1938-03-31

[Stage Direction]
First report of the standing committee on miscellaneous private bills.'-Mr. McPhee.


[Stage Direction]
Mr. MALCOLM McLEAN (Melfort) presented the first report of the special committee appointed to inquire into terms and operation of the Civil Service Superannuation Act, and moved that the report be concurred in.
Motion agreed to.


[Stage Direction]
Mr. C. G. MacNEIL (Vancouver North) moved for leave to introduce Bill No. 83, to amend the Naval Service Act.

Some 'hon. MEMBERS: Explain.
Mr. MacNEIL:: The purpose of this bill is to amend the Naval Service Act so as to make it conform, with the self-governing status of Canada as now recognized, and to provide that parliament shall sanction any action by our naval forces other than that required for the direct defence of Canada.
Motion agreed to and 'bill read the first time.



MILITIA ACT AMENDMENT


[Stage Direction]
Mr. C. G. MacNEIL (Vancouver North) moved for leave to introduce Bill No. 84, to amend the Militia Act.
Some hon. MEMBERS:: Explain.


Charles Grant MacNeil: The purpose of this bill is to amend the Militia Act so as to make it conform with the self-governing status of Canada as now recognized, and further to provide that Canada shall not become involved in any war outside of Canada without the consent of parliament.
Motion agreed to and bill read the first time.



QUESTIONS

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

Mr. FLEMING:: 1.	How many persons were placed in the province of Saskatchewan under the farm placement scheme during the years 1936-37 and 1937-38?
2.	How much money was paid under this arrangement to the farm workers and to the farmers of Saskatchewan during the years named?
3.	How many applications were received, and how many rejected under this plan in Saskatchewan during the said years?


Mr. ROGERS:: 1.	During the fiscal year 1936-37 there were 27,898 persons placed.
During the fiscal year 1937-38 there were 29,379 persons placed.
2.	The dominion's contributions with respect to payments made by the province to farm workers and farmers under the plan during the fiscal year 1936-37 totalled $454,868.63 and 8310.905.90 respectively.

Questions
The dominion's contributions with respect to payments made by the province to farm workers and farmers under the plan during the fiscal year 1937-38 totalled 8195,496.36 and $139,780.77 respectively.
These payments are a contribution of 50 per cent of the total expenditure incurred by the province and represent accounts received from the province and paid as of March 28, 1938, but do not include any payments which may have been made by the province during the years in question for which accounts have not as yet been received by the dominion.
3.	During the fiscal year 1936-37 there were 31,081 applications received and 3,183 applications rejected.
During the fiscal year 1937-38 there were 41,541 applications received and 12,162 applications rejected.
Province or	territory	Total
(Sq. miles)
Prince Edward	Island	 2,184
Nova Scotia	 21,068
New Brunswick	 27.985
Quebec	 594.534
Ontario	 412.582
Manitoba	 246.512
Saskatchewan	 251,700
Alberta	 255,285
British Columbia	 366.255
Yukon	 207,076
Northwest Territories-
Franklin	 554,032
Keewatin	 228,160
Mackenzie	 527,490
Canada	 3,694,863


CREDIT RIVER, ONT., LIGHTHOUSE PURCHASE OP DREDGES
Mr. PELLETIER:: 1.	When were each of the following dredges acquired by the government, and at what cost: Dredges numbers 4, 5, 8, 12, 13, 14, 15, 16, 17, and Churchill No. 1?
2.	Have they been sold?


Mr. HOWE:: 
TERRITORIAL AREA OF PROVINCES AND YUKON
Mr. GRAYDON:: 1.	Has the demolished lighthouse at the mouth of the Credit river been replaced?
2.	What provision was made during the year 1937 to mark the channel for fishermen and others using the harbour at Port Credit?
3.	What steps, if any, are being taken to properly mark the channel this spring?


Mr. HOWE:: 1.	No.
2.	A spar buoy was placed at the entrance to the channel leading to Port Credit.
3.	It is proposed to place a conical buoy to mark the channel near the old lighthouse.


CANE SUGAR IMPORTS
Mr. LENNARD:: 1.	What was the value of the cane sugar imported into Canada during the year 1937?
2.	What proportion of this came from British possessions?


Mr. EULER:: 1.	$17,610,125.
2.	Ninety-six per cent.


Mr. MALLETTE:: 1.	What is the territorial area of each of the nine provinces and the Yukon Territory?
2.	What is the total area of the Dominion of Canada?


Mr. CRERAR:: 1 and 2. The areas in square miles are approximate, and do not include bodies of salt water.


BANANA IMPORTS
Mr. LENNARD:: 1.	What was the value of the bananas imported into Canada during the year 1937?
2.	What proportion of these came from the British West Indies?


Mr. EULER:: 1.	S2,231,119.
2.	66-5 per cent.
Questions


ALAMEDA, SASK., EXPERIMENTAL FARM
Mr. DOUGLAS (Weyburn):: 1.	By whom is the demonstration farm under the federal Department of Agriculture at Alameda, Saskatchewan, operated?
2.	What remuneration is received for the services so rendered, and to what individuals is it paid?


Mr. GARDINER:: 1.	Young Bros. (Gordon F. & Stanley W.)
2.	640 acres experimental studies in strip farming and other cultural methods at SI per acre.
Gordon F. & Stanley W. Young.


* JOINT COMMITTEE TO INVESTIGATE RAILWAY SITUATION
Mr. CHURCH:: Will the government give consideration to the appointment of a joint committee of both bouses of parliament to consider, investigate and report to parliament on the whole railway situation in Canada and on its proper solution as an urgent economic national necessity?


Mr. MACKENZIE KING:: No.
MONTREAL POST OFFICE-ACCIDENTS TO AUTOMOBILE	.


Mr. DESLAURIERS:: 1.	Have any accidents occurred to the government automobile used by the Montreal post office?
2.	If so, at what place and at what hour of the day?
3.	Was it then engaged in post office work?
4.	What is the cost to the government arising from accidents during the period from 1933 to 1937, both inclusive?


Mr. EULER:: 1.	Yes-6 accidents.
2.	(1) Place-St. James st., Montreal
Hour-No record.
(2)	Place-Sherbrooke st., west, Montreal Hour-No record.
(3)	St. Hubert and Bienville, Montreal Hour-No record.
(4)	Place-St. Hubert st., Montreal Hour-9 a.m.
(5)	Place-Plessis st., Montreal Hour-3 p.m.
(6)	Place-Craig st., E., Montreal Hour-5.15 p.m.
3.	Yes.
4.	S64.75, Montreal.
fMr. Euler. 1


DEPARTMENT OF AGRICULTURE-EMPLOYMENT OF DOCTOR DUNBAR
Mr. McGREGOR:: 1.	Is Dr. Dunbar of Melfort, Saskatchewan, employed by the dominion Department of Agriculture?
2.	If so, in what capacity?
3.	Is he employed full or part time?
4.	What civil service examinations, if any, has he written?
5.	What marks did he obtain in each examination?
6.	What marks were required to pass each examination?


Mr. GARDINER:: 1.	Yes.
2.	Veterinary inspector part-time, temporary.
3.	Part-time.
4.	Examinations for veterinary inspector April 24, 1928, and veterinary inspector parttime August 2, 1933, and March 20, 1937.
5.	April 24, 1928-28-2 per cent
August 2, 1933-46	per cent
March 20, 1937-72	per cent
6.	70 per cent.
a. s. AGNEW


Mr. PERLEY:: 1.	Was A. S. Agnew of Broadview, Saskatchewan, employed in the purchasing of feed and fodder in Manitoba or Minnesota, for the province of Saskatchewan?
2.	If so, how long was he employed and how much was he paid by way of salary or commission, and what were his expenses?


Mr. GARDINER:: 1.	A. S. Agnew was employed as a feed grader and used in Minnesota and North Dakota.
2.	Employed from October 19, 1937, to February 21, 1938. $125 per month plus actual travelling expenses as follows: October, $137.59 ; November, $303.52; December, $278.68; January, $205.97; February, incomplete.



QUESTIONS PASSED AS ORDERS FOR RETURNS


Mr. LENNARD:: 1.	How many civil servants, temporary or permanent, whose salaries are paid by the federal government, were employed in Ottawa as of October 14, 1935?
2.	How many such civil servants, temporary or permanent, are at present employed in Ottawa ?

C.N.R.-Shop Employees


EXPROPRIATION OP LANDS FOR PARK PURPOSES
Mr. STEWART:: 1.	Has the Dominion of Canada purchased or acquired by expropriation any lands for public park purposes since the year 1900?
2.	If so, what lands were purchased, where were same located, and what was the price or compensation paid for same in each case?


CANADIAN FARM LOAN BOARD
Mr. MARSHALL:: 1.	What was the yearly profit (or loss) of the Canadian farm loan board since it was formed ?
2.	How many farm properties were acquired by the board in each of the years 1935, 1936, and 1937 in, (a) Alberta; (b) Saskatchewan?
3.	How many sales were held by the board in each of the years 1936 and 1937 in, (a) Alberta; (b) Saskatchewan?
4.	What are the total values of all lands held for sale by the board at the end of the year 1937 in, (a) Alberta; (b) Saskatchewan?


PURCHASE BY DOMINION GOVERNMENT OF REAL ESTATE IN OTTAWA
Mr. McDONALD (Souris):: 1.	How many pieces of real estate have the government bought in Ottawa since the government has been located at Ottawa?
2.	What was the price paid for each of such properties?
3.	Who were the owners in each case at the time of purchase?


MONTREAL HARBOUR BOARD-JACQUES CARTIER BRIDGE
Mr. DESLAURIERS:: 1.	What	was	the	financial	report	of	the
harbour board of Montreal for the years 1928,
1929,	and 1930, not taking into account the administration of the Jacques Cartier bridge?
2.	What	was	the	financial	report	of	the
harbour board of Montreal for the years 1935, 1936, 1937, exclusive of the cost of administration of the Jacques Cartier bridge?
3.	What	was	the	financial	report	of	the
Jacques Cartier bridge for the years 1928, 1929,
1930,	1935, 1936, and 1937?
4.	Is the amount realized by the sale of the government fleet to the company in which Mr. Simard is a partner shown in the financial report of the port of Montreal for 1937?
5.	What	rate	of	interest is the port of
Montreal paying on its debt?



CANADIAN NATIONAL RAILWAYS


[Stage Direction]
On the orders of the day:
Mr. SAMUEL FACTOR (Spadina):: I
should like to submit a question to the Minister of Transport (Mr. Howe). I have received a petition signed by a large number of employees of the Canadian National Railway
shops at Leaside, protesting against their dismissal taking place to-day. I understood from the Minister of Transport the other day that he was conferring with the railway management and the heads of the unions concerning the matter of lay-offs. I wonder if he would mind giving the house the result of that conference.


Hon. C. D. HOWE (Minister of Transport):: As a result of a conference held yesterday in my office between the railway management and a committee of the heads of the shopmen's brotherhood, it was decided that the situation would be again reviewed in the light of representations made by the management and myself as to the extreme undesirability of laying off men at this time. Following a quick telegraphic vote, it was decided that the reduction in work in the central and western regions would be taken care of by a reduction in hours; that is, instead of a twenty-four day month as the schedules now call for the men will accept an eighteen-day month, and no men will lose their employment.
In the eastern region, however, the shopmen decided that they must insist on the maintenance of the schedules; so there will be a lay-off at Moncton and at Riviere du Loup. However, I am happy to say that the business level in the maritime division is somewhat higher than on the rest of the system, therefore the lay-off will not be very extensive.
It was agreed that this condition shall stand until June 1. In May, all the railway brotherhoods are meeting in convention, and will review their position. If that meeting decides that the schedules must be maintained, that decision must be effective on June 1. On the other hand if the convention decides that the system now being followed is preferable, then that system will continue.
On my own behalf I wish to thank the brotherhoods and the shopmen themselves for taking care of this situation in such a way as not to increase unemployment. I fully realize that the senior shopmen in sacrificing their schedules have made a real sacrifice for the sake of the younger men who would otherwise be thrown out of employment. I think the spirit that has been shown is one that every one of us should commend most highly.


Mr. J. S. WOODSWORTH (Winnipeg North Centre):: May I ask the minister
if consideration will be given to the question whether perpetual bondholders are going to make any sacrifice?
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Use of Canada's Financial Resources


Mr. F. C. BETTS (London):: May I ask the minister how the situation will be met in London, Ontario, where there is a threatened lay-off of some seventy men?


Clarence Decatur Howe: London, being in the central region, is meeting the situation by reduction of hours.

use of Canada's financial resources for



ELIMINATION OF POVERTY-AMENDMENT OF MR. BLACKMORE AND SUBAMENDMENT OF MR. BENNETT

[Stage Direction]
The house resumed from Wednesday, March 30, consideration of the motion of Mr. Dunning for committee of supply, the amendment thereto of Mr. Blackmore, and the amendment to the amendment of Mr. Bennett.
Mr. J. H. BLACKMORE (Lethbridge):: I appreciate greatly, and so do the members of our group, the tolerance, courtesy and attention which so far have been accorded to us, not only in this debate but in the previous debates in the house. We realize, no one realizes more keenly, how strange our ideas must appear to hon. members, because all we have to do is to go back four years in our own experience and remember how we felt. We can therefore tell exactly how other hon. members feel. In the light of these things we have no fault whatsoever to find with the tendency on the part of some to scoff at our notions and treat them lightly. But notwithstanding this, we contend that when the realities of the situation and the facts of our proposals are fully comprehended, there will be on all sides nothing but respect and sympathy for our contentions, whether or not it is decided in the end that they are sound.
We have been accused of wasting time. We have deliberately refrained from participating in many debates in this house. There has been very little comment by social crediters on many measures, and little or no discussion of tariff matters; not because we have not our convictions and our beliefs, but because we were deliberately refraining from speaking so that the time we felt was rightfully ours could be devoted to discussion of the matter which we believe of greater importance to this country than anything else that could be discussed at the present time.
Yesterday the hon. member for Broadview (Mr. Church) delayed proceedings while he put on Hansard some things of which some day he and his descendants will not be so very proud.


An hon. MEMBER:: He has no descendants.


John Horne Blackmore: It is too bad he has none, because I think if he had he would be a wiser man. I heard of a story concerning his province; that the first telephone to be put into the office of one of the chief men in Ontario was indignantly kicked out of the office by that man and condemned as an utterly foolhardy device with which he would have nothing to do. If the hon. member has heard that story it should give him cause for thought. The hon. gentleman I believe urged that business men should be given charge of the affairs of this country, and I should like to turn for a moment to this matter of business men managing our affairs. If hon. members will turn to the Dictionary of American Biography, volume XVII, at page 514 they will find an enlightening account of the life of a certain man named William Stanley, who lived from 1858 to 1916. Of him these words are recorded there:
He devised the multiple system of alternating current distribution, together with its equipment (patent No. 372942, issued November 8, 1887), but Westinghouse-
A business man, mark you.
-refused to finance its development until Stanley at his own expense had put the system into regular commercial service in Great Barrington, installing it in several stores.
From that invention up to the present time there have developed in the United States, I am told, businesses worth thirteen and a half billion dollars. Are business men wise? It hardly looks that way, does it? It takes more than business to make a man wise. At the same time Edison was the greatest authority on electricity in the world. Edison opposed this device as an impractical piece of nonsense. It would not work; it could not work; we did not need it. Again, Edison was a business man. Mr. Stanley's invention made possible the first alternating current transmission of electricity. From his invention came to be promoted the distribution of power by an alternating current system. It threatened the direct current system, in which Edison was deeply interested. Edison and other great authorities on electricity at that time ridiculed Stanley and opposed him by every means at their disposal. With such things as this in the records of history, Mr. Speaker, let us not be greatly surprised if even to-day new ideas meet with intolerance, misunderstanding and opposition.
While we are on the question of electricity I should like to suggest a little illustration which I believe will apply to the debate which

Use of Canada's Financial Resources
has taken place up to the present time. Before men learned to use electricity produced from the energy of a stream they had to learn by painful experience that it was possible to change into electricity the energy contained in the ice cold waters pouring down from the mountains. When they were convinced that this could be done, they were prepared to consider the possibility of erecting a plant to do that thing. After they had learned the possibility of erecting such a plant it was time to consider the possibility of distributing the electricity. After that they could occupy themselves with the matter of using the electricity when it was distributed, and of safeguarding its use. In this debate we are contending in this house that pouring down the hills of the Dominion of Canada, so to speak, there are vast torrents filled with energy which can be transformed into a form useful to mankind. There is very little value in talking about the kind of plant we should erect or how to distribute it or safeguard it until we first determine whether or not the thing can be done. In this debate we have been occupied with the question, can the thing be done? Is it possible to change vast quantities of goods and services, which are being produced and consumed in this country in one gigantic stream, into money?
Yesterday the Minister of Finance (Mr. Dunning) offered us an Alberta bank. I must spend a moment discussing this proposal. Yesterday I issued to the press, at their request, a statement which I think it is only fair should go into Hansard:
The Canadian banking system can take a one dollar bill of the dominion or of the Bank of Canada and safely create ten dollars of cheque book money against it. This was definitely proved and acknowledged during the debate on the motion of want of confidence. In using this power, however, the banks have to go forward together in step, so to speak. This all well informed people know.
An Alberta chartered bank under the present set-up in Canada would have to get its Bank of Canada bills from the Bank of Canada, just as any other Canadian chartered bank would have to do. This fact would force the Alberta bank to conform to the policy of the Bank of Canada. Further, if such Alberta bank began to pursue any other policy it would get out of step with other Canadian chartered banks and so become in danger of losing its cash to them. This would of course render it likely to fail. An Alberta bank alone would therefore be unlikely to help in the introduction of social credit.
The Bank of Canada Act gives to the Bank of Canada the power to take one dollar of gold and create against it four dollars of Bank of Canada bills. If Mr. Dunning would offer to Alberta the poTver to give an Alberta bank this right then he would be conferring upon
Alberta real monetary power with great possibilities. If in addition lie would agree to recognize as legal tender Alberta one dollar bills with twenty-five cents of gold backing, as he does with Bank of Canada bills with twenty-five cents of gold backing, the possibilities would be still greater. The Alberta bank could then build upon one dollar of gold a currency and credit structure of $40, as the Bank of Canada with the Canadian chartered banks now can.
The power of creating legal tender bills, however, is not in his offer, I take it, and will not, I fancy, ever be in his offer.
I might add these words, which did not go out to the press: It is not the banks we are after, but the system which gives to them and to them only the creation of Canada's money. An Alberta bank attempting to establish itself to-day would probably have about as much chance of success as an Alberta distributing house would have in competition with the T. Eaton Company.
I turn now to a consideration of my motion.


Mr. DUNNING:: Would the hon. member permit a question?
Mr. BLACIvMORE: If Mr. Speaker will give me extra time I shall be glad to permit interruptions.


Charles Avery Dunning: In his statement the hon. member asked if Mr. Dunning would do so and so. In that connection I wish to say merely this, if the hon. member will permit me, that the things he there states Mr. Dunning should do are not within Mr. Dunning's power. What my hon. friend asks there is that the parliament of Canada should turn over to the social credit party the complete control of currency and credit in Canada which is now vested in this parliament, and also complete control of the Bank of Canada. I cannot do that. My hon. friend may convince parliament

if he can-but it is useless to ask me to do more than I offered to do last night, something which it was within my power to do.


John Horne Blackmore: I gathered from the remarks the Minister of Finance had previously made that in him, the Minister of Finance, rested complete control of currency and credit in Canada.


Charles Avery Dunning: No, no; I repeatedly
denied any such thing, and have stated directly the opposite. In this parliament, and in the instrumentality created by this parliament, rests that power. I hope the hon. member will not repeat the statement, which has been made by several of his group, that I control



I87S COMMONS

[Stage Direction]
Use of Canada's Financial Resources
currency and credit in Canada. It must be within the knowledge of every hon. member of the house that I have never said that.
John Horne Blackmore: This is very good. In 1935, before the Bank of Canada was formed, I understand the dominion had delegated the power to create dollar bills, and credit, to each of at least eleven chartered banks throughout the country. I am going to ask this question, sir; whether or not one of the nine sovereign provinces of the dominion would be likely to mismanage currency and credit of Canada to any greater degree than would the group of men who constitute a bank. If the power lay in this parliament to give this complete power to banking institutions, before the Bank of Canada was formed, then it looks as though that power would permit giving a similar right to a province.
However, this is beside the point, although it has been an interesting sidelight. We are now discussing a motion made by the social credit group on March 8. That was a want of confidence motion, on the ground that the present government is neglecting to use Canada's resources for the abolition of poverty in the country. It is a most remarkable thing to me that, other than social crediters, hon. members who have participated in the debate have discussed anything and everything except the motion. That is a most interesting fact. Yesterday we even got to salt fish.


Mr. BRADETTE:: We had electricity this morning.


John Horne Blackmore: No defence has been made. I challenge members of this house to point to one single place where a defence was made by any member or supporter of the government against the charge that the government has not used the resources of the country to remove poverty. In fact, there have been no answers to any of my contentions concerning money. I directed the attention of the house and the country to money, and the point has been completely sidestepped. A red herring was dragged in, and the time of the house was spent discussing the red herring, while the money question remained in abeyance.
In a few moments I shall show that not a single contention was disproved. Let me recall to the minds of hon. members the points I made. I shall review them briefly.
First: Money is either currency or credit. It could and should be created by the king or by the state.
Second: Our money now is created by and comes from banks. This has been abundantly shown in the discussion.
Third: What gives money value is goods and services, and the producing and consuming power of the community. Had the attention of the house been directed to a discussion of that proposition the time would have been excellently spent. When the truth regarding that proposition is fully recognized we shall be on our way to a change which might do us some good.
Fourth: The amount of money that Canada can have depends upon the number of exchanges Canada can manage to bring to pass within the country. Not one word was said about that. Yet, sir, next to the other one I have mentioned, this is the most important question which can be brought to the attention of parliament.
Fifth: King-created money is sound.
Sixth: Canada's financial set-up now enables her to create legally $80 for one dollar of gold. That was established in the discussion. But before it was established the people in Alberta were called all sorts of lunatics and fools, and withstood a great amount of abuse, from a wide variety of people because that was our contention. It is established, sir, and a great achievement has been brought to pass.
Seventh: Canada can produce abundance for all her people. There was no question about that.
Eighth: Inflation comes from having more money than goods and services. Not a word has been said about that. Yet if we wish to discuss inflation that is the point at which we must commence. This proposition is borne out by the best authorities now living.
Ninth: Canada now has vast amounts of goods no one can buy. She is equipped to produce immediately upon demand vast quantities more of many kinds. The distribution of money would immediately call forth more production. When the almost hysterical outbursts against inflation were in process, not a word was said about that-not a word. And yet that, sir, is the all-important point. If we spent $100,000,000, and by spending that money we immediately brought into existence $100,000,000 or more of goods, there would be no chance in the world of creating inflation- except a form of financial inflation, with which we can deal later on.
Tenth: Therefore, Canada can safely create, issue and use a great deal of money. There was not a word of discussion about that-with the exception of the outburst about inflation.

Use oj Canada's Financial Resources
I said a few moments ago that not one of my contentions was met or answered-not a single one. I ask the members of the government this question: Why in the world was the whole question sidestepped? That is a vital point. Yet we have news sent clear to Australia stating how the Minister of Finance showed that social credit would result in inflation, that it would be most disastrous, and all that sort of thing. The Minister of Finance did not prove that at all, and he cannot prove it.
This debate has proved that $80 can be created in Canada for $1 of gold. It has proved that it can be created out of nothing but paper and pen and ink. That has been proved abundantly on the floor of this house. That is a wonderful achievement. The banks create all the money and they can beat the printing presses any day. We raise our hands in holy horror at the thought of printing presses, but we let the banks go ahead creating money far faster than the printing presses ever could. The banking system of Canada is the power plant that has been erected to serve the country. If we know how to use it we can change our streams of goods and services that are pouring through this country into money that can be used for the betterment of the country. But we must prove that we can do this.
A few moments ago I referred to turning water power into electricity. The first important point is to learn that water power can be turned into electricity. That was the question with which we were occupying ourselves and it had nothing to do with any of the other matters. Can we have money? 

that is the question. I understand that the Minister of Labour (Mr. Rogers) rose in his place and said that it was impossible for us to get money in any other way except by borrowing or by taxation. That is the stand normally taken in Canada to-day, but it is a stand which is utterly not in accordance with the facts. As long as we continue to take that stand, we will continue to be bound and the problems of this country cannot be solved.
The next question with respect to the power plant is that the amount of electricity developed depends on the volume and speed of the water. The amount of money that we can create depends upon the. volume and speed of our production and upon nothing else. Later on we shall deal with other matters. However, the Minister of Finance attacked it in this way. He did not stop to ask whether or not goods and services could be changed into money; he wanted to know immediately how to do it. If you came into the house
ready to discuss the question whether or not water power could be turned into electricity, and you were asked about the details of constructing a power plant, would you consider that to be a fair question? I do not wish to be unfair, but I speak as I see it. This is the next question: He said we do not need electricity; in other words, we have enough coal oil and we do not need any electricity.


Charles Avery Dunning: I never said any such thing.


John Horne Blackmore: I shall make it abundantly clear to my hon. friend in just a minute. I am simply using an illustration.


Charles Avery Dunning: My hon. friend has no right-


John Horne Blackmore: Let me make my point first.


Charles Avery Dunning: My hon. friend says that the Minister of Finance said that we do not need electricity. The Minister of Finance never said any such thing and my hon. friend cannot put words into my mouth.


John Horne Blackmore: I am simply giving an illustration. If the Minister of Finance cannot follow figurative language, it is too bad.


Charles Avery Dunning: My hon. friend can use all the illustrations he likes, but he cannot put words into the mouth of an hon. member which that hon. member did not utter. I used the English language and nowhere did I use such words as those now attributed to me.


John Horne Blackmore: The point is this: The Minister of Finance argued that the A plus B theorem was faulty and there was no deficiency of purchasing power in the country as a result of industry. That is the same thing as saying that there was no need of electricity in the community. Why take all this trouble to create electricity? If that is not sufficient, I will take it all back. The trouble is the Minister of Finance did not allow me to finish what I was saying.
Speaking figuratively again, the next statement was that electricity will kill people, it will burn them-inflation.


Charles Avery Dunning: Who said that?


John Horne Blackmore: It was said that the new money would create inflation, that that would mean disaster and chaos. That is the same as saying that electricity would bum people and kill them.

Use of Canada's Financial Resources


Charles Avery Dunning: As long as it is clear that I did not say that, it is quite all right. My hon. friend is saying that, not I.


John Horne Blackmore: The next question
was that you cannot get a transformer, you cannot get a fuse plug to enable you to control the electric current after you create it. Therefore, do not create it. The objection there was to the just price.


Mr. McLEAN (Melfort):: Will my hon.
friend tell us now what he refused to tell us a few weeks ago? Who will be the transformers? Who will be the experts?


John Horne Blackmore: Would my hon. friend permit me to finish without interrupting? I do not remember the exact words of the Minister of National Revenue (Mr. Usley), but I got the impression that he was saying that the Minister of Finance had demolished completely our contention because he had brought in this A plus B theorem. The Minister of Finance demolished nothing by bringing that in. The hon. member for Acadia (Mr. Quelch) dealt unchallengeably with the A plus B theorem, as reported on pages 1304 to 1308 of Hansard. Any hon. member can turn up those pages and find what was said. If you turn to page 19 of the New and Old Economics you will find Major Douglas' reply to Professor Copland of Melbourne and Professor Robbins of London where the same argument is made.
Then about the banks in the west. The right hon. leader of the opposition (Mr. Bennett) made a remark which I think implied that we were endeavouring to discredit the banks. That is not the point at all. Our point in discussing the banks is to show that they create money, that they do not lend savings. The banks are teaching the people that they lend savings, and the fact is that they do not lend savings. As soon as the people realize that this is so they will begin to say, "Why should we owe and pay interest on this credit which they have created?" That is the first intelligent question about money that men will ask. In our discussion we have tried to show what money is, where it comes from, how it comes and what makes it. We used the banks as an illustration to make those points clear to our people.
I should like to turn again now to the amendment. No one can honestly contend under the circumstances that the government is using the monetary resources of the country as they could be used. The only means used by this government to put purchasing power into the hands of the people is through exports, as far as I can make out. We assume

that unless you practically throw great quantities of goods away in order to get rid of them, you cannot use any goods of that kind. Such an argument is a monstrosity. The only other means of providing purchasing power that we are using are relief, pensions, public works and rearmaments. I contend that we must use another .means to put purchasing power into the hands of the people.
In his speech the minister first of all proceeded to give us a fine outline of the banking system. I believe the people of Canada owe 'him thanks for doing that, because it is one of the finest things ever put before us by a public man in this dominion. I appreciated it tremendously. He then turned to a discussion of the proposals of the hon. member for Rosthern (Mr. Tucker), just as though they had something to do with my motion. Why bring him in? I was not ready to meet what had to be said about him. As a matter of fact, the proposal made by the hon. member for Rosthern is not a social credit proposal. His proposal has merit, but it also has its difficulties, and it is not social credit. He proposed that an additional amount of Bank of Canada notes be created to carry on projects of various kinds. The Minister of Finance applied the principle of ten to one to show that we could reach such a tremendous amount of deposits in the banks as six billions of dollars, and he said that that would immediately cause inflation. I will grant that a great amount of money in a country might cause inflation, but in the United States they have over ten billion dollars of gold hidden in their vaults, and is that causing inflation? Of course not. Why? Because it is being handled right. You do not have to have inflation just because you have great quantities of money.
Under our present set-up, money cannot possibly get into circulation unless someone will come and borrow it. At the present time we are told the banks are full of money, and they cannot lend it to anybody, and they will not lend it. The result is that they are buying more government securities. Now will someone who thinks he knows tell us how, if you had six times as much money in the banks as we have now, you could get any more people to come and borrow it or get any of the banks to lend it? It has not been proved; maybe it can be proved, but certainly it was not proved. The question is, who would get the money? And again, where would they invest it?
Next there was an attack upon social credit. I am not going to deal with that at all at the present time because there are other

Use oj Canada's Financial Resources
matters which need attention. We did not bring social credit into the debate at all. We did not even mention the words social credit -not once.


An hon. MEMBER:: Why not?


John Horne Blackmore: There is a scriptural quotation which could be used, but I shall not quote it now. We did not bring social credit into the debate at all because we had not reached the point where we were ready to consider the details of social credit. We were rather considering the question whether you could take the energy in our productive stream and convert it into money, because until you get that principle settled it is idle to take up other points of social credit.
Then the hon. member (Mr. Dunning) demanded concrete results. He said: These are only principles. But Mr. Speaker, before mankind could fly, you had to show men that it was reasonable to suppose they could fly, and we were simply discussing whether it was reasonable that Canada should be able to fly -that you could get electricity out of this great stream that is flowing by. That is what we were contending, and when that question is discussed openly, sincerely and frankly, hon. members will find that we shall be ready to take up other principles of social credit.
With respect to the speech of the Minister of Finance and the principles he enunciated, he said in the first place that money should be issued according to the needs of business. That is absolutely right, and I say that the real cause of the trouble in Canada to-day is that this government is not doing that very thing, and it cannot show that it is doing it. There is a great deal of agitation apparently for the purpose of making it appear that social credit principles are mysterious and difficult of understanding and all that sort of thing, that social credit would change everything, disrupt the whole of society. That is just pure nonsense. I am told that the Wright Brothers, in order to perfect the aeroplane, had to discover just one simple thing, and that was how to warp the tips of the aeroplane's wings. Everything else was there. And we contend, Mr. Speaker, that everything else that is necessary for social credit is here, that all that is required is just a slight change.


An hon. MEMBER:: What is that?


John Horne Blackmore: There will be plenty
of time to develop that. What business needs above all else in this country to-day is that there shall be markets. If you could manage 51052-119
to give an adequate dividend to every man in this country, you would take care of markets inside of a month; and if you bring in the just price principle you would take care of the problem of a stable price to a tremendous degree. To bring about prosperity we must have an even price level. The best thinkers realize, and have done so for hundreds of years, that you can take care of the price level mainly by the amount of money in circulation.
Next, business wants lower taxes. If the government could manage somehow or other to create money to finance some of the things which are breaking the backs of the taxpayers to-day, it would remove a great deal of t's trouble with business; and it can be done.
The question of inflation was also raised. I maintain, sir, that there is no inflation in the .social credit contention. Major Douglas has stated time and again that he is entirely opposed to inflation. The only way in which you can possibly prevent inflation is by the introduction of social credit. I know there are many people who will say that that is not so; but that is so. And if I had more time I could read quotations from great authorities who cannot be questioned. I will refer to just one on this point of inflation. I quote from Paul Einzig, the great world economist, in his book World Finance Since 1914, published in 1935, where at page 17 he says:
The more advanced definitions (of inflation) duly allow for any change in the volume of real wealth. Thus if the volume of currency and credit increases, and the production of real wealth increases in the same proportion, then there is no reason why the expansion of currency and credit should produce an inflationary effect.
Is not that just as clear as it could be for him who runs to read?
Money properly distributed does cause more goods and services to come into being; where there are plenty of goods the money can be expanded, and it must be expanded. Otherwise, you have a fall in prices; you have deflation. That can be proved by reference to any number of authorities right down to the present moment. I have not time to refer to them all, but I am going to refer to Paul H. Douglas, professor of economics at Chicago, and his book, Controlling Depressions, written in 1935. I will give hon. members the page number, to save time-page 137. There he points out that when you increase the money in circulation you automatically increase goods and services, because there are vast quantities of unused resources, great numbers of men unemployed, great amounts of productive equipment being only partly used, and the minute you distribute money

1882	COMMONS
Use oj Canada's Financial Resources
wisely and get it to the right people, you set your productive machinery into operation and make it possible immediately to issue more money without causing inflation. In Paul Douglas's book, at page 126, you will find another comment of the same kind.


Mr. SPEAKER:: The hon. member's time
is exhausted.


John Horne Blackmore: If I might have just a few minutes more, Mr. Speaker-


Some hon. MEMBERS:: Go on.


John Horne Blackmore: I appreciate greatly the courtesy and consideration of the house, Mr. Speaker. There is a great deal to be said. I know the members want the facts, and I am glad to give them.


Some hon. MEMBERS:: Time.


Walter Edward Foster: The hon. member ' has exhausted his forty minutes and can continue only with the unanimous consent of the house.


Charles Avery Dunning: Mr. Speaker, I think I was responsible for depriving the hon. member of five minutes of his time, but I do not think more than that.


Walter Edward Foster: By unanimous consent.


John Horne Blackmore: Thank you, Mr. Speaker. I had the impression that the house had given consent.
If hon. members will turn to G. D. H. Cole's Principles of Economic Planning, page 208, they will find the same principle set out there. The Minister of Finance assumed inflation. If you will go through his remarks with great care I believe you will find that every time he assumed inflation he at no time proved it. He told of the dangers that would come from inflation but he nowhere proved that inflation would come.
There is one other matter that I wish to deal with in the five minutes that have been granted to me; and if we are going to use the time let us use it without much disturbance.
A good deal was made of the question of the velocity- of circulation, and it was implied that social crediters are not aware of the principle of the velocity of circulation. That is entirely untrue. We have not discussed velocity of circulation simply because we have not got around to it. Let me read something that will interest the minister tremendously- a quotation from Professor Irving Fisher:
The latest and best studies on velocity show that in normal times it varies little; and even in booms and depressions its variations are much smaller than usually supposed, except for speculative transactions.
There are many people who imply that we quote out of context, and actually accuse us

of doing so, and for that reason I wrote to Professor Fisher, before quoting this passage, to ask him where it could be found. On March 19 of the present year he wrote me a letter in the course of which he said:
I do not now recall where the quotation from me on page 10 came from and I cannot now at this time make a search but it correctly states my views.
That is from Professor Irving Fisher of Yale, one of the world's great economists.
I have other material that bears upon the question, material of considerable force, but I have not the time to-day to discuss it. There is one question, however, to which I would refer here. Whenever the question of increasing money is brought up somebody rises and cries "Germany!" If hon. members will consult World Finance Since 1914 they will find at page 67 a complete statement explaining why Germany's issue of money failed. I contend that there is not one of those factors existing in Canada to-day-not one. Let hon. members read the book and form their own conclusion.
I greatly appreciate the extra time given me and the courtesy shown me. I submit that we were thoroughly justified in moving this motion of want of confidence in the government on the ground that, all things considered, the government has not adequately used the resources at its disposal to remove poverty from the midst of the Canadian people.


Mr. J. S. TAYLOR (Nanaimo):: I refuse to be associated with any hon. member in this house in the view that banks, whether chartered or central, can in practice elevate one cash dollar to ten dollars in credit, or do this in any other way than theoretically under present practice. I intended to speak on this and cognate matters, but the unusual progress of the debate precludes the possibility of that. I shall, however, bring my statements before the house on another suitable occasion.


Mr. CASSELMAN:: I was paired with the hon. member for Lambton West (Mr. Gray). Had I voted, I would have voted for the subamendment and for the amendment.


Mr. HARRIS:: I was paired with the hon. member for.Cartier (Mr. Jacobs). Had I voted, I would have voted for the subamendment and for the amendment.


Mr. EDWARDS:: I was paired with the hon. member for Middlesex West (Mr. Elliott). Had I voted, I would have voted for the amendment.
Main motion (Mr. Dunning) agreed to, and the house went into committee of supply, Mr. Sanderson in the chair.



SOLDIER AND GENERAL LAND SETTLEMENT

[Stage Direction]
To provide for payment to the government of the province of New Brunswick in accordance with the terms of the New Brunswick 500 British family amended agreement of April 30. 1935, in respect of (a) the indebtedness of settlers on farms taken over by the dominion government listed in the schedule attached to the said agreement to the extent provided in the said agreement and (b) the dominion government proportion of losses on interest under section 8 (b) of the agreement, $572,975.01.
Mr. BENNETT:: What is this about?


Thomas Alexander Crerar: In 1927 a tripartite arrangement was entered into between the federal government, the government of New Brunswick and the government of the United Kingdom for the settlement of certain British settlers in New Brunswick. Under that agreement the. New Brunswick government supplied the land and the British government, as I recall, supplied the money for equipment. The part played by the federal government was relatively small; my recollection is that it was confined to a share of the interest losses that might arise in the first two years. That arrangement continued until 1935, when a new agreement was made between the federal government and the New Brunswick government under which the federal government in effect purchased the land from the New Brunswick government, covered by such settlers as were still on farms at that time. The understanding was that the New Brunswick government would be paid by the federal government as collections were received from these settlers. During the difficult period since then the payments have not come in from the settlers except in very small degree; consequently the liability is still outstanding to the government of New Brunswick so far as the federal government is concerned.

Supply-Soldier Land Settlement
There is this further aspect of the matter, that we are paying five per cent interest on our obligation to the government of New Brunswick, and it has been considered advisable that it be closed out as at March 31, which is to-day. This vote is necessary for that purpose. I might add that originally there were 359 settlers, of whom 240 are or were recently still on these farms in New Brunswick. Of the amount of $572,975.01 the sum of $521,000 was really principal as at the time in 1935 when the new agreement was made. The balance represents accrued interest from that time to the present.


Richard Bedford Bennett: The amount was in fact borrowed, was it not, by New Brunswick in the first instance on their credit; then they bought the farms and sold them to the settlers?


Thomas Alexander Crerar: I cannot say whether the amount was borrowed.-from the federal government?


Richard Bedford Bennett: No, borrowed from the public.


Thomas Alexander Crerar: That is correct. At any rate New Brunswick found the money in 1927 to carry out its part of the bargain, either by taxation or by borrowing.


Richard Bedford Bennett: I was wondering whether we should take any steps to see that the money we thus pay goes to liquidate the outstanding obligations, because the money was borrowed for that particular purpose.


Thomas Alexander Crerar: Just offhand I think that
might be inadvisable. New Brunswick might charge us with an undue interference in their affairs.


Richard Bedford Bennett: I was just wondering
whether there was anything in the nature of a trust as far as they were concerned with respect to that money.


Thomas Alexander Crerar: No, I understand not;
but after all the responsiblity is with the province of New Brunswick to look after its own financial obligations.


Mr. STIRLING:: As this may be said to come under the head of assisted passage schemes, in view of what the press has told us in the last few days with regard to Canberra, that the Commonwealth of Australia is prepared to discuss the further use of assisted passage schemes, would the minister be prepared to make any statement with regard to the views of the government concerning such schemes?


Thomas Alexander Crerar: I am not prepared at the
present time to make any definite statement
on that question. Of course that does not relate to the item under consideration.


Grote Stirling: This was an assisted
passage scheme?


Thomas Alexander Crerar: Not in the ordinaiy sense. It was the result of a three-cornered arrangement entered into between the federal government, the New Brunswick government and the British government in 1927. Under that agreement I presume possibly some assistance might have been given in regard to passage. I could not say.


Grote Stirling: Yes, there was some
assistance.


Mr. MacINNIS:: Is the amount being
provided now the total cost to the government?


Thomas Alexander Crerar: No, it is the total amount of our obligation to the New Brunswick government. If my hon. friend's question is whether or not this is the total cost to the federal government, the answer is in the negative. What losses will ultimately accrue to the federal government when the scheme is finally liquidated cannot be determined at this time.


Mr. DOUGLAS (Weyburn):: Has the minister the total cos.t to the federal government to date?


Thomas Alexander Crerar: The total cost of this
New Brunswick family scheme?


Thomas Clement (Tommy) Douglas: Yes.


Thomas Alexander Crerar: No, I do not know that
I can give that information at the moment. This item, of course, has nothing to do with losses up to date. It deals with the carrying out of an arrangement made with the government of New Brunswick. The other information for which my hon. friend asks of course can be made available when the ordinary soldier settlement estimates are before the house.


Richard Bedford Bennett: The effect of the agreement was that we took over the liability of New Brunswick, which amounted to about $1,450 per farm, or thereabouts. We have taken their place, but instead of paying the purchase price in instalments the minister is providing this lump sum to defray the whole cost, and New Brunswick no longer has any interest in the lands.


Thomas Alexander Crerar: Quite.


Mr. BROOKS:: The minister said there were 359 settlers who came under this scheme and that 240 were still on the land. That would leave 114 vacant farms. What dis-
1S86

Supply-Soldier Land Settlement
position has been made of these vacant farms, and how many are still vacant?


Thomas Alexander Crerar: I am afraid I cannot give
that information. I did not come prepared to answer a question of that type, or a question such as that asked by the hon. member for Weyburn. That information will be available when the ordinary soldier settlement estimates are before the committee. I repeat that this item is not concerned with losses on farms. It provides an amount to satisfy the obligation to the New Brunswick government which the federal government assumed when the arrangement was made in 1935.


Alfred Johnson Brooks: These farms are being handled under the soldier settlement board, are th^y not?


Thomas Alexander Crerar: That is correct.


Alfred Johnson Brooks: And they make practically the same disposition of a vacant farm in connection with this scheme as they would under the soldier settlement board?


Thomas Alexander Crerar: Yes.


Richard Bedford Bennett: They are not under the same statutory obligation.


Thomas Alexander Crerar: No. We assumed all obligations in connection with the farms taken over in 1935, and that involved the total number of farms on which settlers at that time still remained.


Richard Bedford Bennett: Or had defaulted.


Thomas Alexander Crerar: If there were any cases of default up to 1935-that is, where the settler had left the land,-we did not assume responsibility. We assumed responsibility simply where settlers were still upon the land.


Richard Bedford Bennett: Occupying the farms.


Thomas Alexander Crerar: Yes.


Mr. SPENCE:: The minister said a moment ago that 359 people came out under this scheme to New Brunswick. Did he mean 359 people or families?


Thomas Alexander Crerar: Three hundred and fifty-nine settlers.


James Houston Spence: Sometimes there are ten or eleven in a family, and sometimes only five or six.


Thomas Alexander Crerar: There were three hundred and fifty-nine settlers. Whether or not some
of them were bachelors, I cannot say.


James Houston Spence: 
Thomas Alexander Crerar: At any rate that is the number of settlers.


Thomas Clement (Tommy) Douglas: When the item is paid, what assets or security will the government have with respect to those farms?


Thomas Alexander Crerar: It has a claim against the settlers who were still resident on the land at the time the arrangement was made, in 1935.


Richard Bedford Bennett: Their contract.


Mr. MacNICOL:: Is the matter concerning Lieutenant Frank Murphy, which I brought up some time ago, included in the item, or shall I have to wait until the other estimates are under consideration?


Thomas Alexander Crerar: The matter to which the hon. member refers is one which might more properly be discussed when the general soldier settlement estimates are before the house. This item deals not with the general problem, but simply with carrying out the arrangement in New Brunswick.


Angus MacInnis: Are those settlers selfsupporting now?


Thomas Alexander Crerar: I am afraid some of them may not be, but I cannot give the information at this time.


[Stage Direction]
Item agreed to.

[Stage Direction]
Railwaj' Service-Maritime Freight Rates Act: additional amount, in excess of the sum of $1,800,000 already appropriated, to authorize and provide for the payment from time to time during tlie fiscal year 1937-38 to the Canadian National Railway Company of the difference (estimated by the auditors of the said company and certified by the said auditors to the Minister of Transport as and when required by the said minister) occurring on account of the application of the Maritime Freight Rates Act, between the tariff tolls and the normal tolls (upon the same basis as set out in section 9 of the said Act with respect to companies therein referred to) on all traffic moved during the year 1937, under the tariffs approved, on the eastern lines (as referred to in section 1 of the said Act) of the Canadian National Railways, $587,505.81.
Richard Bedford Bennett: Does this mean that there was increased traffic which necessitated the payment of a larger sum than that estimated last year?


Clarence Decatur Howe: Yes, that is the reason.


John Ritchie MacNicol: Has it anything to do with subventions on coal from the mari-times?


Clarence Decatur Howe: No. Subventions on coal is an entirely different matter.


[Stage Direction]
Item agreed to.
[Stage Direction]
Supply-Transport-Railways
Additional amount in excess of the sum of $700,000 already appropriated to provide for payment from time to time during the fiscal year 1937-38 of the difference, estimated by the Board of Railway Commissioners and certified by the said board to the Minister of Transport as and when required by him, occurring on account of the application of the Maritime Freight Rates Act, between the tariff tolls and the normal tolls (referred to in section 9 of the said act) on all traffic moved during 1937 under the tariffs approved by the following companies:	Canada and Gulf Terminal
Railway; Canadian Pacific Railway, including: Fredericton & Grand Lake Coal & Railway Company, and New Brunswick Coal and Railway Company; Cumberland Railway & Coal Company: Dominion Atlantic Railway; Maritime Coal, Railway & Power Company; Sydney & Louisburg Railway; Temiscouata Railway Company, $94,951.96.
Clarence Decatur Howe: This is a similar vote, with the exception that it is for the Canadian Pacific and other railways.


Alfred Johnson Brooks: How does the item compare with the same item last year?


Clarence Decatur Howe: It is larger than last year's item, due to the larger volume of traffic which has been moving in the maritimes during the past year. Of course this is a statutory item and quite uncontrollable. The amount of it depends entirely on the volume of traffic moving in the region to which the rate is applicable.


Alfred Johnson Brooks: This afternoon in explaining the conditions surrounding the laying off of men in other parts of Canada the minister stated that the union in Moncton did not agree to the lay-off. He also said there were not as many men to lay off at that point, due to the increased traffic on railways in the maritimes. Does he expect that increased traffic to continue after the closing of the winter ports at Halifax and Saint John, or will there be a considerable lay-off after the closing of those ports?


Clarence Decatur Howe: There will be no additional lay-off of shop men on account of the closing of the winter ports. The lay-off there is timed to coincide fairly well with the closing of the rush business.


[Stage Direction]
Item agreed to.
Hudson Bay railway: amount to provide for the difference between expenditures for operation and maintenance and revenue accruing from operation during the year ending March 31, 1938-further amount required, $40,000.
Richard Bedford Bennett: I should like to make it clear that we would like to discuss the whole question in connection with the operation of the Hudson Bay railway when the estimates for the ensuing fiscal year are before the house.
There is no reason for going into the discussion now and again at that time.


Clarence Decatur Howe: That is understood.


[Stage Direction]
Item agreed to.
Interest on rails rolled for Canadian National Railways: to provide for payment under the terms and conditions of orders in council P.C. 1462 and P.C. 1533 of June 7, 1935, respecting orders of steel rails for Canadian National Railways-further amount required, $11,110.50.
Mr. HEAPS:: What amount of rails is lying idle at Sydney? Evidently there must be a large quantity if the interest in a short period of time amounts to the large sums mentioned in this and following items. Is there any possibility that the rails which have been manufactured and rolled will be utilized in the immediate future?


Clarence Decatur Howe: The difficulty in connection with the balance of the order is that more rails of 130 pounds per yard were rolled than the railway has been able to use. Practically all that are left are 130-pound rails. The original order was 40,000 tons to the Dominion Steel and Coal Corporation Limited and
40.000	tons to the Algoma Steel Corporation.


Richard Bedford Bennett: That is all main-line steel, and it is not used because it is not required?


Clarence Decatur Howe: That is correct. It has not been required in connection with maintenance.


Abraham Albert Heaps: What is the value of the steel?


Richard Bedford Bennett: It would figure out to about $1,360,000.


Clarence Decatur Howe: I have not the exact figure, but there are 15,000 tons in one shop and
19.000	in the other, and the price is $42 per ton.


Abraham Albert Heaps: I believe this order was given to provide work in the steel mills of Nova Scotia?


Richard Bedford Bennett: And the Sault.


Abraham Albert Heaps: I have no objection to a policy of that kind being adopted within reasonable limits. But if orders are given in excess of requirements I believe there will be adverse reaction all the way round. From what the minister has said it will be some considerable time before the rails so produced in those mills can be used by the Canadian National Railways. In the meantime there must be considerable loss by deterioration. Although I do not know how fast steel will deteriorate, the minister's engineering experience may place him in a position to tell us.


Clarence Decatur Howe: The steel is not allowed to deteriorate. There is no difficulty at the

Supply-Transport-Railways
Algoma plant, but at Sydney there has been some rusting and pitting. There is an item, No. 448, to pay for rubbing the steel down, removing rust and oiling the rails. The difference between conditions at the Sault and at Sydney are purely climatic; at one point there is moist salt air, and at the other the air is dry.


[Stage Direction]
Item agreed to.
To authorize the writing off to consolidated revenue fund of the amount of $53,895.18, being the amount charged to the Canadian National and the Canadian Pacific railways, and representing the difference between the six per cent sales tax on which their contracts for railway equipment ordered under the provisions of the Supplementary Public Works Construction Act, 1935, were based, and the eight per cent sales tax imposed by chapter 45 of the Statutes of 1936: Canadian National Railways. $24,394.34; Canadian Pacific Railway, $29,500.84; total, $53,895.18.
Richard Bedford Bennett: Is it necessary to come to parliament for this item? Is there not power to remit the tax? The sales tax was increased from six to eight per cent and we are being asked to take care of the extra two per cent. Would not it be possible to deal with this under the finance and audit act?


Clarence Decatur Howe: As my hon. friend is probably aware, the Department of Justice has always taken the view that a contract entered into prior to the date the increase in the sales tax became effective, is not adjustable to provide for such increase. I think that is why our law officers have decided that this should oqme to parliament.


Richard Bedford Bennett: I do not think it is necessary, but it is all right.


Mr. HAYHURST:: Is the eight per cent sales tax added to the manufacturers' or wholesale price?


Clarence Decatur Howe: To the manufacturers' price.


[Stage Direction]
Item agreed to.

[Stage Direction]
Canadian National Railway Company-Additional amount, in excess of the sum of $35,000,000 already appropriated, and the sum of $6,890,000 authorized by governor general's warrant. to be paid from time to time, under such conditions as the Minister of Finance may prescribe, to the Canadian National Railway Company (hereinafter called "the National Company") and to be applied by the National Company in payment of the deficit arising in the calendar year 1937, including such supplementary contribution to the Intercolonial and Prince Edward Island railway employees' provident fund as may be necessary to provide for payment in full of monthly allowances under the provisions of the Intercolonial and Prince Edward Island Railway Employees' Provident Fund Act, notwithstanding the limitation con-
[Mr. Howe.l
tained in section four of the said act, and including such supplementary contribution to the Grand Trunk Railway of Canada superannuation and provident fund as may be necessary to enable payment to be made of monthly allowances under the rules and regulations of the fund, notwithstanding the limitation contained in section thirteen of chapter sixty-five of the statutes of Canada, 1874, but not including amounts charged to proprietor's equity of the national railway system as defined in chapter twenty-two of the statutes of Canada, 1937, $455,867.99.
Richard Bedford Bennett: There will be a good deal of discussion in connection with some of the items in these supplementary estimates, especially the $6,890,000 authorized by governor general's warrants. It will be remembered that $35,000,000 was provided by the statute of last year and was dealt with in the special railway committee. I suggest that the item be allowed to pass on the distinct understanding that when the other matters are before the committee, we can discuss this matter as though it had not been discussed at all.


[Stage Direction]
Item agreed to.
Trans-Canada Air Lines-To hereby authorize and provide for payment from time to time during the fiscal year 1937-38 to Trans-Canada air lines, to be applied by the said Trans-Canada air lines in payment of the deficit (certified by the auditor of the said Trans-Canada air lines to the Minister of Transport as and when required by the said minister) resulting from the operations of the said Trans-Canada air lines during the calendar year 1937, $111,005.07.
Richard Bedford Bennett: We shall want to make
some observations in connection writh this item. The minister will remember that we were in the midst of a discussion with respect to the air lines when the vote was before the committee. We were inquiring about the operations of last year, and at that time the minister was not in a position to give us the information. It will naturally take some time to discuss the whole situation in connection with the deficit. If the principle I have suggested is adopted and no question is raised as to our discussing this matter when the main estimates are up, there is no reason why we should delay the passing of the item.


Clarence Decatur Howe: I shall be glad to discuss this item at that time.


[Stage Direction]
Item agreed to.
National Harbqurs Board-to provide for payment to National Harbours Board of the amount of the deficit incurred in the calendar year 1937 in the operation of Prescott elevator, $23,858.32.
Richard Bedford Bennett: This item will be the
subject matter of a long discussion. If it is

Supply-Labour
understood that the passing of this item at this time is without prejudice to our right to discuss the operations of the past year, there is no reason why it should not pass. I am afraid it would take a long time to discuss it now.


[Stage Direction]
Item agreed to.

[Stage Direction]
Conciliation and Labour Act-further amount required, $13,000.
Richard Bedford Bennett: Perhaps we might have
an explanation of this item.
Hon. NORMAN McL. ROGERS (Minister of Labour):	This item is accounted for by
additional cost of printing, more particularly in connection with the Labour Gazette and supplements thereto which are published ordinarily at this time of the year. It was assumed that we would be able to meet the requirements of these publications for an amount less than has actually been necessary. The increase in cost is due in part to the fact that certain statistics which are published as a matter of record in the Labour Gazette have required additional printing. During the same period it has been found necessary to employ additional temporary employees, and these two considerations are responsible for the additional amount of $13,000.


Richard Bedford Bennett: Would the minister
break down the item?


Mr. ROGERS:: It is estimated that the
printing accounts for January, February and March, chargeable to this vote, will be as follows:
January	$ 1,900
February	 3,600
March (estimated)	 8,400

Of the S35,000 voted in the main estimates there remains available a balance of approximately S900. Therefore, the estimated requirements to March 31 total $13,000.


Abraham Albert Heaps: I had intended raising a question under this item on a subsequent occasion, but I think it is well to take advantage of the first opportunity that presents itself to deal with one aspect of conciliation which I think is of considerable interest. I am sorry I could not give the minister advance notice of my intention to raise this question as in that event he probably would have had full information before him. My question concerns a dispute between the employees and the management of the Canadian Press which has been pending for some time. It seems
that they are farther away from settlement at the present time than they were when the dispute first started several months ago. From information I have received it appears that the management has taken rather a highhanded attitude toward the employees and has refused consistently to recognize their organization. I have seen their representatives who have been in touch with the Department of Labour; but it seems that there are certain formalities to contend with, which, instead of having the effect of bringing the parties to a closer agreement have had the tendency of creating difficulties in the attainment of that particular objective.
The Canadian Press is a semi-public organization, and we would have thought that its management would have set a better example to the rest of the country than it has. Difficulties have been placed in the way of the employees organizing, and the employers will not recognize the organization or union which has been formed. In December of last year the employees sent a memorandum to the employers, and in view of the fact 'hat there is before parliament a bill introduced by the leader of our group, having a direct bearing on this question, perhaps it would not be out of place if I read a few extracts from the memorandum. This is a memorandum prepared by the employees and submitted to Mr. Livesay of the Canadian Press:
This committee, representing your telegraph employees, requested this conference for the purpose of formally seeking acknowledgment and recognition of our right to organize and to bargain collectively with the Canadian Press through representatives of our own choosing.
And further:
_ To reach this common ground we believe it is essential the employees be organized, as the Canadian Press is organized, to permit representatives from both sides to meet as occasion warrants to discuss and agree upon terms of employment.
To reach this common ground we believe it is essential the employees be organized, as the Canadian Press is organized, to permit representatives from both sides to meet as occasion warrants to discuss and agree upon terms of employment.
However, we believe you will agree with us when -we say that the Canadian Press has been organized and developed primarily in the interests of its members who make up the Canadian Press. In other words, for the benefit of the employer.
We believe our desires in these respects can only be properly approached and considered if we are organized and are granted the right to bargain collectively through our chosen representatives.
That is why we respectfully request the Canadian Press to approve our right to organize and to extend us the right to bargain collectively.
Supply-Labour

Further on in the same submission they state:
We believe a union agreement between the Canadian Press and the employees will prove mutually beneficial.
Such an agreement, when negotiated, would represent the best possible conditions and terms of employment that can be established.
I could go on and give quite a number of similar quotations from the submission of the employees asking their employers to recognize the fundamental right of the employees to organize into a union of their own choice. This submission, which was made to the employers on December 7 last, was refused by the company, and now, as a result of the terms of the conciliation act as it stands at present, the employees are compelled to take a strike vote before the Canadian Press need agree to a board of conciliation being appointed.
I should like to state the case of the employees in a little more detail to show what a strong case they have for organization. In Canada, employees in certain categories who are known as junior punchers receive an average wage of approximately S22.50 a week, and senior punchers receive approximately $30 a week. In this country their hours of labour are forty-eight hours' a week. I want to compare these wages with those paid in the United States, and give the hours of work there. Wages for junior punchers in the United States are $45 a week, as against $22.50 a week in Canada, and senior punchers in the United States receive $52.50 a week as against $30 a week in Canada. In the United States they work from 36J to 41 hours a week, as against 48 hours a week in Canada.
The men who are asking for recognition of the right of the employees to bargain collectively are members of' the same international trade union as those who receive these tremendously higher rates of wages in the United States. But when the employees in this country attempt to band themselves together for the purpose of submitting their claims collectively to the Canadian Press, they are met with all kinds of obstacles, technicalities and difficulties when they request that a board of conciliation be appointed. I understand from the information which I have received, and which I think is reliable, that the Canadian Press has refused to accept a board of conciliation until such time as the employees have taken a strike vote on whether they will go out on strike to enforce improved conditions of employment.
One point I am trying to make is that I do not think it should be necessary for the employees in their organization to be com-

pelled to go to the length of taking a strike vote before the Department of Labour will grant a board of conciliation. If a strike vote is forced on the employees, it only tends, I think, to create greater difficulties subsequently than would be the case if the board of conciliation were appointed without this necessary formality of a strike vote. I know the viewpoint of the department, and I am quite sure that had they been in a position to grant the employees a board of conciliation without a strike vote being taken, this would have been done. But in view of the circumstance that the department is not in a position to grant a board of conciliation in this case without the formality of a strike vote having first been taken, I would ask the minister if some ways and means could not be found of amending the existing act or regulations to give the department power to grant a board of conciliation without this formality of the employees having first to take a strike vote.


Norman McLeod Rogers: As my hon. friend has just stated, he advised me only a moment ago of his intention to bring up this question at this time. It is quite true that there has been a dispute between the Canadian Press and some of its employees.


Richard Bedford Bennett: What class of employees?


Norman McLeod Rogers: The teletype operator. It was the hope of the department that it would be found possible to settle this dispute by direct negotiation. As a matter of fact, it is my own view that whenever these disputes can be settled by direct negotiation and collective bargaining, it is desirable that they should be so settled. But as my hon. friend has stated, apparently there has arisen a difficulty which is not capable of settlement by direct negotiation, and application has been made for a board of conciliation under the Industrial Disputes Investigation Act. That application is now pending, and I am sure it will not be expected that I should make any statement at this time with respect to the merits of the controversy. That would be wholly improper, but I can assure my hon. friend that the application will be dealt with on its merits. Certainly there has been no intention on the part of officials of the Department of Labour to place obstacles in the way of having this application granted.
As perhaps members are aware, it is necessary, in order to avoid the setting up of boards sometimes for frivolous purposes, to require that certain declarations shall be made in connection with the application, and one of those declarations is to the effect that

Supply-Labour
unless the dispute is adjusted or a board is set up there is a reasonable and probable belief that a strike will ensue. That, after all, is the reason why the Department of Labour sets up a board in such cases, to prevent a strike in industry.


Mr. WOODS WORTH:: Is that equivalent to what is known as a strike vote?


Norman McLeod Rogers: A strike vote is commonly taken. I can assure my hon. friend of that, although I have not the statute before me. As perhaps will be recalled, a strike vote was taken at a later stage in connection with the dispute last year between the railway companies and their employees. I should like to say, however, that under the Industrial Disputes Investigation Act a board can be set up without the consent of both parties. As a matter of fact, that has been done within recent months in a dispute which arose in the Minto coal fields. At the same time it is always desirable that both parties to a dispute should cooperate in selecting the personnel of the board. I am sure my hon. friend will appreciate the importance of that, and therefore the department believes that if and when this board is established, it will have the full cooperation of the management of the Canadian Press with respect to the nomination of a representative of the employers concerned.


Abraham Albert Heaps: I would emphasize that I have no complaint at all in this particular case against the Department of Labour.


Norman McLeod Rogers: I am just making the point that the application is pending and will be dealt with on its merits.


Abraham Albert Heaps: Has the department, in the minister's opinion, the legal right to establish a board against the consent of one of the parties to the dispute?


Norman McLeod Rogers: What can be done under one section of the act is to set up a board on the initiative of the minister. When that is done, we still ask both parties to the dispute to make their nominations to the board; but if one of the parties should refuse, that nomination can be made at the instance of the Minister of Labour. I mention that because that situation arose in recent months in connection with the dispute at Minto. The board was set up by the minister. The employers concerned declined to make a nomination, and the nomination was made by the minister in order to complete the personnel of the board.


Abraham Albert Heaps: Have any objections been raised?


Norman McLeod Rogers: In the Minto case objections were raised, but they were not pressed. The board was set up and has functioned.


Richard Bedford Bennett: The Snider case made it clear that jurisdiction with respect to some phases rests entirely with the provincial authority.


Norman McLeod Rogers: Yes.


Richard Bedford Bennett: It would be competent for the province to set up a board under the decision in the Snider case. We are operating under a sort of modus vivendi so far as the general application of the act is concerned.


Norman McLeod Rogers: After the decision in the Snider case was rendered, the provinces passed enabling legislation.


Richard Bedford Bennett: Not all of them.


Norman McLeod Rogers: Not all of them, but the majority did; and it is under that enabling legislation that the Industrial Disputes Investigation Act has functioned with respect to provincial undertakings or public utilities operating wholly within the boundaries of one province.


Thomas Langton Church: This act is not as useful as it used to be in industrial cities. For example, three people came to me with regard to applications. There is concurrent jurisdiction, the Ontario government having a department that does almost similar work. That department uses the conciliation and labour office for the same purpose. Has there been any overlapping since last year or the year before? I thought there would be a good deal less work. I had some correspondence with the labour department, and they referred me to the labour and conciliation department of the province. I wonder if there has been any falling off in applications from, 'say Toronto.


Norman McLeod Rogers: I have not that information before me at the moment; but I would say that as a result of the setting up of conciliation services in the larger provinces, particularly in Ontario and Quebec, there has been a moderate reduction in the work done by the conciliation officers of the federal Department of Labour. There are quite obvious reasons for that change. In both Ontario and Quebec, within recent years boards have been set up to deal with the regulation of wages. That has established a much closer contact between provincial authorities and labour and industry in general. Not only that, but some of the disputes that occur are referable in part to decisions which have been given by fair wage boards in the provinces. In this connection I might refer to the fact
Supply-Labour

that disputes have recently occurred in Cornwall in the plant of Canadian Cottons, due in some part to a misunderstanding with respect to wage regulations which were put into effect by the wage and labour board of Ontario. The dominion Department of Labour enters a dispute at the invitation of the parties concerned. It is always ready to send a conciliator to deal with a dispute under those conditions; but where a dispute occurs in a province that has its own conciliation service, we do not as a rule intervene when the conciliator of the provincial department is dealing with the situation. I think the reasons are clear why it is not desirable that there should be intervention under such circumstances. We try to avoid duplication and conflict as between the services of the two departments. The chief interest of both departments is, of course, to settle disputes; the desideratum is cooperation between the departments involved.


Richard Bedford Bennett: One is a compellable jurisdiction and the other is not.


Norman McLeod Rogers: Yes.


[Stage Direction]
Item agreed to.
Employment Offices Coordination Act-further amount required. $2,000.
John Ritchie MacNicol: What cooperation is there between the minister's department and similar departments in the provinces?


Norman McLeod Rogers: This item calls for an additional expenditure in the administration of the act. The additional amount is explained by the further printed forms which were required for distribution to the various employment offices throughout the country. Under the act the dominion government, through the head office, supplies forms to all employment offices, and during the past year there has been an unusually heavy demand. There is not a dominion employment service distinct from the employment service that operates in the various provinces. The employment service of Canada is provided for under the Employment Offices Coordination Act, which provides for an annual grant of $150,000. This amount is paid to the various provinces to assist them in establishing or maintaining a coordinated system of employment offices across the dominion.


Richard Bedford Bennett: Following the judgment of the supreme court, they were provincial and we undertook to assist them.


Norman McLeod Rogers: The function has always been recognized as a provincial one; but after a number of employment offices were established in several provinces, it was decided that it would be of advantage to have the

various services coordinated, and in 1918 this was brought about under the Employment Offices Coordination Act. From that time forward the dominion government has paid a grant in aid of $150,000, divided among the several provinces to assist them in maintaining employment offices. The dominion branch is a clearing house for information and assists in the transfer from one province to another of those seeking employment. It provides forms to all employment offices, so that one might say that the service is cooperative in character.


[Stage Direction]
Item agreed to.

[Stage Direction]
Public Printing and Stationery-codifying and printing 3,000 copies of the revised edition of the criminal code, 1927, English, $4,041.77.
Mr. MALLETTE (Translation):: Is this
item No. 453 for the reprinting of the code?


Hon. FERNAND RINFRET (Secretary of State):: The criminal code is revised periodically. This amount is for printing 3,000 copies to be distributed in part in accordance with an order in council, the rest being sold to the public at $3 a copy. There is also a French edition, which was reprinted about a year or two ago.


Richard Bedford Bennett: What was paid for codifying the code, and to whom?


Louis Édouard Fernand Rinfret: Three hundred dollars, to Mr. Ollivier, the law clerk of the House of Commons.


[Stage Direction]
Item agreed to.
Miscellaneous-Patent Record, further amount required, $3,500.
Louis Édouard Fernand Rinfret: Last year's vote was reduced by $4,800, and we find that we shall need $3,500 to complete the year. We cannot say in advance the number of drawings and applications that we shall have to print in the Patent Record. There will be still a saving of over $1,000?


Mr. STEVENS:: Would the minister at some later date in the session make a statement as to the condition of the patent records? I am informed that the filing, classification and proper recording of patents are hopelessly in arrears. This may be due to lack of staff; it may be due to a huge number of applications for trivial matters scarcely to be classified as discoveries or inventions; but I am informed that the condition of the office records is such that officials have virtually thrown up their hands, and trust to the chance of the moment for the discovery of whatever is asked for. This is a serious matter, as there

Supply-M iscellaneous
may be occasions when bona fide inventions have been made and application for patent filed, and others discovering something of the same kind, or perhaps seeking to copy it, also are filing applications, with the result that the original applicant may lose his right because of the improper condition of the records. It may be unfair to ask the minister to answer at the moment, but he might get the information and give it to us at a later date on the main estimates.


Louis Édouard Fernand Rinfret: I appreciate my hon. friend's action in not pressing his point now. I think we all desire to expedite these supplementary estimates. We are fully aware of some conditions to be improved in the patent office. We have for the last year or so divided the work of the patent office from that of trade-marks; only a few weeks ago by order in council the trade-marks branch was transferred under a separate official in order to obtain as far as possible the very end my hon. friend has just mentioned. I shall be pleased on another occasion to supplement this information by a full statement.


[Stage Direction]
Item agreed to.
Adjustment of war claims-Department of the Secretary of State, $13,990.78.
Mr. STEWART:: Would the minister give an outline of this item?


Louis Édouard Fernand Rinfret: I may explain that this item' represents, not the payment of war claims, but additional legal costs incurred to cover the extradition and prosecution of Freeman Hatfield in connection with the loss of the Gypsum Queen and also in the case of Rex v. Logan in the same connection.


Richard Bedford Bennett: How much money was recovered from Hatfield?


Louis Édouard Fernand Rinfret: The amount that was recovered was $23,013.48, and I must say that the total litigation cost will far exceed that amount. The matter is not yet closed, because there is before the supreme court an appeal in which judgment has not been rendered.


[Stage Direction]
Item agreed to.

[Stage Direction]
Government of the Northwest Territories-
Expenses connected with the administration of the territories-further amount required, $15,000.
Richard Bedford Bennett: Would the minister give a short statement of how this amount is made up?


Thomas Alexander Crerar: A year ago the vote for the
Northwest Territories was underestimated, or rather there developed in the territories conditions that were not foreseen. About half of this vote is for relief purposes, to Indians, white residents and Eskimos in the territories, and the other half is for increased hospitalization costs for the Indians and other residents of that territory.


Richard Bedford Bennett: Will the minister give particulars of that when the main estimates are up?


Thomas Alexander Crerar: Yes; I can do that.


[Stage Direction]
Item agreed to.
Miscellaneous-To provide for payments in connection with movements of coal under conditions prescribed by the governor in council- further amount required, $275,000.
Richard Bedford Bennett: More tons of coal at
the same rate?


Thomas Alexander Crerar: Precisely. It was underestimated last year, or in other words there was a heavier movement than anticipated.


[Stage Direction]
Item agreed to.

[Stage Direction]
Fruit-further amount required, $15,081.05.
Hon. J. G. GARDINER (Minister of Agriculture):: Some hon. member asked
lor particulars regarding this vote when it was first brought up. The extra expenditure is made necessary, partly, because of movement of fruit this year to the western provinces as a result of the drought. There were extra expenses for inspection in connection with that movement.
An analysis of the fruit branch vote and the expenditures to date indicates that expenditures to the end of the fiscal year will exceed the amount provided in the vote by $15,681.05. The causes of the unexpected deficit are expenditures which could not be foreseen when the 1937-38 estimates were prepared. The estimated cost of inspection of fruits and vegetables purchased for drought relief accounts for part of it, and unavoidable expenditures which were not foreseen and provided for in 1937-38 estimates, for the other part.
In the cooperative arrangement with the bureau of economics, United States Department of Agriculture, it was arranged that there should be an interchange of inspectors for short periods of time so that our inspectors located at the principal markets might learn at first hand the United States interprets-
Supply-Agriculture-Fruit

tions of their grades and methods of inspection, and similarly United States inspectors might obtain knowledge of Canadian grades and inspection methods. As a part of this arrangement, senior inspectors McNiven and Jackson spent a period of time on the Boston and New York markets, at a cost of $285.25 to the department.
Cable, telegraph and telephone expenditures were higher than normal, as our collection of information regarding supplies and market trends for the use of the Department of National Revenue in its application of dumping duties was greatly increased over the year before. The appointment of an arbitration board to pass on complaints made by shippers, carriers or receivers under the icensing regulations provided for the appointment of outside members and the payment of any expenses incurred by them in attendance at meetings, and a daily stipend for all members other than government employees. It was estimated that these expnditures would approximate $500 for the current year.
These unforeseen expenditures, including estimated amounts, total $10,181.54.
Our experience this year indicates how difficult it is to estimate closely for our needs. For a number of years the fruit branch has been able to return a surplus to the treasury, and has consistently reduced its estimate, the 1937-38 vote being the lightest in a number of years. In 1937, crops were heavy, particularly apples, with the result that our inspection staff had to be maintained at strength for a period longer than usual. To indicate the increased amount of work, it might be pointed out that during the nine months ended December 31, 1937, 27,950 commercial inspections were made, as compared with 23,433 during the corresponding period of the previous year.
In order that we may meet our expenditures for the remainder of the fiscal year the additional amount of S15.681.05 is required. The total is made up as follows:
Drought relief project:
758 carlot inspections of fruits and vegetables at one day per car;
758 days at $5 per day	 $3,790 00
Additional expenses in connection with above based on average transportation and meal expenses per commercial inspection; 758
days at $1.50 per day	 1,137 00
Communication expenses-head office:
Telegrams	$410 24
Telephones	 162 27

	572 51

In connection with the other extra inspection work the details are as follows:
Western Ontario
1	Inspector, salary	$	945 00Expenses to December 31	
394	262	Inspectors (highway inspectionGravenhurst) salaries	
722	88$	2,062	14
Eastern Ontario
1 Inspector, salary	
1,302	10Expenses to December 31	
761	46Estimated January 1-March 31..	100	001 Stenographer grade 1 appointment, August	
438	00$	2,601	56
Northern Ontario
1 Inspector, salary	
1,431	61Expenses to December 31	
699	98Estimated January 1-March 31..	300	00$	2,431	59
Technical equipment, ordered in 193637, but not delivered in time to
be paid out of that vote	 1,051	00
Special grant for purchase of equipment to be used in research connected with maple syrup problem 750 00 Exchange of inspectors - arrangement with U.S. Department of Agriculture, McNiven & Jackson
to Boston and New York	 285	25
Cables, telegrams, telephones-
Dump duties and export control
regulations, estimated	
500	00Arbitration board-estimated expenditures	
500	00Total	$10,181	54
This amount, together with the amount for the special inspection of fruit purchased for western delivery, totals $15,681.05. I may say that the expenditure of $1,000,000 in connection with fruit and other supplies for Saskatchewan comes under another vote in these supplementaries, and can be better discussed under that item.


Grote Stirling: In the ordinary way the inspection fee is, of course, borne by either the producer or the shipper. Do I understand that in this case the government has taken over the whole cost of the inspection of these 793 cars?


James Garfield Gardiner: The government took over the whole cost of purchasing these supplies for western Canada, and any charges in connection with that were paid out of departmental expenses.


John Ritchie MacNicol: Were there any volunteers, any public spirited citizens who were willing to assist the country in its distress?


James Garfield Gardiner: Speaking from memory, I believe there were between 1,000 and 1.200 carloads of commodities of all kinds shipped.

Relief and Agricultural Distress
Mr. MaoNICOL: I mean in connection with distribution.


James Garfield Gardiner: Yes; much of the
distribution was made in that way; that is, by volunteer assistance.


Mr. PERLEY:: Would the minister explain just why, in connection with the distribution of this fruit in Saskatchewan, Doctor Stapleford was employed at such a high salary, according to the answer given last week?


James Garfield Gardiner: He was paid, not under this item but under the vote of $1,000,000 which we shall come to later on.


George Halsey Perley: I understand, then, that under the other item we shall have an opportunity of discussing the whole question.


James Garfield Gardiner: Yes.


[Stage Direction]
Item agreed to.

[Stage Direction]
Miscellaneous-administration of the Old Age Pensions Act-further amount required, $10,000.
Hon. CHARLES A. DUNNING (Minister of Finance): This is to cover the expenses of medical inspection of blind applicants for pensions.
Item agreed to.
To provide for payment of honorarium to A. S. Whiteley, secretary to the royal commission on the textile industry, $1,000.
Richard Bedford Bennett: Why should he receive this?


Mr. LENNARD:: Where was Mr. Whiteley otherwise employed?


Charles Avery Dunning: I believe Mr. Whiteley is a clerk in the bureau of statistics, with a salary of $1,620 per annum. Apparently he has served on several occasions in connection with inquiries and -was chosen by the commissioner for this service. The commissioner made a strong recommendation to the government that consideration should be given, in the manner which apparently has been followed on previous occasions when extra services of this kind were involved.


Richard Bedford Bennett: The minister must remember that he was given a per diem expense allowance.


Charles Avery Dunning: Yes, for his actual
expenses; he was given no additional remuneration. Everyone connected with the inquiry, on both sides, paid great tribute to Mr. Whiteley's availability at all times, without regard to civil service hours or anything of
that sort. The government deemed it wise to ask the house to recognize such services.


[Stage Direction]
Item agreed to.
Progress reported.
At six o'clock the house took recess.
After Recess
The house resumed at eight o'clock.


[Stage Direction]
Hon. NORMAN McL. ROGERS (Minister of Labour) moved that the house go into committee to consider the following proposed resolution:
That it is expedient to bring in a measure to provide assistance towards the alleviation of unemployment and agricultural distress, and for such payments out of moneys appropriated by parliament as may be necessary for all or any of the purposes of the proposed legislation.
Motion agreed to and the house went into committee, Mr. Sanderson in the chair.
Norman McLeod Rogers: This resolution precedes the introduction of an annual bill for the relief of unemployment and agricultural distress. The bill when introduced will be similar, in general terms, to the Unemployment and Agricultural Assistance Act, 1937, which expires at the close of this month.
Under the terms of the legislation, and subject to the appropriations made by parliament for the purpose, provision is made first for the initiation and execution of works and undertakings by the dominion government, in order to relieve unemployment and agricultural distress and, second, for financial assistance to the provinces, under appropriate agreements, in order to assist them in their efforts to deal with unemployment needs and also the serious conditions which have arisen in certain sections of the prairie provinces because of prolonged drought.
I realize fully that it will be the desire of members of the house to discuss the unemployment question at some length before the Easter recess, and with this in mind, on second reading of the bill which will be introduced following the approval of the resolution, I intend to make a full statement on behalf of the government. We propose to move second reading of the bill on Monday. Meantime, it is intended to-morrow to table and distribute the final report of the national employment commission. That, again, seemed

Belief and Agricultural Distress
to be a good reason why it was best that my statement should be deferred until hon. members had enjoyed full opportunity to read the report of the commission.
In these circumstances I feel I may fairly ask for the cooperation of the committee in expediting passage of this resolution in order that we may proceed on Monday with the second reading of the bill.


James Shaver Woodsworth: This seems to be a strange procedure. I have no desire to delay the regular business of the house; but it seems to me that the report of the national employment commission should be in our hands before the resolution is placed before the committee and, further than that, that the time to make the full statement the minister promises is during the discussion of the resolution, and not afterwards. Members of the committee are at this time in a position intelligently to discuss the resolution.
This resolution and the bill which will be founded upon it deal with the most important matter which has come before the house this year. It would seem to me highly desirable that we take no step whatever until the fullest information is before the committee, and therefore I take this opportunity to protest against this procedure. I am afraid that members in this little corner will have to ask the minister to make his statement before he may expect us to pass the resolution.


Hugh Alexander Stewart: I suggest to the minister that on the introduction of the resolution it would be appropriate to make a comprehensive and complete statement of policy, and a review of conditions in connection with unemployment. To many hon. members the legislation coming down will be the most important of the session. Unemployment has been with us for at least seven years, and I believe that, as on second reading of a bill we are limited to a discussion of the principle involved, there should be a more complete and comprehensive statement than the minister has outlined, or has intimated he intends to make to-night.
The principle of the bill will be a provision for the relief of unemployment. I am sure no hon. member would disagree with such a principle. Therefore, perhaps our discussion on that occasion would be to some extent limited. I am sure the minister is in a position to-night to review the legislation adopted by parliament during the seven years to which I have referred, and no doubt he is in a position to outline in more or less detail what is proposed, and also to give us a fairly comprehensive statement of the work of the

employment commission. That commission has been working for a year. Does it suggest anything new? Is there any radical departure from the principles and methods adopted in the past five years in dealing with this question? What objectives has the government in mind? Particularly, how do those objectives differ in principle, if they do differ, from those which have been adopted in years gone by? Are we to have a supplementary estimate covering unemployment relief, and all that sort of thing?
I believe that in justice to the committee the minister ought at this time to make a fairly comprehensive statement along the lines I have indicated. I do not think anything else will satisfy the committee, and I believe the passage and understanding of the bill would be promoted by the timely and complete statement which the minister, with his accurate knowledge of conditions, could make.


Norman McLeod Rogers: I am entirely in the hands of the committee. So far as the question of procedure is concerned, may I say to the hon. member for Winnipeg North Centre that in submitting the resolution in this manner I am following the practice established in two previous years. I am quite sure I am correct when I state that in each of those years the committee accepted the resolutions after brief discussion, and our debates on unemployment took place on second readings, and during the committee stages of the bills. I say that only to assure the hon. member that there is no desire on my part to deviate from well established practice in this regard.
On the other hand I fully realize-and it has again been brought to my attention by those who have just spoken-that it is most desirable that there should be at this time a full and comprehensive statement on unemployment conditions. It was and still is my intention to make such a statement. On the other hand, I did feel, and still feel, that if that discussion is to be profitable, it is desirable that it take place after, and not before the report of the national employment commission has been tabled and distributed. Under these conditions and with the desire to meet the wishes of the committee as fully as possible, I would suggest that the resolution remain in committee. I shall make my statement after the report of the national employment commission has been tabled to-morrow; that is, in accordance with my original arrangement, I shall make it on Monday of next week. If this meets with the approval of those who have just spoken, I shall move

Supply-Agriculture-Feed
that the committee rise, report progress and ask leave to sit again.
Progress reported.

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



DEPARTMENT OP AGRICULTURE

[Stage Direction]
To provide for feed and fodder relief in the dried-out areas - further amount required, $1,000,000.
James Garfield Gardiner: I might suggest to the members of the committee that items 462 and 463 are for exactly the same purposes as items 469 and 470. All the discussion with regard to detail could take place under the other items, if that meets with the approval of the committee. The amounts provided for by items 462 and 463 have been found to be necessary since parliament opened. These were not provided for by warrant, but they are to be used for exactly the same purpose as those amounts provided by warrant and to be found on the back page of the supplementary estimates.	[DOT]


George Halsey Perley: Does the minister mean that discussion can take place under items 469, 470 and 471?


William Lyon Mackenzie King: That is right.


[Stage Direction]
Item agreed to.
Governor General's Warrants, 1937-38-
To provide for the purchase and distribution of feed and fodder for live stock in the drought areas, and in rural municipalities and local improvement districts not included in the drought areas, of Saskatchewan and Alberta; for freight charges and for the cost of moving equipment used in providing feed requirements; also expenses of marketing cattle in the drought areas (Governor General's warrants of August 6, and October 29, 1937, and January 19, 1938). $13,750,000.
Mr. COLD WELL:: What supervision is given by the federal Department of Agriculture? I have had some complaints as to the quality of feed grain which has been distributed in some parts of Saskatchewan. I wrote to the minister this morning giving the details of one of these complaints, but of course he will not yet have received my communication. My information is that some of the grain shipped in was in such condition that the farmers hesitated to feed it to their hogs. I was wondering if the federal department is giving any supervision to the purchase and distribution of this grain or whether this work is being left to the local authorities. I should like to know whether complaints of
this nature should come to the minister here or be sent to the Saskatchewan Department of Agriculture.


James Garfield Gardiner: In connection with feed and fodder, the federal government provides the funds to pay the accounts, while the provincial government makes the purchases. The federal government has a staff of approximately thirty to forty which checks the grain and fodder for the purposes of grading. Most of the fodder is graded where it is purchased, some of it being graded on the farm where it is located. The grain is graded at certain points through which the cars pass when it is not possible to grade it where it is purchased. This grading occurs at points like Moose Jaw and Calgary. It may happen that the grain was threshed under conditions which were not too good. There was considerable rain in Alberta during the threshing season, and also in Manitoba during the latter part of the season. Of course, grain that was loaded into cars in a damp condition might arrive at destination not in too good shape. If we consider the quantity that has been handled, there has been very little reported to us as having been in poor condition.
Two or three weeks ago I received from southern Alberta a sample which I would have condemned. I did not know all the circumstances, so I sent it back to have them checked up. I do not think any inspector should have passed this grain. Occasionally cars or parts of cars get by the inspection, but one must understand that the ordinary channels of trade for grain in western Canada are east and west. Grain moves to Winnipeg or Vancouver. When you start moving grain across the regular channels of trade, that is from the north of the province to the south, you must set up an organization for checking and grading purposes. All grading organizations are now located at Winnipeg or at the other end, and it has been found necessary to set up more or less temporary organizations. It is extremely difficult to make a proper check as would be the case if the grain moved in the regular channels.


Mr. PELLETIER:: I notice that this item refers to relief outside the drought area, and I should like to have a break-down of the figure. How much money was spent in Saskatchewan and in Alberta?


James Garfield Gardiner: It would be difficult to give the exact amounts spent to date. The nearest I can get to that is to give the amounts which were provided. We entered into agreements with Alberta and Saskatchewan providing for maximum sums of money

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that the federal government would supply for feed and fodder for relief purposes in certain areas. In the case of Saskatchewan, up to August 6, there had been provided $200,000 in one amount and $2,700,000 in another. Those are the amounts covered by the agreement, not what was spent to that date. Then in October, for feed and fodder in the federal area in Saskatchewan, there was provided $5,000,000, and $1,000,000 for the area outside what has been termed the federal area.


René-Antoine Pelletier: I Should like to know the amount of money spent outside the drought area.


James Garfield Gardiner: I shall give all the figures and perhaps the hon. member can separate them. This may save repeating them later on: For feed and fodder in the federal area, $5,000,000; for feed and fodder outside the federal area, $1,000,000. For feed and fodder in the federal area in Alberta, up to the same date, the amount was $750,000. For feed and fodder, on the same date, outside the federal area, the amount was $100,000. On January 19, 1938, inside the federal area in Saskatchewan, the amount was $1,000,000. Those are the total amounts up to the vote of $1,000,000, under item 462, for feed and fodder, which we put through a few moments ago, and which has to be added. The other vote that we put through was for direct relief, which may be spent partly in Alberta and partly in Saskatchewan.


René-Antoine Pelletier: From the minister's figures it would appear that outside the drought area in Saskatchewan not much more than $5,000,000 has been spent, and yet there is a vote of $13,750,000. There seems to be a discrepancy somewhere, or the total amount has not been expended.


James Garfield Gardiner: There is still $3,000,000 lot accounted for by feed and fodder. That s in the cattle vote. I understood the request was for the feed and fodder figures.


Mr. QUELCH:: Certain farmers who did not cut down their stock were not eligible for the grant, I understand, and loans were made this spring or during the winter. Would they be included in this estimate?


James Garfield Gardiner: No; the loans are not included in this estimate. These are the warrants for the amounts that were advanced by this government.


Victor Quelch: What items do the loans come under?


Mr. ROWE (Dufferin-Simcoe):: The hon. member has mentioned an amount of

$13,750,000 for local improvements not included in the drought area. What do the expenditures outside the drought area consist of?


James Garfield Gardiner: The term "in and outside the drought area " is really a misnomer, as I was going to explain. One year ago in handling this matter, the plan followed was to some extent different from that followed this year. A year ago we took, on the first of September, a certain number of municipalities and accepted responsibility for them right through to March 31. We found by experience a year ago that it was extremely difficult to get decisions in the middle of the season. The provincial government would get an application from a municipality to be admitted to the area, and the province in turn would make application to us, and by the time the matter had been considered by three different authorities perhaps a month had gone by, while in the meantime people were having great difficulty. So this year we adopted a different system. We accepted at the first of September responsibility for all the municipalities that were admitted to the federal area. The federal government agreed with the provincial governments to take responsibility for 170 in Saskatchewan and fifty-three in Alberta from September 1 to March 31. We have accustomed ourselves during the winter to call that area the drought area. But outside and around the fringe of that area there are in Saskatchewan at least ninety municipalities, and in Alberta at least ten municipalities, which are in almost as bad conditions as the others. They are really drought area too; but probably it would not have been necessary to bring them in, if we had been dealing with the matter here, until the first of October in some instances, and the first of November, or the first of December, in others. They could have taken care of themselves to that time. So we said to the provincial governments that we would advance a certain cash amount to be used in those areas. In Saskatchewan the amount was $1,000,000, and in Alberta, $100,000.
The amount of $100,000 for Alberta was not our suggestion. We proposed $200,000 for Alberta, but the provincial government proposed an adjustment in the number of municipalities to be taken in and agreed to take half the amount of money for the outside area provided we made an adjustment. So we took in eleven municipalities that we would have preferred to leave outside the area for which we assumed full responsibility.
These amounts were set aside to assist in taking care of these people outside the area for which we took 100 per cent responsibility.

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The provinces were administering the distribution of feed and fodder for the whole area, both the area for which we paid the entire cost and the area in which we gave assistance. So the set-up inside and outside is much the same, and the methods of administration the same; also any regulations governing persons who were obtaining assistance in the form of either direct relief or feed and fodder were intended to be the same. We made inspections to satisfy ourselves that the administration was the same inside and outside the area, once a community had been admitted in under relief.


René-Antoine Pelletier: I understand from the minister's explanation that owing to the type of supervision exercised, it is impossible to determine what amount has been spent in Saskatchewan and what in Alberta; that it is impossible to segregate the expenditures.


James Garfield Gardiner: It is not impossible at all. As a matter of fact, when the accounts are completed there will be an exact division as between the two. There is no connection at all between the moneys spent in the two provinces. The Alberta government spent all the money provided for that province, and the Saskatchewan government spent all the money provided for that province. We are not spending that money; it is the provincial governments who are spending it through their own organizations. All we are doing is to make a certain check to see that the money is expended in what we think is the proper way and in accordance with the proper regulations.


Victor Quelch: The minister said that certain adjustments were made when Alberta agreed to ask for $100,000 instead of $200,000. What were those adjustments?


James Garfield Gardiner: The adjustment was
this:	There were a number of municipalities north and west of Hanna, in the area between Hanna and Edmonton, in the vicinity of Coronation, which the provincial government desired to have admitted to the area. We had selected forty-two other municipalities that we thought, according to our investigation, should come in; but the province asked to have about twenty others around the fringe of the area taken in, and we increased the number from forty-two to fifty-three; that is, we took in eleven more. These municipalities were mostly in the vicinity of Coronation and down towards Drumheller.


René-Antoine Pelletier: So it was because some additional municipalities were included in the drought area that it was not necessary for Alberta to ask for an increased giant?


James Garfield Gardiner: It was not a matter
of an increased grant. The amount we originally suggested which they should have for the outside area was $200,000. They said they would prefer $100,000 for the outside area and for us to .take in eleven additional municipalities for which the federal government would assume entire responsibility.


René-Antoine Pelletier: Does any part of these moneys consist of loans to the provinces to be repaid to the federal government?


James Garfield Gardiner: No; they are grants to the provinces and are not repayable.


George Halsey Perley: I regret that we have not had an opportunity earlier in the session of discussing this question of relief in Saskatchewan, particularly the distribution of feed and fodder. The minister will remember that in the debate on the address I brought to the attention of the government the critical situation in that province with respect to feed and fodder, and at that time I also drew his attention to the fact that early last fall I had taken this matter up with both the provincial Department of Agriculture and the federal Department of Agriculture here in Ottawa.
The minister will remember that, speaking on the address himself, he stated that he was more concerned about taking care of the situation in March than he was in having feed there in the fall months. In the last three weeks I have been receiving protests and certain information from Saskatchewan indicating quite a critical situation with regard to feed and fodder and grain to take care of the spring work. To-day I received a letter from a farmer in the Indian Head district suggesting that it is almost imperative for the government to see to it that the farmers are provided with tractors and tiller combines to get the crop in, because the horse power is very low. The horses returning from the feeding pastures in Manitoba are in no condition to tackle the spring work. I suggest that the minister give us a detailed statement regarding the quantity of feed and fodder supplied each month, starting with September, to the drought area and semi-drought area in Saskatchewan. We should also have a statement regarding the quantities obtained in Manitoba, Alberta, and the states of Minnesota and North Dakota.
The minister referred to-night to the inspection that has been made of the feed and fodder shipped in. As he said, some of it was not in very good condition. Of course, in Manitoba particularly, from which a good deal of it came, the season was such as to
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make it difficult to turn it out in proper condition. If we consider the time it was cut and the delay in baling, the weather was such that some of it was damp. I saw some carloads that were shipped in before I left home and they were in poor condition. As the hon. member for Rosetown-Biggar has said, the fodder was not fit to feed to animals that were expected to show any improvement. It was not fit for dairy cattle or for work horses. The minister has referred to the men inspecting the feed and fodder, for a list of whom I asked some time ago. I am referring to the inspectors whom he mentioned in his speech on the address-some forty-five of them. A return was brought down last week giving the names of some twenty, and I think he should give us the information with regard to the others. These are the men who are doing inspection work in connection with the distribution of relief.


James Garfield Gardiner: I might deal with that point now. In my speech on the address I said that at the peak we would not have more than forty-five, and I found in answering the question that, as a matter of fact, we have never had more than thirty-five. At the time the question was asked there were twenty-nine, as the return shows.


George Halsey Perley: This return shows twenty-eight.


James Garfield Gardiner: Yes, twenty-eight.


George Halsey Perley: After receiving that return I asked a question with reference to one of these men in particular, the man at Broadview.


James Garfield Gardiner: Agnew.


George Halsey Perley: Yes. Let me read from the
return:
Was A. S. Agnew of Broadview, Saskatchewan, employed in the purchasing of feed and fodder in Manitoba or Minnesota for the province of Saskatchewan?
The answer was that he was employed as a feed grader and used in Minnesota and North Dakota.


James Garfield Gardiner: Not in connection with purchase, but as a feed grader.


George Halsey Perley: Yes. The return goes on.
Employed from October 19, 1937, to February 21 1938. $125 per month plus actual travelling expenses as follows: October, $137,59; November, $303.52; December, $278.68; January, $205.97; February incomplete.
That man in four months drew some SI,400 by way of salary and expenses.


James Garfield Gardiner: He does not draw expenses.


George Halsey Perley: His expenses were paid.


James Garfield Gardiner: The government paid his expenses.


George Halsey Perley: Yes, and that means that by way of salary and expenses he has cost the country SI,400 in four months. I call that an outrage. There are all sorts of good men available to do such work at a far smaller cost to the country. Would the minister give us the number of other inspectors engaged in similar work. I suggest that he take this list and set out what each one of the inspectors has done, how many were employed in the purchase of feed and -fodder, and so on. I understood that there were one or two in Regina, but I do not see their names in the return. They had a commission, I understand, to go to Minnesota to secure feed and fodder, and I suggest that we should have a statement in that regard. Furthermore, the minister should give us a statement with regard to the number of cattle shipped out; the number shipped to different markets; the number shipped to the feeding ground; the number of horses shipped to the feeding ground and the number of those that have been returned. Were there any veterinarians employed in Manitoba to attend to the horses at the feeding grounds in Carberry? We should have all that information. The minister should tell us who these men are and give us their salaries.	_
I trust that the minister will not treat this request lightly.
He said the other evening that some of the matters I have mentioned were of no concern to this government; that they were of concern only to the Saskatchewan government. May I emphasize the gravity of the situation and the necessity for full information. It is regrettable that such information as we are asking for is forthcoming so late in the season. Early in February I asked for a return, which I suppose may be discussed under item 471, with respect to all commodities distributed in Saskatchewan for relief purposes, and only this evening has the minister been kind enough to hand me a volume containing the information. It covers from twelve to fifteen large pages, and no doubt we shall be asked to accept this document and pass upon it to-night. I must protest against this. The return was ordered on February 23 and I have just been handed it to-night. If the minister thinks we can go through this return hurriedly with regard to quantities of fish, beans and so on, the places of purchase and distribution; if he thinks it is fair to hand such information to us and ask us to consider it intelligently on the spur

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of the moment, I do not think he will find anyone to agree with him. I suggest that at least the matter should stand until we have had an opportunity to study this return carefully and to ask for any necessary information in connection with it.
I should like to have a statement with regard to the amount of feed supplied each month from Manitoba and the United States, and the minister might tell us something about the pools' offer in connection with the distribution of it. A good deal of money could have been saved in that direction, and I think it important that we should have a statement. We shall ask for certain other information as we go along this evening.


James Garfield Gardiner: As to the remarks concerning the return, I saw it for the first time after leaving the house this afternoon. It was placed on my desk to be brought down tomorrow, and I brought it with me to-night and gave it to the hon. member so that he would have it. In fact, he had it within a few minutes after I received it myself. So if there is any information with which he is not familiar, neither am I familiar with it.


George Halsey Perley: Just there may I say that the order for this return was passed on February 23. It had stood for quite a while owing to the fact that the minister was out west, I am not saying on what business. One of the ministers asked that it stand until he returned; we allowed it to stand, and as soon as the minister got back it was passed. That was on February 23.


James Garfield Gardiner: For much of this information we have to send to Regina. The inquiry had to do with work that was done partly in Regina; all the distribution was done there, and so the return could not be completed here.
In regard to the discussion generally, this is not the last opportunity that will be afforded this session of discussing all these matters. Before the session ends, we shall have to put through estimates having to do with supplies for similar activities, and full discussion can then be had of all these matters.
I can give the committee some of the information, although practically everything that has been asked for involves obtaining information from Regina or Edmonton; it is not information that we would have here in detail at any time unless we sent there for it. It has to do with administration of affairs by the provincial governments. We are concerned largely with two things: First, seeing that the accounts are properly audited, making sure that the money is spent for the purpose for which it was voted, and, second,
checking the activities to see that in the distribution of feed and fodder and direct relief proper service is being given to the area for which the money is being spent. Outside that we do not go fully into the detail. We receive from time to time returns showing what is being done; but to give the information in all the detail asked for by the hon. member would, I think, be impossible unless he is prepared to wait another two or three months while we get the information. I can, however, give in general terms the division, the amounts of money involved and the tons of fodder. The last summary I have is down to February 7.
On February 7 commitments in Saskatchewan were for 7,816,288 bushels of feed grain, of a value of $5,636,230.38. Amount under commitment at that time:	Requirements,
6,944.872 bushels; estimated for cash sale, 346,620 bushels; commitments, 7,816,288 bushels; leaving commitments in excess of requirements, 524,796 bushels. That is a complete statement for the federal area of the drought section of Saskatchewan as far as bushelage is concerned.
In the marginal area, that is the area which is outside what some people call the drought area but which is still in the drought area, the requirements are 2,403.462 bushels; estimated for cash sales-that is bushelage which is sold to people who pay for it-91,603 bushels; commitments, 2,206,738 bushels, leaving requirements in excess of commitments, 288,327 bushels of feed grain.
The commitments for fodder in the federal area to February 7 were 269,000 tons; requirements, 301,000 tons as estimated at that time, leaving 32,000 tons requirement over commitments. The commitments there mean the amounts for which municipalities have asked and which the government has agreed to supply.
In the marginal area commitments are 50,000 tons and requirements 58,000 tons, leaving 8,000 tons of requirements in excess of commitments to that time.
That is as near as I can get to the detail in regard to feed and fodder in Saskatchewan during that period.
So far as the two provinces are concerned, there is a difference in the amounts of money supplied, but there is also a difference in the number of people and the area involved. In Saskatchewan there are 438,000 people on direct relief. In Alberta there are 64,420 people on relief. In dealing with those figures, one must remember that there are many people who are getting feed and fodder for live stock who are not getting direct relief

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To give them feed and fodder for their live stock is one of the means of keeping them off direct relief. So there will be an even wider difference in the figures for feed and fodder than in those for relief. A careful check of what is going on over the drought area indicates that there is somewhere between eight and ten times as much area, and between eight and ten times as many people involved in Saskatchewan as in Alberta. If hon. members follow these figures through carefully, they will see that there is just about the same proportion in the amount of money being expended in the respective areas in order to take care of people and live stock there.
In regard to such matters as shortage of power with which to put in the crop and other such complaints, I can only repeat what I said the other evening; it is strange that I should not be getting those complaints. The farmers' organization in Saskatchewan some months ago circularized all its locals, according to the letter they sent to me, asking them to make complaints if there was any cause of complaint, and not very long after that the bulk of the complaints ceased to come. I have not received any considerable number of complaints recently, and since in that area there are in the neighbourhood of 500,000 people involved, I consider it strange that there are not more complaints if there is so much dissatisfaction. But when complaints are received, I do this with them: I write back to the individual who makes the complaint and indicate that the administration is being carried on by the provincial government; that he will get quicker action on his complaint if he writes to Regina or Edmonton than he will by writing Ottawa; but that in the meantime I am sending his complaint on to the officials in Regina or Edmonton and asking them to deal with it as soon as possible. Possibly if hon. members would do the same, we would at least get the assistance to those requiring it at the earliest possible date, if they are not being properly treated now.


George Halsey Perley: I hope the minister does not think I am trying to exaggerate when I say that we are getting plenty of complaints. I have under my hand at the moment fifty or sixty letters of complaint, and just to-day I received from the secretary of a municipality a letter in which he said they had been informed by the department at Regina that they would not get half of what was required in the way of feed for this spring. That is not one of the 100 per cent areas, of course, but I believe in many instances the situation is just as bad in the 100 per cent districts. So I am not exaggerating at all. If I wanted

to do so, I could produce at least fifty complaints of recent date.


James Garfield Gardiner: Probably I could produce as many, more or less eulogizing this government and the provincial governments for the efficient way in which this work is being done; but I doubt very much if fifty letters from five hundred thousand people would prove anything one way or the other. An effort is being made by all the authorities, working cooperatively so far as possible, to have this particular job done. I can understand that members might at this time be receiving complaints from people who are a little anxious. The end of our financial year is March 31, and there has to be a cut-off somewhere in the payments that are being made by this government. Arrangements are being entered into as to those cut-off dates. That cut-off is the period between seeding activities and winter feed and fodder activities, and for that reason some people are wondering whether they are going to get sufficient feed and fodder to carry them through the seeding season.
The plans are that the feed and fodder in their possession now will be sufficient to carry them until about the middle of April, although the cut-off is at the end of March so far as the purchase and shipment of feed and fodder are concerned. An effort is being made to start the feed and fodder for seeding purposes moving immediately following April 1, in order to have it in the hands of the people by the time the other feed has been used up, and I think it will be found that there will be as little difficulty in connection with seeding operations as there has been in connection with winter operations. I do not want to leave the impression that everyone will be perfectly satisfied, but everything will be done to see that the work is carried on as efficiently as possible.


George Halsey Perley: Is the required amount of
feed and fodder in sight? Is the government pretty well assured that it will be available?


James Garfield Gardiner: I read the figures a few moments ago. I do not know how much they mean to the committee, but they mean a great deal to those who have been finding feed and fodder. According to these figures, between 350.000 and 360,000 tons of fodder have been obtained and shipped into that area from elsewhere. That is a great deal of fodder. We have never required in any previous year to ship more than 260,000 tons; I believe that was the greatest amount ever shipped into that area, and even in years when fodder was available right in the province, when practically all of it could have

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Feed
been found within Saskatchewan for shipment to other parts of the province, it was very difficult to make arrangements to have that done in a way which would be satisfactory to everyone. This year scarcely any fodder was to be obtained anywhere in the province. It was necessary to go to Manitoba in the early part of the season in order to get fodder. Later on, it was necessary to go to Alberta, and I may say that in the early part of the season it was found very difficult to purchase fodder in Alberta because the authorities in that province wanted to make sure of their own supplies first. When eventually it was possible to purchase fodder in Alberta, and after everything possible had been done in those two provinces, they still were unable to get a sufficient supply. The next place they went was the state of Minnesota. Arrangements were made to get supplies, largely of hay, there. The only reason they went to Minnesota was because at that time the freight on hay from the province of Ontario to Regina was SIS a ton. Anyone knows that you cannot feed any animal a ton and a half to two tons of hay when the freight alone, apart altogether from the purchase price of the hay, is $18 a ton.
The first move made by the government of Saskatchewan was to go into the border states of the United States, where the freight rates would be low, buy hay and ship it into that area. But even after they had purchased all that they secured in those states at reasonable prices, they did not have sufficient. Then we brought further influence or pressure to bear on the railway companies in order to get the rates on feed from eastern Canada reduced. It was finally agreed to set a freight rate of $10 a ton on hay from anywhere west of Montreal to the drought area of Saskatchewan, and $10.50 from east of Montreal as far as Three Rivers. A similar arrangement was made in regard to British Columbia.


Mr. BARBER:: What was the rate from British Columbia?


James Garfield Gardiner: It was $10.50 from east of Montreal and $10 from west of Montreal.


Harry James Barber: What was the special rate that was arranged from British Columbia?


James Garfield Gardiner: There was a similar rate from British Columbia. So far as Saskatchewan was concerned the regulation was that they could not accept hay at a laid down cost in that province of more than $18 a ton, and under the special rate from British Columbia they were able to lay down hay for less than $18 a ton. They were also able to get hay
from the eastern part of Canada, under those special rates, for less than that laid down price.


Harry James Barber: I understood that the laid down price from British Columbia was $16 a ton; from Ontario, $17.50, and so on. Is that correct?


James Garfield Gardiner: In that case I would say probably there was a difference of $1 or $1.50 in the freight rate from British Columbia as compared with the freight rate from eastern points. The only part we took in these negotiations was to assist the provincial government in getting special freight rates. They carried on all the other activities in connection with the matter. That was the case in regard to Saskatchewan. Alberta did not purchase outside the province.


Mr. SENN:: What was the laid down price of hay and fodder coming in from the United States?


James Garfield Gardiner: I could not give my hon. friend the exact figure; but it was considerably under that, probably in the neighbourhood of $15 a ton. It may have been as low as $14 from certain points in the United States, but I imagine the average would be somewhere around S15.


George Halsey Perley: What was the average price paid in Manitoba?


James Garfield Gardiner: The top prices that could be paid were set out in the agreement. The price for hay in Manitoba was $8.50 a ton; that was the top price which could be paid in western Canada for No. 1 hay, and then it was graded down to $6.50 a ton. The average price there would be somewhere between those two figures.


George Halsey Perley: How much was purchased in the United States?


James Garfield Gardiner: I have not the exact figures, but they would be somewhere between
75,000	and 100,000 tons.


Mr. TUSTIN:: What was the price paid for hay purchased in the United States ?


James Garfield Gardiner: The price there was governed by exactly the same regulations that governed the price in Manitoba and Alberta. It could not be more than $8.50 per ton. It was under that price.
There is one further remark I should like to make. The hon. member for Qu'Appelle tonight made the statement he made previously in his speech on the address in reply, to the effect that some men had been paid commissions to buy hay in Minnesota. I believe at that time I told the house my information
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was that no commissions were paid for purchasing hay in Minnesota; that the hay was bought in Minnesota at prices which were indicated in t'he agreements and sent up, and that no one in western Canada obtained a commission in connection with it. Some of it may have been purchased from agents in the state of Minnesota who had bought hay from farmers and who had it for sale, just as was done in Ontario and Quebec. The agents who had hay and straw sold that to the government of Saskatchewan. As to whether or not they made a commission, I do not know; I assume they made a profit. It is possible that men in Minnesota made a profit on hay purchased from farmers and resold to the government. But according to my information there was no commission agent acting for the government of Saskatchewan.


George Halsey Perley: There was a great deal of hay purchased, though, was there not, from agents who had gone down to Minnesota from Saskatchewan, and who had accumulated quantities of hay there.


James Garfield Gardiner: Not to my knowledge. There were men who went to Manitoba and Alberta, I assume-although personally I do not know of any who went there-and there probably were men who went to Minnesota and bought hay to ship to Saskatchewan. Some of that hay has been delivered to the municipalities, and the municipalities have sold it. As a matter of fact, I am buying hay this week, to put in my own crop, from a municipality which imported it from somewhere. I do not know from where it was imported. But I pay for the hay whatever it costs the municipality, plus freight and all other charges added. That has been done by municipal organizations throughout Saskatchewan, as a matter of convenience for the people in the municipalities.
There are no hay dealers in Saskatchewan, because we do not deal in hay. As a matter of fact, in the part of Saskatchewan from which I come we never feed hay. We have not done so in any year. But in a year like this, when we have to ship something in to feed our stock, it pays us better to ship in hay than to ship in straw or oat sheaves. There are no agents there to sell hay. There has to be an organization to do this, and the municipal organization is the one which is most convenient.
Someone may go to Minnesota or Manitoba, buy hay, and ship it in to the order of the municipality, and the municipality in turn may sell it.
-Mr. Gardider.]


George Halsey Perley: How many checkers were employed in grading the hay? I assume there were checkers employed in checking provincial government accounts. How many checkers were there in Regina checking the accounts for the federal government?


James Garfield Gardiner: The comptroller of the treasury has full control over the checking of accounts, and he has placed a few men at each capital. I have not the number in my mind at the moment, but I know it is a very small number, not more than half a dozen, and probably only three or four.


Charles Avery Dunning: He puts men there as required.


James Garfield Gardiner: Yes; he puts them there as required. At certain times there may be more than at others. So far as inspectors are concerned, may I say the hon. member has the list; at least he had it a few moments ago and was reading from it. It must be on his desk in front of him. I have not the list before me, but I do not think it would be of any use to read it. It means something to the hon. member for Qu'Appelle, and it means something to me, because we know some of the individuals.


George Halsey Perley: That is fine, if the minister is willing to admit that the list I have is one of government inspectors.


James Garfield Gardiner: That is what the list the hon. member has says.


George Halsey Perley: And that they draw similar salaries. The information shows a salary of $125 a month, and expenses in some months running as high as $300.


James Garfield Gardiner: I would say quite freely that the men on the list the hon. member has are all getting $125 a month, and they are all away from their homes. I think, if he will read the list, he will find they are nearly all farmers, and I think are all out of the drought area.


Mr. DONNELLY:: And all doing a good job.


James Garfield Gardiner: Yes, all doing a good job. They all know hay when they see it; they all know grain when they see it, and they are grading fodder. So far as their expense accounts are concerned, this is made up of a charge of seven cents a mile and living expenses while driving around the country, locating farms where hay is available, and grading it. They must locate grain and grade it, so that when it leaves the point

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from which it is to be shipped it may be known to be in proper shape. Then, we have other men at the other end who are checking to see that it arrives in proper shape.


William Earl Rowe: Do they also locate where it is required?


James Garfield Gardiner: No; the provincial
people locate the hay in the first instance. They locate it, and notify us that they have ordered a certain amount of it at a certain place, and we send a man there to grade and check it.


William Earl Rowe: Is it the provincial government which receives the application for relief, in that regard?


James Garfield Gardiner: The municipality receives the application for relief, and passes it on, through a committee of council, on which a representative of the province sits. Those applications are then submitted to the provincial governments. We never receive the individual applications here.


William Earl Rowe: I appreciate the problem which must be involved in distributing upwards of $27,000,000 or $28,000,000 of relief, through governor general's warrants, as outlined in these various items. I believe that, despite our sympathies with the provinces of Saskatchewan and Alberta, all hon. members must agree that these are enormous amounts of money, and it seems peculiar that we should have items such as these, providing for " the purchase and distribution of feed and fodder for live stock in the drought areas, and in rural municipalities and local improvement districts not included in the drought areas, of Saskatchewan and Alberta; for freight charges and for the cost of moving equipment used in providing feed requirements; also expenses of marketing cattle in drought areas," and then, right below that, the item to provide for " direct relief expenditures," together with the items we have passed to provide for feed and fodder relief in the dried-out areas, and the further item to provide for direct relief in the dried-out areas.
That seems like a lot of items involving expenditures for the same purpose. What are the freight charges, and what is meant by " the cost of moving equipment used in providing feed requirements "? It seems to me that these items make it possible to provide relief or assistance in districts which are not in the drought area, and to provide money for the marketing of cattle and for the payment of freight-in fact for anything which may be wanted in that one province of Saskatchewan, whether or not the particular district is in the drought area. I do not
wish in any way to minimize the problem or the great crisis Saskatchewan has endured, but this seems to be an enormous amount of money. Very wide latitude is also given to the government to make expenditures in connection with those who are in drought areas, and others who are not.


James Garfield Gardiner: I believe there is some confusion in the terms " in the drought area " and " out of the drought area." The meaning is exactly as I explained at the beginning of the discussion. What is known as the area " inside the drought area " is what came in after the first of September, and continued right through the year, and in connection with which the federal government pays the whole bill. But immediately outside that area there is another which is just as much in need of assistance as the area inside the line. We took 170 municipalities, and there are ninety municipalities immediately outside which are in almost as bad condition as the 170. Those are the meanings of " inside " and " outside."


William Earl Rowe: There are similar areas in other parts of the dominion.


James Garfield Gardiner: But not as compared with these. I do not think there are similar areas anywhere. I find from the information before me that in that area the bushelage is about two bushels to the acre, and a considerable part of the area of which I am speaking is immediately outside.
The other point had to do with moving the equipment necessary to provide the fodder requirements. Some of the municipalities maintained that they could send equipment to Manitoba, for instance, and put up this feed or fodder much cheaper than it could be bought anywhere else. This equipment would consist of balers and mowing equipment. We were asked to have the equipment sent down, and residents of the municipality were employed to go down with it to put up the fodder in the adjoining province or elsewhere within Saskatchewan. That fodder cost the government just the cost to the municipality of putting it up.
There are instances where this was the only way in which one could get fodder put up in a locality. During the harvest season all the farmers would be engaged in harvesting, and it was necessary to send men down from the locality where the hay was needed. It was also necessary to send down equipment as there would be localities where there was no equipment available. The province has a considerable number of balers. The idea was to ship down some of this government equipment along with the necessary
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labour, put up the hay and ship it back to where it was needed to feed live stock during the winter. In these cases the government undertook to pay the freight on the balers and other equipment, and on the hay that was sent back.


William Earl Rowe: What is
covered by expenses in marketing cattle? If the government pays relief to the farmer and provides feed and fodder for what cattle are left, what would be meant by expenses in marketing their cattle?


James Garfield Gardiner: That is probably a long story, but that matter is covered by this item. There is 83,000,000 in this item that is not an expenditure; it is included in the first item of $13,750,000. In order to handle the cattle that were moved by the voluntary marketing set-up, it was necessary to have a revolving fund, which was provided by means of a warrant. Three million dollars of this money cover that fund. Probably I should give some information to the committee with regard to the plan followed.


William Earl Rowe: How many were shipped in 1937?


James Garfield Gardiner: I shall give that in a moment. In previous years we have had some difficulty in securing feed and fodder, but it was obvious to everyone at the beginning of the season this year that there was not sufficient feed and fodder in western Canada to feed the live stock that was there. I said during the debate on the address that we made arrangements for 70,000 farmers to keep about
280.000	head of cattle. A total of 280,000 head of cattle consuming a ton and a half per head means a considerable amount of fodder. This is covered by the figures I gave a few moments ago. We made provision also for the farmers in the same area to keep an average of nine horses each. Nine horses each for 70,000 farmers mean 630,000 horses. When you start to feed that many horses at the rate of a ton and a half to two tons of hay, you must have a considerable amount of fodder.
It will be realized that the amount of feed and fodder which we shipped in was not nearly enough to keep that live stock through the whole winter. Much of this fodder had to be got together by the farmers and a good deal was of a very poor quality. At the beginning of the season there were approximately 600,000 head of cattle in that area. We said that the farmers could not expect the government to take care of more than
280.000	head, and we hoped the people would get rid of the difference between that number and 600.000. Everyone realized that that was quite a task with the ordinary facilities

for marketing live stock, particularly when much of the live stock was not fitted for market. It was an impossibility to get rid of that much live stock without the farmers having to take a great loss while it was being done. So we decided to assist the farmers in the marketing of their surplus live stock.
Within a week of the time that we were convinced that fodder could not be obtained, we set up an organization. I am not going to maintain that no mistakes were made in setting up an organization to handle in the neighbourhood of 100,000 head of cattle. You cannot expect to set up an organization in a week's time to buy and sell that number of cattle without making any mistakes. There was recommended to us a Mr. O. Freer, living in the city of Winnipeg. At one time this gentleman had handled cattle for a cooperative organization and he was the secretary of an organization of stockmen. We asked him to take charge of the task of assembling and marketing these cattle and he agreed to do so. As I said a moment ago. he built up an organization within a week of the time when he was asked to do so.
Mr. Freer opened up an office in Carberry. He did this because, we were fencing something over 100,000 acres as a pasture at this point. We hoped to bring many of the feeder cattle to this point and he set up his office there. There was a Mr. Bailey who was acting as clerk, and a Miss Baker, as stenographer. He had a staff of graders and buyers as well, a list of whom I have before me. These men were paid S6 a day and expenses to go through the drought areas in Saskatchewan and Alberta to grade and purchase cattle. We asked the secretary treasurers of the municipalities to take charge of assembling the cattle. We agreed to pay the municipal organizations for the use of their secretary treasurers for the three jobs that we had to do during the two or three months of the season. One job was to assemble the cattle; another was to assist in distributing food that had been purchased in eastern Canada and British Columbia and shipped into the drought areas, and another was to assemble all information necessary for the distribution of feed and fodder within the municipality. The secretary treasurer was paid $125 a month for two or three months to do these particular jobs. He arranged to have the cattle assembled at two or three points in a municipality.
He advertised that we would pay the Winnipeg price, less freight, for all butcher cattle that were ready to go to the abattoir. We would pay the Winnipeg price at the initial point for all feeder cattle, and we

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would pay 81.25 a hundred pounds for all canner cattle at the point at which they were assembled. With this information in their hands the individual farmers brought their cattle to the assembly points at which the grader and buyer graded them and bought them. The individual was paid cash on the spot just as though he had taken his cattle to the market. If the cattle were butcher cattle, they were taken to the abattoir in Edmonton, Winnipeg, Calgary, Moose Jaw or Regina. If they were canner cattle they were taken to various points and sold for what they would bring on the market at that time. The feeder cattle were sold on the stockyards to feeders from parts of the United States and other parts of western Canada or of eastern Canada, or were taken to the pasturage at Carberry and auctioned off to farmers who gathered there from eastern and western Canada. These farmers bought the cattle at auction and took them home, and if they shipped them to the east we paid half the freight on the cattle provided they kept them for three months before marketing them. We estimated at the beginning that we would require a considerable amount of money for this, but we found in the actual transaction that we did not require more than a fraction of the $3,000,000 included in the warrant provided in the supplementary estimates. The cattle were bought and sold. We bought 89.333 head of cattle.


William Earl Rowe: They were shipped out of the district?


James Garfield Gardiner: Yes; and the net purchase price of the cattle was 81,438,188.21; the net sales price was $1,250,102.07; so there was a loss taken of under 8200,000 on 89,333 head. In addition to that, there were freight charges which bring the total loss, in round figures, to 83.80 a head, or 8340,000.


Mark Cecil Senn: That includes transportation
charges?


James Garfield Gardiner: Transportation, administration costs and all netted a total loss to the government of 8340,000.
Mr.	ROWE	(Dufferin-Simcoe):	How
many of these cattle were shipped to the United States?


James Garfield Gardiner: I have not the exact
figures, but it was a very small number. Most of these cattle went to the abattoirs in Winnipeg, Edmonton and Regina, and to eastern Canada.
Mr. ROWE	(Dufferin-Simcoe):	There
were a good many shipped to eastern Canada.


James Garfield Gardiner: We estimated that
out of this group there would be 20,000 head shipped to eastern Canada as feeders, but many more were shipped that did not come into this group at all.


William Earl Rowe: At present prices there will be another loss to absorb there.


James Garfield Gardiner: Not on these cattle.
The feeder cattle were purchased at an average price of 817.31, so they will not take much of a loss on those.


William Earl Rowe: It depends upon what the cattle were like.


James Garfield Gardiner: They were good cattle
or they would not have been purchased as feeders. The poor cattle were all culled out, and the feeders were graded in carload lots at the pasturage. All the breeding cattle taken to pasturage were tested for T.B. and Bang's disease, and those who purchased them took them out of the area clear of disease. So I do not think anyone who took those cattle out at those prices is going to lose very much money.


Mr. LEADER:: As one fairly conversant
with the situation in western Canada, I want to take this opportunity of congratulating the Minister of Agriculture upon the really first-class job he did in handling the situation. His energy and sagacity in dealing with this great problem are, I think, highly creditable to any man in the Dominion of Canada. He mentioned Mr. Freer of Winnipeg, who had given him great assistance. I should like to take the opportunity of mentioning also Mr. Byers of Saskatchewan and Mr. Davies of Manitoba, two gentlemen who I believe, also gave great service. On a visit to Saskatchewan last year, I met buyers from the old province of Ontario. Cattle men can usually spot each other without wasting very much time-birds of a feather flock together, you know. In conversation with these men I found they all said that the system inaugurated by the minister was the cheapest and the best as far as they were concerned. They could go to Carberry and buy at auction, at their own appraisal, the cattle that suited them best, and they were thereby saved the expense of a trip through the country which might take a week to gather up a load of cattle. The only fly in the ointment, I think, is the fact that many of these cattle came to Ontario for feeding purposes. When they were purchased they were worth the money at that time, but owing to the slump in the market at the present time I think the farmers who are feeding these
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cattle stand to lose some money or, at best, to break even. This is regrettable.


Miss MACPHAIL:: They will lose money.


Harry Leader: They will lose, as the hon. member for Grey-Bruce suggests; on the other hand perhaps they made considerable money last year, and after all we make it one year and lose it the next. We have to take our chances as far as that is concerned. What I rose to say was that we appreciate the work which was done by the minister and his helpers in taking care of a grievous situation in western Canada.


Mark Cecil Senn: I want to corroborate what
the hon. member for Portage la Prairie has said, but unfortunately I am afraid that the farmers of Ontario who bought these cattle are not going to make much money out of them. I understand that some of them are very much disappointed with the results, no matter what the trouble is due to. However, I did not rise to speak about cattle.
I want to ask the minister to give us some more information about the price paid for feed grain. He told us that 7,618,000 bushels of feed grain for Saskatchewan had cost $5,636,000. which is approximately seventy cents a bushel. I suppose a large proportion of this feed grain was either barley or oats, and if one looks at the market quotations which appear in the papers from time to time, and the price in Ontario, one will see that it is very much below seventy cents a bushel.


James Garfield Gardiner: That amount included
the freight and shipping.


Mark Cecil Senn: I suppose a large proportion
of this feed grain was purchased in Manitoba or Alberta, so the freight from these points would not be very great as compared with the freight from Fort William. I should like to know where this grain came from, where it was purchased and the price, and what difference in the price the freight made. Seventy cents a bushel seems a high price to pay with prices for oats and barley as they have been in the last six months.


James Garfield Gardiner: 
Mark Cecil Senn: That is feed wheat.


James Garfield Gardiner: Yes, and in some cases it is fairly good.


Mark Cecil Senn: It is a low quality wheat.


James Garfield Gardiner: There was no feed wheat this year, but they estimate the cost per pound of wheat as against oats or barley or anything else, and ship in the feed that will give the best returns. There is a considerable amount of wheat and barley, some rye and more oats; but even oats at the present time in the district in which I farm will cost between sixty and seventy cents a bushel. We are not in the federal area. For oats that is the cheapest figure we can get by the time it is shipped in from Manitoba.


William Earl Rowe: I have been buying oats shipped to my farm from western Canada at fifty cents.


James Garfield Gardiner: I wish the hon. member could ship some of that back to Saskatchewan ; he must have had a preferential rate to get it down to that price.


William Earl Rowe: That is the market quotation; I bought oats two weeks ago at fifty cents.


Alexander McKay Edwards: 
James Garfield Gardiner: With reference to the remarks of the hon. member for Dufferin-Simcoe, I suggest that the hon. member for New Westminster could probably explain the question of freights much better than I can. If the hon. gentleman were living in the west, he would find that oats can be shipped from the centre of Saskatchewan probably to the middle of Ontario cheaper than it can be shipped from some places in Manitoba to some places in Saskatchewan. As a matter of fact, you can ship grain from Saskatchewan to China, according to what our friends on the coast say, just as cheaply as from Saskatchewan to Vancouver, if it is to be used in Vancouver.


Henry Herbert Stevens: That is right.


James Garfield Gardiner: The same thing happens in connection with grain rates all over the west. If you start to ship grain across the routes that grain travels under the Crowsnest Pass rates, you will find that the freight rate is considerably higher when you ship a few hundred miles between points in western Canada than when you ship all the way to the port in the east. You cannot, therefore, gauge prices in Ontario on the basis of what we may have to pay for shipping grain north and south across areas in western Canada or for shipping from eastern Canada west into Saskatchewan.
With respect to the question of shipping cattle to the old country, earlier in the session some hon. member asked a question on the orders of the day with regard to this very matter, and I indicated then that we had three men in Montreal working on the question for about a week, two of them representing the Department of Agriculture and one the Department of Trade and Commerce. These men saw all the shippers and everyone who was interested in shipping cattle to the old country, and they brought back a report to us to the effect that the chief difficulty was the question of getting freight with which to fill the holds of the ships this year in order to make it possible to ship cattle on the deck at the rates at which cattle can be taken to the old country. The chief reason is that very little wheat is going from Canada to European countries this year; there was little wheat grown. Our recent reports indicate that that situation has been relieved greatly during the last few weeks.
The reports which I get from day to day are to the effect that even now it is questionable whether it pays better to ship cattle to the old country than to Chicago. At the time when we were first discussing the question the price was around five cents a pound. I do not know what prices are to-day, but within the last few days it was seven cents on the Toronto market. I venture to say that any of the cattle bought under the scheme we have been discussing to-night, which have been fed and can be sold at seven cents a pound, will make good money for the farmers who bought them. We had a man checking the stables of most of those who brought down cattle from the west under this scheme. There are approximately
20,000	head of these cattle that are being fed. We have also checked the stables of some of those who have cattle which they bought from men who went to the west and brought back considerable numbers hoping to make something out of them. Certain individuals brought as many as 14,000 head into certain areas of Ontario and resold them. Last fall they were sold at prices which looked reasonable, but I have no doubt that at the present price of cattle some of these men- perhaps most of them-will take a loss. That, however, has nothing to do with the cattle which came down under the scheme that I have been outlining. They were brought down from the west by people who did a good service to western Canada. They went and bought the cattle, brought them down and placed them on farms in eastern Canada. There are others who went west under the halffreight plan, bought cattle themselves throughout the area and brought them back, and they are feeding them. It is possible that some of them paid too much for the cattle and will consequently lose money.
We have been making every effort to get shipping space for cattle for the old country. At the moment there is available space for between 40,000 and 50,000 head. We could ship many more than that to the old country this year if it were possible to get space. The main difficulty is the fact that three years ago they wanted to ship 6,000; the year before last, 36,000; last year, 9,000, and this year they want to ship 60,000. Anyone who considers these figures will realize that it is impossible for shipping companies to prepare for a trade which varies to that extent.


Alexander McKay Edwards: The information which I received about three weeks ago was that space was available for about 40,000 head. The drovers tell me that they should have
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space for about twice that number, and they say that bottoms are not available for shipping to the old country owing largely to the increase in the quota to the United States the year before, running to between 180,000 and 200,000 head.


James Garfield Gardiner: We shipped about 300,000 all told.


Alexander McKay Edwards: Well, whatever the quantity was. They were diverted to the south. The story they tell me now is that the control of the space going to the old country is in the hands of three men, one in the old country, one in New York and one in Montreal. They are taking advantage of this situation to buy the cattle at the United States price, and bottoms not being available to ship them to the old country, the farmers have to take that price. The cattle stand them at the present time about five to five and a quarter cents a pound, some more than that, and they tell me they will lose not less than $10 an animal, which to Waterloo county will mean about $180,000. It is a serious situation. If that is right, and if this space has been taken up by three men and held in that way with the idea of beating down the price to the farmer, some action should be taken. I know the minister sympathizes with the situa- [DOT] tion, but cannot something be done to put a little pressure on to get these cattle across?


James Garfield Gardiner: I have no brief for the three men who are shipping cattle and have the space; but as far as I have been able to find out, it is not a new thing, it has been the condition for many years. I think the hon. member for Kootenay East will agree with me that three men have controlled most of the space for a number of years. But they controlled it in the years when we were shipping 6,000 head and when we were shipping 60,000 head; they have had to take it both ways.
There is perhaps something more important to be done than merely getting control of the space that these men may have. Whoever had that space would have considerable difficulty in using it with satisfaction if we are to have such variation in the shipments of live stock to the old country. We may have to devise some plan to prevail upon our people to ship more regularly.


George Halsey Perley: And ship fewer south.


James Garfield Gardiner: It cannot be worked out in a moment. We have seen all the shipping companies that have space, gone fully into the matter with them, but have been unable 
to find any additional space in which cattle can be shipped to the old country at the present time to save anyone any money.


Alexander McKay Edwards: Not only is the situation serious this year; but if unfortunately the same conditions that we had last year should recur in western Canada, I think there will be a great deal of difficulty, after the recent experience, in having feeder cattle again brought to Ontario. I am sure the minister is doing the best he can; but I know a number of farmers in the county of Waterloo-and I am sure the Minister of Trade and Commerce will bear me out in this-who are going to lose a lot of money, and they will be reluctant to go into a similar deal again.


Henry Herbert Stevens: There is no doubt about the difficulty of handling the export of cattle to the British market. The minister is right in pointing out that the tendency which arises from time to time to abandon the British market in favour of the United States market when the latter market opens up is an old and serious difficulty affecting the continuity of supply to the British market. There is no doubt also that over a long period of years certain large exporters have substantially controlled the existing space on ships going to the old country. Of course they are in the business in a large way, and they give the shipping companies some assurance of continuity of freight. The difficulty comes about in this, that it costs a shipping company a substantial, sum to equip a ship to carry cattle, and when it is so equipped, that space is not suitable for general cargo returning to this country, so it is a handicap unless the supply of cattle moving to the old country is more or less regular. We found this condition back in, I think, 1931, and what was done at that time worked pretty satisfactorily and, I submit, might be again considered by the minister. The parliament of Canada voted a sum of money for equipping ships to handle cattle. If my memory is correct, this cost $14 a stall. Again speaking without the record, I believe a stall will accommodate three large animals or four small ones. The shipping companies were paid the cost of installation of these stalls, and we also took . pains to assure a certain number of cattle being shipped over a period of time, so that the shipping company was assured of a reasonable return for devoting that space to this class of business. In that way the records will show that we moved in certain years quite a substantial number of cattle.


James Garfield Gardiner: You guaranteed them so many trips.

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Henry Herbert Stevens: Yes. As a matter of fact the movement continued after that guarantee, and the movement of cattle was greatly facilitated. One unfortunate feature is that the small independent shipper, by the very nature of his operations, simply cannot guarantee continuity of supply. So the Department of Trade and Commerce joined with the Department of Agriculture in an effort to stabilize the supply by the smaller shippers, or made accommodation available to the smaller shippers so that supply could be guaranteed; and this greatly expedited the movement of cattle to the mother country.
In view of the circumstances mentioned to-night, it might be well to review the practice of those years and consider the advisability of again paying the cost of equipping ships for carrying cattle. The sum required was not large compared with the value of the service and the results achieved.
Back of it all lies this problem: The British market offers an excellent outlet for Canadian cattle, but we can hope to hold that market only if our cattle move forward with reasonable continuity and of suitable quality. These are essential factors in marketing Canadian cattle in the British Isles. If it were possible to organize the disorganized farmers so that continuity of supply to the British market might be assured, this would go a long way to solve the problem of the British market and at the same time to ensure that the shipping companies would provide continuous space for the cattle movement. I think the experience of the Department of Agriculture and the Department of Trade and Commerce in 1931, 1932, 1933 and 1934 might be considered in the present circumstances.


Mr. EULER:: That continuity of supply applies to many other commodities.


Henry Herbert Stevens: It does, but this question of the movement of cattle is vital. There is serious distress; in fact, the interjection of the minister tempts me to point out that the price of cattle to the farmers in Canada is not a fair price or one based upon the law of supply and demand at all. It is fixed in Toronto by the heads of the packing institutions, and that condition is unfair to the farmers. I am going to have more to say about that later on. I feel strongly on this question, because next to grain, if not indeed equally with grain, the marketing of live stock is one of the largest items in the production of new wealth in this country. There is no question in my mind-and I have given the matter a great deal of study-that the farmers of Canada are to-day, and have been-I was going to use the word "defrauded"-deprived, and unjustly deprived, of millions of dollars
annually that they should get. I am prepared to prove that, and I shall do so one of these days. I am almost tempted to proceed with an analysis of these conditions, but I did not rise for that purpose to-night. When it is suggested that these conditions apply to other commodities, that is true, but there is nothing in the whole realm of activity in Canada to-day comparable with the unfairness in connection with marketing live stock.


James Garfield Gardiner: The officials who went to Montreal and other eastern ports at the time mentioned, three or four weeks ago, did review what had taken place along about 1931 and 1932, and had in mind an endeavour to arrange something similar at this time. That could not be done to advantage because of the fact to which I referred a few moments ago. Boats that are going to carry live stock on their decks must carry something else in their holds in order to pay for their passage across the ocean. We found that it was absolutely impossible to do what was done in 1931 if we were to be able to pay the additional cost of doing it. We would have to pay practically the whole cost of a boat going across the ocean and back again, and when we figured that into the costs it was found impossible to obtain anyone who would undertake the work at any price that we could pay. Then, as the Minister of Trade and Commerce says, we could not have obtained sufficient space in any case. There would have been a very small increase in the space that would have been available.
With regard to the last few remarks of the hon. member for Kootenay East, while there may be a great deal of truth in the statement that we are not obtaining enough for our cattle, I think it is pretty well agreed, particularly by those of us who are raising cattle, that there is a feature of the present situation which should be mentioned when we are discussing it from that point of view. Cattle were seventeen cents a pound live weight on the Chicago market at one time last year, and I think one day they were even eighteen cents. Someone says they were nineteen cents. When cattle are nineteen cents a pound in Chicago, no person, either in Ontario or elsewhere, is going to ship cattle to Great Britain.


Alexander McKay Edwards: Did they have cattle to ship at that time?


James Garfield Gardiner: Yes, a great many were shipped at that time.


William Earl Rowe: How many were shipped to the United States at that time?
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James Garfield Gardiner: So many were shipped just prior to the time they were seventeen cents that we went beyond our quota in a month and a half when we had not expected to go beyond it at all this season. At the beginning of June we were thirty thousand behind as coirmared with the year previous, but after the middle of August our quota had been entirely taken up by the shipment of cattle to the United States. The fact of the matter is that beef got so high in the United States that people began to get out of the habit of eating it. When the price of beef rises to nineteen cents a pound in these times, many people cannot eat it. Whether or not that was the whole cause, something did happen in the United States, and beef went down to a very low price. Then for a few months it paid better to ship cattle to Great Britain, and the farmers went into the shipping of cattle to that market. But I am told by those who have been keeping in close touch with the market during the last week or so, that not very many want to ship to Great Britain. They want to ship to Chicago again, because the price is going up. In other words, these two markets, one on each side of the province of Ontario, do have some influence on the price of cattle in Canada.
If we should have an arrangement under which we could land our cattle continuously in the old country, and supply the market over there, we could do very much better than we are able to do by shipping spasmodically, as has been the case in recent years. When we were discussing this question over there two years ago, the main problem in the minds of the British people who were concerned about the matter was where they were going to get their meat supplies. They had no objection to arranging for meat supplies from Canada, but they had to be fairly well assured that they were going to get those supplies somewhere. If they were to undertake to cut down their supplies of meat from the Argentine, they wanted to be absolutely certain that we could send them their supplies every year. From my experience over there, I am quite satisfied that if we should give an undertaking to the old country that we could supply a certain number of cattle every year, the British market would take all the cattle we in Canada could fit for that market. But I think we shall have to be prepared to develop some plan under which they can be fairly well assured that if they get 60,000 head this year, they will get 60.000 head next year and the year following. If we wanted to put it up to 100,000 head, we could do so if we could so arrange matters that we could con-

tinuously supply that market with 100,000 head a year. I do not think, however, we can do that under anything proposed here.


Mr. WEIR:: I should like to say just a word at this time with particular reference to the movement of cattle from western Canada into Manitoba. The discussion here to-night has demonstrated clearly the creditable accomplishments of the Department of Agriculture last fall in the handling of cattle from the drought areas of Saskatchewan and Alberta. We regret, of course, that the probable returns for the finished cattle on the feed lots, not only in Ontario and Quebec b it also in Manitoba, may not be as good as one might have hoped, and no doubt some of the people are going to be disappointed.
I should like to make a reference to the pasture field at Carberry. A concentration point was established there, and in that pasture field there are 130,000 acres. It was all fenced by the dominion government; corrals were built; provision was made, as the minister has said, for testing these cattle for tuberculosis as well as for some blood tests in connection with cattle that were exported to the United States. The total cost was in the neighbourhood of $20,000, and some 18,000 head were handled through there. There is a splendid pasture field there, with plenty of water; and, by the way, last fall that field could have handled a considerably larger number than the
18,000	head which were there. So the cost per head was roughly one dollar, which is a very, very reasonable price.
The point I wished to mention more particularly was the attempt to establish auction selling. The accommodation was very good. These corrals were erected,; there were sorting chutes, and so forth. Men employed there sorted these cattle into uniform lots; they were brought into a yard and then sold by auction. These sales were attended by men from all over the country. I think something was started there that is well worth following up. When we look at the heavy shipments of cattle that ordinarily come from western Canada in the fall of the year, loading our stock yards with a burden they can hardly handle, something may be accomplished in the way of securing a proper price for our cattle through auction selling. This concentration pasture for cattle certainly showed that auction selling could be done, and that people would come there to buy cattle. More than that, I was there on one or two occasions, and invariably the live stock commission men were not buying cattle, because they said they were too high. The result was that those

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cattle were being purchased by farmers in Manitoba, Ontario and Quebec, and also some from the United States as well. That, in my view, reacts to the credit of the Department of Agriculture in that they were able to organize a scheme whereby full value could be secured, for those cattle. Often we hear that governments cannot do business as satisfactorily as private institutions. This is one illustration where a government has accomplished something very much to its credit.
A few days ago reference was made to horses which had been put in the same pasture fields, after the cattle were moved out. Some people said that many of those horses died, and that some were not in fit condition to move back to the places whence they came. I had occasion to make inquiry about them, and I find that some local people were taking considerable interest in the pasture field. The horses that are in there are put there by the Saskatchewan government, and not by the dominion government at all. A considerable amount of hay was provided for them, in addition to the pasture they could take from under the snow. Unfortunately the snow became deep, and hay had to be fed. As a matter of fact, a number of those horses were up in years, and their teeth were not in good condition. They were not in a condition suitable to stand outside wintering, and to get their own living from under the snow.
However, despite that condition, provision was made to bring those same horses to the corrals, and they were even fed some grain. Therefore, so far as the attention given to the live stock in that pasture field is concerned!, I would say that it has been well cared for. My chief purpose in rising was to point out what really had been accomplished in the pasture field, and to indicate that, so far as my observations are concerned, it reflects creditably on the Department of Agriculture.


Alexander McKay Edwards: To get back to what
the minister said about the price of cattle last fall on the Chicago market, may I say that what he pointed out did not help the case I was trying to bring to his attention. These cattle are now ready for market. Seven thousand will be shipped out of Waterloo county in the next two or three weeks, and the point I wish to bring out is that there is only space for 40,000 cattle to go to the old country and to take advantage of that market, when a space for 80,000 is required. Under the circumstances I would urge the minister to accept some of the suggestions
of the hon. member for Kootenay East with respect to making some arrangements to get these cattle into the old country market. If, as the minister has indicated, conditions have changed within the last two weeks, the problem may be partly solved. I must point out, however, that it is a serious one in my district.


James Garfield Gardiner: I agree with that; we
are doing everything we can. I am speaking from memory, but my belief is that we had succeeded in increasing by approximately
10,000	the number that could be shipped. That would still leave it betwen 50,000 and
60,000,	despite an increase of 10,000 more than 46,000. Our information was that by following the plan which had been followed before, we could not get the results this year. We tried at every port, going as far south as New York, to make arrangements, but satisfactory arrangements could not be made. We are still keeping in touch with the situation, and trying to move as many cattle as possible to the old country.


Hugh Alexander Stewart: We are now discussing
item No. 469. involving an expenditure of $13,750,000. The minister agreed that with that item we might discuss items Nos. 462 and 463.


James Garfield Gardiner: Item No. 462 with the item the hon. member has mentioned, and item No. 463 with the following item.


Hugh Alexander Stewart: They are all similar.


James Garfield Gardiner: No.


Hugh Alexander Stewart: Item No. 463 is for
direct relief in the dried-out areas, and provides for a further amount of $2,000,000. Item No. 462 is to provide for feed and fodder relief in the dried-out areas. I suggest that they are kindred subjects. Let us take those two items, with the $13,750,000 in item No. 469, the $7,640,000 in item No. 470 and the 81,000,000 in item No. 471, and add them together, and we have a grand total of $28,390,000. Those are the expenditures provided in these supplementary estimates, for two provinces.
The size of the amount must impress the committee with the seriousness of the situation, and the extent of the disaster which has overtaken those provinces. There is no doubt that conditions could not be entirely foreseen. Some provision was made in the special estimates of last year. I desire now to call attention to the fact that the items now under consideration involve an expenditure of 829,371,500 by governor general's warrants.

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Charles Avery Dunning: I think the hon. member has unwittingly enlarged the amount under the warrants. There are three amounts under warrants.


Hugh Alexander Stewart: 
Charles Avery Dunning: No; that is in Ontario.


Hugh Alexander Stewart: But it is on governor general's warrants, and that is the point I am discussing.


Charles Avery Dunning: As a whole? '


Hugh Alexander Stewart: 
Charles Avery Dunning: Yes, all by warrants.


Hugh Alexander Stewart: Yes, all governor general's warrants, and that is a large sum of money to be provided in that way. I recall over a period of years a very severe criticism of this method of providing money. So far as possible we should anticipate our requirements. They should come down in estimates to be voted by the house, and it is only in connection with extraordinary expenditures that resort should be had to governor general's warrants. Undoubtedly a considerable part of this expenditure is of that kind. It could aot be foreseen-


Charles Avery Dunning: The whole of it.


Hugh Alexander Stewart: I would not say the whole
of it. I believe the government must have been well aware that a considerable amount would be required in Saskatchewan in this connection; conditions have been very bad. Then, to come back to the two items-the minister seems to shake his head at everything I say-


Charles Avery Dunning: I was agreeing with the hon. member right along until a moment ago.


Hugh Alexander Stewart: We are coming now to the point about which I would rather have the Minister of Agriculture agree with me. There were estimates in connection with items Nos. 462 and 463 which are not items under governor general's warrants.


Charles Avery Dunning: If my hon. friend will permit me, I can clear that up immediately. The amounts covered by items Nos. 462 and 463 have been required since this house commenced to sit. My hon. friend will remember that a governor general's warrant cannot be issued while the house is sitting. Items Nos. 470, 471 and 472 are in connection with governor general's warrants which were issued prior

to the meeting of the house. We could not take care of the further expenditures which developed as being necessary by that method, so we are asking the committee to vote items Nos. 462 and 463.


Hugh Alexander Stewart: 
Charles Avery Dunning: Exactly the same thing.


Hugh Alexander Stewart: That is what I was starting out to make clear, that they were the same.


Charles Avery Dunning: They are exactly the same.


Hugh Alexander Stewart: If I understand the minister aright, he admits that if the house had not been in session the two items amounting to $3,000,000 would probably have been provided for by a governor general's warrant.


Charles Avery Dunning: Most certainly.


Hugh Alexander Stewart: That makes my case that much better.


Charles Avery Dunning: This afternoon the minister undertook to discuss them together because they were the same thing.


Hugh Alexander Stewart: 
Charles Avery Dunning: So far as the votes are concerned, not the warrants.


Hugh Alexander Stewart: I understand that after the house is in session, moneys required for purposes of this kind would be provided for by votes similar to votes Nos. 462 and 463.

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James Garfield Gardiner: The moneys provided by items Nos. 462 and 463 have not all been expended, but those are not governor general's warrants.


Hugh Alexander Stewart: Has the whole amount of item No. 469, that is 813,750,000 been expended?


James Garfield Gardiner: An amount of 83,000,000 for cattle is included, in that, and as I indicated, there was only 8340,000 of that ultimately expended.


Hugh Alexander Stewart: By governor general's warrant after the session began?


James Garfield Gardiner: That was made available last year.


Hugh Alexander Stewart: Everyone admits that it would be irregular to pass governor general's warrants after the session has started, but in my opinion expenditures under governor general's warrants should not be made after the session begins. We should adopt the same course that has been adopted in connection with items Nos. 462 and 463.


Charles Avery Dunning: If my hon. friend will permit me, I shall try to explain that. With regard to the amounts involved in the governor general's warrants, everyone knows the test under the Consolidated Revenue and Audit Act is whether or not the expenditure is urgently needed for the public good and could not be foreseen. In connection with the first of these votes, No. 468, we could not foresee the flood in western Ontario at the time this house was last in session. The amount for that purpose was urgently necessary for the public good.


William Earl Rowe: Pretty
small.


Charles Avery Dunning: It was in the form of a grant to the Red Cross which I shall deal with when that vote is before us. When this house was last in session we could not foresee another drought in western Canada in 1937. We did make provision in the estimates for the fiscal year 1937-38 to take care of the conditions which had carried over from the previous drought. The expenditures contemplated in item No. 469 are due entirely to the fact that a new drought came along in 1937 after parliament had prorogued. The same is true of item No. 470 to cover relief expenditures in the drought areas amounting to
87,640,000,	and the same applies to the item of $1,000,000. The item of $6,500 was emergently and urgently necessary because the radio station at Fort Smith burned down.
51952-121-1


Hugh Alexander Stewart: I am not discussing that.


Charles Avery Dunning: Item No. 473 provides for additional expenses of the royal commission on dominion-provincial relations. We did not foresee the need of these additional expenses, but I shall deal with this matter in its proper place. The next item is for $6,890,000 and covers a matter which is always dealt with in this way. This is the course followed when the deficit of the Canadian National Railways has been underestimated in the main or supplementary estimates for the year in question. I may say that the underestimation of this deficit, making necessary this warrant, was brought about by the same emergent and unforeseen conditions as made necessary votes Nos. 469 and 470. The railway deficit would not have been greater than was estimated had there been a crop in the drought areas of western Canada.
There is one point brought up by my hon. friend in connection with which he is entitled to an explanation; that is, his reference to the handling of these cattle. We had to find the means of providing the money wherewith to take these cattle from the farmers and market them. The legal advisers of the government told us that the only possible means of getting money for that purpose was a governor general's warrant. We replied that we did not require all the money as we would be selling the cattle and most of the money would be coming back. They told us, however, that we must have authority for the' whole amount which we planned to spend. That is why the $3,000,000 is included in the $13,750,000, in spite of the fact that all of the $3,000,000 will come back with the exception of the amount represented by expenses and loss, which I think the minister gave as $340,000. The amount necessary to be provided in the first place could be obtained only by a governor general's warrant.
Mr. MacJvICOL: Why would the expenses be chargeable to the country?


Charles Avery Dunning: The Minister of Agriculture has explained several times exactly how it worked. I am afraid my hon. friend could not have been in the chamber.


John Ritchie MacNicol: I understood the Minister of Finance to say that all the money had come back except the expenses. Why has not the 8340,000 come back?


James Garfield Gardiner: The whole 8340.000 did not come back. That is the loss we took on the cattle we handled.


John Ritchie MacNicol: I cannot see why there
should be any loss.
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James Garfield Gardiner: If the hon. gentleman
will read Hansard to-morrow he will find it all in there.


William Hayhurst: I should like to say
a few words regarding this loss on cattle. We have a ten per cent exportable surplus of cattle in Canada, the other ninety per cent being consumed in this country. Our farmers are actually selling cattle at a loss ten times out of twelve, and that applies from 1920 to 1938. Yet here we are voting large grants of millions of dollars to buy feed for cattle which will be sold at a loss. That is what it amounts to. We have all done that, and we are doing it now. Go into the province of Alberta, where they have plenty of feed, and you will find that the farmers will not feed their cattle. They say: " What is the use of using high-priced feed for cattle which will have to be sold at a loss?" They prefer to sell their feed to the drought area because they can get more for their feed in that way than by feeding it to cattle. It pays them better to sell the feed. As a farmer I know perfectly well that as soon as I purchase feed and bring it to the farm, there is a loss.
We talk about railway deficits, and we talk of raising the wages of railway men and civil servants, and of consumers who would eat beef, but they will not pay the price for beef. We raise railway wages and the price of everything except the price of the very thing the farmer has to sell, and I would point out that the greater proportion of the people of this country are farmers. With increased wages the consumers of this country ought to be buying more of the products of the farm. We have a quota for our cattle shipments to the United States, and as we have a ten per cent exportable surplus of cattle, why should we not ship our cattle to Great Britain and have a quota there? The farmers in the western provinces, particularly in the foothills of Alberta, could produce live stock in abundance if they were given any opportunity of producing it at a profit; but we are actually producing it at a loss, and therefore we are submarginal in regard not only to raising grain but to raising cattle as well. You bring cattle down from the west to the east, and find that you have no market for them. The poor people in Wellington county have to use high-priced feed to feed the cattle and then sell them at a lower price than they bought them for.
Hon. gentlemen to my right are always seeking to make the wages of railway men higher, while the farmers' wages are brought down to nothing. We cannot get anything for our cattle. The people who have had

their wages raised to the limit will not buy the stuff, and the result is that the farmers, who are the back-bone of Canada, are suffering. Hon. gentlemen to my right want industry to be prosperous and wages high, but people getting high wages will not buy beef.
There is something wrong with our economic structure and there should be some stabilization or equilibrium or equation whereby those who are the back-bone of this nation should be able to get the living they are entitled to. I am certain the Minister of Agriculture, when he goes over to Great Britain, can find a market for our beef over there. He may say that the boats are not available; but if we have not a steady flow of cattle and beef products going over there, naturally the boats are not going to be available. I guarantee that Alberta alone, if I went through the western foothills, would ship several thousand head of cattle a year to Great Britain.


Charles Avery Dunning: Provided the price in
the United States was not higher. That is the joker.


William Hayhurst: I know that is the
joker, but we cannot rely on the United States market alone. Therefore I say that we should be given a quota for the shipment of our cattle to Great Britain. When the hog quota was established a few years ago-I was not in politics at the time-I know our farmers were pleased and people went about Alberta telling our farmers to raise hogs because there would be a market for them in Great Britain.


John Ritchie MacNicol: But the farmers did not show their appreciation by their votes.


William Hayhurst: There was something
wrong with the Conservative policy.


John Ritchie MacNicol: The Conservatives got
the farmers the quota, but the farmers did not show their appreciation by voting for the Conservatives.


William Hayhurst: Pardon me, Mr. Chairman, for getting drawn into an argument on the side. My contention is that thousands of cattle in western Canada die every year because they cannot be fed at a profit. Hay is too dear, and what is the use of carrying cattle through several winter months if they are going to be sold at a loss in the spring? Our railways are running at a loss. Certainly they could be run more profitably than they are now if they were carrying cattle. Our railways run east and west. The Minister of Finance says that we should ship our cattle

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to the United States. Well, we have quite a quota there, and I think we should retain it, but at the same time I think we ought to be shipping cattle to Great Britain as well.
I have in my hand the Ottawa Citizen. I have no desire to run down any particular paper, but why does it not put the price of cattle on its stock market page? It has a heading: "Buying movement at Toronto flattens out as trading dries up." It gives news of the mining market and the price of mining stocks, but look for the cattle prices in Toronto on this page! You will find no section in it devoted to cattle prices in Toronto or Winnipeg. I looked in vain for cattle prices in the daily paper to-day. There is just a little sneaking piece about the price of carcass beef in Ottawa, and the price of veal carcass is given as from six to seven cents a pound. I wonder if that is a misprint.


Mr. MARTIN:: That is a social credit
paper.


William Hayhurst: I am not saying anything about the editorials in the paper. They may be thoroughly satisfactory, but I suggest to the editor of the paper that he put on the stock market page news that country people around the city of Ottawa would like to read. Then we would probably get more votes for our cause.


George Halsey Perley: A few minutes ago the hon. member for Macdonald came to the rescue of the Minister of Agriculture and complimented him upon the splendid system he had developed of shipping out the cattle. I can to a certain extent agree with the hon. member for Macdonald, because I think the government made a splendid job of cleaning out a lot of cattle from the province-and incidentally putting many of the dairy men out of business for a year or two. Many thousands of young breeding cattle and a great many cows left the province that should never have gone out at all. As the member for Macdonald said, many of them were sold to farmers in Manitoba. Some of them were sold to farmers in Ontario. I think a great injustice was done to many of the men out there who had established small dairy herds and were getting considerable revenue from them and who would depend next year upon that revenue if the cattle were there. As I say, they will not be there. The farmers who bought this young breeding stock will benefit to a great extent. I have protested a great many times in this regard and I shall not pursue the matter further than to repeat that a great injustice has been done to many men who built up small dairy herds.
With regard to horses, the hon. member for Macdonald said that he had investigated the matter to some extent and felt sure that many of the horses were aged, some of them without any teeth or with poor teeth. I believe the opposite. I know that farmers generally shipped young horses and kept the old ones at home where they could give them attention if they got the feed. That is only natural. My neighbour shipped a fine team of black horses weighing between 1,600 and 1,700 pounds when they left. They were one of the finest pairs in the district, and when they came back they weighed about 1,250 pounds. They had lost upwards of 350 pounds.


James Garfield Gardiner: Why did men ship horses from north of Wolseley to the Carberry pasture?


George Halsey Perley: They had no feed. Take my own farm. We did not thresh as much grain as would fill a bin twelve feet by fourteen feet, taking straw and everything.


James Garfield Gardiner: That may be quite right, but the reason for shipping horses to the Carberry pasture was to ship them away from areas where 'it cost more to ship feed in than to ship horses out. While it may be true that in my hon. friend's district there was no feed, there was feed ten miles away.


George Halsey Perley: In the minister's district they were very fortunate.


James Garfield Gardiner: We were not fortunate in my district, but between my district and the hon. member's the farmers were.
Mr. PERLE1 :	They were 100 per cent
better off-


Charles Avery Dunning: May I interrupt to
suggest to the committee that this is not the only opportunity they will have to ventilate and thoroughly discuss all matters connected with the items now under discussion. There, must be items either in the main estimates or in supplementary estimates to come before the house for the new fiscal year covering matters precisely similar to those now under discussion. There will, therefore, be ample opportunity to discuss these matters. The estimates we have under consideration now are estimates for expenditures the authority for which expires at midnight to-night. No expenditures can be made under what is now being considered beyond March 31. It may be there is a desire on the part of the committee to discuss further the matter now under consideration, and I cannot complain if that is so; but I want to point out that there will be ample opportunity again to ventilate all these matters, so that the
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committee will not be losing anything by passing these estimates to-night.


George Halsey Perley: I do not intend to hold
up the estimates. I was simply tiying to reply to the hon. member for Macdonald, who has left a wrong impression. Are we discussing more than one item now? If we are discussing item No. 471 as well, I would ask the minister to tell us under what item in the main estimates we shall have an opportunity to discuss thoroughly the question of relief apart from feed and fodder. If he will tell us that, I am willing to let this item go through.


Charles Avery Dunning: There must be provision
in the supplementary estimates for the fiscal year starting to-morrow. Provision must be made for carrying along the drought area until such time as something grows there to enable the people to take care of themselves, and in connection with that it will be competent to discuss any of these items that are now under consideration. There is no question about that.


Hugh Alexander Stewart: The same intimation was made on two or three occasions this afternoon, and the passage of these estimates has been facilitated.


Charles Avery Dunning: Very much, and we
appreciate it.


Hugh Alexander Stewart: There is no disposition
to delay these estimates, but I do not think the minister will say that any member has :asked for information to which he was not [DOT]entitled or which he might not reasonably expect to receive at this time.


Charles Avery Dunning: Quite right.


Hugh Alexander Stewart: The hon. member who is now speaking was endeavouring to clear up something which has -arisen and to which, if a reply is to be made, it should be made here and now. I accept the assurance that on a future occasion, even though possibly there may be no corresponding item that is absolutely relevant, we may discuss some of these matters, particularly on some of the larger items. I take it that we may discuss them on any item that is similar. I suggest that we ought to facilitate the passing of these supplementary estimates to-night, and I assure the minister that there is no intention of holding them up.


Charles Avery Dunning: I did not think there
was.


George Halsey Perley: I was going to ask the
minister with respect to the numbers of horses that had been shipped to the Carberry pasture, the number that had returned, the

number that had died, and also whether any veterinary service had been required during the winter. If so, who was employed and at what cost?


James Garfield Gardiner: I have stated on three
occasions that we had absolutely nothing to do with that. We built a fence around that pasture last, summer, and this winter the provincial government asked for the privilege of shipping horses to the pasture. We built the fence to keep cattle there in the summer and they asked for permission to ship horses.


William Earl Rowe: The provincial government?


James Garfield Gardiner: Yes, and they shipped
about 1,500. Veterinary assistance was required for some of the horses early after their arrival. It was found at that time that over fifty were old horses, many of them without teeth, and they should not have been shipped. Some of them did die. How many of them have been shipped back, I do not know; the provincial government is handling that entirely.


[Stage Direction]
Item agreed to.
To provide for direct relief expenditures in the drought areas of the provinces of Saskatchewan and Alberta (Governor General's warrant of September 29, 1937), $7,640,000.
Frank Exton Lennard: Does this item cover any of the assistance given to farmers and their families, and stock, moved from Saskatchewan to Ontario during the past year?


James Garfield Gardiner: No. No expenditures will be taken out of this money for that purpose. I understand that the provincial government did pay freight on two carloads for persons who	were	moving from	Saskatchewan to other provinces provided they first obtained the consent of the province and the county into which they were moved. My understanding is that there is some arrangement between municipal bodies in Saskatchewan and	the	county into	whichthey go, under which arrangement relief is being paid. But	that	arrangement	is not
made out of these funds.


Frank Exton Lennard: The federal government
had nothing to do with it?


James Garfield Gardiner: No.


[Stage Direction]
Item agreed to.
To provide for the purchase and distribution of foodstuffs in the drought areas of the provinces of Saskatchewan and Alberta (Governor General's warrant	of September 29,	1937),
George Halsey Perley: I should like to have an
opportunity to study this. Will the minister

Supply-M iscellaneous
assure us that we shall have an opportunity to discuss it thoroughly later on?


James Garfield Gardiner: There will be no other item that exactly covers this particular matter, but I shall give an undertaking to the committee to allow discussion on it, if the chairman of the committee will permit me at the time.


George Halsey Perley: Under some item in the
main estimates?


James Garfield Gardiner: Under any item having to do with the provision of money for relief between now and the next crop.


[Stage Direction]
Item agreed to.
To provide for additional expenses of the royal commission on dominion-provincial relations (Governor General's warrant of January 19, 1938), $70,000.
William Earl Rowe: What was
the total estimated expenditure for the royal commission? That seems an enormous supplementary for that purpose.


Charles Avery Dunning: The amount provided last year was 8150,000. The warrant now under discussion is for 870,000, but I am advised that the amount of the warrant will not be spent. Probably some $30,000 of the amount of the warrant will not be expended during the current fiscal year which ends to-night. So that it can be roughly said that the total expenditure will be about $190,000 in the current fiscal year.


William Earl Rowe: The balance is for the coming year?


Charles Avery Dunning: The rest of the $70,000 unexpended lapses at midnight to-night.


[Stage Direction]
Item agreed to.
To provide an amount additional to that provided under vote 361 of the special supplementary estimates for 1937-38 to cover the net income deficit of the Canadian National Railways (Governor General's warrant of January 26, 1938), $6,890,000.
Charles Avery Dunning: That is the balance of the deficit of the Canadian National Railways over and above the amount provided in the estimates last year.


Hugh Alexander Stewart: I note that the date of that warrant was January 26. That is just before the commencement of the session. I assume that the reason for not letting it wait, but passing a warrant so close to the beginning of the session, is that the railway year ends with the calendar year.


Charles Avery Dunning: That is correct.


Hugh Alexander Stewart: And that they required this to balance the year; otherwise it would appear to me that the issue of a governor general's warrant on that date was perhaps not justified.
Mr.DUNNING: It has frequently happened, as I think my hon. friend will remember, that a similar situation arose just prior to the opening of parliament, the railway needing the money to close up their accounts for the year.


[Stage Direction]
Item agreed to.
To provide for assistance to sufferers from the flooding of areas in western Ontario (Governor General's warrant of May 5, 1937), $15,000.
Frederick Cronyn Betts: This money was to provide assistance on account of the flood of last spring. Most of the damage was done in London. There was tremendous devastation and property destruction, and there would have been a frightful loss of life but for the fact that the water came up in daylight and not after dark. As it was, there was only one person drowned. But it created a very serious situation, and there was a threat of recurrence a short time ago. Some scheme was undertaken whereby the province of Ontario was to make a survey of the whole Thames valley in conjunction with the federal authorities, and to plan preventive measures. How far has that survey gone?


Charles Avery Dunning: I am sorry I have no information here in respect to that matter. It does not arise in connection with this vote. All that I have here is the explanation of this warrant. It was a special grant to the Canadian Red Cross Society to enable it to assist the sufferers from the disaster to which my hon. friend refers. Perhaps he will avail himself of some other occasion, when Public Works estimates are up, or some item on which the minister concerned can give the information.


William Earl Rowe: It was under discussion recently, was it not, between the provincial government and the federal government in regard to a conservation scheme?


Charles Avery Dunning: I believe there was something under discussion, but I have no personal knowledge of it. It does not connect with my department, at least not yet.


[Stage Direction]
Item agreed to.
Miscellaneous-
Additional temporary grant to the province of Saskatchewan to enable that province to continue essential services pending improvement in crop conditions and pending report of royal
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[Stage Direction]
commission to investigate financial powers and responsibilities of the dominion and the provinces, $2,000,000.
William Earl Rowe: I do not want to hold up the committee so close to eleven o'clock, but this seems a most exceptional item. It is a further grant to the province; it is not in the form of relief or the cost of shipping cattle or fodder or feed or the movement of foodstuffs; it seems to be more or less a direct grant in assistance to the province. Perhaps the Minister of Finance might tell us what they are doing in the way of direct grants to Alberta. That province has defaulted on its bonds; yet we find that Saskatchewan has received about ninety per cent of these different grants, and now we find a further $2,000,000 being granted to that province for essential services. I only wish to point out that Alberta is perhaps recognized generally to be in more difficult financial circumstances than Saskatchewan.


Charles Avery Dunning: Oh, no. I am glad to give the information upon which this vote is based. It became apparent during last September that the whole basis of living and tax-paying in Saskatchewan was disrupted to an extent which had never previously occurred in the history of any Canadian province. It will be remembered that last session votes passed this committee in exactly the terms of the one now under discussion, following an examination by the Bank of Canada and a report to the house with respect to the financial condition of the provinces of Manitoba, Saskatchewan and Alberta. When September arrived, it became quite apparent that the $1,500,000 previously voted would be completely inadequate to enable Saskatchewan to perform the essential ordinary services on a minimum 6cale for its people, in spite of the fact that they had imposed on themselves increased taxation by way of a two per cent sales tax in order to raise the necessary funds to keep their educational system going. I have some figures which would illustrate the situation in that regard as between the three provinces. The value of the wheat crop for 1935, 1936 and 1937 in each of the three provinces-


William Earl Rowe: I do not think it is necessary to put that on the record. I believe it is generally recognized.


Charles Avery Dunning: But the figures are so staggering and bear so directly upon the question asked by my hon. friend that I think he must permit me to state that the value of the crop in Saskatchewan dropped from $101,000,000 in 1936 to only $38,000,000 in 1937, for the whole province. In Manitoba it increased from $23,000,000 worth of crop

in 1936 to $46,000,000 worth in 1937. In Alberta it also increased from $60,000,000 worth in 1936 to $72,000,000 worth in 1937. That represented a tremendous cut in the income of the people of Saskatchewan, so that practically four-fifths of them have had to go on some form of relief, partial or entire. Consequently the ability of the people to pay taxes to support their institutions was simply nonexistent. After a careful examination with the province, following along the line of the bank's report of the year before, the government decided that an additional grant of $2,-
000.000 was necessary. On the instructions of the government I wrote a letter to the premier of Saskatchewan expressing our willingness to include in these estimates such a sum in addition to that which was voted in the house a year ago.


William Earl Rowe: Did the minister say it was a million and a half a year ago?


Charles Avery Dunning: Yes.


Thomas Miller Bell: Would the minister tell the committee precisely what is included under the term "essential services."


Charles Avery Dunning: All the services of the province.


Mr. COLDWELL:: Perhaps it would be interesting if we had before the committee an outline of what those services are, because, as the minister says, the income of the province was cut so severely that none of these sendees could have been carried on. As a matter of fact, not only would the usual municipal officers have had to be dispensed with, but medical assistance in some instances could not have been maintained or forthcoming. I should like, of course, to have seen some provision made to assist the educational system of the province, which has suffered severely. I have outlined in the house previously the cuts in wages that the teachers have had to accept. Some of them, in fact all within the drought area, have had cuts amounting to sixty per cent of their salaries. In the drought area the average salary paid in cash amounted to only $10 a month in some instances, while some worked for $100 for the whole year.
These essential services are of interest to the whole dominion. They are not for any particular locality, because if the health of the people deteriorates or the children cannot secure education, this reacts adversely upon the entire life of the dominion. To my mind, this vote is one of the most deserving that the committee has been called upon to pass, and I hope it will be carried.

Ensol


Victor Quelch: What do the words "temporary grant" mean? Is it in the form of a loan?


Charles Avery Dunning: No; it is a grant.


William Earl Rowe: What is item No. 459 for?


Mr DUNNING:: That was carried this
afternoon. It is a federal district commission item, covering extra cost of snow removal and work in connection with four additional buildings, the grounds of which have been committed to the care of the commission.
I should like to thank the committee for its forbearance in this matter to-night, and to assure every hon. member that he will lose . nothing in the way of opportunity for discussion by having cooperated in putting through these estimates. I move that the committee rise, report that it has considered certain resolutions, and ask leave to sit again. I shall not present the bill to-night, as it will be necessary to make other provisions. I spoke to the right hon. leader of the opposition with regard to interim supply, which we have to provide. In that connection there is this difficulty, that there are certain items which normally come down in supplementary estimates for the new year which are not yet before the house, and hence would not be covered by an interim supply vote. It may be necessary to introduce supplementary estimates for the coming year in order to take care of the needs for a month or two under items which would not be covered now by interim supply because they are not before the house. For that reason I should like to leave the bill over.


William Earl Rowe: They are not as large as these?


Charles Avery Dunning: Oh, no, thank goodness.


[Stage Direction]
Item agreed to.
Progress reported.
On motion of Mr. Lapointe (Quebec East) the house adjourned at 10.58 p.m.
Friday, April 1, 1938