few minutes to it.
In brief, the commission has undertaken to put steam behind the plan. This involves arranging publicity to make the Canadian public home-repair conscious and to explain the plan to all concerned. The publicity takes the form of distribution of booklets, which have already had quite a wide distribution; newspaper advertising, radio broadcasting, and public addresses. Much work along these lines has already been done, and the success evident during the first two months' operation is an indication that results are beginning to accrue. I should point out in this connection that the costs involved in the publicity campaign will be financed not by government moneys but by private funds raised from public-spirited citizens and business interests who expect to benefit from the expenditure involved.
I believe the organization of provincial committees has now been almost completed by the employment commission. There will also be local advisory committees in every community to stimulate home improvement activity, to afford every encouragement and information, to prospective borrowers, and to interest local participating industries and business groups. A vital point which is being taken up vigorously by these local committees is the matter which was mentioned the other day during the discussion on. the financial resolution, that of the increase in assessment which normally would occur in a community when home improvement had been undertaken according to the plan. The dominion government stated, in announcing the plan originally, that it deemed it to be essential that local efforts should ensure that the home improvement plan should not be frustrated as a creator of employment by increased tax assessments. In all parts of Canada local committees are dealing with that phase of the matter, either with their municipalities, where the municipalities have power
468	COMMONS
Home, Improvement Loans-Mr. Dunning
to deal with it, or by making, in respect thereto appropriate representations to the provincial governments.
The point I am making is that this is a genuine national community effort. It is not in any sense of a partisan political character, and in that respect I was particularly appreciative of the remarks of the hon. member for Kootenay West (Mr. Esling) the other day.
I think it may be said that all these local and provincial committees throughout the dominion are doing their best in a community effort regardless of whether they are Liberals, Conservatives, Labour men, members of the Cooperative Commonwealth Federation or Social Crediters. That is the spirit which the employment commission found had made such a success of a similar plan in the United States. I only desire to say at this stage that there is every evidence that the community effort now being put forth across Canada will, ere the spring months, produce a very considerable volume of much-needed employment and in a manner tending to make more comfortable the living conditions of our people.
Mr. T. L. CHURCH (Broadview):: I wish to say a few words on the second reading of this bill as it affects the industrial workers of Canada. I ask the government: When the seed planted by this particular type of Purvis bill has reached its maturity, what will the harvest be? The harvest will be reaped by the taxpayers of Canada and the harvest will not be in the forms of crops which will fill their bams but in the form of taxes which will empty their pockets.
Under the rules of the house the time to discuss the principle of a bill is on its second reading. The rules provide that when a bill is read the second time the house approves the principle of it. The minister's cry-and it is the cry of all ministers-is, "Wait until you get into committee." That is the cry they always make; we must wait until we get into committee before we can get any information. Well, the industrial workers of Canada will wait until doomsday before they get any relief from this Bill No. 11, or from Mr. Purvis, the head of the duPont dynasty in Canada, who has been selected after many years of travel to take charge of this matter. He travelled around the world from 1912 to 1923; he went to South America, and during the war years he was in South America and the United States. Then in 1923 he came to this country, to the city of Montreal, and is now head of all these large industries. There are two of the largest of them in my riding. He supported the late government in by-elections and in the general

election, and what was the battle-cry which you could find on the bill boards in different parts of the country? It was this: "Return the government to power and the industrial worker will see the end of unemployment; he will see slums abolished; he will see a housing scheme put into operation," and protection for industrial workers, and so on and so on.
The principle of this bill is not new by any means; I have called the attention of the house myself to it fifteen or twenty times the past three years. The unemployment that exists in Canada to-day has not, however, been remedied to any extent by the Minister of Labour and the professors of universities who have been appointed to these commissions and have staffed them from beginning to end. As a matter of fact, as far as the Minister of Labour is concerned we might as well go home, because this is only a mock parliament to-day. The government have appointed' so many commissions that parliament has abrogated its powers under the British North America Act to a commission government behind the scenes. I have here the report of the committee of labour and education of the United States which investigated unemployment in 1908 and 1929 and which was presided over by the late Mr. Couzens, the great mayor of Detroit and governor of Michigan, as well as senator, who did so much for the relief of unemployment and in connection with housing in the United States. The bill which is now before us is based entirely on this report of President Roosevelt's new deal, recommending what is known as the home-owners' legislation. How has that legislation worked out in the United States? Look at the Evening Telegram of Toronto-last night's Telegram-and see for yourselves the condition of affairs in Milwaukee. You will see the result there.
This is not something new, as one hon. gentleman suggested last Friday; it was before the housing committee two years ago in 1935, and I moved a motion in connection with housing and the question of slums, especially as it relates to our industrial workers and a committee of the house sat three months and made a report. That committee went into the subject and now we have before us this particular bill. Now, you cannot on the second reading of a bill go into any discussion of individual clauses but can refer to them, and I do not intend to do so, but I wish to offer two or three observations with respect to the principle of the bill as I see it. In the first place, parliament's powers have been taken away and given to a Purvis academic commission, which has announced an expenditure of $50,000,000. I

Home Improvement Loans-Mr. Church
believe that appears in the bill as the limit, but that is not what we learn from other quarters. Last Friday there appeared a whole page picture in the Toronto evening papers of some fifteen gentlemen chosen as a commission to administer the bill-and this before parliament ever heard of the bill-from the publicity agent of Mr. Purvis. Mr. Purvis, whom the government seems to regard as omnipotent, has announced a policy which it is said will run into something like $200,000,000 according to the said papers. Along with this announcement there appeared, as I say, a picture of these twelve gentlemen good and true for Ontario, and it looked almost like a Liberal campaign fund. The other day I moved for an order of the house with respect to loans in the city of Toronto under this act and the reply given yesterday was that $103,000 to the end of 1936, was all that had been spent in Toronto.


Mr. DUNNING:: That is in two months.


Thomas Langton Church: There have been 274 small loans a total of $103,000. The industrial workers comprise fifty-one per cent of the taxpayers and they have been driven out of their homes by high taxes, foreclosures, and the lack of protection of their equity, because it is no use asking the industrial worker to go to the bank and sign a note. I have been in banks every day and have never yet seen an industrial worker in one; he cannot afford to go to a bank. He has lost his equity and property. His property has been taken from him by foreclosure and nothing is done for him. There is protection under the Farmers' Creditors Arrangement Act for the fisherman and for the farmer. If the farmer or fisherman loses his home he can take advantage of the Farmers' Creditors Arrangement Act and get a loan, paying a low rate of interest. But how is the industrial worker treated? Last session the hon. member for St. Mary (Mr. Deslauriers) brought before the house a motion with regard to the industrial worker and the government promised a study of it all. The hon. member for Parkdale (Mr. Spence) spoke on it; he comes from an industrial riding and knows a great deal about real estate conditions in Toronto. Under present conditions in this country nobody wants to hold or own real estate in the cities and towns. I venture to say lots of hon. members in this chamber would be glad to unload all the real estate they have on the federal government and on Mr. Purvis's commission, because the taxes take all the income and through no fault of the city are a rent in itself. The income tax was the field of the municipalities exclusively from the time of confederation until 1917, when the federal
government came along and took it. It was to be just a temporary measure. Then along came the provinces, and now it is a triplicate tax in some parts; Ontario has taken the income tax as a province. A million dollars has been deducted off relief in Toronto alone. The city used to get $2,600,000 from the income tax, but it has been taken away by act of the provincial parliament and they deduct that $860,000. That tax went far to enable municipalities to pay their way and maintain municipal services without government aid. Now where will that burden fall? The whole $2,600,000 will fall on real estate, in Toronto and in other cities such as Ottawa, Montreal, Hamilton, London, Winnipeg and the rest, a proportionate amount.
This bill is faulty for another reason. The Ontario .Assessment Act will not permit the exemption of the improvements covered by this bill. It is all very well to promise relief, but the assessment act provides for the assessment of buildings and improvements. The Mayor of Hamilton a great and able executive attacked this piece of legislation when it was announced with a great flourish of brass bands and waving of flags last September. He said he doubted its usefulness. He said he did not believe in it, that it was not practicable, that the remedy was worse than the disease it professed to cure. Mr. Hepburn attacked the proposal also, on account of the high interest rates and charges. It is very high for an industrial worker who is out of work to have to pay. He cannot even pay his taxes or insurance which are almost confiscatory in the cities and towns, and in consequence arrears of taxes are piling up through no fault of the municipalities. Does any hon. member know anyone who wants now to invest in or to own real estate, with its accompanying burden of federal and provincial taxes loaded on to municipal taxes illegally? I know hundreds of people who would be glad to part with their real estate. The assessment act cannot be evaded in this way at the call of Mr. Purvis.
The committee of 1935 on housing had this matter before it, and it was proposed-I think the present Postmaster General (Mr. Elliott) suggested it-that the Ontario legislature, which was to close within a week, should be_ urged to exempt from taxation these repair improvements, such as new plumbing, new verandah, new roof, new floor, and the modem conveniences which should be in every home. The city of Toronto took up the matter of home improvement and got separate legislation from the province to compel the owners of such property, which included the Synod of Toronto, to clean up their property and put- in plumbing and modem conveniences.
I	COMMONS
Home Improvement Loans-Mr. Church
They were given power to make loans up to $50 or $100 a house to dean up conditions which needed improvement, similar to the principle of this bill. The province of Ontario has recently announced a new housing and slum clearance policy as set out in the legislature by the provincial minister of labour. As far as the building trades are concerned, in to-day's issue of the Globe and Mail it is stated that in Toronto alone the value of building permits for 1936 ^ was $8,114,000, while for Montreal it was $6,905,000. There is a laTge amount of building going on in the northern, eastern and western part of Toronto at the present time. All winter they have been building dwellings, many of them duplexes. How are they going to compete with this particular type of spoon-fed legislation? There are to-day altogether too many burdens and artificial barriers obstructing and placed on business, with the result that we have the taxation situation that now exists which is prohibitive and one of the main causes of unemployment. It is almost too late now to go into this proposition. I am not opposed to federal aid towards lowering interest rates and building, bank, and loan and insurance rates, but some of the legislation .passed by this parliament last session is the direct antithesis of this bill. I had an order of the house passed for a return about these small loan companies in 1936, and it showed that their interest rates were as high as 35 and 42 per cent per annum. Names and figures will be found on page 2453 of Hansard of May 4 of last year.
This legislation in my opinion is going to be a glorious fiasco. If you go into a branch bank in any residential district in Toronto and ask the manager for a loan of $50 or $100 he cannot make it without reference to the inspector at head office. He cannot permit an overdraft of $100 without the authority of the inspector. When the housing committee had before it this matter as affecting the industrial workers we were laughed at because we proposed protection for all the people all the time and not for some of the people some of the time, when I proposed to give the industrial and suburban worker the same protection as the farmer and fisherman. Something should be done for the small home owners and the farmers who to-day are without proper conveniences. But these people, like the industrial workers, cannot get a dollar from the banks on a note. And what protection has the industrial borrower? The time limit of the loan under Bill 11 has been extended from one to five years in view of the criticism that has been forthcoming. That was included in a recom-
(Mr. Church.]
mendation of the housing committee. There is a moratorium act in Ontario which does something to protect mortgages, and that is to be extended for another year. But when you sign a note at the bank there is no moratorium protection; they can get speedy judgment immediately on the note and take your property. Any real estate man knows that as soon as you do any improvement to your property up go the taxes and assessment under the Assessment Act, while you do not get much increase in rent. Everyone here knows the difficulty of making real estate carry itself these days.
The proposed plan has been largely advertised in Toronto but the harvest so far has been very small. Up to December 31, 1936, there have been 274 loans aggregating $103,330.27-note the 27 cents.
I may say in conclusion that the head of the commission is Mr. A. B. Purvis, President of Canadian Industries Limited, a man who is connected with the Bank of Montreal, the duPont dynasty, British American oil, the Bell Telephone Company and other concerns. He is the gentleman who is carrying on the work over his own signature, and those of the other members of the new board. Here we have a full tone picture-not a half-tone-in the newspaper. Here is a full-face view of this wonderful commission which, headed by its dynamic chairman, has taken over the administration of the work in the province of Ontario. I can say to that dynamic chairman that if parliament does not wake up and do something for the industrial workers, instead of spending days and weeks talking about international affairs, and if we do not devote more time to the betterment of the conditions of the industrial worker, then it will be that much worse for the people of Canada and the cause of order and good government.
When the price spreads and mass buying commission was sitting the conditions of white-collar workers were described. They have had the bailiffs in their homes, and under the present measure I can see very little help for them. In the United States not only the banks but the insurance companies, loan and mortgage companies came to the support of the industrial workers. Those insurance and loan companies made loans to a much greater extent than is being done in Canada. A short time ago, in 1935, I read of the good work the New York Life Insurance Company was doing at Gravesend beach, Brooklyn. Aside from the home owners' program of the Roosevelt administration, $25,000,000 is being supplied in Brooklyn to help build small homes for the working people there.

Home Improvement Loans-Mr. Church
During the depression they estimate there were at least 60,000 people in the city of Toronto who moved into apartment houses. They had to give up their homes because they could not meet the mortgages. Many of those mortgages were foreclosed and the unfortunate people in several cases put out on the street; their goods and chattels, right down to the kitchen stove, were taken from them. Some of the shark loan companies which are charging forty-two per cent interest are putting people out on the city streets to-day. When it was proposed in the house that the banks and insurance, loan and mortgage companies should change their ways, did they do so? No; they came here to parliament with a body of the highest paid lawyers in Canada in 1934 and 1935, to oppose lower rates.
I do not wish to throw any more cold water on the bill, but I have very little faith in it. Here we have a man on one side of the street struggling to make ends meet, without any spoon-fed aid from parliament, trying to put a verandah andi repairs on his house by doing some night work. The hon. member for Davenport (Mr. MacNicol) lives in the Earls-court district of Toronto, composed largely of industrial workers. This is not a matter to laugh at; it is to the credit of the hon. member's constituency and himself. Once I represented it, and I can tell this house that that district was built up by hard working people who built their own log cabins, many of them 20 years ago, and their own houses after coming home at five o'clock from their work, and they are fine houses. I fail to see where the so-called increase in business under this bill is going to do very much for these people.
Hon. members talk about the Jameson raid in South Africa. Let me tell them that the Jameson raid was nothing when compared with the raid this parliament and provincial legislatures have made on the belated income taxes of the municipalities and took their income away. In the city of Toronto the municipality will sooner or later be forced to place S2,600,000 of income tax taken from them for the first time by force, on real estate. Who wants to own real estate under such conditions? It is said in Toronto that $876,000 income will be paid back. The provinces receive from this parliament seventy-five per cent of old age pensions. I say the federal parliament should collect its own income tax, and let the provinces shift for themselves and collect their own, and not act as an accessory. It was a retrograde movement when this parliament came along and attempted to take income taxation away from the municipalities. The government of that day, 1917, deprived the municipalities of taxation which they enjoyed from 1867 and which
relieved the position of people holding real estate.
I have pleaded the case of the industrial worker, and I shall go no farther. The responsibility rests on the government of the day, so long as they hold that position, to go forward with a plan similar to that which has been advocated all over Ontario, namely a plan to relieve the industrial worker from confiscation, from losing his equity in his home, and from having his goods and chattels thrown out on the city streets, and to save and protect the municipalities of the province from these raids, which are contrary to the British North America Act.
The time has come for the minister to be up and doing in connection with these large insurance, loan and mortgage companies which have so much money set aside. A few years ago they had plenty of money to gamble with the premiums of their policy-holders on all kinds of common stock the world over, and they gambled instead of investing and allowing the poor industrial worker to obtain an easy loan at an easy rate of interest on a home in Canada. I see no reason why this bill should not go to a committee. If we are to have any parliamentary government, then here is a bill which should go to a housing committee, and reassert the supremacy of parliament over the Purvis way.
There is now a notice of motion on the order paper which, if accepted, would provide for a committee such as I have indicated. I have discussed the matter of housing and reconstruction in my motions for two sessions, and I am pleased to see that the hon. member for Greenwood (Mr. Massey) intends to carry the matter further. I hope his notice of motion will be discussed next Monday. The bill should be referred to a select committee before which industrial workers could be heard. Let the labour unions be heard and all parties thereto, and the municipalities. Let the trust companies and loan and insurance companies be brought here, and the banks. Let us hear from the shark loan companies. I shall name them: I will refer hon. members to page 2453 of Hansard for 1936 where they will find reference to the Central Finance Corporation. That company has just sent through the mail a leaflet stating what it does do for the industrial worker. How did those leaflets get into the mail? Then, there is the Personal Finance Corporation, and many other such companies.
If ever there was a bill which should go to a committee of the house, it is this one. We should know what the effect of the measure will be. We should know whether we would be justified in enacting it and how the rate of interest would work out; and we should
472	COMMONS
Home Improvement Loam-Mr. MacNicol
know the results of any housing efforts which have been so far made. Personally I believe they have not been a success. How would such a measure react in the way of taking taxation from the municipalities? We should investigate the relationship between real estate and Bill No. 11. We should look into the matter of taxes paid on real estate, and many other matters in this connection could be laid before parliament.
I have little faith in the assertion that good results would come from the bill. For about ten years I have considered the matter.
I have looked into the evidence taken by the housing committee set up in 1929 by the United States, the Couzens committee, and the committee which I moved for two years ago, and have considered the effect of this type of legislation on the economic situation. The result of my research is the belief that the whole question and position of the industrial worker, his home and the equity in his property should go to a committee of the house to hear all sides of Bill No. 11. The problem is a most important one. We must relieve the holders of real estate in the municipalities, because if much more is loaded on them, municipal institutions in Canada will be automatically abolished by the raids of the provinces; and may be abolished by the arbitrary action of the provinces. Municipal institutions are at the parting of the ways, and I venture to say that before long if we impose many more of these regulations upon them, and take away their revenues, we will see a day when municipal institutions will cease to exist and a lot of useless provincial governments will take their place.


Mr. J. R. MacNICOL (Davenport):: Mr. Speaker, before the bill is sent to a committee I should like to make a few observations. I listened carefully to the minister's statement, and some of his remarks made me feel that perhaps the bill will not be as valuable as I had hoped it would be. I felt that way particularly when the minister indicated how costs were to be paid.
On January 29, when the bill was given first reading, I brought to the attention of the minister the circumstances in connection with a resident in my constituency. The person in question is a working man well known to the hon. member who has just resumed his seat (Mr. Church). I felt that his case was of an example which the government had in mind. Apparently the government's intention was not only to assist the home owner, but to provide work.
I have in mind a particular workman. This man came from the old country as did many
[Mr. Church.!
other workmen who live in that particular part of my riding. The majority of these men brought with them the idea of old country thrift. Their first thought was to buy a piece of land and then erect a small cottage upon it. Thousands of these men came out here in 1907 and through the years they have demonstrated that they are good citizens. I believe a larger number of them own their homes to-day than do similar workmen in other parts of Canada. The particular man I have in mind bought a piece of land upon which he built a small cottage of two or three rooms. His house did not have a foundation; it was placed on posts which were encased with lumber. This small cottage has served him as a residence through the years, but he would now like to put in a foundation and add one room to the upper part of the cottage, necessitating a new roof. How can that man get money with which to do this work? He owns his house outright and has steady work with the city of Toronto. I cannot see how this man would be able to repay a loan of $750 in three years. He figures that this is the amount he will require to do the work he wants to do, and if he borrows it he will have to repay it at the rate of $250 a year.
While I believe that the intentions of the government are good, while I want to give them every credit, while I commend the minister for endeavouring to promote the repairing of homes and residences to provide work, I cannot see how the ordinary home owner will be able to take advantage of these loans. He cannot pay back a loan of, say, $750 at the rate of $250 a year. The particular man to whom I have referred makes something over $28 per week. He works only ten months in' the year and it would be utterly impossible for him out of such wages to pay back $250 per year. I should like some consideration given to this angle of the matter.
I had intended to ask the minister with reference to the costs when he was speaking, but I thought it would be better to let the bill go into committee.


Charles Avery Dunning: I shall try to deal with that point when we are in committee.


John Ritchie MacNicol: With the point I have just raised?


Charles Avery Dunning: Yes.


John Ritchie MacNicol: With reference to costs, I cannot see how this measure will be as beneficial as we hope it to be if the municipalities are to share the costs. Many municipalities are bankrupt.

Home Improvement Loans-Mr. Marshall


Charles Avery Dunning: There is to be no sharing of the cost.


John Ritchie MacNicol: I understood the minister to say that part of the cost was to be borne by the business interests which would benefit from this work, and also a part by the municipalities which would benefit. I am glad to know that the municipalities will not have anything to do with the cost.
When the bill was introduced I was under the impression, apparently wrongly, that 15 per cent of the individual loans were to be guaranteed by the government. I realize that such a method of guarantee would mean a great deal of bookkeeping, but this is a measure to give relief in most serious times and we ought to be prepared to do some bookkeeping. I am afraid that when a man such as the one to whom I referred goes to a banker for a loan of $750 he will be told that the bank does not want to be bothered with a loan of that size because the government does not guarantee the loans individually. He may be told that a good deal of red tape will be necessary before the loan can be collected out of the aggregate guarantee in case of his failure. I know the government proposes to guarantee fifteen per cent of the aggregate and I hope some provision will be made to prevent lending companies from refusing to advance loans because individual loans will not be guaranteed.
There is one further item I should like to discuss. In my opinion this bill was designed primarily to benefit the home owner who has not been able to obtain necessary loans during these very strenuous and hard times. However, I note that the bill covers multiple houses. I have no objection to duplexes, but I should like to see some limitation placed upon the number of apartments in a building upon which a loan could be obtained. Unless that is done the large apartment owners will get too much of this money.
I want to thank the hon. member for Broadview (Mr. Church) for speaking so highly of the people in my riding. At one time he represented part of my riding and he gave the people very good representation. They are thrifty and sound1 people and I hope this bill will benefit them. I cannot see how it will be other than beneficial unless its effectiveness is reduced by some of the matters to which I have referred.


Mr. J. A. MARSHALL (Camrose):: Mr. Speaker, the Social Credit party has refrained up to the present from criticizing the appointment of the National Employment Commission because we hoped that some good would come out of it. On many occasions we
have urged that the problem of unemployment can never be solved in its entirety, that in this mechanized age it is impossible to give work to all men. This opinion was upheld the other day by the Minister of Labour (Mr. Rogers), when he said that public works will never solve unemployment.
I think it is generally understood that the home improvement loan scheme is the brainchild of the chairman and other members of the employment commission. I do not believe it, for I credit these gentlemen with more intelligence than to offer just this one solution of the problem after almost a year's work. To me the price we have paid for the plan has been very high, and certainly it far outweighs the material benefits we have received. If my information is correct, and I have no reason to doubt the authenticity of it, this is not an original scheme. It has been in operation in the United States, and we are told that a similar scheme was hatched by officials of the federal Department of Finance, collaborating with bankers, and offered to the people of Windsor, Ontario,, some time ago as a means whereby they might solve their economic problems. Evidently all has not been well in the city of Windsor.


Mr. MARTIN:: It is improving, though.


James Alexander Marshall: It has had its financial difficulties as many other Canadian cities have, and because the people of Windsor were thinking in terms of reduction of interest and perhaps of repudiation, terms which supposedly came out of the west but which have been in constant use in many of the cities of the east, this scheme was presented to the people of that city in order that they might become home conscious and that their minds might be kept away or diverted from the large burden of debt they are shouldering.


Paul Joseph James Martin: Quite wrong.


James Alexander Marshall: The general outline of the scheme is well known to all, so that it is not necessary for me to go into it fully. It has been brought to the attention of the people of Canada by an intensive advertising campaign. In my humble judgment it is going to cost this country a great deal more than $7,500,000 when we take into consideration the cost of the commission, the cost of advertising, the cost of broadcasting and finally the amount we will pay eventually to the banks as a guarantee under this scheme.


Charles Avery Dunning: If my hon. friend will
permit me, doubtless he did not hear my statement that the whole cost of the publicity campaign in connection with the home im-
474	COMMONS
Home Improvement Loans-Mr. Marshall
provement scheme is being borne not by the government but by voluntary contributions gathered from all over the dominion.


James Alexander Marshall: I heard the statement
made by the Minister of Finance, but eventually the cost of advertising will be included in the cost of goods and the people of Canada will have to pay it.
One of the things to which I take strong exception is the use of the term "discount 3J per cent." To me that is misleading. Those who are not constantly dealing with financial concerns might easily confuse discount with interest. They not only might; they actually do. Last fall I was in conversation with many people in regard to this scheme. They seemed to think it was a splendid idea that the government, through the medium of the banks, should place
850,000,000 at the disposal of the people of Canada at such a low rate of interest. They had confused discount with interest. When I drew to their attention the fact that discount at 3J per cent was equivalent to interest charges at 6-32 per cent, the scheme took on a different complexion.
I was surprised to leam that at one time -the financial institutions had asked for a discount rate of five per cent, or interest at approximately ten per cent. I also learned with a great deal of surprise that commercial loans carry a rate of interest equal to this and that instalment buying is carried on at a rate of interest almost double. Is it any wonder, Mr. Speaker, that this country is on the verge of bankruptcy? This racket has been going on for so long that we are experiencing the greatest difficulty in stamping it out. I wonder when the people will awake to the fact that international finance is responsible for most of the present ills of this dominion. The government boasts that it can borrow short term money for less than one per cent and on long term bonds at less than four per cent. Yet it gives its blessing, it sanctions, it permits financial institutions to charge 6-32 per cent, and by every means at its command urges people to patronize the scheme.
The other day the Minister of Finance stated that the borrower required no backing on his note. Why should he? What finer backing could any financial institution have than the word of the dominion government? We were told that the borrower must have character and credit. These are characteristics which will obtain a loan for any individual at any time from any financial institution; at least they should. If the borrower has both those qualities I maintain that he requires no backing. Under this 
scheme, when a man goes into a financial institution he is asked such questions as: Is there a mortgage on the property? What is its size? What shape is it in to-day? He is asked about the taxes, whether they have been paid up, whether they are in arrears or whether the property is in danger of being offered for sale under the taxation laws. He is asked about the insurance on the property; he is also asked if he has a job, and, if so, whether it is a permanent or a temporary one. Finally he is asked what his monthly earnings are, and if he can answer all these questions satisfactorily the loan is granted to him. I venture to say that any individual who went to a financial institution and was able to answer these questions satisfactorily should have no difficulty in raising a loan to-day, without any backing or guarantee of any sort.
Certain things have been said with regard to the person who improves his property but does not wish to have the matter known to the taxation authorities. In other words, there is a certain type of citizen who realizes that improvement means increased valuations, and that an increased valuation means increased taxation. We have been assured that this- supposedly-will not be taken into consideration when valuations are placed upon property, but I do not think the dominion government has any power in the matter of assessments or of municipal taxation.


Charles Avery Dunning: It does not pretend to have.


James Alexander Marshall: I do not see why one individual should be allowed to be free of additional taxation because he obtains a loan under this plan from a financial institution, while another who puts his own money into improvements is not granted the same privilege. In short, the scheme is this. The banks, finding a strong current of public opinion against them, come forward as the saviours of our country. They propose by means of bookkeeping entries to create $50,000,000 of credit, lend it to the people of Canada and in process of time take back $50,000,000 plus $3,160,000 for services rendered. Why is it that we do not hear a word about inflation? Simply because it is the banks who are doing it on this occasion. The banks create $50,000,000 against $50,000,000 of production, and they place a stranglehold on the country by demanding $3,160,000 which was never created in the first place, and this, too, with the full sanction of the government. The Canadian Farm Loan Board to-day charges only five per cent, and that board, I understand, is making profits.

Home Improvement Loans-Mr. Woodsworth


Charles Avery Dunning: The hon. member is misinformed.


James Alexander Marshall: The farmers' creditors arrangement boards operating throughout the country are cutting down interest to five per cent. Why, then, I ask, are banks allowed to charge 6-32 per cent? The government itself could easily have created this $50,000,000 through the central bank and lent the money at lower rates to the people to whom the banks are lending it to-day, and the profits, if any, could be used to reduce our debt. But naturally in that case we would hear the cry that it is "inflation." It is said that we have not the facilities for doing so. I do not agree. We have soldier settlement board officers throughout the country; we have farmers' creditors arrangement boards; we have inspectors; we have a hundred and one different agencies operating under the dominion government. Why could we not ask them to do what we are asking the banks to do? The solution of our difficulty lies in the control of currency and credit to be used for public needs rather than private gain. If this scheme is all the National Employment Commission can offer, even as a partial solution of the unemployment problem, after almost a year in office, it might well be abolished and the responsibility again placed where it rightfully belongs, on the shoulders of the Minister of Labour. I feel quite confident that a man of his intelligence and capability could easily have done as much as the commission has done, in less time and at less cost to the country. The government of Canada by commissions is a costly affair, and it may be that at some future time the present government, to its sorrow, will find that out.
I am not opposed to the idea which is behind the bill, but I object to financial institutions being given a monopoly in the matter; I object most strongly to the excessive interest charged; and I most strongly object to the government giving a guarantee when in the first place the scheme in every essential is being promoted to assist financial institutions in gouging from the people of Canada at least three millions of dollars.


James Shaver Woodsworth: As I read the bill, it seems to me that it is designed to give some benefit, but that the benefits to be conferred are very limited and will be of advantage to a very small group of people. There are several outstanding problems which we in Canada must face: unemployment, cheaper credit, debt, and housing, and in my judgment this bill does very little to help in their solution. It is put
forward with the idea of helping employment. Possibly it may stimulate a certain amount of employment in the building trades, and for that reason I think it is along the right lines. But, as has been pointed out by the previous speaker (Mr. Marshall), this is the only measure which has been given us by the employment commission, and if this is all that is to be put forward I would say that it does not begin to touch the great mass of the unemployed people of this country.
One of the dangers is that, upon the government putting forth this scheme, there is a great hullaballoo about it; the people think they are getting something, only to find later on that it has very little real effect on the mass of unemployment. Further than that, we need cheap credit, but I cannot think that this is the best way in which cheap credit can be given to those who most need it to-day.
Again, as a previous speaker has said, I believe that the government itself is in just as good a position directly to advance credit as the banks are; or, if it is not desirable that the government should do this, steps might be taken to force down the rates which the banks charge. But here apparently the banks or other lending institutions are to be very carefully protected. Clause 3 seems to contain the principle of the bill; that is, the guarantee to approved lending institutions against losses which they may sustain as a result of home improvement loans made by them. The arrangement is a help to the lending institutions.
Again, no credit is offered to many people who very greatly need it at the present time. I quite admit that certain classes of people whose homes are run down might not be able to get credit, and under this scheme they can. So far, so good. But there are large numbers of people who very much need credit and who will not be able to qualify under this scheme; no provision whatever is made for them.
But there is a still more serious question which must be considered, and that is debt. Not only are the industrial workers head over ears in debt, but a great many of them are actually losing their homes; and much the same is true in the country districts. Until therefore there is some more comprehensive way of dealing with the debt problem, I do not think we have advanced very far towards promoting that general prosperity which in itself, if it were here, would solve a great many of these problems.


Mr. ISNOR:: What class of person coming within the scope of this bill is not taken care of?
476	COMMONS
Home Improvement Loans-Mr. Woodsworth


James Shaver Woodsworth: I do not suggest
that the people who come within the scope of this bill are not being taken care of. What I said was that the majority of the people who need help, do not come within its scope. I am speaking of the limitations of the bill. As far as it goes the bill may bring benefits to some, but the benefits are so limited in scope that I cannot be very enthusiastic about the bill.
The point that has been stressed in the elaborate broadcasting of this proposal is that it is a splendid housing scheme. The fact is, it simply does not touch the great problem of housing that faces the country at the present time. In common with many other members I have read some of the housing surveys made by a number of our cities in recent years. I had thought it might possibly be well to put some of these figures on Hansard, but I do not want simply to clutter the pages of Hansard with them. The conditions in many of our cities are, however, simply appalling, and this bill does not touch them. Most of the people who are in the worst condition cannot take advantage of the provisions of the bill. I wish the minister could lay this bill over until we could have a discussion on the resolution standing in the name of the hon. member for Greenwood (Mr. Massey). He proposes to bring before us this whole question of housing, and it seems to me that the house should discuss that resolution and then come to a consideration of this bill in the light of such a discussion of the whole problem. As it is, a bill which touches a very small segment of the problem is presented to us and we are asked to pass it. Some will say. "Very well; raise your objections to this, that and the other particular clause, but let us pass the bill." That is not the way in which these things should be done. We ought to have a survey of the whole problem of housing in Canada, and then we should be in a position to say how far the provisions of this bill might help in solving that problem, especially in regard to home owners.


Mr. ROGERS:: Is the hon. member now
speaking of housing in its social aspects as a measure of improving the health of our people? He will agree with me that there is a marked distinction between different purposes that may be effected by housing legislation. This home improvement plan is designed, as I understand it and as I think he must understand it, rather to afford employment to the building trades; it is not designed to improve the conditions of which he has complained.


James Shaver Woodsworth: Yes, but it has
been put forward in a general way as being a housing scheme, and there is no other housing scheme which has so far been presented by the government. We heard a few years ago the expression "nuisance value." I am afraid this bill may have a sort of nuisance value-


Charles Avery Dunning: Not to the men getting
wages as a result of it.


James Shaver Woodsworth: No; it has a value to a comparatively limited number of people. The trouble is that it may become a substitute for a more comprehensive scheme. I think we should consider carefully the larger question which so far has not been before the house. While it is all very well to distinguish theoretically between housing as it affects the health and social conditions of the people and housing as a means by which builders may earn a livelihood, I think the two should be considered together. I would remind the minister that even the people engaged in the building trades are themselves living in houses, and some of them amid very wretched conditions, so that even the class of workers engaged in the building industry must be considered, not merely as workmen but also as human beings having to live with their families in certain houses. But I am speaking not merely of building workers but of industrial workers generally, and this bill makes very little provision for the mass of industrial workers.
Just one other consideration at this point. The bill provides that the government shall stand behind the approved lending institutions. The government does not stand behind the home owners, and I think there is a very considerable distinction. If a man enters into this arrangement and is not able to make good I assume he may lose his home.


Charles Avery Dunning: It has nothing to do with that at all.


James Shaver Woodsworth: Why not?


Charles Avery Dunning: Simply because this bill takes no account of whether or not he may have a mortgage on his home.


James Shaver Woodsworth: That is the point.


Charles Avery Dunning: The point is that nonpayment of the loan he secures under this act certainly cannot affect the question of his being deprived of his home.


James Shaver Woodsworth: I am sure the
minister must recognize that the amount he can make use of under the act is only a fraction of the value of his home.

Home Improvement Loans-Mr. Bennett


Charles Avery Dunning: Of course.


James Shaver Woodsworth: This bill does not stand behind him in his struggle to obtain a home for himself. He may be heavily mortgaged at the present time, and if he is too heavily mortgaged I doubt whether he can qualify under the bill. But in the long effort he is putting forth to establish a home for himself the government does not stand behind him, whereas the government does stand behind the lending institutions, so that they are saved from any loss. An hon. member behind me suggested to me a little while ago, it might be possible that a bonus to home owners, to some such extent as this, might be just as sure a way of helping the home owners and might do just as much to stimulate employment. I have not gone into that question.


Charles Avery Dunning: I have.


James Shaver Woodsworth: Well, I shall be very glad to hear the minister explain that in due course. My point was simply that the government stands behind the lending institutions and guarantees them against loss, and considers only the aggregate loss. It does not stand behind the individual home owner in his efforts to secure a clear title to his home. There is one of the real difficulties.
As I said before I shall be glad to vote for the bill, but I regret that the government so far have not brought down more comprehensive measures which would deal with the outstanding problems which I have tried to enumerate.


Richard Bedford Bennett: On second reading the principle of the measure is to be considered by the house; the details stand for consideration in committee. The principle of this bill, as far as the government is concerned, is to guarantee lending institutions against loss to the extent of fifteen per cent of any sums they advance for the improvement of homes, not more than 12,000 in any one case.
There are two or three observations which might be made as to details in connection with that guarantee. The lending institutions are to be approved by the governor in council. We will assume that "lending institution" will mean any bank or insurance company or trust company or financial institution of any kind. The other day in answer to a question the minister said that the guarantee was for the aggregate of fifteen per cent to any lending institution, which institution might have many branches. A result of that might be that in a favoured community all the loans might go bad. That is, if the
total sums advanced by any lending institution having a hundred branches throughout Canada amount to $300,000, the country has guaranteed $45,000, and that $45,000 might all be lost in one community. That is perfectly clear. Whether or not it will be satisfactory to work it out in that way I cannot say; I merely direct attention to the facts disclosed by the measure itself. But it does appear to me that, assuming an institution lends $1,000,000, there might be a loss of $150,000, distributed over two or three communities, representing fifty or sixty per cent of the loans made in those communities, and as a result of careful supervision of the loans made in other communities there is no loss there. So that the guarantee provision applied in that way might not work out as was intended.
As far as the general purposes are concerned I doubt very much whether this will accomplish what was intended by the promoters of it. Much might be said, and will be said at another time and place, with respect to the character of the publicity that has been given to it and the consequent misunderstanding on the part of many people as to what it really means. That there is such misunderstanding I think will be found by those who desire to make inquiry concerning it. The Minister of Labour (Mr. Rogers) a moment ago said it has nothing to do with the housing question. That of course is true. These loans may be made on a property mortgaged to the hilt, provided the owner can induce the lending institution to advance the money, and companies which have security on the property will of course be only too pleased to see money expended on it; for whatever may be said, such improvements will enure to their advantage. A judgment against a defaulting borrower will not be available for the execution holder against the property, yet the security of the mortgage has been increased. As far as that phase is concerned, however, I do not think it seriously enters into the matter. The whole question is, will the lending institutions in the exercise of their discretion in the several communities throughout Canada, whether urban or rural, in which advances may be made, grant credit-for that is what it gets down to-for improvements on terms indicated by this measure to any appreciable extent? And by appreciable extent I mean an extent which will provide employment to any substantial number of craftsmen.


Charles Avery Dunning: That is the point.


Richard Bedford Bennett: That is the whole issue.
The government's action violates some of the tenets of faith so dear to professors and others of the Liberal party, notably the ex-
478	COMMONS
Home Improvement Loans-Mr. Bennett
tending of credit before parliament has authorized it, and the undertaking by mere letters of responsibilities that never should be undertaken. How the welkin would have rung had any effort of this kind been made by the preceding administration ! It was done, as will be recalled, in a smaller way with respect to some matters. The very idea of authorizing the expenditure of public moneys without a vote of -parliament is so contrary to all principles which govern and control public finance that I was horror-struck when I read in the press the original statement made by the Prime Minister (Mr. Mackenzie King), that when parliament met money would be authorized and appropriated and the scheme put in operation. A few days later that position was abandoned and it was said that by arrangement with the lending institutions the finance minister had succeeded in inducing them to be assured that with the 'large majority behind the administration they could rest in perfect peace that the guarantee would be honoured and in effect would be retroactive.


Charles Avery Dunning: I did not say tihat.


Richard Bedford Bennett: No, but that is the sense of it. The language of the letter read the other day makes it abundantly clear.
I congratulate the government upon adopting plans which they find now in practice are essential, although in theory they may seem unsound. So often during the last few months we have seen evidence of this. The cold, calm theorist in opposition becomes wedded at once to plans of concrete usefulness when he is in office. If the Minister of Finance sees it is essential that a plan become operative in order that unemployment may be lessened, of course he should1 bring it into operation. I have no doubt about it, and never have had. The fact that we are now in opposition and the government are doing what they opposed when they were in opposition is no reason why I should reverse my position. I support the government in what they have done; what they did was right and proper and1 sound, and what we did and would do to-morrow if we hadi the same responsibility. But we throw back to the government now the criticisms they made in those days, and remind them that after all you can quote at great length books on public finance, but the cold-blooded fact is that when the public interest demands that employment be furnished now-not then, not at some other time in the future, but now if possible-by the operation of a plan which 's thought to be effective, it is not the time -o oppose if within the general bounds of

our constitutional practice it is possible to give immediate effect to that which is useful.
There is one other matter in connection with the guarantees which I think is important. If the lending institutions are bound by the strict law of guarantee as it now stands, no extension of time can be given in case of default, not a single day. A variation to the slightest extent of the terms of the guarantee would operate to release it. And no one knows that better than the lending institutions themselves. Unless, therefore, it is provided-and I think it would- have to be done by statute, not by regulation-that the granting of an extension of time by the lending institutions shall not operate to discharge the guarantee, it is quite obvious that the institutions will not for a moment permit their guarantee to lapse by granting an extension of time. They will at once institute proceedings for the purpose of collecting the moneys that may be due. I mention that because I think it should be a statutory provision rather than a mere regulation. That is, a statutory power should be conferred upon the lending institution to grant extensions of time; for the maximum time extends over sixty payments. The minimum is thirty-six, is it not?


Charles Avery Dunning: With the larger loans it extends over five years.


Richard Bedford Bennett: Yes. It will be observed that if the lending institution does not strictly enforce its rights, or grants extensions, this will have the effect of releasing the guarantee. Knowing what we do of lending institutions in connection with their every-day operations, we know perfectly well they will not take that chance. I suggest that principle is very important in making this measure effective.
It has been said so frequently it is not necessary to repeat that the legislation, in itself, is not new. Therefore it seems to me we should profit somewhat by the experience of other countries. It must be remembered, however, in dealing with matters of this kind, that Canada is a country entirely different from the great republic to the south of us, as will be found by those who have to administer the legislation-. It is undesirable to arouse too great expectations with respect to a matter of this sort, when it must be patent to even the superficial observer that the limitations of benefits are very apparent.
The twofold object which the commission, and through it the government, have in mind is, in the first place, the improvement of the homes of our people, and in the second place

Home Improvement Loans
-and perhaps this should be indicated first- employment on as large a scale as possible in useful and productive service. Whether we put one or the other first, it does not make any difference. For that purpose the country' is obligating itself to a maximum of $7,500,000, which is fifteen per cent of $50,000,000. Seven and a half million dollars is a substantial sum of money, and we run the risk of losing all or part of it. We would run a risk of losing very little of it if it were not that apparently we have agreed, although it is not so indicated, that the lending institution is to be regarded not as a series of branches, but as a whole. A lending institution having two hundred branches each of which advances $5,000 will have $1,000,000 lent out. Fifteen per cent of that is $150,000, which the country would have to pay. I am not quite sure if that is sound finance, but it is exactly what the bill means, in view of the answer given the other day.


Charles Avery Dunning: No, not in the case of two hundred institutions.


Richard Bedford Bennett: Two hundred branches, I said, each one advancing an average of $5,000.
There is a vital factor in that connection affecting the success or failure of the whole plan. I make my submission not in a critical sense, because I desire that any suggestions I may make may be helpful. My experience has taught me that when one is dealing with a question of a guarantee and with branches being in a position to make advances, one must keep in mind, first, that the law of guarantee is very strict and, second, that the sum of the losses in all the many branches through which the lending companies may make advances may place upon the country a burden which would be avoided if each was made responsible for its own fifteen per cent.


[Stage Direction]
Motion agreed to, bill read the second time, and the house went into committee thereon, Mr. Sanderson in the chair.
On section 1-Short title.
John Ritchie MacNicol: Is there any clause in the bill referring to the wages the workmen are to be paid while carrying out repairs to buildings indicated in the measure?


Norman McLeod Rogers: No clause in the bill deals with that particular subject. Fair wages legislation of the dominion parliament does not affect work done through private contracts. It extends only to public works and public contracts. Therefore the matter of wages paid to those who will be employed on the
improvement of homes will be for the determination of the authorities in the provinces where the work is being done.


John Ritchie MacNicol: Regulations as to wages will come under provincial legislation?


Norman McLeod Rogers: Yes.


Mr. MASSEY:: Can the minister impose any restriction in connection with the use of moneys obtained under a loan? For instance, we know of houses which, although being lived in, are unfit for human habitation and should be condemned and demolished. Under this measure the owner of such a house could apply for a loan, repair the house and put it into a state of repair sufficient for certain purposes. However, even after the repairs were made the house would not be fit for human habitation. Is any machinery set up whereby a person would be prevented from obtaining money to repair a house in a condition such as I have described?


Charles Avery Dunning: The question is important and indicates one of the difficulties faced by the federal government when it attempts to assist in fields certain phases of which are under other jurisdiction. As the hon. member is aware, the duty of condemning a dwelling house as being unfit for human habitation is a provincial matter. The power is generally conferred by the provinces upon the municipalities. Through legislation of the kind before us we can have only a very ibroad and somewhat distant connection with the problem. Through the lending institutions we can attempt to indicate that it is not the policy of the government to make loans to place slum dwellings in the condition described by the hon. member. I submit, however, that the federal authority cannot enter into an argument as to whether a dwelling is or is not habitable or suitable for human occupation. The determining authority in such instances would be not ourselves but the local authority, usually the municipality.


Mr. McNIVEN:: I should like further information on the question asked by the hon. member for Davenport, namely with regard to wages of workmen employed. The object of the bill is to increase employment, but I anticipate that in so doing it is the intention not merely to create a job but to bring about a condition of affairs which will assist workmen in reestablishing themselves. Therefore it seems to me that in guaranteeing the payment of certain moneys parliament has a responsibility toward the men who are to do the work. The dominion government has recognized this principle by incorporating a fair wage clause in every contract given out
Home Improvement Loans

by the government. We are using the public credit to guarantee certain expenditures and it seems to me we could well take steps to ensure that the expenditure of that money will assist in reestablishing these men instead of giving them merely a few days work. It will be little satisfaction to this parliament and to the public at large if, after a summer's work, these carpenters, plumbers, steam-fitters, painters, decorators, and other artisans have to go immediately on relief. If such a thing were to occur, then this parliament would be losing both coming and going.
The borrower must make an application to the bank. Could there not be incorporated in that application an undertaking that he will pay the going rate of wages to the various trades employed? There are still many chisellers around who delight in preying upon the unprotected artisan, and I think we have a responsibility in that connection.


Norman McLeod Rogers: Mr. Chairman, the question just raised by the hon. member for Regina (Mr. McNiven), and previously by the hon. member for Davenport (Mr. MacNicol), has been before the Department of Labour for consideration. It is quite true that in addition to laying down scales of wages for public works, the Department of Labour has followed the practice of inserting a fair wage clause in government contracts. I am sure my hon. friend is aware that that fair wage clause provides only for the payment of the going wages in the locality where the work is being done. We have never attempted to lay down a definite scale of wages apart from public works and public contracts. In other words, the determination of the wages is a matter of local usage or is decided by local authorities, as in a number of provinces where labour codes prevail. I am bound to say that we have had suggestions that we should move in the contrary direction. It has been suggested that in certain localities the wages paid to some classes of labour in the building trades are abnormally high, and that this fact has tended to discourage building operations. I would doubt the wisdom of inserting in this bill a clause which would mean an extension of the fair wages policy of the government beyond public works and public contracts. Hitherto we have never gone beyond public works or public works' contracts. I think I might add this further observation. Provision has been made for setting up advisory committees in every province and in every large city and town. Labour will be represented upon these committees, and it does seem to me that the proper means of securing what my hon. friend has in mind would be for such committees to
TMr. McNiven.]
bring their influence to bear upon the local authority to see that fair wages were paid for this particular type of work.


Mr. STEWART:: Mr. Chairman, I think there is a great deal of merit in the suggestion made by the hon. member for Regina (Mr. McNiven). The solution he offers is simple and effective. When the borrower applies for a loan, which he undoubtedly will do by filling out some form, he should give the undertaking suggested by the hon. member. That is a reasonable provision to make in cases of this kind and it provides the necessary safeguard. The minister's statement with reference to wages paid on public works is correct if he has in mind only common labour, but it is not complete in all its details. Each year the Department of Labour determines upon a scale of wages for the skilled trades in the different areas. It thereby sets the rates of wages. Those rates are sent to the Department of Public Works and the schedule is posted on the works being carried on. The different contractors agree to pay the rates of wages specified therein. These rates are made part of the specifications and the department not only undertakes to see that the going rates of wages are paid in the case of ordinary labour, but enters into the field of fixing and determining the rates for the skilled trades.


Norman McLeod Rogers: Based upon the prevailing
wages in the locality.


Hugh Alexander Stewart: I do not know what the basis is, but it is determined by the Department of Labour. They do not leave it at that; they say that so much per hour or so much per day is the schedule of wages which shall apply to this work in the area concerned. That schedule is posted on the work for the information of the employees.


Mr. BROOKS:: A few days ago when this bill was being discussed an hon. member asked a question with reference to improvements on farm buildings. At that time I understood the minister to say that the terms of this bill would apply to outbuildings such as bams and so on, as well as to houses on farms. I cannot find anything in the bill to lead me to believe that these buildings are included. Yesterday I received a pamphlet from the National Employment Commission, issued under the authority of the dominion government. I assume all hon. members received copies of this. In one section it states:
Loans are to be made solely for the purpose of making repairs, alterations and additions (including built-in equipment) to either rural or urban dwellings. The proceeds of such loans can be used for no other purpose than the above.

Home Improvement Loans
It will be noted that the purpose stated is sufficiently broad to include repairs or altera-the house, or improvements or additions to the house. It would also include an attached or detached garage on the same property.
But there is nothing to indicate that the farmer's barn, hog pen or other buildings is included. The farmer has had just as hard a time as the city dweller; his buildings are very necessary to his livelihood, and I think such buildings should be included, in a scheme of this kind.


Charles Avery Dunning: 
Mr. MacINNIS:: I tried to get the floor two or three times, but others caught the eye of the chairman. This is a very important point, and it is something this house and this government should keep in mind continually, whether or not it can be incorporated in these agreements.
The Minister of Finance (Mr. Dunning) referred to the cost of policing in connection with these loans, and stated that the cost which would be involved if such a fair wage clause were written into the agreements would



Home Improvement Loans
be very heavy. IVhen it comes to protecting the interests of the wage-earner we are always met with a reference to the cost and the difficulties involved. It is almost impossible to get authorities to act to protect the interests of the wage-earner. Some little time ago my attention was drawn to a city in this country in which two cases were brought before a magistrate. In the one case an unemployed man stole a small amount; at the moment I do not know whether it was money or goods. In the other an employer was brought into court for violation of the minimum wage act. In the first case the magistrate did not hesitate at all before imposing a term of imprisonment upon the unemployed man, pointing out that the community must be protected from an individual of this kind. When the violation of the minimum wage act came before him, however, he said that at a time like this employers could not be expected to pay any attention to minimum wage laws. That is something which cannot be overlooked by this or any other government.


Charles Avery Dunning: May I ask what possible relation that can have to the matter before the committee?


Angus MacInnis: It has a relation in principle. The answer of the Minister of Labour (Mr. Rogers) was exceedingly unsatisfactory. He said that never before did we attempt to do anything except to insert a fair wage clause in public works contracts.


Richard Bedford Bennett: He could not have been in the house from 1930 to 1935.


Angus MacInnis: I quite agree. As a
matter of fact, before the fair wage legislation was passed there was no protection at all in government contracts. If we adopted the principle of the Minister of Labour that we should not do anything because it had not been done before, we would never make any progress at all.
There is another point. The minister mentioned that in his opinion some wages in the building trades were too high.


Charles Avery Dunning: He did not say any such thing.


Norman McLeod Rogers: Let me correct my hon. friend. I said complaints had been received in the Department of Labour that in certain localities certain tradesmen in the building industries were charging wages which made it difficult to get the amount of building started that otherwise would be proceeded with. I did not myself state that those wages were too high. I said that as a matter of fact complaints had been received.
[Mr. Maclnnis.)


Angus MacInnis: I am sorry if I misquoted the minister; I apologize. My understanding, however, was that he thought a lower scale should be inserted in the contracts.


Norman McLeod Rogers: No; there was no suggestion of that.


Angus MacInnis: In any case the minister said the reverse would have to be done.


Norman McLeod Rogers: What does that mean?


Angus MacInnis: I do not know; the minister made the statement.


Norman McLeod Rogers: I am afraid my hon. friend is putting the words into my mouth. I certainly do not recall having made a statement of that kind.


Angus MacInnis: Then I withdraw the statement, if the minister objects. But that just emphasizes the point we wish to make, that wages are always too high for the employers of labour and that they never pay a living wage unless they are forced to do so. If we take the building trades workers, we know that in most cities, in fact in nearly every city, they work for only a few months in the year, and if they are to live at all during the other months they must have a reasonable wage, a wage that might appear rather high for a person who has a steady job the year round. I think it would be quite easy for the government to insert in this agreement a clause which would to some extent protect the wage workers. The fact that a few individuals obtaining loans might do some of the work themselves would not make such provision impossible, and if it could be inserted it would have a moral value, if no more.


Denton Massey: I assume that the bill is
sincere in its broad statement that it is a bill "to increase employment." I was interested in what the minister said as to the use which could be made of the loan to obtain materials, and his statement that in many instances further work would be done by the man himself, be being perhaps a skilled mechanic. I imagine that in a good many cases these who obtain loans can do a good deal of the repair work, such as their own painting, their own carpentry, and so on But the declared purpose of the bill is to increase employment. Many of the people who receive loans are in a position to improve their homes as a result of this legislation, but they are also in a position to employ men for a few days to do the work. Some of them can afford to do that. They can get their material for three or four hundred dollars-the average, I think it has been stated, is three hundred dollars-and could

Home Improvement Loans
pay say twenty or twenty-five dollars of that amount in labour charges to have the work done. I was als.. much interested to hear the minister say that in the publicity campaign which was to be launched there would be direct advertising in the newspapers and also radio announcements. Would it be possible to incorporate in this advertising something which would stimulate a desire on the part of those obtaining loans whenever at all possible to employ labour; in other words, to make the act carry out as far as it can its declared purpose, which is to increase employment, and thus give emphasis to the fact that the object of this loan is not only to repair homes but to give men jobs?


Charles Avery Dunning: That is the motive. The suggestion of my hon. friend will be passed on.


Mr. COLD WELL:: While this measure may be regarded as a step in the right direction, nevertheless it will not touch our badly housed people in the rural districts; it is largely an urban scheme, and should be so regarded. I should like to see the ministry of labour and perhaps the ministry of agriculture endeavour to work out a plan of rural Lousing apart from a home rehabilitation plan such as this is. I doubt very much whether many of our rural people will be able to take advantage of this particular scheme.


Charles Avery Dunning: I can tell my hon. friend that they are taking advantage of it.


Thomas Miller Bell: I am very glad to
know that. In what provinces?


Charles Avery Dunning: In practically all the
provinces; to a larger degree in Ontario than anywhere else. Perhaps if I tell my hon. friend that in cities with a population of
40,000	and over, the total number of loans in two months was 1,252 out of a total number of loans of nearly 3,200, it will be appreciated that the larger proportion must be in the smaller communities. From a cursory examination of the returns I know that the scheme is spreading out more and more into the rural districts, and we have information that, with respect to those areas, the early spring months, just before work on the land is possible, are going to be the most advantageous time from the standpoint of repairs of farm outbuildings and work on the homes. In that regard it must be remembered that, while I can give the information with respect to cities of 40,000 and over, I cannot at the present time subdivide that further with respect to the balance, because of the fact that we are only just getting the machinery for recording these reports into such shape as
to produce the information which I know the committee would want and which I hope to give in great detail next year as a result of the machinery now being set up. But there is a definite interest in the rural areas which is very encouraging.


Thomas Miller Bell: I am very glad to know that. I wonder whether the minister has the figures broken down to show the distribution of the loans as between the provinces.


Charles Avery Dunning: Yes; I can give that.


Thomas Miller Bell: I think that might be
interesting.


Charles Avery Dunning: Of course, always bearing in mind it is only for the first two months.


Thomas Miller Bell: Yes.


Mr. HEAPS:: Can the minister give the
amounts?


Charles Avery Dunning: Yes. I shall leave off odd dollars and give it down to hundreds, if that will be satisfactory. In Prince Edward Island 31 loans, $10,800; in Nova Scotia 328 loans, $102,300; in New Brunswick 179 loans, $56,500; in Quebec 518 loans, $266,400; in Ontario 1,153 loans, $415,000; in Manitoba 131 loans, $50,200; in Saskatchewan 91 loans, $28,700; in Alberta 281 loans, $121,800; in British Columbia 447 loans, $146,000. My officers point out that it is not fair to regard this list as at all indicative of the progress made, because of the fact that the setting up of the organization in various provinces has not synchronized, and we are only now reviewing two months' experience. Some provinces were rather slower than others in getting fully organized, and of course economic conditions prevailing in certain parts of the country have an effect on the immediate use of the scheme.


Mr. COLDWELL:: At another time when
the minister discusses this matter in the house it might also be of interest to know the number of applications made and the number granted in the various provinces, if that information can be secured. I am not asking for it now.


Charles Avery Dunning: I do not know that we
have provision to get it.


Major James William Coldwell: The statement has been made that this is a scheme for home rehabilitation apart from mortgage and other indebtedness, and therefore it would be interesting to see the proportion of grants to applications made in various areas of Canada. However, I am not pressing for that information now; I am just suggesting that it may be of interest at a later date. I was,

Home Improvement Loans
however, going to add my views in support of the suggestion as to the inclusion of a fair wage clause. It is important that somehow this shall be done, even if it is simply stated on the application form that a fair wage should be paid. I believe it should be obligatory; at any rate on the form of application some attention should be drawn to it. I understood, like the hon. member for Vancouver East (Mr. Maclnnis), the minister's remark to mean that probably, if such a suggestion were carried out, it would involve a reduction of wages in some localities. Apparently we misunderstood him.


Charles Avery Dunning: I did not say anything like that.


Major James William Coldwell: No. I alluded to the Minister of Labour (Mr. Rogers).


Norman McLeod Rogers: At any rate that was not my intention. If I said so I should be glad to correct it.


Major James William Coldwell: 
Mr. LOCKHART:: I want to add a word to what I said the other day when the bill was first presented. I agree with the minister that loans are now being made in the rural districts. I am closely associated with the distribution of building materials and therefore know something whereof I speak. Considerable interest has been manifested on the part both of residents in urban centres and of the rural population, but there seems to be some doubt in the minds of those in the rural sections, more so perhaps than among those in the urban centres, as to the conditions and the qualifications for obtaining this money. I cannot altogether agree with the hon. member for Greenwood in insisting upon the labour to be engaged in order to make use of materials.


Denton Massey: If my hon. friend will permit me to interrupt, I did not say "insist," but urge whenever possible.


Norman James Macdonald Lockhart: I beg the hon. member's pardon; possibly I misunderstood him. Houses by the score are being built to-day- this was very noticeable in 1936-by men who are doing as much as possible of the work themselves in order to make their money go as far as possible. I am quite convinced that the amount of the loans which will be outstanding at the end of the first year will probably be very small, as intimated by the minister. But there is just that doubt in the minds of men who are looking for information, and naturally they come to the building material dealer for information. They say that they cannot get quite clearly _ in their minds the qualifications for obtaining this money, and I am more than pleased to know that the minister is making an effort by radio or otherwise to acquaint the people most definitely with the regulations and the qualifications that are called for. I urge upon him again and upon those in charge of the work of drawing up the instructions which are to be sent out to the heads of the banks and the lending institutions that they take some pains in this matter. Many of our best men in Canada are not particularly versed in the methods of banking institutions; they are not versed in financial practice. If bank managers and others interested will give these men some simple instructions as to how they may obtain three or four or five hundred dollars, for use possibly in the installation of bathroom equipment or something else which they have not had in the past, and if this is carried to the fullest extent in the instructions which are sent out, so that those who have struggled hard to maintain their little homes may be fully informed on the subject, I am sure this bill can be of considerable benefit to the people not only in the cities but in the rural sections, who, I know from experience, are now inquiring as to the cost of material for certain pieces of work.


Abraham Albert Heaps: I have no doubt this bill can be of considerable advantage to those who are in a position to avail themselves of its provisions. I do not know how many will be able to qualify, how many there are whose signatures would be accepted by banks or lending institutions. Personally, I hope the lending institutions designated under the terms of the bill will be fairly liberal in their interpretation of the provisions of the measure and will not turn down too many applicants. In the first place, the minister ought to inform the

Home Improvement Loans
committee as to what provision the government itself is making with respect to the loans that will be made by lending institutions.


Charles Avery Dunning: We have not yet come to that section.


Abraham Albert Heaps: If there is a provision covering that question, we can discuss it when we come to it. The minister ought to inform the committee if he can whether the term "lending institution" will be narrowed down to banks and mortgage companies or whether others will be allowed to lend money if they are in a position to do so, and, in the opinion of the Department of Finance, are suitable agencies for the purpose.


Charles Avery Dunning: We have not yet come to that, but I may answer the question now. Banks of course qualify; mortgage companies do not. They would not undertake it, and in any case the law with respect to mortgage companies in the various provinces would render it rather difficult to make it a part of the mortgage company's business. I believe we have at the present time approved one company, Heating and Plumbing Finance Limited, which is organized to finance improvements in connection with the heating and plumbing trades. Of course, in entering into an arrangement under this act they must comply with its discount provisions, which, as everyone here knows, are much lower than the normal discount provisions with respect to instalment buying of anything. We are prepared to consider approving as a lending institution any one which is equipped to do the work and will comply with the maximum limitations on discount which we impose. We will look at any one which wants to do this job and judge whether or not that institution is capable of rendering service. If it is, we have no objection to approving it.


Abraham Albert Heaps: There should be some supervision over the companies that might qualify to lend money or to give out materials under the provisions of the bill.


Charles Avery Dunning: Naturally.


Abraham Albert Heaps: We are dealing now with lending institutions.


Charles Avery Dunning: No, we have not reached that yet.


The CHAIRMAN:: We are still on clause 1.


Mr. GREEN:: Both the Minister of Finance and the Minister of Labour have referred to local committees, and apparently there are committees in each province and in the larger cities. Speaking for the city of Vancouver, I know there is a thoroughly responsible committee there. I believe all these committees are serving without remuneration, but there is not a word in this bill to indicate what the powers and the duties of these committees are. Last year, when we were dealing with the veterans' assistance commission, a section was inserted setting out the powers and duties of the honorary local committees. There should be a section in this bill covering the duties of the local committees and also providing for their expenses. I believe they will have a paid secretary in each city, and no doubt office rent and similar expenses.


Charles Avery Dunning: They are paying that
themselves.


Howard Charles Green: Well, there is no mention of these committees in this bill. This is not fair to these responsible citizens, who are giving of their time and energy to make this plan a success.


Mr. NEEDHAM:: Would an applicant for a loan be limited to one house? I know people who a few years ago built perhaps five or six houses in a community, and as times recently have not been so good these houses have become to some extent dilapidated, owing perhaps to reduced rents. Under this scheme could an applicant apply for loans on five or six houses?


Charles Avery Dunning: Yes.


Joseph Needham: Is there any provision
whereby the rent will not more than, compensate the interest that is going to be added?


Charles Avery Dunning: I do not understand my hon. friends' last question. As to whether more than one house owned by the same owner can come within the provisions of the plan, I answer yes. There is nothing in the bill relating to rent. That depends upon the individual case. But one owner can borrow with respect to more than one house.


Howard Charles Green: Might I have an answer to my question?


Norman McLeod Rogers: I intended to answer at
the first opportunity. There is no provision in the bill itself for advisory committees, because the entire organization, which includes provincial committees and local advisory committees, has been set up through the National Employment Commission and is upon an entirely voluntary basis. There seems to me very much to be said in favour of leaving that type of organization very largely to the guidance of experience. It would probably tend to restrict rather than to encourage the work of the committees if their duties were definitely set forth in the bill. The members serve voluntarily; the organization is

Home Improvement Loans
under the National Employment Commission, and I have in my hand a folder published by the commission setting out useful suggestions for local advisory committees, so that these committees are not left entirely without ;uidance. But it seems wise to leave them on a voluntary basis, rather than to give them statutory form.


Howard Charles Green: But the committees under
the veterans' assistance commission also serve without remuneration and are also working with the National Employment Commission. It is to be hoped that this National Employment Commission will evolve many different schemes. Are we to have five or ten or fifteen different committees in a city, without any legislative definition of their powers or duties? I suggest that it is impracticable _ to have them working without some definition by parliament of what they are supposed to do; it will only lead to confusion.
Section 1 agreed to.
On section 2-Definitions.


Abraham Albert Heaps: I think it desirable that there should be a certain amount of government supervision of construction or repairs in connection with all buildings. In the first place this is desirable because I have a strong feeling that if building or repairs become active we are likely to find an increase in the price of materials. It would not be the first time this has happened. Particularly is this true in the case of plumbing supplies, which are practically controlled by a monopoly. And the minister pointed out that he had complaints from some quarters that labour costs were too high. Have the government given some consideration to the cost of building supplies? There was an inquiry a few years ago, and I believe it was found that in some cases costs had risen to far in excess of what they should be. The whole purpose of the scheme may be defeated if the cost of building materials jumps too far beyond what it should be. For that reason at least I should like to see some supervision of a direct sort by the government. There should be some committee of either the Department of Finance or the Department of Labour or even the National Employment Commission to see that prices of building materials do not rise as soon as building becomes active.
Second, the government should also see that the maximum rate of 3\ per cent, which may be about 6 per cent in fact, is not exceeded by the lending organizations. For these reasons I would impress upon the minister that his or some other department should exercise

supervision over the operation of this plan to make it a success, for in my judgment the administration of the measure will be one of the most important features. Unless there is proper administration the whole thing may fall to the ground.
At six o'clock the Speaker resumed the chair and the house took recess.
After Recess
The house resumed at eight o'clock.



COPYRIGHT AMENDMENT ACT, 1931

[Stage Direction]
Mr. W. K.' ESLING (Kootenay West) moved the second reading of Bill No. 13, to amend the Copyright Amendment Act, 1931.
Mr. NEILL:: Explain.


Mr. ESLING:: Mr. Speaker, I am confident that if hon. members would refer to the Canada Gazette of January 2, they would be somewhat bewildered by the ambiguous tariffs under which the Canadian Performing Right Society operates. I am not at all concerned about the tariffs and fees they collect from theatres or broadcasting stations, because those institutions are well able to look after themselves. But the continuous complaints from small music users in the interior of British Columbia, from such places as lodge halls, orchestras, skating rinks, stores and the like, together with the unjust fees the society seeks to collect, certainly suggests that there should be some remedy for the existing situation.
The society in coming into a community attempts to collect a minimum of $30. If it cannot get the S30, it will come back next day and indicate its willingness to take S20. If it cannot get S20, it will take $10. The purpose seems to be to get money some way. It is not a satisfactory way, because most of its collections are induced by threats. At the last session of parliament we had an extended review of the set-up of the Canadian Performing Right Society. Hon. members will recall that there was an American Society of Authors, Composers and Publishers, and an English society with which were affiliated various associations in the different European countries. Those societies are about fifty per cent publishers. The publishers are the people who acquire the copyrights on various pieces of music, and are those who profit chiefly by such fees as can be collected.
There are about twelve hundred members in the American societies and an equal number in the English and affiliated societies.

Copyright Amendment-Mr. Esling
The directors of the two societies apparently saw a fertile field in Canada for the collection of money, and as a result in 1925 the Canadian Performing Right Society was incorporated under the Dominion Companies Act. It had a capital set-up of 10,000 no-par-value shares. To show that there was very little Canadian interest in the matter, may I say that only seven of the 10,000 were retained in Canada as qualifying shares.
Prior to the time of Judge Parker's investigation in 1935, there were no Canadian authors or composers participating in or benefiting by the collections. This was the cause of some criticism. On the floor of this house some six months later it was revealed that there were only seven Canadian authors and composers. The directors of the American and English societies simply assigned to the new Canadian Performing Right Society copyrights to between 2,000,000 and 3,000.000 pieces of music. One might say that that is the stock-in-trade of the Canadian Performing Right Society. It is on these alleged copyrights that they proceed to collect fees from users of music throughout the dominion.
Who is there in the house who can say that the American and English companies had title to the copyrighted music transferred to Canada. Nobody knows whether they had title or not. They simply come in and tell the government that they have title to between
2.000,000 and 3.000.000 pieces of music, and under the statute they are authorized to issue licences and to collect fees in compensation for the use of the music. They have proceeded to collect their fees in a most arbitrary fashion, largely by threats. A bill may be presented to an applicant, and in the event of the applicant refusing to pay, or in the event of his using a piece of music on which they contend they have a copyright, legal action is suggested.
At present the Canadian Performing Right Society is the only company exercising the right to issue licences and to collect fees in Canada. But one cannot say how many more concerns may come in and claim the same right, provided they can show title to certain pieces of music. I do not think it would be difficult for them to show just as good title as the present Canadian Performing Right Society is able to show
My point is that thert is nothing to indicate that the society which collects the fees does have actual possession of or actual right to the copyrights in question, and there has never been any particular effort to make them prove their right. Under the statute they are compelled to register their titles in the copyright
office. Early in the period of their business operations when they were depositing between two and three million titles in the copyright office, they simply deposited whole catalogues showing various pieces of music. As recently as last year they have been known to attempt to collect fees on music to which they had absolutely no right or title. If this is done in one case it is fair to assume that it is done in others. Their fees until the appointment of the appeal board have certainly been varied, and subject to all sorts of combinations.
Since 1931, when they first attempted to collect fees they have filed no less than nine separate tariffs, each one of which had a tendency to increase rather than to reduce. The joker in the present tariffs is that everything is based upon a minimum and from the minimum there may be gradual increases by calculations and conditions until a maximum, the certainty of which can never be established, is reached. Between the minimum and the maximum they are on safe ground. It would appear, therefore, that the Canadian Performing Right Society is a very clear example of "heads I win, tails you lose."
Thus far they say they have deposited in the copyright office about 200,000 titles. The purpose of the amendment is to require the society in its collections to give to every user of music a list of the titles to which it claims ownership or upon which it claims authority to collect fees. That list should be certified by the Secretary of State. The excuse is made that this would involve an expenditure of $10,000 for printing. Let us assume that such is the case; that would simply be a capital expenditure on the part of a firm doing a very profitable business. This concern, under the 1937 tariff, collects
570.000	from the broadcasting stations of this dominion. Our own Canadian Broadcasting Corporation contributes $15,000 of this $70,000. Is there anyone in business w'ho has not to make some capital expenditure? A lawyer must buy his books, his office fixtures and so on, and a merchant must put up his shelving and counters, buy his stock and do his advertising. Those are capital expenditures which must be made. Why should not this performing right society expend $10,000 or $20,000 in order that the public may be protected?
We all admit the principle that an author or composer should be protected, that his rights should be secured, but the public generally is also entitled to protection. In addition to the 870,000 contributed by the broadcasting stations, the theatres of Canada pay
860.000	annually as fees t.o thw society. rrl,en
488	COMMONS
Copyright Amendment-Mr. Esling
to this total must be added the numerous minimum fees paid by stores, skating rinks and other places of amusement. I ask hon. members if it is unreasonable to require that this performing right society shall give to every applicant for a licence a list of the music to which it claims to have the copyright and for which it claims authority to collect a fee? Is there any hon. member willing to hand out $30 in payment of a bill without knowing what it covers? Why should not the same principle apply to the payment of licence fees?
I am going to ask this house to give earnest and sympathetic consideration to these amendments which concern the protection of the public. When these people go out to collect licence fees they should be required to satisfy the applicant for a licence that they have ownership in that which they offer for sale. It is unfortunate that this whole matter is not of a more material nature. There is no reason why this society should not be paying a sales tax. I suppose we can hardly apply a sales tax to music, but the fact is that they make their money far more easily than the average merchant or professional man. There is no reason why they should not pay for the privileges they enjoy in this dominion.
They do not stop to consider for one moment how much of a drain the payment of a licence will be upon the resources of an applicant. If the applicant refuses to pay, he is told that they will bring action against him. I commend the minister for having set up an appeal board. This board is doing the best it can under the circumstances to carry out the provisions of the act. However, it is serving simply as a stop-gap in preventing the Canadian Performing Right Society from changing its tariffs two or three times a year.
The second amendment deals with the licence fees charged the smaller users of radios and an exemption is asked for these users. As I said before, under the 1937 tariff the broadcasting stations paid a total of $70,000, of which $15,000 was contributed by the Canadian Broadcasting Corporation. In addition to the broadcasting stations there are the little fellows, the skating rinks, the lodge halls, the hotels, the restaurants and so on that use radios for some purpose or other. We may have a restaurant with four or five tables on either side of an aisle with a little radio to provide music for the guests. Along comes a representative of the Canadian Performing Right Society who charges this man $5 as a minimum fee. He is then told he must make continuous and voluminous reports as to what music is played, how many hours per day and how many days per week the different pieces

are played. There are more reports to be made to this society than are necessary in making income tax returns to dominion, provincial and municipal governments. These small users of radios claim that they have paid for their radios, that they have paid the dominion government a fee of 82, and they want to know what use their radios will be if they cannot get music from the broadcasting stations without additional expense. The minimum fee is $5, with increases up to a maximum beyond all reason.
I appeal again to hon. members to give sympathetic consideration to this bill. The amendments suggested therein affect every constituency in the dominion, no matter how large or how small it may be. I could not possibly read these amendments myself, so I ask the Clerk to be good enough to read them in order that the house may have a clear conception of their meaning.


Louis Édouard Fernand Rinfret: Mr. Speaker, I wish first t,o congratulate the hon. member for Kootenay West (Mr. Esling) upon the sincerity of his purpose and upon the constant study he has given to copyright matters. The hon. member has participated in every debate which we have had on this question during a number of years, and has shown considerable moderation in the presentation of his views, which I must say I cannot altogether share. I hesitate to recommend the adoption of this bill. Perhaps I can put the position more clearly by saying that I cannot recommend its acceptance as I do not consider this to be the opportune moment to offer such amendments. The amendments themselves are not acceptable.
Last year the Copyright Act was amended very materially. All matters of copyright which concerned the Canadian Performing Right Society were inquired into by Judge Parker during 1935. His report was received after an exhaustive study had been made of the situation. The government last year brought down amendments to give effect to that report, and the amendments covered very fully the recommendations which were made by Judge Parker. Those amendments were submitted to the house and were adopted both in this house and in the other chamber. The bill went before a committee of the senate, and I remember that over there the senators recommended that a fair trial be given to the recommendations made by Judge Parker; that we should' let time prove to what extent they were desirable. I must repeat that both points which have been made by my hon. friend to-night and which

Copyright Amendment-Mr. Rinjret
are covered by his bill were very fully covered in the report of Judge Parker, and in both cases his conclusions were quite different from those at which my hon. friend has arrived.
As the house will remember, the bill that was put through last year provided for the appointment of an appeal board to which these question of the performing rights of musical compositions could be referred. The bill provided that the fees of the performing right society should be filed by the month of November, and if any objection were taken to them, those objections were to be referred to an appeal board. The appeal board, which was set up in December, is composed of Mr. Justice Maclean, a judge of the exchequer court, the under-secretary of state, Mr. Coleman, and a lawyer from the Department of Justice, Mr. Fontaine. The fees of the performing right society were published in the Canada Gazette of November 7; the board heard the objections to them and listened to representations from both sides, and on January 2 the Canada Gazette published the revised tariffs which are to prevail during the year 1937.
I appeal to the house:	After both chambers have approved the bill which provides for this tribunal to hear both sides and to act as arbitrators in the matter, and after the fees have already been arbitrated and are now officially in force for the year 1937, is it reasonable, only one month after this is done, to ask the House of Commons to amend the act further and to change the whole situation by act of parliament? I do not think it is. I think the least we can do is to let things go along as they stand and to watch the results of that arbitration, which was a compromise effort to bring together the representatives of the performers on the one side, and of the society, representing the composers, on the other.
I know there is in this house quite a considerable body of opinion that even as now existing the performing rights of the Canadian Performing Right Society are exacting. I say that purposely for, because of my own views and feelings on the matter and because of a desire for good will of the government, I resent very much the stand taken during last session by societies of authors and, composers who cursed the government and who directed against the member of the government in charge of this bill a certain, literature which was very unworthy and very unjust, when I do stand here in the honesty of my purpose to reach a compromise in this matter that will be fair to the composers, on the one hand, and to the performers and the public on the other.
With the discussion which took place last year,-and I must say in all fairness that it did take place somewhat late in the session and therefore perhaps did not afford the fullest expression of views from all corners of the house-I think the authors and composers must have felt that with the bill we did propose we were standing as a protection between them and the feelings of quite a number of hon. members representing the public in this country. But the house did give its confidence to the government; as I said, the bill was before a committee of the senate, and the senate took the attitude that it was worth while to try this experiment of having an arbitration exercised in this matter by the tribunal which I have just described.
I say again, Mr. Speaker, that it is not opportune, now that these tariffs have been in force for only a few weeks, to ask the house further to amend the Copyright Act and to throw overboard all that we did last year.
I also wish, to say that notwithstanding that general view of the question, I cannot accept, at least for the present, either of the amendments which my hon. friend proposes in his bill. In the first section of his bill my hon. friend suggests that the performing right society should not only file a copy of its works with the department of the Secretary of State, but also, when a licence is applied for, furnish to each applicant a complete list of all the works so filed. That, at first sight, may appear to be a fair demand, but it is absolutely in contradiction to the very spirit of copyright. When a copyright is filed with us or when a patent is applied for or when a trade mark is asked, for, it is never stipulated that the owner of that copyright or patent or trade mark must supply the public with a description or a list of that thing, whatever it may be. Such a procedure, moreover, would not in the least apply in this specific case because here we are dealing with a society which controls the performances of practically all musical works of composers of the different countries of the world. It is because the society is of that kind that we maintained that we could control its prices notwithstanding the convention of Rome and the undertaking there given by Canada together with other countries. We have to deal with a very special case. We have to deal with a necessary monopoly, if I may put it in that way, and that is why we believe we are justified in having established a control of its tariffs. That is also a reason why we should not exact from the society, not merely the filing of all its musical compositions with the Department of the Secretary of State, but what my hon. friend further asks for, namely,
490	COMMONS
Copyright Amendment-Mr. Rinfret
that whenever a licence is applied for the society should furnish a complete list of its musical compositions. I understand, Mr. Speaker, that the number of these compositions runs into a million, and the senate last year amended the bill to make it read that only musical pieces in current use should be filed with my department. So, least of all, should my hon. friend ask that the act should be amended in such a way as to force that society to supply a complete list of its works to the public. I insist also that this is not practical. Inasmuch as the society collects a licence fee which covers all musical compositions, there is no practical use in any member of the public having a complete list because the licence covers them all. Dealing with that particular point, I might add that Judge Parker was very clear in his report that the filing of such a list was not practicable. Let me quote from his report at page 33 on the filing of lists. The judge said:
When it is shown by program analysis that of the 25,982 musical numbers performed in Canada in 1934 only 4.841 numbers were controlled by Performing Right Society and 4,370 numbers were controlled by all other European Societies, it seems absurd and significant that Canadian Performing Right Society should waste time and money on filing a list of the works that possibly never have been and never may be performed in Canada.
That is the statement made by the judge who inquired very fully into this situation. Therefore I say that it is neither practicable nor justifiable to ask from that society not only the filing of their lists with the department of the Secretary of State but the supplying of those lists-which would be voluminous and very costly-to all applicants for licences.
As to the second section of the bill of my hon. friend, I shall be very frank about it and say that some day may come when his wish will seem acceptable and when it will appear that we have reached the point which is dealt with in that section. But again I say I do not think it would be advisable to accept that amendment now. If the hon. member will refer to the terms of the convention of Rome, 1928, which is the amended convention of that of Berne, he will find that in article 13 this very point is covered. Let me read article 13 of the convention of Rome:
The authors of musical works shall have the exclusive right of authorizing (1) the adaptation of those works to instruments which can reproduce them mechanically; and (2) the public performance of the said works by means of these instruments.
I again point out No. 2, "The public performance of the said works by means of these instruments." This means the performance

of such works by a corporation or a radio operating in a public place, and that is exactly what is covered by what my hon. friend wants his amendment to strike out from our Copyright Act. The matter was dealt with by Judge Parker in his report, and if my hon. friend refers to it he will find that under different titles-page 34, concerning the broadcasting tariff; page 40, the hotel tariff; page 42, the parks, small fairs and community halls tariff; and page 43, restaurants, skating rinks, et cetera- Judge Parker has recommended a lower minimum than the one which was requested by the society. He has maintained the principle that these small places should pay at least a minimum licence fee, and that is what has been maintained by the appeal board, as will be seen if anybody refers to the tariff filed and published in the Canada Gazette of January 2.
Therefore, Mr. Speaker, I think we should avoid bringing in this year further amendments to the Copyright Act, and should especially avoid these amendments, because they have been dealt with by the judge, by the house, by the senate and by the appeal board, and in every case a decision has been arrived at which is totally different from the one that is proposed in this bill.
In conclusion I may say I know that the Copyright Act, like any other act, is perfectible, and I know by my own experience with these matters-and it has not been very pleasant all the time-that there exists a great difference of view in this country about copyright. At the same time I believe we have gone as far as possible to meet the desires of the public and to curb the activities of the Canadian Performing Right Society, and by going further at present we would risk ignoring the rights of the owners themselves, who after all also deserve consideration.
As I say, the new tariff has been in force for only one month; the appeal court sat about five or six weeks ago, and it would be a great mistake not to allow several months to pass and permit this new experiment, this new arbitration, to work itself for the time being. Therefore, while not compromising any future consideration that we may have of the act, I cannot see my way clear to accepting the bill as it is, and I shall have to recommend to the house not to pass its second reading.
May I add that there should have been an international conference in Brussels last fall. For several reasons it unfortunately did not take place, but it is contemplated that the various nations which were parties to the conventions of Berne and Rome will meet either this fall or perhaps in the spring of

Copyright Amendment-Mr. Neill
1938. This, I believe, is a further reason why we should not disturb the amendments that we have brought to the act in the course of the last session.


Alan Webster Neill: I am sorry that the minister has announced his intention of declaring "thumbs down" on this bill, and particularly so at this stage, before he allowed the ordinary members of the house, other than the introducer, any opportunity to express their views. It is customary, I think, to hear what may be said by the various members and for the government, ostensibly at least, to sum up the situation and announce their decision. In this case the decision has been given first. Nevertheless I feel impelled by the interests that my constituents and I have in this matter to support the hon. member for Kootenay West (Mr. Esling), and I congratulate him upon the attitude he has taken and the very able manner in which he has expressed himself.
Dealing with the remarks of the minister, I believe he took a somewhat different view of the bill from that which is justified by its terms. The minister said or suggested that the hon. member was trying to change the whole set-up of the radio act. I do not think a consideration of the bill bears out that statement. There is no suggestion of material change, and certainly there is no suggestion and no attempt to change the arbitration features of it which were in the good act which the minister introduced last year, and which were a very good thing indeed. The bill does not in any way interfere with them.
The minister talks about the amendments not being opportune, and says that we are proposing to amend a bill which was introduced or passed only last year. It is always opportune to correct a grievance or an error, and I think the history of parliamentary practice and of legislation will show that it is quite a common thing to amend an act a year after it has been passed because experience has shown a need for amendment. I imagine that was the motive of the hon. member for Kootenay West in bringing in this bill. My personal complaint would rather be, not altogether as to the charges that have been proposed there, but as to the method of computing them, and I shall deal with that a little later on.
The hon. member for Kootenay West, as he stated, asks two things. He suggests that the company should give out a list of all articles or songs or music over which they claim the exclusive control. I do not think that is unreasonable. When the agent of the
company comes around to these small people and says " I want to collect so much from you," and the man says, "What is it for?" and the agent says, " Why, you are using or you are going to use articles or music of which we have the sole control," I do not think it is unreasonable for the man to say, " Well, show me your authority or show me your ownership."
As regards the alleged enormous cost of printing these titles, I suppose this would be only the titles of these various songs or pieces of music. It is surely not unreasonable to suppose that this company, who claim that they own them and have obtained the exclusive copyright in them or had it assigned to them, have a list of what they possess, and if they have it, the actual cost of printing it would be very small indeed. They claim that they have had this copyright assigned to them in many cases, I think, and that they collect these charges and allocate them or at least a portion of them to the authors. How are they going to know where the authors are, or who they are, or what they shall allocate to them if they have not a list? I do not think the company themselves would dare to say that they have not a complete list of all the articles over which they have jurisdiction, and if that is so, the cost of reprinting the list would be trivial. Otherwise it leaves the door open for the company to come forward and make a claim to ownership of articles and music to which they have no right, and we are utterly helpless and in their hands and are obliged to pay up, in total ignorance as to whether they have the least elemental right to some of the things over which they claim jurisdiction. Surely it ought to be open to any man running some small place such as a restaurant to say, " I will not use any of the music over which you claim to have jurisdiction, any music to which you claim sole rights, but you tell me exactly what those are and I will make use of the others." But, no. The agent simply comes along and says, "We claim jurisdiction over practically everything that is printed," and the man has to pay.
The bill proposes to do away with charges for the use of radios or gramophones in certain hotels, public halls and stores, but it does not apply to theatres or other such places; it is only the smaller halls, restaurants, stores and so on. As the hon. member who introduced this bill points out, the radio broadcasting stations pay 870,000 to this copyright society-some people would' call it a racketeering society. This is supposed to cover compensation for private and domestic use only.
492	COMMONS
Copyright Amendment-Mr. Neill
The purpose of the bill is to make it cover also the use of music in small stores or halls, hotels, skating rinks and the like.
I would call attention to the method by which these charges are computed and ask hon. members whether they think it reasonable or conducive to the ordinary running of a business. I am not referring now to the big departmental houses that can afford to employ lawyers, statisticians and mathematicians to calculate the fees; I am referring to the man who runs a small business such as a hotel, a pool-room, a Greek restaurant, or a barber shop. One of these agents will come along and, as the hon. member has said, use strong-arm methods. He will say, "We want to collect SIS from you"; the pool-room man will reply that only a short time ago he paid S25, and he will ask what the extra charge is lor. The agent replies, "Never mind what it is for; these are the charges; you can calculate them for yourself, and if you don't pay up you will be prosecuted," and he immediately produces a list of successful prosecutions. They have always been successful in their prosecutions, because in days gone by they had an iron-clad law behind them, and they would threaten'-the hon. member for Kootenay West was justified in using that word- about what would be done if the victim did not pay up at once. This small man is perhaps not too familiar with the English language, or too well educated, even if he should happen to be of British birth; how then is he to cope with a situation such as this?
I propose to read to the house the method by which the charge is arrived at. This is in connection with halls, restaurants, skating rinks and stores, and it gives the fees "on maximum basis," whatever that may be. On that basis the rates are so much. These are not maximum charges but charges on maximum basis, and further on it deals with charges "on actual basis." There is always a minimum fee to begin with. What I shall read consists of 144 words and it is all one sentence. There are only a few commas in it and I shall indicate them, so that I may not be accused of trying to make it out to be worse than it is. After I have read it through, if any hon. member can assure me that he understands it I shall sit down and make no further objection to this racket. The clause reads:
The rate is one and one-half cents for each "performer hour" for a licence covering the maximum number of "performer hours," the maximum of "performer hours" being determined by multiplying the maximum number of performers (including musicians, orchestra leader and vocalists) that may be employed at any time during the licence year by the

maximum number of hours of all or any musical performance during which is desired a licence to perform in any day during the licence year wholly or in part from the society's repertoire, by the maximum number of days for which a licence is desired in any week in the licence year, by the same number as the number of weeks occurring between the opening and closing dates of the period of time within which musical performances may take place, but in no case by a number less than thirteen (weeks).
Does anyone know what figure is charged there? Some suspicion of this question seems to have dawned on the man who drafted it because he goes on to say what the actual basis is. What I have just read is the maximum basis, but on actual basis the rate is as follows:
The rate is three cents for each "performer hour" for a licence covering all actual hours of musical performance during the licence year.
A payment is required on account and in advance equal to the amount due at the above rate on the total "performer hours" as estimated by the applicant, the advance payment to be not less than $5.
The licensee is required to report, at the end of the licence year or of each operating season within the licence year, the actual number of "performer hours" during such period, giving dates and times of all musical performances and the number of performers engaged thereat, the licensee at such times to make payment of any balance due.
Next we came to hotels:
The fee payable is determined as follows:
(1)	An initial payment is required annually in advance in an amount calculated at the rate of 10 cents per room charged on the total room capacity of the hotel, the minimum initial payment being $15.
(2)	At the end of each quarter an additional payment is required in an amount determined by multiplying the number of rooms in the hotel by the units of performance, by the number of months within which music is at times performed, by the rate (1 cent or less).
This is not quite clear and so the draftsman undertakes to explain it:
The rate is determined as follows:
If the hotel's average daily occupancy in the months within which music is at times performed is 80 per cent or over, the rate is 1 cent. If occupancy falls below 80 per cent, the rate is 1 cent less a deduction of 2 per cent thereof for each 1 per cent that occupancy falls below 80 per cent.
This is as clear as mud; the barman or the man who cleans boots could figure it out.


Mr. BOTHWELL:: What is the hon. member quoting from? Has it been approved by the department?


Alan Webster Neill: Yes; it is from the Canada Gazette of January 2.


An hon. MEMBER:: One can hardly believe it.

Copyright Amendment-Mr. Lockhart


Alan Webster Neill: But the worst is yet to come. Let us see what "units of performance" are:
Units
Music at lunch time (12 noon to 2 p.m.)	 2
Music at tea time (2 p.m. to 5 p.m.)..	2
Music at dinner time (5 p.m. to 8 p.m.).	2
And so on. Payments are made on as high as ten units. The following example is given:
An hotel having 250 rooms-initial payment	 $25
On 4 units of performance during only 2 months of the quarter, the average daily occupancy being 70 per cent during the 2 months-additional quarterly fee (250 x 4 x 2 x -8 cents)	 $16
It works out that it is $16. I would rather pay the $16 than go through the calculation.
That, then, is what one would call the fundamental charge, then there are extras. If a hotel has a radio in a public room there is an extra charge for the number of bedrooms. Then there is a charge for an occasional entertainment, or for a single entertainment. If that does not lend itself to unhindered extortion I do not know what does. Of course it is useless to argue, because the minister has given his ultimatum. I can only say that a great many people in Canada think of this society as the hon. member for Kootenay West and I do, that it is a racket.


Some hon. MEMBERS:: Hear, hear.


Norman James Macdonald Lockhart: May I add a word in regard to the interpretation of this law? It has been my experience to follow very closely the application of this act to benevolent societies and fraternal and friendly organizations. I shall cite a particular instance, relating to a building in which I am interested as chairman of the trustee board. The inspector of the society attended a gathering there as a detective and then wrote a letter stating definitely that the program included four items subject to fees. When a request was sent in to get a list of the protected numbers, the answer came back from the society that they did not furnish lists. I contend that fraternal organizations which during the past five years have been making an earnest effort to raise funds to take care of less fortunate members should at least have the protection of being provided with a list of numbers which they may not play unless they pay a licence fee. I know many hon. members have had experiences similar to mine in this matter. Fraternal organizations, church societies and similar groups, which have been trying to raise money to distribute to less
fortunate people, find themselves compelled to pay these fees. The society should at least be required to provide a list of its protected works; then it would be easy for small groups, where the orchestra may consist of only a piano and two other instruments, to avoid playing numbers licensed by this society. These small organizations, carrying on useful social and benevolent and fraternal work in this country, should have that protection.


Richard Bedford Bennett: I was paired with the right hon. the Prime Minister (Mr. Mackenzie King), and therefore could not vote. Had I voted I would have voted for the
motion.


Mr. ELLIOTT (Middlesex):: I was paired with the hon. member for Waterloo South (Mr. Edwards). Had I voted I would have voted against the motion.


Paul Joseph James Martin: I was paired with the hon. member for Hamilton East (Mr. Brown). Had I voted I would have voted against the motion.



HOME IMPROVEMENT LOANS


[Stage Direction]
The house resumed consideration in committee of Bill No. 11, to increase employment by encouraging the repair of rural and urban homes-Mr. Dunning-Mr. Sanderson in the chair.
On section 2-Definitions.
Jean-François Pouliot: Are the regulations for
the guidance of the officials of the Department of Finance or of the lending institutions?


Charles Avery Dunning: Of the Department of Finance.


Jean-François Pouliot: But are there any loans which would come to the department for approval, or will the department approve the loans which will be made by the institutions? If John desires to borrow a thousand dollars for repairs, would he go to the Department of Finance or to the bank?


Charles Avery Dunning: To the bank.


Jean-François Pouliot: Therefore most of the
regulations are for the guidance of the banks which lend money to private individuals. So far as I can understand, the department guarantees part of the possible losses made by the lending institutions. I believe the minister agrees with that. What statute under his department has control of this lending business? I believe there is a Mr. Nicolls. Are there others besides Mr. Nicolls, who look after this matter?


Charles Avery Dunning: There is a small staff in connection with the housing act, which is not this bill, which is being used in connection with the home improvement plan. Under the regulations as at present existing, lending institutions making loans are required to send to the department fortnightly all the applications which they have received in order that they may be checked to ensure that the lending institutions are complying with the conditions of the regulations so that they may come under the guarantee of fifteen per cent contemplated by the legislation.


Jean-François Pouliot: Supposing Joe wants to borrow some money; he will go direct to the bank and not to the department?


Charles Avery Dunning: That is right.


Jean-François Pouliot: The department has a check only on loans made and does not approve or disapprove them when they are being made?


Charles Avery Dunning: When an application
reaches the department, if it is apparent that it does not fall within the scope of the legislation, if for any reason the purpose of the loan is not covered by the measure, the lending institution will be advised that the guarantee of the government will not apply to that particular loan. It is necessary for the department to be certain that loans are being properly made. Before a guarantee can be given, the department must assure itself that a loan is a bona fide one within the terms of the legislation.


Jean-François Pouliot: When a bank makes a loan which is not in accordance with the departmental regulations, such a loan would be made at the bank's risk?


Charles Avery Dunning: That is true.


Jean-François Pouliot: It would be made by the bank before being approved by the department. The department could refuse to approve a loan and no guarantee would be given on such a loan?

Home Improvement Loans


Charles Avery Dunning: That is quite correct. Loans are reported to the department after they are made. The department examines the forms provided for the purpose in order to see that the loans have been made under the conditions prescribed by the regulations and the act. If, in the opinion of the department, a loan does not come within that category, the bank or lending institution will be in the position of having made a loan without having a government guarantee with respect to it.


Jean-François Pouliot: Supposing someone asks for a loan and is refused; can he go to his member to ask for a recommendation that such loan be made?


Charles Avery Dunning: I must point out that the discretion with respect to the credit of the individual applying for a loan is with the lending institutions. We have attempted to eliminate a great deal of the red tape associated with small loans and have prescribed the limit of discount which may be charged. There must be no endorser or other collateral asked for; it must be a loan upon the personal credit of the individual. We do not take any steps to influence a bank to lend to one man or to another; the bank must be the judge of the individual's credit standing. I know of nothing which would be a surer way of involving the full guarantee of the dominion than to create a situation whereby pressure could be brought to bear upon the lending institution to make loans in particular cases. I think that would be very bad for the plan. The criticism with respect to this might be that the banks may not be reasonably sympathetic. I may point out that committees are to be formed in local communities all over Canada. If, because of some technicality, a bank is unable to grant a loan, it will be the duty of the committee to investigate the case and, if possible, to adjust the technicalities in order that the loan may be made.
I cannot make it too clear that the lending institution must be the judge of the character of the applicant. We cannot pretend to set up, in connection with the hundreds of thousands of loans which we hope and believe will be made under this law, machinery whereby the government could insist upon, a loan being made to John Jones or William Smith. Certainly if a complaint is received by the department that a branch of a bank is adopting an arbitrary attitude or is unwilling to proceed in accordance with the legislation, the department will take up the matter and ask for an explanation as to why cooperation is not forthcoming from this branch as it is from others. I think to ask the department
to interfere with respect to particular cases, to insist upon a loan being granted to a particular individual, would defeat one of the major purposes of the bill. I may say I have had no complaint in that regard during the period which has elapsed since the plan has been in force.


Jean-François Pouliot: I was not intending to
criticize the banks; they lend the money and they must take the greater risk. I wanted to have it made clear to the committee that these loans were to be made without any political consideration.


Charles Avery Dunning: Quite.


Jean-François Pouliot: That is what I wanted
to make clear. Without abusing the generosity of the hon. gentleman, I should like to ask him the fundamental difference between this legislation and the housing act. Also, what salary is paid to Mr. Nicolls and to his assistants in the Department of Finance?


Charles Avery Dunning: I think I might be
excused from attempting to answer the first question. Obviously the housing act and the bill now before the committee were each designed for entirely different purposes. They have no relation whatsoever to each other. The official in charge receives a salary of $4,800, and there are two other assistants in that branch of the department.


Jean-François Pouliot: According to what t'he
minister has said, the work performed by Mr. Nico.lls is not that of an architect; he is doing the work of a checker.


Charles Avery Dunning: No. Mr. Nicolls is a
qualified architect and a qualified architect is required in connection with the administration of the housing act. There are many aspects of this legislation which make the technical knowledge of an architect quite useful. Mr. Nicolls was appointed, under the housing act, and when this work came along, instead of other officials being appointed, Mr. Nicolls was put in charge with one additional member being added to his staff. At the present time three people, including Mr. Nicolls, are carrying on this work. As to whether it will be necessary to expand the staff by the appointment of checkers and that sort of thing will depend upon our future experience.


Jean-François Pouliot: Is it possible to get plans from Mr. Nicolls, the architect?


Charles Avery Dunning: I do not want to confuse two things. We are discussing section 2 of this bill. Under the general housing act I shall be very glad to give information on any
Home Improvement Loans

particular. As a matter of fact, the housing administration of the Department of Finance has been and is supplying to-day literally hundreds of modern plans for use.


John Ritchie MacNicol: Free of charge?


Charles Avery Dunning: It is 25 or 50 cents for a booklet containing a number of plans. I am not too positive, but I shall see that my hon. friend gets the information. It is just a nominal charge. The demand for these plans has been very great indeed.


Abraham Albert Heaps: Just before the dinner hour
recess I was suggesting that if at all feasible a certain amount of supervision should be exercised over the ioans made under the provisions of this bill. I know it would be rather difficult to have supervision exercised by a central authority when loans are being made throughout the dominion, but I believe that in order to assure the proper and efficient working of this bill something along that line ought to be done.


Charles Avery Dunning: To supervise what?
Mr. HEAPS? To see that the money is properly spent.


Charles Avery Dunning: Properly spent?


Abraham Albert Heaps: Yes, and that there is nothing wrong so far as the lending of the money is concerned, that more is not being charged by certain corporations which shall be designated as lending corporations. Certain organizations might be lending corporations and be supplying materials too, and they should not be allowed to overcharge their customers for the materials used. All these abuses are liable to creep into work of this kind. A person goes to the bank and says: I want a loan of S500 or $1,000 to repair certain property. What is there beyond that which the bank or anybody else knows how the money is going to be utilized? I wonder whether there is not some form of supervision that could be exercised by say, local authorities. Is any power granted to them to exercise a certain amount of supervision, or is a person who is seeking to borrow money compelled to bring in some form of document to show how the money is going to be used? I make this suggestion because in the past I have had a little experience in housing operations, and I know something of how money has been spent, even squandered at times, after it has been lent. I know the difficulty which provincial governments have today in repaying money that was borrowed under the housing act of 1919 just because of lack of supervision at that time. This time I hope, whether it is a federal housing act 
or an act for the purposes of rehabilitation, that proper supervision will be exercised to see that the money is spent properly and to the advantage of the individual concerned and the country as a whole.


Denton Massey: Mr. Chairman, in the discussion before the dinner recess the hon. member for Royal (Mr. Brooks) asked a question of the minister relative to what was a home, and he furnished the reply that in the rural areas a home included any bams and outbuildings of various kinds. It seems to me that it would be wise in section 2 to include a definition of what a home is under this legislation. The minister understands, and his law officers understand, but the local bank may not understand and this may cause difficulty and delay, whereas if there was a definition in the bill that delay might be obviated. I would suggest that the minister consider including a fifth definition under paragraph (e) of what is a home under this measure.


Charles Avery Dunning: As a matter of fact, in our first draft of the legislation we attempted to arrive at more specific definitions, but as the work went on for the first two months the differences which arose between localities caused us constantly to consider widening the definition of a home. If my hon. friend will look forward to section 8, paragraph (e), he will find that provision is made for regulations in regard to the definition of rural and urban homes:
" Rural and urban homes," with power to include in such expression all such property as may reasonably be considered as part of a rural or urban home.
I thought that the committee might reasonably want to have that more closely defined, but I frankly confess that I had some difficulty with regard to it in actual operation. For instance, there had to be a regulation with regard to new houses that a man had built but had not quite finished. Should we deal with those? There had also to be regulations with respect to the inclusion of certain buildings with a farm house. Shall a barn or a garage be included? Shall a summer cottage be eligible? Then, with regard to combined stores and dwellings, we had to evolve a regulation to provide that the plan would not be abused by being used for commercial rather than dwelling purposes. That is a matter of some difficulty, as my hon. friend will understand. Tourist cabins-there was a thorny question.


Denton Massey: A temporary home.

Home Improvement Loans


Charles Avery Dunning: I could go on over a couple of pages instancing the degrees of variation which arise, and which caused me finally to decide to recommend to the committee that we be given power by regulation to make definitions subject to that qualification I have just quoted, "which may reasonably be considered as part of a rural or urban home." On consideration I felt that that was the best solution.
With respect to the suggestion of the hon. member for Winnipeg North (Mr. Heaps), I am afraid we are rather at cross-purposes. He speaks of the necessity for supervision in order to see that the money is spent for the purpose for which it is loaned. Well, Mr. Chairman, if this plan is to succeed in its major objective, which is to create work by encouraging people to do hundreds of thousands of small jobs, effectively to follow the money to its ultimate spending by the individual who borrows it in small amounts is virtually impossible, and I believe it would be regarded by borrowers generally of small sums of from one to three hundred dollars as more of what is generally described as governmental red tape. Only this afternoon I had a criticism from a member about what? About the information demanded of a man before he could get a loan. You see, we get it coming and going. In the one case we have not enough supervision, and in the other the criticism is that we have too much. I would point out to the hon. member for Winnipeg North, who I know is desirous of assisting, not of blocking, the plan, that the application for a home improvement loan must be made on a form approved by the department, and it is the only form the use of which properly filled out will qualify the lending institution to get the government guarantee with respect to the amount loaned in the particular case. That form asks for a complete description of the repairs intended, along with much other information-my hon. friend criticized the amount of information asked for-and it winds up by saying-this is the borrower authorizing the lender:
I authorize you to obtain such information as you may require concerning the above statement, and agree that it shall remain your property whether or not my note is finally accepted by you. I certify that if the loan is granted to me the entire proceeds will be used exclusively in payment for alterations, repairs and/or improvements on the property described above. I hereby affirm that the foregoing information is true and correct.
That is what the borrower says. When this form goes to the department, there is a certificate from the manager of the branch bank advancing the money:
I certify that this day a loan for $	
for	 months repayable in	
instalments, was made to the above mentioned applicant for the purpose named by negotiating
his note for $	less discount of $	
calculated in accordance with the official tables, and having scrutinized and checked this application with the care ordinarily required of me by the bank, I certify to the best of my knowledge that the conditions and purpose of this loan are such as qualify it for the dominion government guarantee under the home improvement plan.
That is signed then by the bank manager. The information which appears on the form, the affirmation of the borrower, represents the distance which we believe we should go in creating red tape in the form of supervision around the expenditure of this money. After all, the people who will be borrowing this money are not well-off people. It is a loan. It must be paid back. Community interest in the plan involves that a considerable number of people will know what is going on, and I think in that widespread publicity and in the community nature of the enterprise rests our major protection against wrongful use of the money, together, of course, with the affirmation and with the penalty further on in the bill with regard to misrepresentation and obtaining a loan not in accordance with the provisions.


Mr. LAWSON:: Section 2 (a) of the bill defines "approved lending institution" as one which is approved by the governor in council. I understood the Minister of Finance (Mr. Dunning) to say this afternoon that loan companies have not been and would not be approved as approved lending institutions.


Charles Avery Dunning: I would not say we would not approve them, but they1-


James Earl Lawson: I am sorry; I intended to say mortgage companies. Can the minister suggest to me any institutions now in existence in this country, other than banks, which might come within the termo of an approved lending institution, with the possible exception of such an one as he suggested this afternoon, which was apparently created by one phase of the building trades to extend credits for the purpose of carrying on this business?


Charles Avery Dunning: Well, so far I have mentioned the one concern in addition to the banks.


James Earl Lawson: Plumbing.

Home Improvement Loans


Charles Avery Dunning: And another concern- I suppose I had better not mention names unless it is really necessary-which deals with a very wide range of commodities, has no regular finance subsidiary but is operating through one of the chartered banks. The banks are filling the gap to which my hon. friend refers in that case and are gradually branching out into others. Another concern, a very large supplier of materials, which has no subsidiary, has in the past financed direct through dealers. They themselves are not lending institutions and therefore, as my hon. friend points out, we could not approve them, but this concern has expressed a willingness to go ahead making these loans on its own responsibility without government guarantee and in accordance with the financial conditions laid down in this bill, and its operations, I may say, cover a very wide range of supplies. One of the type of institutions known as acceptance corporations, which states that it cannot accept our low interest charge, may nevertheless work out a special arrangement with one of the large suppliers under which it will do the financing but with the supplier making up to it the difference between the rates called for by the legislation and the rates which the acceptance corporation deems it necessary for it to have in connection with its business. That latter arrangement has not yet been approved; there are some features of it which I am naturally doubtful, for reasons which will occur to my hon. friend, but in the main, I must say, the banks are displaying a very cooperative attitude in regard to the matter.


James Earl Lawson: I am not doubting that in the least, but it appears to me that the institutions which would be carrying out this legislation by advancing the money would in the main, of necessity, be the banks.


Charles Avery Dunning: Yes.


James Earl Lawson: For example, the minister mentioned this afternoon one concern, a plumbing and supply company. Would they be loaning amounts in excess of the purchase price of materials which might be purchased from them or some of their subsidiaries or affiliated companies?


Charles Avery Dunning: Yes.


Mr. TOLMIE:: I should like to ask the minister for a list of those institutions which are authorized to make loans in British Columbia.


Charles Avery Dunning: All of the chartered
banks.
[Mr. Lawson 1


Richard Bedford Bennett: The trust companies?


Charles Avery Dunning: No trust companies have yet come in.


Denton Massey: I trust the minister will not think that I am trying to obstruct unduly. I am trying to be constructive rather than destructive. But let me return to a point that was discussed a few moments ago. I learned my draftsmanship on a board with a T-square and compass, not with a pencil and law books and an imagination, but it seems to me that the brochure which has been issued and a copy of which I have in my hand is peculiarly clear on the inside back page, page 15, where it lays down the kind of improvements that are allowed under the home improvement plan. The last paragraph states:
In other words, whatever permanently improves the property.
I see no language to that effect in the bill.


Charles Avery Dunning: No.


Denton Massey: What I am getting at is this:	Somewhere in a little town farmer
Brown comes in to get a loan. He speaks to the banker, and the banker perhaps dioes not have a copy of this brochure before him.


Charles Avery Dunning: That is just what he has, though.


Denton Massey: He is going to have it?


Charles Avery Dunning: He has it now.


Denton Massey: Then the minister feels there will be no difficulty in regard to farmer Brown not being able to make his case perfectly clear?


Charles Avery Dunning: No.


Denton Massey: But the bill does not specify that.


Charles Avery Dunning: I must confess that such difficulties as have so far arisen are due to the inventiveness of persons with respect to what constitutes an improvement to the home. That is, the difficulties met with so far are in restricting the matter to proper expenditures. For instance, we do not feel that loans can be made for detachable or movable equipment. A great deal of representation has been .made with respect to certain kinds of movable equipment, but we do not think it would be sound to guarantee loans made for the purpose of getting an installation of something which merely plugs in and can therefore be removed as a piece of furniture. That is not, from the point of view of the department or the government, an improvement in the sense that the home improvement plan

Supply-National Revenue
calls for. But inasmuch as I shall probably not get the bill through committee to-night, I should like to assure the hon. member for Greenwood (Mr. Massey) that I shall give consideration to his suggestions as to, if possible, a somewhat broader definition, and see if I can make any suggestions when the bill is again before the committee.


Denton Massey: The minister may be interested to know that the case I had in mind was that of one of my constituents who wanted to put a portable garage behind his house. He was told that was not "permanent;" it was not a permanent improvement because it was portable. He assured the official that he was not going to take it around with his car. However, there was some little dispute and the matter was delayed for two or three days, in the course of which the price of the portable garage went up. It was perhaps rather an absurd case to bring to the attention of the committee, but it seemed to me that if any delay of that kind could be obviated it would be to the benefit of the legislation.


Mr. MacNEIL:: I should appreciate a further explanation from the minister as to the test to be applied to determine whether an applicant is credit-worthy, to use the term the minister himself used. I have in mind two types of applicants, the rancher on the coast who is not within easy access of a chartered bank or a lending institution, and the fisherman whose income is seasonal.


Charles Avery Dunning: It is very difficult for me to answer in specific terms, because, as my hon. friend knows, credit is something that belongs to a man's own self and to the conditions under which he lives and under which he receives his income. I know of cases in which loans have been made where the income is seasonal, as in farming or fishing, but I could not attempt to lay down any specific rule to determine the creditworthiness of an individual except to say this. Generally speaking, I am advised that these loans are being approached on the basis of character. But of course, even with respect to a man of good character, the lender is not doing a service to that individual by lending him something which it is quite apparent, from the man's circumstances and his prospective income, he cannot repay. All these considerations must enter into the determination of the question whether or not an individual loan should be made. I am sure that my hon. friend, who is familiar with the middle west, as I am, will acknowledge that many of us out there were considered more credit-worthy during one period of the history of the west
at any rate than we turned out to be, and even some of my hon. friends from Toronto have had that experience as well as those of us from the west.


Mr. McIVOR:: It would depend upon the lender; a particular lender might consider a man credit-worthy. Suppose a banker in Fort William were asked for a loan; he might be more willing to lend than a banker in Toronto. He might be more generous in a particular case. In this respect, therefore, I am glad that no supervisor is necessary, because that will eliminate expense. Any banker in the community, before he lends his money, will be sure that the borrower is worthy and that the loan will be of service to him.


Charles Avery Dunning: As indicated last evening, the government is rather anxious to get a couple of departments into supply and therefore I move that the committee rise and report progress and ask leave to sit again.
Progress reported.

The house in committee of supply, Mr. Sanderson in the chair.



DEPARTMENT OF NATIONAL REVENUE

[Stage Direction]
Civil government
[Stage Direction]
Salaries, $916,375.
Contingencies, $110,000.
James Earl Lawson: There is an increase of $35,000 in, this item. Will the minister give a general outline to show whether the increase is caused merely by the normal advancement of civil service salaries or whether there are special items contributing to it.


Hon. J. L. ILSLEY (Minister of National Revenue):: The hon. member will note that on the whole item the increase is not $35,000 but the difference between $30,285 and $35,000, or a net increase of $4,715. The increase is arrived at in this way. There is a decrease in salaries amounting to $30,285. This is due to the abolition of fourteen positions not further required, amounting to $19,435, and to the fact that twenty-five positions are occupied by temporary employees who were not made permanent as expected and whose salaries, amounting to $26,195, are provided for in the contingency item. In addition to those two sums there is a net saving, by the promotion of officers at lower salaries than those paid to their predecessors, of $6,405. The total of the three sums I have mentioned is $52,035, against which one must place statutory increases amounting to $21,750, leaving a net decrease in the

Supply-National Revenue
salary item of $30,285. Now I come to the increase in the contingency item. The increase in this item amounting to $35,000 is due to the transfer of the salaries of twenty-five temporary employees from the permanent vote, amounting to $26,195, plus $8,805 to provide a safe margin for future requirements.


James Earl Lawson: The minister has me confused in a mass of figures. Are the detailed items included in item 14 on page 7 those set out in detail on page 83 of this year's estimates? If so, I wish to call something to his attention in connection with some details, in order to save my raising the point on each item.


James Lorimer Ilsley: The answer is yes.


James Earl Lawson: Thank you. In the estimates of 1936-37 which were before us last session, in several individual instances very substantial increases were shown over the previous year. If my recollection serves me aright, the minister explained those increases last year as being due to increased staff required to handle matters in the department. This year the minister in his estimates shows a decrease over last year, but a large increase over the year before, indicating that last year in the estimates he showed large increases which apparently were never required and never used. For example, take item 17 of the 1936-37 estimates, on page 83 of this year's estimates. This year it is shown as $49,080 as against $48,000 last year. The same item in the estimates of 1936-37 which were before us last session showed the estimated expenditure as $51,0000, as against $47,100 for the year before. The net result is that last year's estimates showed a very substantial increase, whereas this year it shows a decrease, but in reality there has been a steady increase in the item each year since this government has been in power. And I have picked only one item out of seven or eight which I could enumerate in this year's estimates. I should like to know what was the scheme or idea of inserting in last year's estimates vast increases which obviously were never required. Was it in order that this year the estimates might show a decrease?
Probably I should call the minister's attention to item 65 of last year's estimates- because it was the outstanding one- which would be item 52 in this year's, shown on page 83. This year the estimate shows $69,930. In the outside column it shows that last year there was voted $82,620. Therefore the minister says there is a decrease of approximately $13,000. On the other hand, if we take exactly the same item in last year's estimates,
[Mr. Ilsley.J
we find that last year it was increased from $63,000 to $82,620. I should like to know the explanation of that amazing apparent juggling of figures.


James Lorimer Ilsley: I am unable to appreciate my hon. friend's adjectives, if he will pardon my saying so. The terms "vast" and "amazing" do not apply to these minor changes.


James Earl Lawson: The sum of $13,000 is hardly minor.


James Lorimer Ilsley: The first item my hon. friend pointed out is the one referring to head clerks, where the difference is between $48,000 for 1936-37 and $49,080 for 1937-38. I assume that difference would be due to statutory increases. As to the other item which my hon. friend mentioned, it is not correct to refer to that as item 52. The word "number" at the top of the left hand columns on page 83 relates to the number of persons employed. The number employed in 1936-37 was sixty-five, and for 1937-38 the estimated number is fifty-two. We apparently have been able to cut down somewhat on the staff, either that or they are in the temporary class instead of permanent. I think the latter is the proper explanation.


James Earl Lawson: May I interrupt to make my point clear? If the minister will be good enough to look at last year's estimates-


James Lorimer Ilsley: I do not have them before me.


James Earl Lawson: Well, if he will accept my word that in the column of numbers in 1935-36 there were shown forty-nine persons employed, he now submits an estimate for sixty-five persons for this year, and asks for an increase from $63,000 to $82,620, or, in other words, an increase of $19,620. If we take the corresponding item for this year, it shows that instead of having sixty-five employees as contemplated, he had fifty-two. But according to the estimates submitted this year the committee and the country would be led to believe that the number of employees in that branch had been curtailed from sixty-five last year to fifty-two this year with a corresponding reduction of $13,000 in salaries.


James Lorimer Ilsley: I may correct any erroneous impression the country might get on that point. Last year there were forty-nine stenographers, and they were permanent. It was expected, no doubt, that the number of permanents would be increased to sixty-five, but it was not deemed advisable, nor was it possible, to make them permanent, and so the number of permanents is only fifty-two, substantially what it was last year.

Supply-National Revenue


James Earl Lawson: Three more.


James Lorimer Ilsley: Yes; it is about where it was, instead of being considerably higher. No doubt this means that substantially the same number of stenographers are engaged, but they are still temporary. There is an increase in the contingency item equivalent to the decrease in the permanents.


James Earl Lawson: And a little bit over.


James Lorimer Ilsley: Yes, a little bit over.


Major James William Coldwell: Does item No. 14 include customs appraisers?


James Lorimer Ilsley: Only those at head office.


Major James William Coldwell: Who is responsible for the regulations under which appraisals are made? Is it the minister, or are there certain officials in the department who advise the minister? Perhaps I can make myself clear in this way:	I believe somewhere in a discussion of the estimates a question should be asked as to the regulations which have been made in the past year with respect to the S100 tourist exemption. When parliament prorogued, certain exemptions had been made, and following the prorogation of parliament apparently a number of regulations were issued to officials at customs offices. In many instances the regulations seemed to limit or to abolish the exemption.
For example, I have in mind regulations laid down in connection with radios. One could bring in a radio in his car, but could not bring in a radio attached to his automobile. I heard of an instance of a car coming into Canada with four new tires bought in the United States. The owner who crossed on the boat from Seattle to Vancouver or Victoria was warned that if the tires were on the car they were dutiable, but if they were off the car they could enter duty free. He took the tires off, ran the ear in on the rims and brought the tires in duty free. May I add I was told, that by an officer of the department. If such things can happen, then I say the provision in the budget has been made ridiculous by departmental regulations.
I have been looking for an item under which the matter may be discussed, and I thought this might be the proper place to do so. I 'have in mind difficulties which have arisen in Calgary and elsewhere in connection with persons who have imported radios and then have found themselves in the position of being liable to attack for the violation of certain patents. One point which seems to puzzle people in Canada, myself included, is how the companies concerned with the
patents know, without access to or advice from the department, that an individual has imported a radio containing tubes which infringe patent regulations. Reviewing three or four striking cases which have been brought to my attention I believe the intention of parliament has been largely nullified by regulations which have been laid diown. Either the exemption is good or it is not good. I think these facts should be brought to the attention of the minister and the officials with him so that through the minister they may be able to advise the committee as to the regulations which have been made.


James Lorimer Ilsley: Before I say what I 'have in mind, may I read tariff item 703 (b) which states that the following goods are free under all tariffs.
(b) Goods valued at not more than one hundred dollars included in the baggage accompanying residents of Canada returning from abroad after an absence from Canada of not less than forty-eight hours and acquired by them for personal or household use or as souvenirs or gifts, but not bought on commission or as an accommodation for other persons or for sale, under regulations prescribed by the minister.
Then follows a proviso. The words to which I would draw the attention of the hon. member are these: "Included an the baggage accompanying residents of Canada returning from abroad." I am quite free to admit that the department has experienced difficulty with these words and has received quite a number of complaints from residents of Canada returning from abroad. Almost entirely their complaints have been limited to the two matters mentioned by the hon. member, namely radios installed in cars and tires mounted on the wheels of cars coming into Canada.
The view taken by the department and by myself was that unless we depart entirely from the language of the item, as the Department of National Revenue we cannot possibly declare that automobile tires on wheels, revolving and in use when they come into Canada, are goods "included in the baggage accompanying residents of Canada returning from abroad." Similarly the department has said, and I agree, that we cannot rule that a radio affixed to a car as part of it, used in the car abroad, and actually brought back into Canada as part of the car, could be described as goods "included in the baggage of the resident returning to Canada."


Richard Bedford Bennett: But if he detached it
and put it into his trunk, it would be.


James Lorimer Ilsley: Yes. We have tried to give this a rather liberal interpretation-
Supply-National Revenue


Richard Bedford Bennett: Conservative.


James Lorimer Ilsley: The hon. member will bear in- mind that the Department of National Revenue is an administrative department. We have to carry out the will of parliament as expressed in the items we are administering. Otherwise we would be making administrative law, rather than carrying out the will of parliament. We have gone so far as to say that if the returning resident brings back a radio sitting loosely in the back seat of his car we shall regard it as baggage. Further, we have gone so far as to say that if he brings tires back he may carry them with him or have them loosely in the back seat of his car and we shall regard them as baggage. But when they are part of the car we cannot say, without departing from the language of the section, they are part of his baggage. These are the reasons for the rulings which have been made. Whether or not there should be a change in the wording of the item, I cannot say; at present we are not concerned with that.
It is very unsafe for an administrative department to depart from the undoubted meaning of the language. If we did so it would be subversive of law.


Major James William Coldwell: I can understand that, but I am pointing out what is a ridiculous state of affairs.


James Lorimer Ilsley: That may be.


Major James William Coldwell: A man may import four new tires into Canada if he carries them in on the back seat of his car. But if he has a blow-out in the United States, is forced to buy a new tire and run his car into Canada on that tire, it is classed as a new tire attached to the car, and he is liable to duty on it.


Richard Bedford Bennett: He always was.


Major James William Coldwell: 
James Lorimer Ilsley: With regard to the last suggestion of the hon. member, that owners of patents have access to the files of the department, I want to say that such is not the fact.


Major James William Coldwell: I am glad to have that assurance.


James Lorimer Ilsley: They have no such access and if an application was made for any information, it would be refused. It has always been the law that a person importing a
patented article for use or sale is liable to action. It has, however, never been part of the functions of the customs authorities to advise importers as to whether or not the importation of any article violates a patent. That -is something upon which we are not qualified to advise.


Abraham Albert Heaps: How do they get to know about it?


Mr. JACOBS:: Second sight.


James Lorimer Ilsley: I do not know how patent owners learn that their patents are being infringed by importers, but I can think of many ways in which they might find out. Not long ago I heard of an instance where an exporter in the United States was advertising extensively that he was selling a certain patented article to Canadians. The owner of the patent in Canada immediately looked around to see where these were coming from, and I believe he started an action against some people.


John Ritchie MacNicol: Very frequently importers tell others how cheaply they were able to buy an article in the United States and thus give themselves away.


James Earl Lawson: My recollection is that
there is a provision in the act permitting the inspection of invoice entries on payment of a nominal fee.


Richard Bedford Bennett: That is not available to anybody.


James Lorimer Ilsley: No stranger.


James Earl Lawson: It is limited to the importer?


James Lorimer Ilsley: Yes.


Mr. WALSH:: I should think it would be possible for the Minister of National Revenue to place a less liberal interpretation upon the section to which reference has just been made.

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If my recollection serves me correctly, the debate which took place in this house on that particular item was not such as to justify the minister and his department in taking such a liberal view of importations of this kind. If the minister would allow his Scotch instinct to prevail, this ultra liberal view would not be in force in the department. Canadian tradesmen ought to be given a little consideration. I hardly think the person who signed the treaty with the United States republic in which this clause was embodied, anticipated an interpretation of this sort. If the minister were an ordinary layman travelling back and forth between the United States and Canada, he would realize how ridiculous is this interpretation. It seems ridiculous when a man has to take a radio off his car, put it in the back seat until he gets past the customs and then attach it again to his car in order to comply with the interpretation of the regulation.


John Ritchie MacNicol: In order to get by.


William Allen Walsh: We should interpret this regulation somewhat differently. While I am on my feet I should like to direct the attention of the minister to another matter in connection with his department. I have found the officials of his department to be extraordinarily capable, but I have also found that they are housed in an extraordinary manner. It is a real shame to expect capable officials to carry on their duties under such conditions as prevail at present in the department. There is one office which I visit quite frequently in which are located six men. On a recent visit to this office I found each of these six men trying to interview another man. The office was so littered with papers that one could hardly step from one desk to the next, and yet all these papers were necessary to the work of the department. The minister should give some consideration to the people in his department who are doing such efficient work. The conditions under which these people work should be improved. This would create a better impression in the minds of the public who visit these offices from time to time. Perhaps a better distribution of the space available would bring about the necessary results. It is awkward for someone trying to get information from an official to have five other officials giving information to five other individuals in the same office.


James Lorimer Ilsley: I appreciate the force of what my hon. friend has said. I am glad to join with him in paying a tribute to the officers of the department. I agree with his
statement as to their capability and competence, and I agree also as to the necessity for some improvement in office space. That matter is being considered at the present time and plans are being matured.


Mr. BARBER:: I should like to know what interpretation the minister places upon baggage contained in a car. Would that be hand baggage? I suppose many hon. members receive complaints in connection with this particular regulation. I had one incident brought to my attention of a man who had visited the United States where he had seen an oil stove of a type not possible to obtain in Canada. This was priced at about $80 and he thought he could bring it in. He had it crated and put into his car, but when he arrived at the port of entry he was assessed the regular duty. I understand the officer explained to him that if it had been a small parcel with a rope on it, something that he could carry, it would have been classed as baggage, but that the crate could not be thus classified. It is a question of baggage. I thought perhaps a large trunk would be considered as baggage. This is no bigger than a trunk.


James Lorimer Ilsley: The department takes the commonly accepted railway interpretation of baggage, what a passenger travelling on a railway train might be able to check as baggage or carry with him into a Pullman car. It may be that there is some variety of interpretation by different collectors because it is difficult to make a thoroughly consistent application of a rule such as that. It must be borne in mind that the past year is the first one during which this item has been in force, and it may be that certain collectors have taken one view and other collectors a different view, but the rule I have just mentioned is the rule of the department, which we follow very closely.


Harry James Barber: I agree from what I have heard that the interpretation is not uniform, because the gentleman informed me that if he had gone through another port he would have got through all right; that is, if he had understood before he came back that his own interpretation was wrong. As it was, he had to pay S31 or S32 duty on the stuff.


James Earl Lawson: I really cannot let this item pass without congratulating the minister upon one subitem in it. I well recollect that when an item was up last year for secretaries to the executive, I questioned the necessity of the minister having two secretaries to the executive instead of one, and I must confess that with some force he argued the necessity
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for two such secretaries. I am delighted to see that this year he has come to the conclusion from eighteen months of experience that two are not necessary, and that he has apparently come back to one secretary to the executive because I notice that in this year's estimates provision for only one is made, with a saving of $2,100.


John Ritchie MacNicol: If I am in order I should again like to refer to the case I brought up last year of Mr. Cave, a former employee of the department.


James Lorimer Ilsley: Certainly.


John Ritchie MacNicol: Under date of March 18, 1930, Mr. Charles S. Cave, at that time a customs excise examiner on the staff at Halifax, made application for transfer to the port of Toronto in view of the health of his family since the Halifax explosion. I want to say that no private institution would treat any employee as Mr. Cave has been treated. I do not blame the department particularly. Perhaps it is because of some regulations that nothing has been done, but certainly something should be done to right a very great wrong. Mr. Cave says:
At the time of the Halifax disaster I was on duty (customs) at the Halifax graving docks, close to the point where the Mont Blanc blew up. I was blown into the Halifax harbour and my house, not far away, was blown off the map, three of my children were burned to death, and my wife and only surviving daughter were taken to Truro in a very serious condition. My wife has never fully recovered and for several years was under the doctor's care. I was advised by him that we would have to move elsewhere for her health's sake, so we decided to move to Toronto where her only surviving relatives were located.
Now it appears that he could not be transferred to Toronto, and later on, as I said a moment ago, he resigned from the department, but on the assumption that at a later date he would receive an appointment at Toronto. On various occasions he applied to the civil service commission for an appointment, and finally he was turned down because he was slightly over the age limit.
I want to compliment one official of the department, Mr. C. E. Wood, Commissioner of Customs, upon his humanitarian view of this case. In writing to the civil service commission, perhaps at the instance of the minister himself with whom I took this matter up a year ago, Mr. Wood says:
In view of the extenuating circumstances of which the department was not fully cognizant at the time, also the fact that while employed at Halifax, Mr. Cave's services were of the highest order, it would be appreciated if some way could be found to facilitate his re-entry to the customs excise service, notwithstanding that he now appears over the age limit.

The department also states that through his many years of service at Halifax Mr. Cave rendered excellent and efficient service, without any complaint at any time being made against him. I do hope that something will be done to give some consideration to this man who, while he was in the service of the government, lost his whole family but one through no fault of his own. It does seem to me, as one who has had a great deal to do with the employment of labour and who knows how labour should be treated, that a government official should not be treated as this man has been, and I would ask the minister to reconsider this case so that this man may be reemployed. Scores of officials have been appointed in Toronto since I brought this matter up, and surely this man can be put into some position.


James Lorimer Ilsley: The appointments to Toronto
have been made by the civil service commission, and my recollection is that when we took this matter up with the commission we were told that it was impossible to do anything for this man. Does the hon. member know the age of the man in question?


John Ritchie MacNicol: No, but I know he is a comparatively young man.


Samuel William Jacobs: How long had he been in the service?


Richard Bedford Bennett: Twenty odd years. He is over the age required by the Civil Service Act.


John Ritchie MacNicol: He was with the department for many years and gave excellent service. It appears now that he is slightly over the age limit.


Abraham Albert Heaps: What is the age limit?


Richard Bedford Bennett: Thirty-five.


John Ritchie MacNicol: I think in view of the circumstances, when a man while in the service of the government had his house blown away at the time of that terrible disaster at Halifax, had three of his children burned to death and his wife left naturally in a state of collapse, and found it necessary, after struggling on for years at Halifax, to move away to some other part of the country, as any man would do under those circumstances even if he lost his position, something should be done for him. I do not believe any private company with branches scattered throughout Canada would have treated an employee in the way in which this gentleman has been treated.


Richard Bedford Bennett: There are several cases of this kind arising from time to time in various departments of the public service. The

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mistake in this case arose with the gentleman resigning. Once he resigned there is no power in the statute for anybody to place him in the public service again if he is over the age of thirty-five years, and the civil service commission could no more place him in a position than they could me. But there is a way in which the minister can deal with it if he so desires, and that is by placing an item in the supplementary estimates providing for the man's appointment notwithstanding anything contained in the Civil Service Act. In view of the circumstances to which reference has been made, and the letter written by a departmental official pointing out that all the facts were not in the possession of the department at the time this man felt compelled to resign in order to remove to another place where his wife could live, I would suggest that what I have indicated might be a very reasonable thing to do. This has been done more than once, and the only way in which it can be done is by act of parliament, because the statutory prohibition is such that he cannot otherwise be employed legally. The only way by which he can be legally employed is under a supplementary estimate, which of course is an act of parliament.


Howard Charles Green: What is the total value of the imports under the S100 exemption?


James Lorimer Ilsley: For the seven months ended December 31, 1936, the total is $3,528,639 from all countries. The total from the United States is $2,931,691.


Howard Charles Green: Has the minister that by classification?


James Lorimer Ilsley: I should perhaps mention that importations of goods valued at less than five dollars are not declared, but I imagine they would not amount to very much. Does the hon. gentleman want these by classes?
From the United States: automobile accessories, S100,826; automobile tires and tubes, S48.968; boots and shoes, $285,091; clothing, $1,455,924; foodstuffs, $11,702; furniture and household appliances, $442,004; miscellaneous commodities, $578,176, making the total previously mentioned of $2,931,691.
The totals from all countries are: automobile accessories, $100,871; automobile tires and tubes, $49,002; boots and shoes, $303,959; clothing, $1,755,013; foodstuffs, $15,207; furniture and household appliances, $467,529; miscellaneous commodities, $837,058, making a total I mentioned of $3,528,639.


Mr. BAKER:: What was the total of clothing and boots and shoes, the two important items?


James Lorimer Ilsley: From all countries?


Richard Langton Baker: The importations under this $100 exemption from all countries.


James Lorimer Ilsley: Boots and shoes, $303,959; clothing, $1,755,013.


Richard Langton Baker: Did the minister stop to think of how much labour that is depriving the people of Canada?


An hon. MEMBER:: Out of order.


Abraham Albert Heaps: Before this item carries, I think the minister ought to deal a little more definitely with the case raised by the hon. member for Davenport (Mr. MacNicol). If the department desire, ways and means can be found to have that man reestablished in his duties, around Toronto. Could he not at least be placed in temporary employment?


Richard Bedford Bennett: He cannot be placed in the service at all.


Abraham Albert Heaps: I think the minister spoke the other evening of a large number of appointments to the stenographic staff. If there is any way of having a special item in the estimates to meet his case or of placing him in the temporary service, I believe the government should do what any ordinary employer in Canada would do-transfer him from the employment in which he was formerly engaged to a place where he can find more congenial surroundings than in the place he left, namely the city of Halifax.


James Lorimer Ilsley: I am informed that this officer did not leave the service until thirteen years after the explosion. The explosion occurred in 1917, and this officer left the service in 1930; that may have some bearing on the matter. However, I shall be glad to go into the case again and consider it in the light of the representations which have been made here to-night. With regard to this item, my colleague the Postmaster General (Mr. Elliott) is anxious to introduce his estimates, and if the committee would care to pass it-


Richard Bedford Bennett: It is not necessary to pass it, you know.


James Lorimer Ilsley: -all right. If not that will be all right also.


[Stage Direction]
Item agreed to.
POST OFFICE DEPARTMENT Civil Government-
Salaries, including the assistant deputy postmaster general and general superintendent of postal service at $7,500 a year from April 1, 1937; amounts required to pay allowances to office appliance operators, grade 2, operating mechanical audit card punching machines in accordance with the terms of order in council P.C. 280/383. dated February 17, 1930; to pay
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[Stage Direction]
allowances to typists, grade 1, employed cutting stencils in accordance with regulations approved by order in council; and to pay allowances to office appliance operators, grade 2, in the revenue division employed as key punch operators, schedules and rates to be decided upon by the civil service commission and the post office department and approved by the governor in council, $1,318,488.
Contingencies, $215,000.
Hon, J. C. ELLIOTT (Postmaster General): Perhaps I should make a statement as to the increases. The item for salaries is $1,318,488, an increase of $69,828. The increase is accounted for by 391 statutory increases amounting to $27,540. If my hon. friends would like to have the details I can give them very readily, but they are the regular statutory increases. Then there is one special increase of $600 to augment the salary of the assistant deputy postmaster general and general superintendent of postal service to $7,500, effective April 1, 1937. There are fifty-two additional positions; these are required to provide an adequate establishment for the administrative services and financial branch. The positions were approved by the civil service commission and authorized by order in council dated July 10, 1936, and October 23, 1936. They will be filled by the civil service commission by promotional competition or appointment. What I have already given amounts to $27,540. There will be deducted three positions no longer required, amounting to S9,600, and the difference in salaries of employees who have left the service and the salaries of those who have replaced them, amounting to $1,620, and current salary deduction amounting to $2,952. There is a total of deductions of $14,000, making up the $69,828.
John Ritchie MacNicol: I notice this item in
the estimates of 1937-38 is No. 16, and in the estimates of 1936-37 it was No. 20. Looking through the auditor general's report of 193536, I find it scattered in three or four different places. It is almost impossible to check one item with the other so as to find out where we are going or what we have under discussion. An estimate appears for a large sum of money like this and about the only thing we can do is to ask the reason for the increase, or some question which has no more import than that. If we want to check over the figures contained in the previous year's item we have not yet the details. The latest report I have is the auditor general's report for 1935-36; next year we shall get the auditor general's report for last year, 1936-37, and the year following we shall get it for the item now under discussion. I do not know that anything can be done in the way of better bookkeeping 
than we have at present, but it is a nightmare to connect the items of this year with last year from the auditor general's report of 1935-36.


Mr. PELLETIER:: I want to ask the minister what led his department to decide that the postal employees of Canada should be compelled to work on statutory holidays. Undoubtedly a decision for which he is responsible was arrived at by his department, and he should make a statement.


John Campbell Elliott: That question can better be discussed under item 275 and I suggest that we defer the discussion until then.


Abraham Albert Heaps: In this connection I suggest that the minister bring down the return to the question asked him a few weeks ago and passed by the house. A request was made for the tabling of correspondence relating to changes made in the regulations of the department respecting hours and conditions of labour during the past year. When may we expect that correspondence?


John Campbell Elliott: The great
volume of it is ready now, but it is not complete. I expect to be able to table the report within a short time.


Richard Bedford Bennett: A great volume is ready but the small volume is not.


John Campbell Elliott: A considerable volume still remains.


Richard Bedford Bennett: The minister said that
three positions had been abolished. What were they?


John Campbell Elliott: One was
superintendent of mail contracts, S6,000; one principal clerk, $2,400; one packer and helper, $1,200, or a total of $9,600.


Richard Bedford Bennett: Who were the incumbents?


John Campbell Elliott: Mr. Anderson was the superintendent of mail contracts.


Richard Bedford Bennett: That position was vacant; he had been superannuated.


John Campbell Elliott: Yes; it was
joined with the air mail office and the position was abolished.


Richard Bedford Bennett: Who has taken on the
responsibilities of the mail contract service?


John Campbell Elliott: Mr. Herring
is performing them at the present time.


Richard Bedford Bennett: What is his title?


John Campbell Elliott: Chief superintendent of air and land mail services.

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Mr. STIRLING:: This covers superintendent of air and land mail services. Will the minister give us some information with regard to what air mail services there are now in Canada?


John Campbell Elliott: That also
comes under item 275. I have a full list of them and I could give them now, but perhaps it would be better to give them under item 275.


Gordon Graydon: What are the duties of the director of public relations of the Post Office Department?


John Campbell Elliott: Largely publicity, to endeavour to keep track of matters that are taking place in the various branches of the department and to give information concerning them from time to time. These duties are carried out with the fourfold object: increasing revenue; obtaining the cooperation of the mailing public; maintaining supervision over the various branches with the idea of creating an esprit de corps among the different branches, and the creating of good will.


Gordon Benjamin Isnor: Is the department carrying out an accounting system of its own showing complete revenue and complete disbursements as applied to the Post Office Department?


John Campbell Elliott: We have an accounting system that keeps track of the business in the department and that is under the supervision of the financial superintendent and for expenditure under the comptroller of the treasury.


Gordon Benjamin Isnor: Is the minister in a position to state, from his financial set-up showing revenues and disbursements, whether the Post Office Department pays it way?


John Campbell Elliott: I am in a
position to state that the department more than pays its way.


Samuel William Jacobs: Except the dead letter department.


John Campbell Elliott: I may say that in the last year it more than paid its way. If time permitted, I should like to give my bon. friend the total revenues and expenditures for the past year. Perhaps I have time.


Richard Bedford Bennett: Time to start anyway.


John Campbell Elliott: The total estimated revenue for the year closing March 31, 1937, judging by the nine months that have passed, will be $41,178,199. From this we deduct $6,868,164 paid to commission postmasters, leaving net revenue $34,310,035. This represents an increase of $1,802,146 over the
preceding year. The outlay for the year is S30,100,101.63.


Abraham Albert Heaps: Does that include gross outlay or just the net?


John Campbell Elliott: No, that is outlay reckoned according to the system to which my hon. friend objects, but which has been in force since confederation. It does not include the item to which I know he refers, of rental for buildings-


Abraham Albert Heaps: Maintenance.


John Campbell Elliott: -maintenance of those buildings, including char service, coal and that sort of thing. Perhaps to clarify the matter-


Richard Bedford Bennett: The minister might break down the items at his convenience.


John Campbell Elliott: Yes. I should like to say a word in regard to that so as to give my hon. friend the information for which he asked.
Progress reported.


[Stage Direction]
At eleven o'clock the house adjourned, without question put, pursuant to standing order.
Wednesday, February 3, 1937