1938-06-13

[Stage Direction]
Bill No. 147, for the relief of Frank Roy Hedges.-Mr. Emmerson.
Bill No. 148, for the relief of Jessie Fields Chambers Henry.-Mr. Emmerson.
Bill No. 149, for the relief of Marguerite Oldham Jamieson Macdonald.-Mr. Emmerson.
Bill No. 150. for the relief of Ida Hillman Livermore Woodall.-Mr. Emmerson.
Bill No. 151, for the relief of Gabrielle Rachel Cecile Pelissier de Kermeno de Gou-zillon.-Mr. Emmerson.
Bill No. 152, for the relief of Millicent Bar-beau Edmondson.-Mr. Emmerson.
Bill No. 153, for the relief of Theodore Charles Grothe.-Mr. Donnelly.

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

[Stage Direction]
Motions jor Papers


Mr. HANSON:: 1.	What amount has been contributed by the federal government, since 1930, towards the construction of arterial highways in British Columbia, giving each year separately, and showing: (a) number and names of projects; (b) how much to each project per year?
2.	What amount has been contributed by the federal government, since 1930, towards the construction of mining roads, trails and bridges in British Columbia, showing each year separately, and: (a) number and names of projects; (b) how much to each project per year?


FEDERAL CONTRIBUTIONS TO TRANS-CANADA HIGHWAY CONSTRUCTION IN QUEBEC PROVINCE
Mr. SYLVESTRE:: 1.	Did the dominion government contribute to the cost of straightening and rebuilding that portion of the trans-Canada highway between Berthierville and Three Rivers, and to the cost of eliminating the railway crossings on that section ?
2.	What total amount was paid to date by the dominion government for the project, and what other payments, if any, may be expected in the future from the said government in relation thereto ?
3.	When were such works started, when were they concluded, by whom were they performed, and at what total cost?
4.	Was the project performed under a definite price contract awarded after public and regular call for tenders?
5.	If so, in what newspapers were such calls for tenders published, and what persons or corporations tendered?
6.	Was the contract approved by the dominion government? If so, in what way, and upon the report of what officer?
7.	When were the plans for the said project completed by the Quebec highway department, and on what dates, if any, were requests made by the provincial government of Quebec to the dominion government in connection with the said project?
8.	What amount was contributed by the dominion government to the provincial government of Quebec for the improvements of the trans-Canada highway between August 7, 1930, and October 23, 1935?


COMPANIES EXEMPT FROM CORPORATION TAX
Mr. GREEN:: 1.	What companies have been exempted from corporation tax under the provisions of part XIII of the Income War Tax Act which came into force on May 1, 1936?
2.	In respect of what mine or mines have each of the said companies qualified for such exemption?
3.	Which of such mines have been classified as new, and which as old mines?
4.	In what provinces are the different mines located ?
5.	What certificates have been issued stating a date upon which a mine is deemed to have come into production under the terms of the said part XIII?
6.	What fiscal periods during which income derived from any such mine is exempt from corporation tax have been established in the respective certificates issued?


ROYAL COMMISSIONS
Mr. CASSELMAN:: 1.	What royal commissions have been appointed by the government of Canada since January 1, 1900?
2.	What was the cost of each commission?
3.	What was the subject matter investigated by each commission ?



MOTIONS FOR PAPERS


Mr. STEVENS:: For a copy of a letter written by Mr. Roberts, a member of the national harbours board, to Mr. Kaiser of the Louis Dreyfus Company of New York and dated April, 1938, and of a memo attached thereto setting forth an understanding regarding certain reductions of rates for the handling of grain through the port of Quebec.


Mr. HOWE:: I desire to oppose this motion, but as it is not debatable under the rules I am unable to state my reasons for opposing it. I therefore ask that it be transferred to notices of motions.


Henry Herbert Stevens: On a point of order, I submit that it is not competent for the minister to suggest that this be transferred to the order for notices of motions, because that is an order which obviously will not be reached again this session; furthermore I have never yet heard of its being done without the consent or request of the mover. A third point is this-and I am not discussing the matter involved; that can be discussed on another occasion. It is a question of the rights of a member of the House of Commons. I contend that I have an absolute right, as has any other member of this House of Commons, to call for the production of this particular document. It is a document that has entered into the public business of Canada.


An hon. MEMBER:: He is debating it.


Henry Herbert Stevens: I am discussing the point of order in this sense, that it is my right to ask for the production of the document. It is the point of order I am discussing, not the subject matter of the motion. I contend that
Motions for Papers

it is not competent under the rules for the government to take refuge in the possible fact that a document may have been marked "private," if the document affects or deals with public business. That is my contention in regard to this document. The matter has been standing for something like ten days, so that there has been ample opportunity for the government to look into it; otherwise I should not object to a request that it stand for the purpose of examination. But the facts are well known. I must respectfully insist that the right of members of parliament to request the production of public documents be upheld on this occasion.


Mr. LAPOINTE (Quebec East):: Mr. Speaker, the matter which is under discussion is dealt with by standing order No. 51.
Notices of motion for the production of papers which the member asking for the same intends to move without discussion shall be marked by him with an asterisk and shall be placed by the clerk on the order paper above "Notices of Motions" under the heading "Notices of Motions for the Production of Papers." All such notices when called shall be forthwith disposed of; but if on any such motion a debate be desired, it shall be transferred by the clerk to the order of notices of motions.
The Minister of Transport (Mr. Howe) has stated that a debate is desired on this motion, therefore no discretion is to be exercised; it is imperative that the clerk should transfer it to the other order.


Henry Herbert Stevens: I now rise to a question of privilege.


Ernest Lapointe: What was it the first time?


Henry Herbert Stevens: It was a point of order. I am not going to allow my right hon. friend, with all the respect I have for him in matters of this and other kinds, to delude the house into thinking that the desire is to debate this motion. If the desire is to debate it, that can be done when the estimates are under consideration. But to transfer the motion to the order which the Minister of Transport has called for would remove it from the realm of debate, because it could not then be debated under any other order, and I should be precluded from discussing it. This matter ought to be discussed. Again I protest against the privileges and liberties of members of the House of Commons being interfered with or overridden by a subterfuge of this kind.


Ernest Lapointe: On the question of privilege-a new matter-my hon. friend is entirely wrong. We have to observe the rules as they are. He says he will not be 
able to discuss the matter before going into supply or otherwise. Well, if he were doing me the honour of asking my advice I would give him a very simple way of doing it.


Mr. WOODSWORTH:: It seems to me the rule is very clear. Citation 436 under standing order 51 says:
Addresses are moved for papers and dispatches from the imperial government; for orders in council; for correspondence between the dominion, British and foreign governments, or between the dominion and provincial governments, or between the dominion and any company, corporation or individual.
It seems to me this clearly comes under that head. Paragraph 437 says:
The general rule is that information to be obtained from or through any of the revenue departments, any department under the treasury, or any department constituted or regulated by statute, is obtained by means of an order, whilst information to be obtained from or through a Secretary of State or the privy council is obtained by means of an address.
438. The information sought must relate to a matter of public importance and be obtainable through a public authority.
Surely there is no reason why this particular document should not be laid before the house. In any case on the point of order from which this discussion started I do not see that anything has occurred which gives it into the power of the minister to say that the moton should be transferred to another order.


Mr. BENNETT:: There is another question which seems to me relevant to this discussion, namely, whether this paper should not be produced and laid on the table without any further discussion in view of the reference made to it the other day by the Minister of Transport (Mr. Howe). I think if the right hon. Minister of Justice (Mr. Lapointe) would look into that phase of it he would be convinced-
Mr. LAPOINTE (Quebec East); That is another question.


Richard Bedford Bennett: Yes, it is another question. He would be convinced I think that it is a document that should be laid on the table. The general principle of the rule is stated very clearly, that if a public document is referred to by a minister it must be laid on the table in order that access may be had to it by all hon. members of the house so that they may be able to understand and appreciate its contents. The rule is based on sound public policy.
As far as the immediate motion is concerned, it seems to me it cannot be said to be in any sense a debatable motion, because the contents of the paper cannot be anticipated

Motions for Papers
in the discussion. The only question for debate is whether or not it is a public document, and inasmuch as it has been admitted that it is a document written by one of the members of what might be described as a governmental agency-that, it will be recalled, is the description given of it-surely it should now be produced. I am bound to say that I agree with what the right hon. gentleman has said as to the general question of debate, but this is not a debatable matter in the sense in which those words are used in our rules; because there it is, the contents are known, it is a specific document-specific, mark you. It is not as though this were a roving commission seeking to get something that is not known; there is the description of it: (a) the person who wrote it; (b) the person to whom it is written; (c) it clearly touches public business of, I think everyone will agree, the most outstanding kind, namely the question of rates.
I suggest to the minister, with great deference, that it might be well to let the order stand until it can be further looked into. If the Minister of Justice will examine the authorities with the care which he usually displays in matters of this kind I think he will conclude that having regard to all the circumstances this is not a debatable matter within the niles; and in any event the document should be laid on the table, having regard to the fact that the Minister of Transport referred to it in the terms in which he did the other day, and to the further fact that it is a specific document concerning which we have now the names of the addressee and the sender, and knowledge of the kind of public business to which it relates.


Mr. SPEAKER:: Does any other hon.
member wish to speak to the point of order?
I believe in this matter the Speaker has no discretion. The standing order states clearly that motions on which debate is desired shall be dealt with in a certain way, and, the minister himself having stated that debate is desired, I think the standing order must be followed and this motion be transferred to the order, notices of motions. I so rule.


Henry Herbert Stevens: With very great regret,
Mr. Speaker, and I think for the first time in my twenty-seven years in the house, I am reluctantly compelled to appeal from your ruling.
Mr. SPEAKER put the question as follows:
Mr. Stevens having moved that an order of the house do issue for a copy of a letter written by Mr. Roberts, a member of the national
51D52-239
harbours board, to Mr. Kaiser, of the Louis Dreyfus Company of New York, and dated April, 1938, and of a memo attached thereto setting forth an understanding regarding certain reductions of rates for the handling of grain through the port of Quebec; the Minister of Transport (Mr. Howe) having asked that the said motion be transferred to notices of motions, and the Speaker having decided that it is in order so to do, Mr. Stevens appeals from the ruling of the Speaker.


Henry Herbert Stevens: Maclnnis
MacNeil
MacNicoI
Macphail
Marsh
Marshall
Massey
Mitchell
Needham
Pelletier
Perley
Poole
Queleh
Rose (St. Paul's) Senn Stevens Stirling
Taylor (Nanaimo)
Thompson
White
Woodsworth-43.
For a copy of all letters, telegrams, draft agreements or other documents during the months of February, March, April and May, 1938, passing between the Minister of Transport, the national harbours board or any member or official of the said board, and the Louis Dreyfus Company of New York regarding the handling of grain at the port of Quebec or the port of Montreal or dealing with proposed reduction of rates in the handling of grain at the same ports.


Clarence Decatur Howe: Mr. Speaker, there is no such correspondence except to the extent that this motion may refer to the previous motion. The motion then becomes identical with the previous one, and I would ask that it be disposed of in the same manner and transferred to notices of motions.


Henry Herbert Stevens: I simply rise to protest against this method of evading the production of public documents.


Walter Edward Foster: Is it the pleasure of the house that the motion be transferred to notices of motions?


Richard Bedford Bennett: On division.


Henry Herbert Stevens: For a copy of all letters, telegrams and other documents during the months of February, March, April and May, 1938, passing between the Minister of Transport, the national harbours board or any of its officials and the board of grain commissioners, its chairman, its secretary or any of its officials regarding the rates on the handling of grain at the port of Quebec or the port of Montreal or regarding the administration of the Canada Grain Act in relation to the said ports.



LANDBACE AND YORK HOGS

Mr. BLAIR:: A complete report of all tests made by the experimental farms of the landraee and York hogs, during the years 1936, 1937 and 1938.



AMOS, QUE., POST OFFICE

Mr. BLAIS:: For a copy of all correspondence, letters, telegrams and other documents dated from 1935, with respect to the post office at Amos, Chap-leau county, province of Quebec?



RADIO STATION CKGW

Mr. CLARKE (Rosedale):: For a copy of the lease originally made by the Canadian Broadcasting Corporation or by the Canadian radio commission for the leasing of radio station CKGW at Toronto;
Also, a copy of all correspondence, letters, telegrams and other documents passing between the proprietors of the said station CKGW and the Canadian radio commission and/or the Canadian Broadcasting Corporation;
And also, a copy of all correspondence, letters, telegrams and other documents passing between the proprietors of the said station CKGW and the Canadian Broadcasting Corporation relative to the termination of the lease above mentioned.


Clarence Decatur Howe: As the subject matter of this motion is now before the courts, I would ask that it pass with the usual reservation.


[Stage Direction]
Motion agreed to.


[Stage Direction]
Hon. T. A. CRERAR (Minister of Mines and Resources) moved that the house go into committee at the next sitting to consider the following proposed resolution:
That it is expedient to amend the National Parks Act and the Nova Scotia and Prince Edward Island National Parks Act, 1938, to abolish the Wawaskesy national park in the province of Alberta and vest the land in the province; to change the boundaries of the Elk Island national park in the said province by adding to and parting with certain described areas and transferring the latter to the province; and to withdraw certain lands from the Prince Edward Island national park and vest the same in his majesty in the right of the province.
He said: His Excellency the Governor General, having been made acquainted with the subject matter of this resolution, recommends it to the favourable consideration of the house.
Mr. HOI\ E: Return tabled.	Motion agreed to.
[Stage Direction]
Business uj the House-Procedure


[Stage Direction]
Hon. CHARLES A. DUNNING (Minister of Finance) moved that the house go into committee at the next sitting to consider the following proposed resolution:
That it is expedient to introduce an act to regulate the cost of small loans, also with respect to the incorporation and powers of small loan companies, and to provide for the annual licensing of money lenders, for the administration of the said act, and the annual assessment of each licencee for the purpose of meeting the expense incurred by the government in such administration.
He said: His Excellency the Governor General, having been made acquainted with the subject matter of this resolution, recommends it to the favourable consideration of the house.
Motion agreed to.


Right Hon. W. L. MACKENZIE KING (Prime Minister) moved:: That on Wednesday the 15th of June next, and all subsequent Wednesdays until the end of the session, the sittings shall in every respect be under the same rules provided for other days.


Richard Bedford Bennett: Mr. Speaker, in view of the fact that the committees of the house are still sitting in the mornings, it is an intolerable burden to place upon lion, members to deprive them of the one night in the week in which they can catch up with their work. I think it must be known to all who are familiar with the work being done by the committees that they have been very busily engaged, and by having this one night in the week hon. members are enabled to do much of their work that has fallen in arrears. I think that until the committees have ceased to function in the mornings this night should be left free. When the committee work has been concluded then this- motion could be adopted. That is my personal view.


William Lyon Mackenzie King: If there is any desire on the part of hon. members not to sit on Wednesday evenings rather than to sit with a view to expediting the work of the house, I shall not press the motion. In view of what the right hon. leader of the opposition (Mr. Bennett) has just said I am quite content that the motion should drop. I do believe, however, that most hon. members of the house would much prefer to sit on Wednesday evenings with the idea of getting through.
.*>1952-2394


Richard Bedford Bennett: I was very careful to say, until such time as the committees had completed their work.


Some hon. MEMBERS:: Question.


William Lyon Mackenzie King: I shall put a motion again next week for the Wednesday evening of that week.
Motion dropped.



SUSPENSION OF STANDING ORDER 28 RESPECTING COMMITTEE OF SUPPLY

William Lyon Mackenzie King: That the provision of standing order 28 respecting the committee of supply be suspended for the sittings of Thursday, 16tli June and Friday, 17th June, 1938.
He said: As hon. members are aware, Mr. Speaker leaves the chair without motion being put on Thursday. As it is the desire of the Minister of Finance (Mr. Dunning) to present his budget statement while His Honour the Speaker is in the chair, I am asking the house to agree to the suspension of this rule.


Mr. CAHAN:: Why mention Friday, June 17?


William Lyon Mackenzie King: The Speaker also leaves the chair on Fridays without question being put, and I had assumed that it would be the wish of the house to continue the debate on the budget on Friday, in which event by the adoption of this motion, the Speaker would still be in the chair. However, if it were decided on Thursday night that it would not be advisable to continue the debate on the budget on Friday, we could return to the usual order of business on that day.


Charles Hazlitt Cahan: It has been usual to allow a day or two to elapse.


William Lyon Mackenzie King: I shall be glad to allow to elapse whatever time hon. gentlemen opposite may wish. If the house will permit, I shall amend the present motion by striking out "Friday, June 17." The house perhaps will permit me to substitute "committee of ways and means" for "committee of supply." Either is quite correct, but I believe it would be more appropriate to have the Minister of Finance make his budget statement on a motion for the house to resolve itself into a committee on ways and means. The motion as amended would read:
That the provisions of standing order 28 respecting the committee of ways and means be suspended for the sitting of Thursday, 16th June, 1938.
Motion as amended agreed to.
Privilege-Mr. Rogers



MOTION FOR COMMITTEE OF SUPPLY SUBSEQUENT TO COMMITTEE RISING FOR WANT OF QUORUM- NECESSITY FOR UNANIMOUS CONSENT

[Stage Direction]
On the orders of the day.
Richard Bedford Bennett: Before the house proceeds with the orders of the day I desire to direct attention to a matter which perhaps may be of more importance in the future than it is at the present time. On Friday last the right lion, the Prime Minister (Mr. Mackenzie King) moved:
That this house do now resolve itself into a committee to consider of a supply to be granted to His Majesty.
That motion was made in consequence of the committee having lapsed owing to there being no quorum on the preceding evening. Citation 47 under standing order 3 provides:
If the committee of supply, or ways and means, rises because there is not a quorum present, and therefore makes no report and does not ask leave to sit again, a motion with forty-eight hours' notice, unless unanimous consent is granted, must be made that the committee do sit again on some specified date.
I notice both in Hansard and in the Votes and Proceedings it does not appear that this was done by unanimous consent. I rise merely to suggest, having regard to future parliaments, that it might be desirable to add the words, "by unanimous consent," and thereby conform to the rule.


William Lyon Mackenzie King: As a matter of fact the house did give unanimous consent.


Richard Bedford Bennett: No, nothing was said about it.



PRIVILEGE-MR. ROGERS PRESS REPORT OF PROCEEDINGS OF JUNE 9 CONCERNING THE EMPLOYMENT SERVICE OF CANADA

[Stage Direction]
On the orders of the day:
Hon. NORMAN McL. ROGERS (Minister of Labour): Mr. Speaker, before the orders of the day are called I wish to rise to a question of privilege in connection with a Canadian Press report of the discussions of Thursday, which appeared in the afternoon papers of Friday. There is the following reference to dismissal of officials of the Employment Service of Canada, and the statement is attributed to the leader of the opposition (Mr. Bennett) and is given in quotations. The statement is to the following effect:
The men who occupied positions in them *were dismissed when he-

The reference being to me as Minister of Labour.
[Stage Direction]
came to office. That, in my opinion, is exactly contrary to what was intended when this statute was enacted.
The leader of the opposition made a number of allegations at that time, but I have not been able to discover this was one of them. In any event the statement as given is absolutely untrue. No federal employee of the Employment Service of Canada was dismissed or has been dismissed since the present administration came into office. I hope that the appropriate correction will be made.
Richard Bedford Bennett: Mr. Speaker, with respect to the same question of privilege, I noticed what the minister has referred to. I was particularly careful to make it clear, and if he will look at Hansard he will see that it is removed from any possible doubt, that the removals or dismissals were by the provincial and not the federal administration.


Mr. ROGERS:: I said, Mr. Speaker, that I had not been able to discover that he had made that statement.



NATIONAL HOUSING ACT


[Stage Direction]
Hon. CHARLES A. DUNNING (Minister of Finance) moved the second reading of Bill No. 145, to assist the construction of houses.
He said: Mr. Speaker, in view of the manner in which the house bore with me in a lengthy and detailed address on this matter when the financial resolution was before the house, I do not think I need at this time add anything to the remarks I then made. They will be found in Hansard of last Wednesday. The discussion which took place on the financial resolution should enable the house to make better progress with respect to this matter in committee than could be made by a further general discussion on the second reading, but that is of course, for members of the house to decide. For myself I think I said on the occasion of the introduction of the financial resolution all that I would desire to say on the second reading.
Richard Bedford Bennett: Mr. Speaker, I intimated
the other day that the speech made by the

National Housing Act
Minister of Finance (Mr. Dunning) on the financial resolution was really a second reading speech, and if you will permit us to reserve our right to discuss the principles involved in this mesure, when we are in committee, I think the minister's suggestion will serve a useful service and expedite the conduct of business. There are certain matters in the measure as it stands that certainly I cannot think are workable, and therefore it will be my duty to point out that they will not be useful for the purpose intended; but there is no point in discussing them now if the question of principles can be referred to when the house is in committee and the appropriate sections are under consideration.


Mr. DUNNING:: If the house will permit me, Mr. Speaker, I should like to say that it is rather difficult to define closely the principle upon which we are deciding on the second reading of this bill. There is of course a separate principle involved in each of the three parts, and it is conceivable that certain members of the house might be quite in favour of the principle involved in part I but opposed to the principle involved in part II, or indeed in favovir of any two of the three and against the third. So it will be necessary,
1	think, to permit discussion of the principle of each part of the bill as we proceed with the discussion in committee, and I certainly shall not stand upon any question of the principle of the bill having been passed upon on the second reading. I think we can expedite business by getting on with the committee stage.


[Stage Direction]
Motion agreed to, bill read the second time, and the house went into committee thereon, Mr. Sanderson in the chair.
Section 1 agreed to.
On section 2, paragraph (a)-"approved lending institution."
Charles Avery Dunning: It will be seen in section
2	that there is some amendment of the definitions contained in the present Dominion Housing Act. Some of the changes are merely matters of language; others involve quite a change. I would call the attention of the committee particularly to paragraph (e) of this section, which defines "lending value" to mean:
-the estimated cost of construction of a house or its appraised value, whichever is the lesser.
There was no definition of "lending value" in the former act.
Mr.	BENNETT:	With respect	to	(a)
may I point out that "approved lending institution" as defined means those institutions that were existing as such under the housing act of 1935.
Mr.	DUNNING:	Yes.Mr.	BENNETT:	The definition	in	(a)
goes on to say:
-and any lending institution approved by the governor in council for the purpose of making loans under this part.
Is that sufficiently	comprehensive	to	permit of the exercise of the power?-because it is the old definition that we are sticking to with respect to those that have been approved up to 1935. It is only the language I question.


Charles Avery Dunning: The intention, and the
legal draftsmen were so instructed, was to enable the existing agreements to continue, and that other lending institutions should have the capacity to enter into agreements. But more than that, in view of the fact that possibly a different type of agreement is contemplated by the new legislation, the intention was to enable new agreements to be entered into where necessary with lending institutions which are at present approved under the existing legislation.


Richard Bedford Bennett: I realize that, but I
doubt if the language is broad enough to cover the case of new lending institutions approved under this section. That is the only thing I had in mind.


Charles Avery Dunning: It says, "and any." It
could not be much broader, could it?


Richard Bedford Bennett: It is only the way it
is put.


Mr. REID:: I wonder if the minister has
a list of the approved lending institutions under the old act. In some parts of British Columbia, even yet splendid citizens are being turned down by the present lending institutions. I had a letter the other day from a member of the Vancouver police force, a man who had had a steady job for years, and the lending institutions would not approve of a loan on a house for him estimated to cost S3,000. I should like to have a list of the approved lending institutions of British Columbia.


Charles Avery Dunning: The list at present consists of thirteen life insurance companies, all of which I think may be described as national institutions-certainly none of them are local to British Columbia; then there are
National Housing Act

thirteen trust and mortgage companies, and I do not notice any British Columbia address as the head office of any of these companies. Then there are three other lending institutions, of which two are Caisse Populaire in the province of Quebec, and one, the Western Savings and Loan Association of Winnipeg. I believe the only parties making loans in British Columbia at the present time are those national lending institutions to which I have referred. I will not now, on this definition section, debate the question whether loans were made that should not have been made; that is difficult to answer. I will tell my hon. friends from British Columbia, however, that at the present time there are more loans being made in British Columbia under the housing act than in any other province of the dominion.


Thomas Reid: That is readily understood when one looks at the credit conditions of the province and realizes that as far as mortgages are concerned the situation there is one of the best. In the preamble it is provided that the localities are to be designated by the minister, and one question I should like to have answered is this.


The CHAIRMAN:: I would remind the hon. member that we have not yet taken up the preamble; we shall come to that later.


Thomas Reid: I realize that, but I thought that under this section it was competent to mention something that appears in the preamble.


Charles Avery Dunning: The matter to which the hon. member was about to refer will come up properly under another section of the bill, and it will very much facilitate discussion of this rather complex type of legislation if we confine discussion as closely as we reasonably can to the sections under review. Of course, I am in the hands of the committee but I am sure that any question that arises in its proper place will be fully discussed.


Mr. TAYLOR (Nanaimo):: Will the minister be good enough to put on Hansard the names of the lending institutions?


Charles Avery Dunning: I shall be glad to do that.
Insurance companies-Head office
Sun Life Assurance Company of Canada, Montreal, Que.
London Life Insurance Company, London, Ont.
North American Life Assurance Company, Toronto, Ont.
Mutual Life Assurance Company of Canada, Waterloo, Ont.
Great-West Life Assurance Company, Winnipeg, Man.

The Northern Life Assurance Company of Canada, London, Ont.
Canada Life Assurance Company, Toronto, Ont.
Confederation Life Association, Toronto, Out.
The Equitable Life Insurance Company of Canada, Waterloo, Ont.
The Manufacturers Life Insurance Company, Toronto, Ont.
The T. Eaton Life Assurance Company. Toronto, Ont.
Montreal Life Insurance Company, Montreal. Que.
The National Life Assurance Co. of Canada, Toronto, Ont.
Trust companies
The Grey & Bruce Trust & Savings Company, Owen Sound, Ont.
Community Trusts Corporation, Chatham, Ont.
The Sterling Trusts Corporation, Limited, Toronto, Ont.
Capital Trust Corporation, Limited, Ottawa, Ont.
The Premier Trust Company, Toronto, Ont.
Osier & Nanton Trust Company, Winnipeg, Man.
The Ontario Loan & Debenture Company, London, Ont.
The Central Trust Company of Canada, Moncton, N.B.
The Waterloo Trust and Savings Company, Kitchener, Ont.
Canada Permanent Mortgage Corporation, Toronto, Ont.
Guelph & Ontario Investment & Savings Society, Guelph, Ont.
National Trust Company Limited, Toronto, Ont.
Sherbrooke Trust Company, Sherbrooke, Que.
Other lending institutions
The Western Savings & Loan Association, Winnipeg, Man.
La Caisse Populaire de la Cite de Shawinigan, Shawinigan Falls, Que.
La Caisse Populaire de Levis, Levis, Que.


Mr. ESLING:: All municipalities are designated as lending authorities, are they not?


Charles Avery Dunning: They may be. Local
authority means any province, municipality, society, association or corporation having authority to undertake a housing scheme.


William Kemble Esling: I was referring particularly to municipalities. Is it not a fact that in British Columbia no municipality can exercise its authority until the next provincial legislature amends the municipal act? It may be well to have that known right now in order to avoid a lot of useless correspondence.


Charles Avery Dunning: That was true with
respect to the period since 1935 when the existing Dominion Housing Act was passed, for the reason that the definition of local housing authority is the same in this part

National Housing Act
of the new hill as it was in the old Dominion Housing Act, so that any amendment which might have been necessary to the municipal acts in the various provinces to enable municipalities to undertake housing schemes could, and in some cases may, have been made by provincial legislatures in the intervening period. I am not sure whether in a number of provinces at any rate specific amendment would be required to enable the municipality itself to undertake a housing scheme under this part, but certain it is that work that has been done-over seventeen million dollars worth of building that has been done under the existing Dominion Housing Act- has all been done by virtue of agreements between the Minister of Finance, as provided for in that act, and lending institutions. There is no case in the dominion where the municipality itself has taken advantage of that provision under the existing statute. It was thought wise, in carrying forward important parts of the existing statute into this bill, to leave the provision which would enable municipalities to assume the position of lending authority by agreement with the minister if they desired to do so and if, of course, as my hon. friend points out, they have authority so to do from the provincial legislatures. We cannot compel it but we can provide for them to act in that capacity provided they have both the legislative authority from the province and the desire to do it.


William Kemble Esling: In order to clarify the situation it may be pointed out that there were several municipalities that did desire to take advantage of the housing act. The matter was placed before the union of municipalities and that body was asked to pass a resolution asking the provincial government to provide methods bjr which we could take advantage of the act. But it has not been done and therefore cannot be done until the next meeting of the provincial legislature in Victoria. That should be kpown and well known in order to avoid a lot of useless correspondence, because so far as British Columbia is concerned, the act cannot become operative until the next session of the legislature.


Charles Avery Dunning: My hon. friend is going rather too far. The act can become operative, but the particular method of operating it by municipal action under this part cannot. He may be right in that, but certainly the other method provided by this part of the bill can continue as it is continuing at the present time to operate in British Columbia. I am pleased to be able to make this statement to the hon. member for New Westminster as
well as to other members from British Columbia, who have questioned me about the matter. I undertook some time ago to have the director of housing in the Department of Finance pay a visit to that province in an endeavour to find a means of meeting problems which have arisen there, and I have very encouraging reports from him as to the manner in which the provisions of the present housing act can be extended particularly to the interior of the province, from which locality there have come very many complaints of lack of facilities for obtaining loans under the act. I do not say that we can remove every difficulty. Of course, my hon. friend from Kootenay West is quite correct when he says that so far as the municipality acting is concerned, a change in provincial legislation in British Columbia will be necessary; but no municipality anywhere in the dominion has yet taken advantage of this particular feature of the present Dominion Housing Act. At the same time we felt it wise to retain the opportunity for them to do so if they received the necessary authority from the province and desired to take advantage of it.


Mr. MASSEY:: Would the minister be good enough to give the distribution by provinces and by years of expenditures so far under the old act?


Charles Avery Dunning: Up to May 31 is the last figure I have. I will give the number of family units and the value of loans approved. I have a good deal more information but it will be simpler to stick to the expression "family units" than to complicate the number of loans with units provided.


Denton Massey: This is the total to date?


Charles Avery Dunning: Total to March 31, 1938, by provinces:
Prince Edward Island..
Nova Scotia	
New Brunswick	
Quebec	
Ontario	
Manitoba	
Saskatchewan	
Alberta	
British Columbia	
Amount	Family units
loaned	provided
54,034	10
1,532,983	351
328,917	78
4.953,627	1,057
7,910.287	1,959
425,414	87
8,200	2
2,136,942	705
$17,350,404	4,249
The average loan per family unit as of May 31 was S4,083. I think that covers the information for which my hon. friend asked.


Mr. SENN:: I think the minister said the other day that it is the desire of the government to extend the benefits of this legislation
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to all parts of the country, to the rural sections and particularly the villages. In the last year or two there has been reluctance on the part of some lending institutions to visit these rural communities and look over applications. Is there anything in this bill which makes it obligatory for an approval lending institution at least to investigate an application from a man residing in a rural district? I understood the minister to say that certain financial aid is to be given, but even then it might not be considered profitable for the company to do it in an isolated case in a particular locality. Is there anything in the bill to oblige the companies to treat all applications on exactly the same basis?


Charles Avery Dunning: No, there is nothing in the bill to compel people to lend their money. That positively is not in the bill. But if my hon. friend will wait until we reach section 4, that whole range of questions will then come under review.


Mark Cecil Senn: I was asking if they were being compelled not to lend money but to investigate the application.


Charles Avery Dunning: We can induce, but I doubt if we can compel.


Mr. McNIVEN:: Have any of the lending institutions in making their applications for approval indicated unwillingness to lend money in certain parts of Canada? I notice that in Saskatchewan there were only two loans, both in the city of Prince Albert.


Charles Avery Dunning: I do not recall lending institutions having indicated unwillingness to lend in certain parts of Canada particularly. In fact since I first had anything to do with the act we have endeavoured in every way to get lending institutions to make agreements with the dominion. It has been a slow process to persuade them to enter into agreements at all. I think I can say that it is only during the last year or year and a half we have had anything like the swing of progress in that direction which I should like to have seen. We have not attempted to dictate to lending institutions where they should lend. We have however endeavoured to persuade them to look for business in areas from which it was apparent, from correspondence coming to the department, that a demand existed from people who were able to give the necessary security and under conditions which would enable lending to be done with, in our opinion, reasonable certainty that the loan would be repaid. It will be seen however from my speech of last Wednesday, and from the contents of this bill as we proceed with it, that the great effort with respect to

part I is to overcome the deficiency which I pointed out on Wednesday last, that there are considerable areas in all provinces which up to now have not been able to get loans under the provisions of the housing act. When we come to section 4 we shall have opportunity of discussing the precise means by which we propose to overcome that situation. I think discussion on section 4 will clarify the intention in that regard.


Mr. LANDERYOU:: The minister said
these lending institutions were reluctant to enter into agreements. What reasons did they advance, or did they advance any reasons, for being reluctant?


Charles Avery Dunning: Not always the same. There is, to begin with, the general reluctance to enter into an entirely new method of doing business. That had to be overcome by a process of education as to what the Dominion Housing Act really meant from the standpoint of the lending institutions. And there are many institutions which do not particularly like the idea of being in partnership with the government. The process is one of educating the lending institutions in this method of cooperating with the government in meeting a problem. As to specific objections, there was the general question of the cost of operation. We were forcing quite a low rate of interest for the borrower from the standpoint of the lending institutions, and at the same time expecting them to make loans. The cost of making loans under the existing housing act, particularly in the smaller communities, averaged quite high. My hon. friend of course can understand that it is very much cheaper to make loans in a city where one man can inspect the construction of twenty or thirty houses at one time than it is in a community forty or fifty miles away from the company's office where only two or three or four loans are involved. That is a problem which we hope to solve by section 4 of the bill.


Denton Massey: With respect to the tables the minister gave showing the expenditure and number of units, can he say how many of the 4,249 housing units were rural houses?


Charles Avery Dunning: In what sense does my hon. friend use the word "rural"?


Denton Massey: In rural communities rather than in municipalities.


Charles Avery Dunning: In small urban communities rather than in cities?


Denton Massey: Yes.

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Charles Avery Dunning: Of course this is not a farm loan act.


Denton Massey: I agree.


Charles Avery Dunning: I have here a list of
about one hundred communities in Ontario.


Denton Massey: It has been stated that there was difficulty in getting some of these institutions to come and investigate a situation outside of cities or small towns such as a farmhouse away from a municipality. Is that reflected in the number of units already built under this plan?


Charles Avery Dunning: There is a very wide
distribution among small urban communites in Ontario, but not nearly so much so in other provinces. As to the province of Quebec, apart from the fifteen or sixteen municipalities which are comprised in the metropolitan area of Montreal there are about a dozen communities in which loans have been made; but Quebec is one of the provinces from which complaints have come. For instance, there is the Gaspe peninsula. It can be readily understood that while there are a number of thriving small communities on the Gaspe peninsula, it is difficult to get the lending institutions to undertake the expense of making loans, taking care of the cost of inspection during construction, and so on. That is one of the areas I have in mind that may be helped by section 4 of the bill. In New Brunswick there are about a dozen districts in which loans have been made. In Nova Scotia I should say there were about fifteen communities. In Prince Edward Island there is only one, Charlottetown. In Manitoba, apart from the district that might be called the Winnipeg metropolitan area, there are only three places in which loans have been made. My hon. friend from Regina was not quite correct with regard to Saskatchewan; one loan is in Prince Albert and one is in Yorkton. In British Columbia, if we exclude the Vancouver metropolitan area, there are only nine municipalities in which loans actually had been made up to the end of May last.


Mr. NEILL:: That is in municipalities, but I think my hon. friend was inquiring more about rural districts. The minister used the word "urban". That indicates an organized district, but I should like to know if any loans have been made in rural communities not big enough to be towns or villages, just settlements of five or six hundred people.


Charles Avery Dunning: Frequent reference is
made here in this list of areas in which loans have been made to townships, but of course I must make it clear that this is not a farm
loan act. Under this bill, it is not possible to make loans on farms. The loans are on the homes, and as a practical question one can see immediately how difficult it would be to have a separate mortgage on a farm house with the farm under a farm mortgage. It was never contemplated by the authors of the original bill, I am sure, that it should meet that situation. But there is no reason why, with the changes we are proposing in section 4-and you are still compelling me to discuss that section before we reach it- the object of the bill should not be attained, which is to widen the application of the principles of the housing act in its relationship to communities which are not now being served by it, no matter what their class may be; but of course I cannot pretend that it is a farm loan act. We have a farm loan act on the statute books, and we have a farm loan board operating. Under this bill we cannot make loans on farms, but the lending institutions can make loans on rural homes.


Alan Webster Neill: But they are not doing it.


Charles Avery Dunning: I am not prepared to
say definitely that they are not doing it at all at the present time, but I am prepared to say they are not doing it to the extent to which it ought to be done. One of the major objects of the present legislation is to encourage the development of that sort of thing. That will be clear as we proceed with the bill, I am sure.


Denton Massey: The point I had in mind
was that a house is a house, whether it is on a farm or in the middle of a thriving community, and if the farm exists before the house is built that farm mortgage cannot possibly take in that house, because it was not built at the time the mortgage was obtained. This loan is to be advanced on the new house that is to be built.


Mr. McCANN:: You cannot separate them.


Denton Massey: Why not? The house
has not been built; the two did not exist together.


Charles Avery Dunning: The house has not been built, but if the farm is under mortgage the land upon which the house will be built forms part of the security for that mortgage. How can you arrange to take a piece of land out of an existing mortgage and place another mortgage on it? And what security value would attach to the house if there was not also the security of the land on which it was built? It is an impossible thing, from a practical point of view.
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Denton Massey: But the value of the property increases to the extent of the value of the new house to be constructed on that property.


Charles Avery Dunning: It may be, and that can be dealt with under the farm loan act.


Denton Massey: But if the mortgage is
held by one of the existing lending companies, as it may be, then the position is not jeopardized from the point of view of the company.


Charles Avery Dunning: May I clear that up immediately. If the mortgage on a farm is held by a lending institution which is willing to advance to that farm owner enough money to build a house, there is provision for that already; but when you try to visualize a situation in connection with which one mortgagee would have a mortgage on the house and another mortgagee would have a mortgage on the rest of the farm, it becomes impossible.


Denton Massey: I did not have that in
mind.


Charles Avery Dunning: The situation where one mortgage exists is already dealt with otherwise than by this statute.


Mr. THOMPSON:: Would not the same
condition exist in an urban municipality where there was an existing mortgage?


Charles Avery Dunning: Well, there could not
be a mortgage on an urban property.


Thomas Alfred Thompson: On the land.


Charles Avery Dunning: The land has to be
brought in as security before the house can be built on it, under this law. It would have to be cleared off to enable the mortgage to be given on the whole property, the land as well as the buildings.


[Stage Direction]
Paragraph agreed to.
On section 2, paragraph (b)-"Cost of construction."
Mr. ISNOR:: I think the other day the minister said it was under this part that he would be willing to advance sums to these companies or firms to carry on their investigations. Would that come under this paragraph?


Charles Avery Dunning: No; that is dealt with later on.


Richard Bedford Bennett: I think this section uses language rather too broad in regard to legal expenses. In the old act we limited it to expenses in connection with the loans. As it

stands now it might involve litigation in connection with the acquiring of title, and matters of that sort. The cost of construction should be considered only in respect to the loan itself, in my judgment.


Charles Avery Dunning: The view expressed by my right hon. friend is that the words should be "connected with any loan," and we are proposing to make it "necessary to complete the house." That is a minor amendment, but it has arisen out of the experience the legal officers have had with odd, peculiar cases. That is all.


Richard Bedford Bennett: That is what I had in mind. Should we pay legal expenses for the purpose of completing the house, where it may involve litigation in no sense related to the loan, but which must be disposed of before the loan can be made? I have particular cases which have arisen in which litigation was pending. A man wants a loan, and he gets that litigation wound up and acquires title. In doing so he spends $150 or $200. As this reads now it is broad enough to include that amount in the cost of the house, and in my judgment it has no relation to such cost. I think there was some discussion along that line either in this house or out of it. It is always difficult; you cannot cover every case, and we finally arrived at the conclusion at that time that it was wise to say "connected with any loan."


Charles Avery Dunning: Would my right hon.
friend read the definition of "lending value" in paragraph (e) in relation to paragraph (b) ? We were of opinion that that covered the probability of the extraordinary case.


Richard Bedford Bennett: Perhaps it does.


John Charles Landeryou: Under paragraph (c) would money be loaned to any of these lending companies by the government for the erection of apartment houses?


Charles Avery Dunning: Yes; it is being loaned to-day.


[Stage Direction]
Paragraph agreed to.
Paragraph (c) agreed to.
On section 2, paragraph (d)-lending institution.
Richard Bedford Bennett: In paragraph (f) we say " association or corporation." I notice that in the old act, which was prepared hurriedly, the same words are used, but I think it is desirable to use the same language when we are dealing with the same thing. The words " company " and " corporation " are used for the same purpose. It should be either " company " or " corporation."

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Charles Avery Dunning: My right hon. friend means that in both cases we should use either the word " company " or the word " corporation."


Richard Bedford Bennett: I submit that, yes. Of course there may be some reason for having it otherwise.


Charles Avery Dunning: There are some insurance companies which are not companies; they are associations.


Richard Bedford Bennett: That is all right. The word " association " is all right, and should be left in the paragraph.


Charles Avery Dunning: It is intended to cover in those two definitions all possible types of institution which could be dealing in this matter; up to now there has been no difficulty.


Richard Bedford Bennett: A trust company is not in the same class as an insurance company, and I assume that under this measure trust companies are making loans. We will need to add the word " trust."


Charles Avery Dunning: We have- a number of trust companies.


Richard Bedford Bennett: I think the word "trust" should be inserted after the word " insurance," because in this I believe we scarcely regard a trust company as being in the same class as the other classes mentioned.


Charles Avery Dunning: If my colleague will so move, I will agree to including the word " trust." There will be a comma after the word " insurance," and then the word " trust."


Norman McLeod Rogers: I so move.


Mr. McIVOR:: Do these lending institutions have to be guaranteed by the provinces? Whether they be- insurance companies or private companies, must they all be guaranteed?


Charles Avery Dunning: Not under this part of the bill. There is no guarantee by a province contemplated under part I of the bill.


Richard Bedford Bennett: No more than there was under the old act.


Charles Avery Dunning: That is correct.


Richard Bedford Bennett: It would remove any possible chance of difficulty if we used the words " company or corporation " in line 17, and then in line 23 the same words- " association, company or corporation." I say that because we refer to the Toronto General Trusts Corporation and to the Royal Trust Company, which is incorporated by statute.


Charles Avery Dunning: I see no difficulty in accepting that.


Richard Bedford Bennett: I suggest it only to avoid possible difficulties.


Norman McLeod Rogers: I move that the words " or corporation " be added after the word " company " in line 17.


Charles Avery Dunning: The right hon. gentleman indicated an addition after the word "association" in line 23. It could scarcely be a company in that connection. It is a borrower.


Richard Bedford Bennett: In its present form the paragraph reads,-
"Local authority" means any province, municipality, society, association.
We would add the word "company" before the word "corporation."


Charles Avery Dunning: "Having authority to
undertake a housing scheme."


Richard Bedford Bennett: The minister dealt with a ease the other day of a municipality creating a separate branch of its activity, and giving it a name. That is why I suggest that the word "company" is hardly an apt word to use. Neither is the word "corporation."


Charles Avery Dunning: "Association or society."


Richard Bedford Bennett: "Association" is hardly right.


Norman McLeod Rogers: Do you mean "housing commission"?


Richard Bedford Bennett: That is what I mean.


Charles Avery Dunning: "Association or corporation."


Richard Bedford Bennett: I think the expression "association or corporation" covers it.


Charles Avery Dunning: And after the word "corporation" we could add the word "commission."


Richard Bedford Bennett: I would not make the suggestion were it not for what the minister said the other day in respect to independent bodies, which are really corporations, but which operate to all intents and purposes as though they were separate entities.


Charles Avery Dunning: Perhaps the Minister of Labour would be good enough to move that the words "or commission" be inserted after the word "corporation" in line 23.


Richard Bedford Bennett: And take out the word "or" before the word "corporation." I am taking up the time of the committee only in consequence of what was said the other day as to what might be desirable to meet the case.


Norman McLeod Rogers: I move accordingly.
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Frederick George Sanderson: That is an amendment to paragraph (f).


James Samuel Taylor: Have we finished with paragraph (e)?


Charles Avery Dunning: We had better pass the amendments first.


Alan Webster Neill: We have not yet passed paragraph (e).


Richard Bedford Bennett: We were going to have the amendments first, so as to get them out of the way. The section has not yet been passed.


Charles Avery Dunning: Perhaps the chairman would be good enough to read paragraph (d) as amended, so that we could carry it.


Frederick George Sanderson: It is as follows:
(d) "Lending institution" means a loan, insurance, trust or other company or corporation authorized to lend money on the security of real or immovable property;
Paragraph (d) as amended agreed to.


Charles Avery Dunning: We will now discuss paragraph (e).
On section 2, paragraph (e)-"Lending value."


James Samuel Taylor: Mr. Chairman,
I have encountered a certain indefiniteness and have had some difficulty in understanding paragraph (e). It states:
"Lending value" means the estimated cost of construction of a house or its appraised value whichever is the lesser;
If that paragraph is taken literally, then of course the land is left out.


Charles Avery Dunning: No.


James Samuel Taylor: Under paragraph (b) the cost of construction is intended to include the land.


Charles Avery Dunning: Yes, absolutely.


James Samuel Taylor: For the sake of clarity I suggest, if it meets with the approval of the minister, that single quotation marks be placed around the expression "cost of construction".


Charles Avery Dunning: From the standpoint of legal construction I am advised that there is no doubt about it. I can tell my hon. friend that when this section came to me I raised the same point. The legal draftsmen assured me that having defined the cost of construction as including the cost of the land, it automatically applies in other respects.


James Samuel Taylor: All right.


Mr. HEAPS:: Before the section is carried may I say that under paragraph (c) it would appear that a "house" means a building intended exclusively for human habitation, comprising one or more self-contained dwelling places. If a person wishes to erect a building containing four dwellings can he do so under this measure?


Charles Avery Dunning: Yes, surely.


Abraham Albert Heaps: If it is an apartment block?


Charles Avery Dunning: Yes, it is being done
to-day.


Abraham Albert Heaps: I wonder if that is the intent and purpose of the bill?


Charles Avery Dunning: Oh, yes. Under the existing housing act we make loans on apartments.


Mr. BERTRAND (Prescott):: Would a
loan be considered on a schoolhouse?


Charles Avery Dunning: No, it must be used for human habitation.


Mr. McGREGOR:: This would not apply to a store with a house attached?


Charles Avery Dunning: No.
Paragraph (e) agreed to.
On section 2, paragraph (f)-"Local authority".


Frederick George Sanderson: There is an amendment to paragraph (f). I shall read the paragraph as it is amended:
(f) 'Local authority" means any province, municipality, society, association, corporation or commission having authority to undertake a housing scheme.


Mr. BRADETTE:: I do not know that
that would cover all sections of Canada. In the northern parts of Ontario and Quebec we have what are known as unorganized districts, in which there are no local municipalities. There would be no machinery through which they could apply for loans under this scheme.


Charles Avery Dunning: Yes. they could apply as individuals. Paragraph (f), dealing with "local authority" applies to a certain way of operating under part I. It has no reference at all to the individual applying for a loan. He may apply just the same. It does not matter where he is situated.


Joseph-Arthur Bradette: He will have to apply to the provincial government.


Charles Avery Dunning: No, not to any government, but to a lending institution. This part of the bill has nothing to do with the administration of a housing scheme by a municipality

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except that we are continuing the provisions of the existing Dominion Housing Act whereby a municipality, if it wishes, may assume the position of a lending institution to lend to its own people. The reason for the definition in paragraph (f) is to define those classes of municipalities, commissions, corporations and so forth which can, if they wish, become lenders under the act to their own people. None have done so up to the present and I do not anticipate any great move in that direction. So far as a new borrower is concerned, normally he would get into touch with a lending institution which has entered into an agreement with the minister, as contemplated in paragraph (d).


Joseph-Arthur Bradette: The minister realizes
that lending institutions do not operate in those sections of the country to which I have just referred.


Charles Avery Dunning: That matter could be discussed under section 4.


Alan Webster Neill: What is covered by "association"? Does that mean an incorporated body, and, if so, under what law or laws would it have to come? Out in the west we have the habit of calling a dozen or so men who get together for some purpose an association. There is no formality or legality about it at all.


Charles Avery Dunning: The concluding words,
"having authority to undertake a housing scheme" indicate the meaning of the clause.


Alan Webster Neill: The association would have to have that power?


Charles Avery Dunning: That would have to be among its powers.


Alan Webster Neill: How would it have to be
incorporated, under the Benevolent Societies Act, or what?


Charles Avery Dunning: The incorporation is not nearly so important as the next step which they would have to take, that is, satisfy the Minister of Finance that they could effectively and reasonably safely lend money under this act. The necessary qualification under paragraph (f) is that an agreement must be entered into with the Minister of Finance for the purpose of lending money. An association would have to satisfy the minister as to its ability so to do and as to its authority under whatever laws may exist in the province in which it is situated and in which it is likely to lend money. Otherwise the minister would not enter into an agreement.


Daniel (Dan) McIvor: Does that mean that a group of men who were sound financially could not operate a scheme of this kind?


Charles Avery Dunning: They would have to band themselves together in a manner which would permit them to enter into an agreement with the minister. The manner of banding together is the only point that would arise under this clause.


Daniel (Dan) McIvor: A group of men who were sound financially could not make an agreement with the minister.


Charles Avery Dunning: They would have to have some corporate existence in order to undertake a scheme over a period of years. There must be continuity. I should be pleased to see individuals of the type referred to form themselves into companies for the purpose of making loans under this scheme. They would have to demonstrate financial soundness and guarantee the necessary continuity to carry on the scheme.


Daniel (Dan) McIvor: I think that is one of the
fine things in the bill.


John Charles Landeryou: How would the cost of a house be estimated under paragraph (e) ?


Charles Avery Dunning: Plans and specifications,
quantities, contract prices and all that sort of thing would enter into it.


John Charles Landeryou: In the various areas?


Charles Avery Dunning: Yes.
Paragraph (f) as amended agreed to.
Paragraph (g) agreed to.


[Stage Direction]
Section agreed to.
On section 3, paragraph (a)-Investigations and plans.
Charles Avery Dunning: A change has been
made from the present act due to the fact that there is now no economic council. Under this section the minister is given the power, with the approval of the governor in council, to investigate certain matters which were to be dealt with by the proposed economic council under the former legislation.


John Charles Landeryou: How is it intended
to set up investigations?


Charles Avery Dunning: That would depend
upon the thing to be investigated. A decision would have to be reached in each particular case. For instance, at the present time the director of housing has been sent to British Columbia because of a particular type of complaint that has developed there. He is meeting boards of trade, municipal authorities and interested people who want to borrow money and is advising and helping them in connection with taking advantage of the provisions of the act. That is one type
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of investigation. I can conceive of others where a community will desire to do something in the way of a community effort in the development of a particular area. We are being written to constantly by people who do not understand all the implications of the act. We are continually putting people, either in groups or as individuals, into touch with the lending institutions in order to facilitate the general move forward in connection with housing. There are a thousand different things that arise from time to time requiring investigation. In connection with plans we have had two competitions, both dominionwide. These were for low cost houses, and in connection with these competitions we had the cooperation of the architects' organizations. Prizes were awarded for the best plans and the judging was by a committee of eminent people who were representative of the different parts of the country and classes of business. At the present time these low cost housing plans are available to anyone who wishes them for S10 per set. There are ten different sets of plans, all for houses costing 83,000 more or less, varying with different localities. We have already sold a considerable number of these plans. All of this work is intended to stimulate public interest in better housing, particularly in low cost housing.


John Charles Landeryou: Would this investigation include a survey of slum areas in the large cities?


Charles Avery Dunning: That would not come
under this part of the bill.


John Charles Landeryou: Is there any intention to carry on an investigation of that kind?


Charles Avery Dunning: I would not say that we have the power to investigate slum areas, but part II of the bill is designed to provide a remedy for those conditions. We must remember that housing and public health in our cities are matters within the jurisdiction of the principal governments. We must step carefully and not get into that too deeply. When we come to part II it will be found that inducements are offered to municipalities to provide low rental housing, which is a specific form of attack on the slum problem. Nowhere in this bill do we assume to take the power, which in any ease this parliament could not give us, to eliminate slums as such. I think my right hon. friend will agree with me that there is no question constitutionally that we cannot attack directly this problem as such. However, by providing cheap money we can bring about, with the consent of the 
provinces and the municipalities, the erection of more low rental houses, which of itself will be one of the best means of getting rid of our slums.


Richard Bedford Bennett: Paragraph (d) of the old section provided for an investigation with reference to slum areas. I agree with the minister that we have no power to deal with it according to the act.


John Charles Landeryou: There is plenty of building material and labour in the country, and I was wondering if the investigations carried on under this section would result in a report being submitted to parliament as to the real reasons why people have not been building houses in the last five or six years.


Charles Avery Dunning: One of the reasons for bringing down legislation of this kind is that we all know that people have not been building as many houses as they should have. This whole bill is designed to facilitate the building of more houses because of the opinion we all have that Canada and the people of Canada need houses to a greater extent than they have been provided in the last few years.
I would not undertake to send out an investigator to find out why people did not build houses. I would much prefer to bring down legislation such as this, which is intended to help them build more houses, because the reasons why they have not done so during the last number of years would range over a very wide variety of opinions. One man's opinion would be one thing, another man's opinion would be another, and the reasons would differ in various parts of Canada. So I doubt if any practical good would come of appointing people to find out why houses have not been built in sufficient numbers. I should prefer to proceed on the constructive lines which this bill contemplates of making it easier for houses to be built in the future.


Thomas Alfred Thompson: 
Charles Avery Dunning: If my hon. friend will forgive me, he is speaking constantly of two per cent money. There is no provision whatever for two per cent money in connection with part I of the act. The money to which my hon. friend refers is in connection with part II, which is solely for low rental projects, if the municipality and the province desire to get into them. There is no two per cent money at all under the part we are discussing.


Thomas Alfred Thompson: Unless the municipality agrees with the minister to borrow the money.


Charles Avery Dunning: And in that case they do not get two per cent money.


Thomas Alfred Thompson: They do not get two per cent money?


Charles Avery Dunning: Oh, no.


Thomas Alfred Thompson: If the government would do something to lower the taxes, it might be of greater assistance. We should not be burdened with the taxation we have at present. There is enough money lying in the banks in Canada, drawing one and a half per cent to supply all the houses that would be required, and when the government steps in to remedy the housing situation it is to my mind putting the cart before the horse. What we really need is a reduction in taxation, to encourage private capital to invest money in housing. The more the government goes into business in this country bhe worse it will be for the people of Canada. What we should do is to cease hampering and impeding private enterprise, and lower the taxation.


Charles Avery Dunning: May I just reply to my hon. friend, because I am very anxious that in this discussion we should endeavour to stay on a constructive plane, as I believe is everyone's desire. The taxes to which my hon. friend refers as retarding the building of houses are, I think he will admit, mostly municipal taxes.


Thomas Alfred Thompson: Not entirely.


Charles Avery Dunning: Not entirely, but for the major part. I know that in the district in which I live just outside this city the great deterrent on building houses is bhe municipal rate of taxation which applies. That is not to the discredit of that particular municipality. It is true of many others. That is the major problem. We have enough responsibility in this parliament, goodness knows, and it should be made clear that we
are not responsible for municipal taxation except in so far as it may be said that municipal taxation is increased by virtue of relief costs. To that extent I suppose we must take our share of responsibility.


Richard Bedford Bennett: There is the sales tax.


Charles Avery Dunning: The sales tax enters only in a small degree into the mill rate of a municipality.


Richard Bedford Bennett: The builder pays the sales tax on what he has to buy.


Charles Avery Dunning: The individual has to pay sales tax, but that is the man who is building houses, and what my hon. friend from Lanark (Mr. Thompson) was speaking of was the house that exists to-day, to which no sales tax applies. It is the present taxes on that house which he says prevent the landlord from being able to rent it at a figure which will enable him to make any money.


Thomas Alfred Thompson: You cannot build a house to-day and make money, because there is a sales tax of eight per cent on everything you buy. Even if a man does make a profit, the government comes along and taxes his profit in the form of income tax. It is plain to-day that capital is running to cover, putting its money in government bonds at two or three per cent, or leaving it in the bank. That is what is the matter. We must get to the place where a man can build a house and rent it and pay taxes on it and make a profit.


John Charles Landeryou: The hon. gentleman believes that private capital should not be interfered with, that the government should not give assistance to the people in the building of homes. Private capital has had plenty of opportunity in the last few years to assist in the housing problem, but they have not invested their money in building houses for the simple reason that they have had no faith in the ability of the people to pay back the money they borrowed. I am glad the government is taking steps to solve this housing problem by advancing credit to assist in the erection of houses; but I cannot agree that the minister is bringing down very constructive legislation, because, after all, it is simply adding $100,000,000 to the debts of the country.


Charles Avery Dunning: No, it is not.


John Charles Landeryou: You are lending
$100,000,000. That is what it amounts to.


Charles Avery Dunning: No.
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John Charles Landeryou: I cannot see anything else but that you are lending $100,000,000 for the erection of houses-


Charles Avery Dunning: Oh, no.


John Charles Landeryou: -thus adding to the public and private debt. I cannot see how these people are going to be able to pay it back, with municipal taxation as high as it is to-day. An investigation would prove that it is the high tax rate of municipalities that is holding up many building enterprises.
The minister says that we are not responsible for the taxes and debts of the municipalities, but constitutionally we have jurisdiction over interest, and we have done nothing to lower the interest rate on municipal debts. These high debt charges have increased municipal taxation throughout Canada. The minister is making provision in this bill for the government to pay the taxes on these houses one hundred per cent the first year, fifty per cent the second year, and twenty-five per cent the third year. But what is going to happen in the fourth year? How do we know that the citizens will be able to keep their houses? There are so many people throughout the country to-day who are losing property, and if people with homes cannot keep them now, if they are losing them through foreclosure, I do not see how we can very well advance $50,000,000 to add to public and private debts at five per cent in order to encourage the building of homes, even by paying a certain amount of the taxes, because we have no assurance of economic stability. We do not know whether the people will be able to pay off the debt.


Daniel (Dan) McIvor: I have listened to speeches loud, long and emphatic on this side of the house pointing out why the government should embark upon a cheap housing or rental scheme, and I was enthusiastically behind those speakers, because that is one of the needs of the time. Now I am wondering whether that is what those speakers meant or wanted.


Gordon Benjamin Isnor: Before section 3 passes I wish to say I looked through the bill and failed to find any other section dealing with investigations and complaints. Reading paragraphs (a), (b), (c), (d) and (e), we find that practically all these provisions have already under the act been carried out, but I should like to ask the minister what form of investigation he proposes in regard to the actual construction of the homes after the work is started. I have in mind a recent investigation in Halifax county, particularly in connection with the town of Dartmouth,

when there were two groups of houses constructed, one a group of twenty and the other a group of ten. The construction was faulty. I believe the director of housing visited that section of the country; the contention that construction was faulty was borne out, and it was suggested that a waste of the investors' money could possibly have been prevented if some form of investigation had been carried out in connection with these groups of houses. I quite appreciate that the minister may say this is a matter for the company who had advanced the money, but it seems to me that there should be some further form of investigation, and it is in that particular respect that I am asking the minister whether he could not add another clause to those already included in paragraphs (a), (b), (c), (d) and (e) so that there would be stricter supervision in connection with the construction of houses.


Charles Avery Dunning: Perhaps I should be perfectly frank in expressing my opinion as to that kind of suggestion. There is a limit to the extent to which the government can wet-nurse both the lending institutions and the man borrowing money for the construction of a house in which he is to live. We cannot possibly undertake, as a parliament or a government, to see to it that the contractual relations between the parties are carried out to the satisfaction of all concerned. As a matter of fact there are three parties, because the contractor enters into the matter. With respect to the Halifax incident, because of noise made locally, I felt it desirable to send the director of housing to see what exactly the condition was, and in that connection I have a report indicating that the matters referred to were very much exaggerated. Here is a man borrowing money from a lending institution to build a house; here is a lending institution putting in at least sixty per cent of the total amount of the loan; and here is the contractor.


Richard Bedford Bennett: Without guarantee.


Charles Avery Dunning: And without guarantee. Then people say that the government should see to it that these three parties play square with one another. The lending institution and the owner are both interested in seeing that the house is built according to the specifications, and they are there right on the ground watching their own interests. Why call upon the dominion government to step in between two parties who have a definite contract, the specifications of which have been approved under the dominion housing scheme? We simply cannot undertake as a government to

National Housing Act
wet-nurse the parties to these contracts, I put it bluntly. Surely they are capable of looking after their own interests in a reasonable way. The owner of the house is interested in seeing that the contractor carries out his contract; the lending institution, which is risking sixty per cent of the money, is interested in seeing that a good job is done. The government has taken an interest in the matter to ensure that the specifications on which 'the house is to be built, the specifications included in the contract, shall be those of a reasonably well constructed house of the type desired, but it seems to me that is as far as the government should be expected to go. After that, the interests of the various parties ought to ensure that the house is built as it should be. I believe there was some deficiency but not nearly the deficiency that the reports indicate. But one should remember that the Dominion Housing Act has enemies to-day, and the new housing act will have enemies, self-interested enemies. I say nothing against them, because they have a perfect right to criticize; but if we approach this legislation in the belief that everyone will hold up both hands to help us, then we are ignorant of the facts. The fact is that criticism will develop from all those sources which are interested in some other method of dealing with this problem. I am saying nothing specific about Halifax in that regard, but from my point of view the average man who intends to own a home of his own will see to it that the specifications under which the home is built are carried out.


Richard Bedford Bennett: If he does not, he should
not have a loan.


Charles Avery Dunning: Exactly.


Gordon Benjamin Isnor: I quite agree with the general thought expressed by the minister, but the dominion government has laid down certain rules, plans and specifications. The minister admits that the government has approved the plans and specifications, and it is true that the insurance company advances sixty per cent. But I still contend that a certain obligation rests upon the government to supervise the carrying out of the plans to the extent of making sure that the builder is putting up a house that is in accordance with those specifications. I do not believe there are any enemies of this scheme in Nova Scotia. In fact, as one of the representatives of that province, I wish to congratulate the minister upon this forward step. In Canada in 1935 building permits amounted to 8140,988.228; in 1936 this had increased slightly to 8142,628,800, and in 1937 for the first ten months of the year it had risen to $198,576,800. Therefore there has been 51052-240
a considerable improvement in our building program in the dominion, and I have no doubt it will increase still further. Fully realizing that, I was merely offering a constructive suggestion which I thought the minister might take into consideration. I do not think he helped himself by adopting the tone he did, because he rather resented the suggestion. I offered it in good faith, and I think he should accept it in that spirit. I hold that there should be further supervision of any housing scheme in connection with which the dominion is in the position of guarantor.


Richard Bedford Bennett: There is in the bill a provision empowering the minister to supervise.


Gordon Benjamin Isnor: If there is, it is all right, but it is not stated in that particular section, and that is the only section which applies to investigation.


Charles Avery Dunning: If I owe my hon. friend an apology I am glad to tender it right now. It was not that I resented the suggestion, but I do deprecate any idea going' out from this house that in some way the government will nurse along every man who wants a home, will even see that after he has made his contract, made all his arrangements for his loan, the government will step in and make sure that the contractor puts every nail in its place. That is the idea which would go out if we undertook to become responsible for seeing that the ordinary contractual relations between borrower and lender and prospective home owner and contractor were lived up to. It would require an army to undertake any such thing. That is why I spoke as I did. This is a big, a tremendously wide country. To undertake specific governmental supervision of every house built under this legislation is impossible. I am sorry I gave the impression of heat to my hon. friend; I did not intend to do so with respect to his suggestion; but certainly harm would be done if the idea went abroad that we could undertake supervision of that kind.


Gordon Benjamin Isnor: If I remember rightly, under the home improvement act there was a penalty imposed if a person borrowed money and did not carry out the plan for which he borrowed it. Is there any penalty under this bill for a person who borrows to build a certain type of building according to certain specifications and then does not follow those specifications?


Charles Avery Dunning: No, there is no penalty.


Gordon Benjamin Isnor: Possibly that would overcome it.

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John Charles Landeryou: Paragraph (a) is what we are discussing. The minister may:
. . . carry on or arrange for the carrying on of investigations as to housing conditions and the adequacy of existing housing accommodation in Canada. . . .
"The adequacy of existing housing accommodation." Surely investigation would have to be made in at least the large centres of Canada, if not in the rural centres, as to just what slum conditions do obtain, so that we would have a general idea of the amount of money that would have to be spent really to abolish slums in Canada. The minister says there is to be no investigation of that. Then how did he arrive at $100,000,000 as being sufficient to meet the problem this year? Is it because we cannot increase the amount, or why is it limited to $100,000,000 and no investigation to be made as to the need for more?


Charles Avery Dunning: Would my hon. friend look through this bill carefully in the next five minutes and find that $100,000,000 of which he speaks?


John Charles Landeryou: Well, we got some idea regarding the amount of money that would be issued; we expected $100,000,000 would be the amount.


Denton Massey: The other day the minister pointed out that the distribution among municipalities would be on the basis of population.


Charles Avery Dunning: Not in part I, solely
with respect to part II.


Thomas Reid: Do the regulations require lending institutions to confine loans to houses in zoned areas, that is town-planned areas?


Charles Avery Dunning: No.


Richard Bedford Bennett: What has been the average rate of interest payable by borrowers under the act of 1935?


Charles Avery Dunning: Five per cent, always
five per cent.


John Charles Landeryou: How much money is involved? Is it $30,000,000?


Charles Avery Dunning: My hon. friend mixes
up two things when he speaks in terms of money. The provision in this part of the bill is clear, as will be seen a little later; it is $20,000,000 as far as governmental expenditure is concerned under this part. One may estimate what the total amount of building made possible by the dominion putting in $20,000,000 will be; that is a matter of estimate. Under the existing act the dominion has invested up to the present about

$4,500,000, if my memory is correct, and $17,000,000 of building has resulted. If we apply the same proportions to the $20,000,000 authorized by this part of the bill, it would give somewhere in the neighbourhood of $80,000,000. Then in part II provision is made for $30,000,000 to be advanced by the dominion for low rental housing schemes. In connection with that, either ten per cent in the case of a municipality undertaking the scheme or twenty per cent in the case of a limited dividend housing corporation must be added to what the dominion puts in. Under the third part of the bill we make a taxation subsidy. If you add the whole thing together you might get $100,000,000, you might get $120,000,000. The bill is intended to stimulate the investment of capital by the man who wants to own a home and by the institution which has money seeking an outlet but which is afraid of the risk; and part III is to help for a period of years in connection with the taxation on new low cost homes. That is the whole principle of the measure. I did not intend by this legislation to bring in the millennium, but it represents a carefully thought out means of assistance in connection with what we all recognize to be a serious problem; one in connection with which, as I said 'the other day, we have only limited jurisdiction; we can assist only financially, and some eminent authorities even question our authority to do that. It is intended as an attack upon this particular problem, not as a means of bringing about a new heaven and a new earth.


Mr. KINLEY:: I think there is another
aspect of this bill to be kept in mind, that is that it will have the effect of bringing down interest rates generally on real estate. I do not think the lending institutions are going to let the government get all that business; if they are going to continue in business, and legislation like this is a competitive feature, they will have to lower their rates, and that is desirable, because as regards interest rates on real estate security, as they are charged, especially in Nova Scotia, and I may say in Halifax-and there is no city in Canada where trust companies do a better business, and do it more efficiently perhaps- if the secondary effect of this bill is to bring down the interest rates charged by trust companies in this country, that will be salutary.


Abraham Albert Heaps: The statement was made
this afternoon that private capital may be scared away by the legislation now under consideration. I am of the opinion that the result will be the very reverse. Perhaps the

National Housing Act
minister is in a position to state at this time how much money was actually lent by private institutions under the old housing legislation.


Charles Avery Dunning: I said a moment ago that up to date it is $17,350,000 of which the dominion is responsible for $4,500,000.


Abraham Albert Heaps: In other words the fear of some hon. members that private capital is going to be frightened away is ill founded; the result has been the very opposite. This legislation may have the effect of stimulating the lending of money where previously they did nothing of the kind.


[Stage Direction]
Paragraph agreed to.
On section 3, paragraph (b).
Donald Alexander McNiven: I notice we have authority here to undertake investigations elsewhere than in Canada, Have any such investigations been undertaken by the department; for example, in Sweden, Great Britain or any of the countries which have housing schemes, so that there will be information available for municipalities which decide to undertake such a scheme?


Charles Avery Dunning: We have not made
investigations by way of sending officials to other countries, except to the United States. The director of housing has been in touch with the housing authority at Washington with respect to the schemes which are operating in that country. Of course we have all the detailed information we could secure from Sweden, which was mentioned by my hon. friend; in fact, only a week or so ago a member of the Swedish parliament who is also an economist-which is an unusual thing -was in the city, and I had a long talk with him about housing and other matters in Sweden. The officials of the department also took advantage of his presence here to learn a great deal about it. But there has been no sending of officials there. It must be remembered that the act we have been working under, the Dominion Housing Act, was designed-as is this part of the new measure- to fit Canadian conditions, which are not similar to conditions in some other countries to which reference is frequently made; and by studying the plans in operation in those other countries we can get a pretty good idea of just what parts of such plans will be applicable to our conditions. We have too, of course, full information with respect to the British housing plans, and I do not think it necessary to send anyone to that country. The inclusion of this section, which is similar to section 3 of the old act, was merely to give authority to the minister to get information when and where and how it could be 51952-240i
obtained. There really is no necessity for debate on it; it is really the old section, substituting the Minister of Finance with the approval of the governor in council for the former economic council.


Richard Bedford Bennett: With some amendments.


Charles Avery Dunning: Some small amendments.


Mr. DUFFUS:: Perhaps I should have
asked this question under paragraph (b) section 2, but as yet I have not ascertained whether it is the intention to permit the building of houses at a lower cost than $2,500; for example, $1,500?


Charles Avery Dunning: Oh, yes.


Richard Bedford Bennett: There is no limitation
in this part.


Charles Avery Dunning: No.


James Samuel Taylor: I did not hear the remarks of the minister, but this does appear to indicate some investigation and research, does it not?


Charles Avery Dunning: It makes it possible, if conditions render it necessary.


[Stage Direction]
Paragraph agreed to.
On section 3, paragraph (c).
Donald Alexander McNiven: When the home improvement plan wes inaugurated, almost immediately there was a twenty per cent increase in the cost of building materials. It seems to me there is a great probability of a substantial increase in the cost of building material once this plan is launched, which will render null the minister's well laid plans.


Richard Bedford Bennett: This has been in operation for two and a half years.


Donald Alexander McNiven: I was wondering whether under this section there was any power in the minister to deal with such a situation, or if he would have to invoke the good offices of the Minister of Labour under the Combines Investigation Act to preserve some degree of certainty as to the cost of building material.


Charles Avery Dunning: My hon. friend started with a statement which I can neither confirm nor deny, with respect to a twenty per cent increase in the cost of building materials. I do not know whether or not that was the case. There is nothing in this legislation which will enable the minister to control costs, but I would direct attention to what I said last Wednesday:
-this legislation is a challenge to the building construction industry of this country, and is so intended. It is often stated that of all
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our industries, the one most laggard in advancing, in taking advantage of possibilities of improved technique, of lowering costs, of the standardizing of commodities, is the building industry. I do not join in that criticism, but I do say that there is one way in which anything this parliament may do in connection with housing can be killed, and that is for the building construction industry, capital and labour, material suppliers and all the rest, to believe that they can, by reason of it, start a steady upward trend in the price of the commodities they have to sell, whether those commodities consist of capital, goods or labour. We require the maximum of cooperative effort from everybody concerned

With respect to investigations, the laws of Canada provide through the combines act and other legislation means of dealing with some of the matters to which my hon. friend refers. In connection with this section I had in mind that if abuse of a national kind was alleged, this would offer another means of securing the facts of the case. There are no punitive measures in this bill. The combines act and other similar acts which are on the statute books exist for that purpose. This bill is brought down with the desire of cooperating with all those engaged in the building industry, and I believe the people engaged in the construction industry will see in this legislation a great opportunity. From the messages I have received, from both capital and labour in the building industry, I have every reason to believe that they are desirous of cooperating and that they appreciate the spirit in which I spoke the other day, as I have just quoted.


Denton Massey: I understand that at the moment there are plans, at the rate of $10 per set, available for the $2,500 houses.


Charles Avery Dunning: Three thousand dollars and under.


Denton Massey: This paragraph says, "as to the feasibility by any means of securing economies and increased efficiency in such construction." Under that I assume the possibilities of pre-fabrication would be considered, not only in regard to whole sections but also in regard to casements, doors and so on. Has anything been done so far in that respect?


Charles Avery Dunning: Yes; we have quite a lot of information with respect to pre-fabrication and the concerns which undertake it. At this stage I cannot elaborate on it; in fact I have not it all in mind, but I can say that the department intends to follow up every development both in the United States and in Great Britain particularly, where there appears to have been more in the way of taking advantage of mass production methods as applied to the construction industry than has been the case elsewhere. There is some

question as to the extent to which what has been done elsewhere in that regard can be made applicable here because of our climatic conditions.


Denton Massey: And our fire laws, and so on.


Charles Avery Dunning: Yes; particularly our
extremes of temperature, -but that is also in mind in connection with the power to make investigations.


Denton Massey: In connection with the plans the minister has in his possession, do they contemplate houses of brick or of timber, or both?


Charles Avery Dunning: Some of each.


Denton Massey: Would the minister tell the committee what plans are available?


Charles Avery Dunning: There are ten different types of small houses. The basis of the computation was a house that could be built for $3,000 under average conditions in Canada. There would be variations above and below that $3,000, depending upon the conditions prevailing in various parts of the country.


James Samuel Taylor: I assume a general sketch is first obtainable?


Charles Avery Dunning: Any one of ten different
types.


James Samuel Taylor: But how do you know which one you want unless you have all ten before you?


Charles Avery Dunning: The general plans have been published in all the newspapers, and we also have a booklet which contains the general designs. I can assure my hon. friend that he will not have to buy a pig in a poke. He will be able to get a look at the pig anyway.


James Samuel Taylor: I ask these questions for the benefit of those who will rend Hansard, and discover what the bill means.


Charles Avery Dunning: I understand that.


Donald Alexander McNiven: Does the figure of $3,000 apply to every part of Canada?


Charles Avery Dunning: I said under average conditions. It would vary above and below the $3,000, according to local conditions in the different parts of Canada.


Donald Alexander McNiven: I recall that last year- and I believe it was when the estimates were before the committee-this matter was discussed. The minister mentioned that a house could be built for $2,500.


Charles Avery Dunning: Yes.

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Donald Alexander McNiven: I made inquiries and
found that was a pre-fabricated house, built in the city of Hamilton. After I obtained the plans and specifications, I submitted them to contractors for construction in western Canada and found that to build the same house in that part of the country it would cost $4,000 to $4,200. I was wondering whether local conditions in western Canada had been considered when the price was fixed at $3,000.


Charles Avery Dunning: That will be taken into consideration. I hope, however, that the hon. member will bear in mind that some people do not welcome changes in technique which involve pre-fabrication. I need not say more.


[Stage Direction]
Paragraph agreed to.
On section 3, paragraph (d).
Mr. LENNARD:: In connection with low cost housing may I ask if there is any determination as to rates of wages to be applied among the different building trades?


Charles Avery Dunning: No.


Frank Exton Lennard: That is not considered?


Charles Avery Dunning: No.


Frank Exton Lennard: Then how is the cost arrived at?


Charles Avery Dunning: Those factors are all considered when we are arriving at specifications.


Frank Exton Lennard: Are standard wages considered?


Charles Avery Dunning: Yes; it is based upon standard wages.


[Stage Direction]
Paragraph agreed to.
Paragraph (e) agreed to.
Section agreed to.
On section 4, subsection 1-Advances.
Mark Cecil Senn: In connection with a former item I asked the minister what the government intended to do about extending these privileges to the country districts. May I state a case in point?


Charles Avery Dunning: I would suggest that the hon. member read paragraph (g), and that he make his observation on that paragraph. If that were done, we would get along faster.


[Stage Direction]
Subsection agreed to.
On section 4, subsection 2, paragraph (a)- Conditions.
Charles Avery Dunning: This paragraph is the same as in the present act.


[Stage Direction]
Paragraph agreed to.
On section 4, subsection 2, paragraph (b).
Alan Webster Neill: Would the minister explain why the paragraph makes it mandatory or compulsory to borrow not less than seventy per cent? Suppose a man wishes to borrow only fifty per cent; would that not be all right? Why is he compelled to borrow seventy per cent?


Mr. LAWSON:: Is not this the part of the bill which relates to individual loans?


Richard Bedford Bennett: Yes.


James Earl Lawson: Is not the whole scheme one of helping those who have not enough money to finance the building of houses?


Charles Avery Dunning: Yes. There is the further point, that those loans smaller than seventy per cent are loans in connection with which government assistance ought not to be required. When a man has an equity of forty per cent or fifty per cent of the cost of the proposed house, then the lending institution ought to be able to fill the bill, without the assistance of the government. The tendency has been, in areas where loaning has been done under the Dominion Housing Act, for the rate effect of the act to become visible in connection with loans which were made not under the Dominion Housing Act, but for smaller percentages in the form of straight loans by lending institutions. That is a by-product of the Dominion Housing Act.


Mr. McCUAIG:: It seems to me, if I may be permitted to follow up the question, that seventy per cent is too high a figure. In many municipalities it is very difficult to borrow money privately to a point as high as seventy per cent. I know in my own locality if a person had $2,000 and wanted to build a house valued at $5,000, he might be able to borrow the $3,000. Therefore a man wanting to borrow between sixty per cent and seventy per cent would be outside this section of the bill, and yet the amount he would have to borrow would be higher than he could borrow from a private individual. It seems to me it would be advisable to reduce the amount to a point below seventy per cent. Perhaps it should be as low as sixty per cent.


Richard Bedford Bennett: I noticed that the old section provides that the advance made by the minister shall not exceed twenty per cent of the cost of construction of the house or its appraised value, whichever is the lesser. Then it goes on to say that the interest payable shall be so and so. Under the present measure, whether a man likes it or not, he has to. borrow seventy per cent. He must borrow not less than seventy per cent or more than eighty per cent.
National Homing Act


Charles Avery Dunning: If my right hon. friend will read farther on, he will see that the results are about the same.


Richard Bedford Bennett: Yes, but I am talking about this paragraph. The advance made jointly by the minister and the lending institution or local authority shall not, according to the paragraph be less than seventy per cent.


Charles Avery Dunning: Yes, and not more than eighty per cent.


Richard Bedford Bennett: On a $2,000 house he must borrow from the lending institution and the government $1,400. But suppose he needs only $1,000.


Charles Avery Dunning: We have been operating under paragraph (c) of section 4 in the old act, which states:
The advance by the minister shall be made only if the lending institution or local authority lends, in addition to the amount of the advance, sixty per cent of the cost of construction of the house or the appraised value-
And so on.


Richard Bedford Bennett: Quite.


Charles Avery Dunning: And it continues:
-whichever is the lesser: provided that the governor in council may in any class of cases fix the percentage at less than the sixty per cent aforesaid.
And under that power the regulations were made on a graduated scale of seventy, seventy-five and eighty. It is the result of experience that has made us put in the seventy per cent provision.


Richard Bedford Bennett: If a person does not require that much, why should he be compelled to take it? It precludes him from doing business with the government, and compels him to go somewhere else and pay a higher rate.


Charles Avery Dunning: No; the effect of it strangely enough has been that a man in the position of the one described by the hon. member for Simcoe North (Mr. McCuaig) has been, by virtue of this legislation, enabled to borrow from the lending institution itself on terms approximating the terms under the Dominion Housing Act, in cases where such person may have a larger equity than is contemplated by the act. That has been one of the by-products. That is the way in which the act has been working up to now, in actual practice.


Alan Webster Neill: But it has not worked out. The trouible is that in British Columbia the lending companies do not make loans outside the big cities, and there is a demand for houses in the smaller municipalities. The

people in those municipalities cannot borrow from the lending institutions, because they are simply met with the statement-and I have approached them on behalf of some people-"We will not go into- that town.1' The lending institution will not go outside the big towns.


Charles Avery Dunning: Has the hon. member read paragraph (g) ? We have not reached that part of the section which enables me to discuss the methods whereby we hope to overcome the difficulty.


Daniel (Dan) McIvor: If a man making a loan wishes to make payment before the time stated, has he permission to pay off the whole loan?


Charles Avery Dunning: It operates under an amortization plan, of course. But the contract usually contains a provision whereby a loan may be paid off. I forget the exact terms. I may say, however, that there is such a provision.


Frederick George Sanderson: Shall paragraph (b) carry?


Richard Bedford Bennett: I must say I cannot follow paragraph (b) in its present form.


Charles Avery Dunning: I am willing to consider taking out the seventy per cent. My right hon. friend is speaking of the minimum?


Richard Bedford Bennett: Yes.


Charles Avery Dunning: The suggestion is that
we should extend government assistance to the man who is able to put up fifty, sixty or seventy per cent of the amount and is taking only a small loan. If that is done, a large part of the dominion's proportion will be taken up by people who have the capacity to make private arrangements to borrow money. I am anxious not to open the door too widely. Would the committee think sixty per cent would be too much?


Mr. BARBER:: No.


Charles Avery Dunning: I do not want these
companies to be trying to make low percentage loans only.


Richard Bedford Bennett: Let me demonstrate
how it works out. Let me take the case put to the committee by one of the members. This paragraph reads:
The advance made jointly by the minister and the lending institution or local authority shall not be less than seventy per centum and not more than eighty per centum of the lending value of the house.
Suppose the lending value is $2,000. As this section now stands, the man, whether

National Housing Act
he wants to or not, would have to borrow $1,400 of that sum. The government would put up twenty-five per cent of that $1,400, which amounts to $350. In other words, the lending institution would put up $1,050 and the government would put up $350. The man must do that. I see no reason why we should make it compulsory that he should borrow seventy per cent. Perhaps I have not made myself clear.


Charles Avery Dunning: I am at the disadvantage of having to try to get these companies to make loans sufficient in amount to enable people in the income group that build $2,400 houses to get a loan. It has been rare in my experience to find a man with $600 who is willing to live in a $2,000 house. The great complaint against the existing housing act is the exact opposite of that, that is, it does not come down low enough to reach the man in the income group concerned. That is why we are making provision under paragraph (g) to go up as high as ninety per cent of the total lending value.


John James Kinley: It might help out the
rural situation if you brought it down to sixty per cent. It would be then more attractive to the loan companies to go into the rural communities.


Richard Bedford Bennett: Because of its being
guaranteed by the government?


John James Kinley: It makes a better risk.


Charles Avery Dunning: I am sure the committee will appreciate the position of the lending institutions. Naturally they try to be as selective as they can. They want the maximum security and it is their duty to get it. If we pull down that percentage, I am afraid we shall be placing an inducement in the way of the lending institutions to look for the people who have the most money. What I want this bill to do is to help those who have the least money. The principle of selectivity enters into the matter. We have had this difficulty up to date. I am not worrying much about embarrassing the man who has more money than this bill calls for, but I am worrying a great deal about the fellow who is just able to get together the amount called for by this bill. That really is the difference between us. The lending institutions will always look for the maximum security and will tend to be unwilling to make loans to those who have only a little money. We want them to make loans to those people who have only a little but who have the other essentials, the character and the desire to own a home and the ability to work out a plan under this scheme whereby
in many cases the rent they are paying will pay for their homes over a period of years. That is really what we are after. I am sure it will be found in practice that the lower the percentage requirement is put, the more the lending institutions will tend to concentrate on those people who have the most money. We want to induce them to consider the other class.


John James Kinley: I am concerned about the people in the rural communities. The loan companies do not like to make loans in rural communities.


Charles Avery Dunning: The inducement is offered under paragraph (g).


John James Kinley: If a man in the country had a little more money to put into a project, it would be more attractive to the loan companies and we would likely get more action under this bill.


Charles Avery Dunning: Our experience is just the reverse.


Alan Webster Neill: The minister says that we must induce the loan companies to lend to the man who has just a little stake; otherwise they will be looking for the man who is the best risk. That argument pre-supposes that the lending institutions have only a limited amount of money to lend, whereas they have all kinds of money. If you lower the percentage to sixty and induce them to go into the small country villages, they will take on everything that comeg. If you do not encourage them to go in, then the people of whom the hon. member behind me speaks will be simply out of luck. We have found by experience that these loan companies will not go into the country places.


Charles Avery Dunning: My hon. friend and the hon. member behind him keep on debating the problem which paragraph (g) seeks to meet. I am trying to save my own energy as much as I can, and I shall not follow my hon. friend in attempting to debate just how paragraph (g) seeks to overcome that problem. I do not recognize that the problem suggested by my hon. friends has any material relationship to the seventy per cent provision, but it does have a most important relationship to the new principle we are inserting in paragraphs (g) and (h) of this subsection. I may tell my hon. friends quite frankly that under the existing housing act our experience has been directly the opposite of what they suggest.


John James Kinley: If the percentage were lowered to sixty per cent, the security would be increased in connection with rural loans.

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Charles Avery Dunning: I shall answer that,
although it is in advance of the question. I am sure that difference would not be sufficient to induce the loan companies to go into the rural areas.


Alan Webster Neill: It would help.


Charles Avery Dunning: You may think it will help if they have ten per cent more, but what are the problems with which they have to deal in making loans in small areas like that?


Alan Webster Neill: There are not enough loans.


Charles Avery Dunning: There are not enough loans over which to distribute the cost of overhead. Next, there is a relative lack of salability of the security. The third problem is that of collection. An increase of ten per cent in the original equity would not be sufficient to overcome those difficulties. That is why we are introducing an entirely new principle, so far as the Dominion Housing Act is concerned, in paragraphs (g) and (h). We are attempting to make the lender feel more secure when lending money in these communities. However, I would prefer to take that up when we come to those paragraphs. Probably I have not quite grasped the point raised by the leader of the opposition in connection with the seventy per cent provision.


Richard Bedford Bennett: The sixty per cent provision would work adversely to the view which the minister has presented. It would have to be eighty per cent to make it effective. In order to make his point, he would have to increase it instead of decreasing it. Consider a $2,500 loan. If we are to advance seventy per cent, that would be only $1,750. If we say it is to be eighty per cent, it would be $2,000. If we say sixty per cent we have hardened the position as against the borrower; for sixty per cent of $2,500 is $1,500, and then he has to find somewhere another $1,000. It is putting the sixty per cent the wrong way, not in favour of the borrower, but against him.


Charles Avery Dunning: No; that is my whole point.


Richard Bedford Bennett: The difficulty I see is the rigidity when you say seventy per cent. As the old act stood, there was elasticity and discretion.


Charles Avery Dunning: Not below sixty per cent.


Richard Bedford Bennett: Oh, yes. It said that the advance made by the minister shall not exceed twenty per cent of the cost of construction of the house or its appraised value,

whichever is the lesser, and the advance by the minister shall be made only if the lending institution lends sixty per cent of the cost of construction of the house.


Charles Avery Dunning: In addition to the amount advanced by the government.


Richard Bedford Bennett: Quite, and the government was finding not more than twenty per cent of the cost of the construction of the house or its appraised value, whichever was the lesser. But we have changed that, and it is the rigidity which the minister has introduced which I think is unfair. He says positively: You have to get seventy per cent from the lending company. The introduction of that rigidity may make the legislation impossible of operation. I am not concerned about the seventy and eighty per cent, and that sort of thing. All I want is to have some elasticity so that the situation that develops later under paragraph (g) shall not be the only situation to which that applies, and I still think that perhaps the old method was the better. You may say: The advance of the country and the lending institution together shall not exceed so much. We are taking not more than twenty-five per cent of the loan; that is clear, is it not? On a $2,500 loan we may go up to ninety per cent; that is, not more than ninety per cent of the lending value shall be borne by the country.
Just take this case. You have a $2,500 property, and we are going to carry ninety per cent of the load of the loan. How much is the loan going to be?


Charles Avery Dunning: Not ninety per cent. We do not carry ninety per cent.


Richard Bedford Bennett: No, twenty-five per cent, I should say.


Charles Avery Dunning: Twenty-five per cent of ninety per cent.


Richard Bedford Bennett: And ninety per cent of $2,500 is $2,250, and that $2,250 is not borne by the lending institution alone. That is the maximum loan which can be made against the property.


Charles Avery Dunning: Of which we bear twentyfive per cent.


Richard Bedford Bennett: Quite so, or $562.50.


Charles Avery Dunning: That is right.


Richard Bedford Bennett: Now, $562.50 from $2,250 leaves the amount that is borne by the lending institution, namely, $1,687.50. Is that correct?


Charles Avery Dunning: Yes.

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Richard Bedford Bennett: That is the lending institution's part of the load, and our part is $562.50. Why should we not leave some elasticity with respect to the matter? Why should we say, not less than seventy per cent and not more than ninety per cent? I am not forgetting the provisions in paragraphs (g) and Oh), but we are dealing now with another class of case altogether. I confess I do not know why there should be that rigidity. I am quite content that the other form should be used, namely, that the advance made shall not exceed such and such per cent, of which we bear twenty-five per cent. But doing it in this way makes it absolutely rigid, and we say to these borrowers: You have to borrow seventy per cent to avail yourself of the provisions of this section and get the dominion's contribution.


Charles Avery Dunning: I am quite prepared to let paragraph (b) of subsection 2 stand for further consideration, although I do not think I can express any more plainly than I have already done the reason for it.


Richard Bedford Bennett: I had no difficulty in following the minister, but the difficulty I see is in having that rigid provision there.


Charles Avery Dunning: I intended to explain
that in practice we have not been advancing up to date under the Dominion Housing Act any loans of less than seventy per cent of the lending value. Seventy per cent is the way in which it works out at present.


Richard Bedford Bennett: Because the statute is
there. That is the reason.


Charles Avery Dunning: Yes, and it has worked. The only reason we are changing the incidence of the dominion's proportion is in order to meet the problem which arises by the possible juggling of valuations to make them come within a particular percentage.


Richard Bedford Bennett: We have met that by
our definition.


Charles Avery Dunning: Yes, we have met that by our definition and by the fact that the dominion will take not more than twenty-five per cent with respect to any percentage of loan which is made.


Richard Bedford Bennett: Twenty-five per cent of the advance is our maximum?


Charles Avery Dunning: Exactly. It will simplify bookkeeping and help tremendously in avoiding that difficulty of people trying to get an appraised value which would bring them under the wire.


Richard Bedford Bennett: Have you not covered that, making it inflexible and still keeping your twenty-five per cent? There is no flexibility now, but there is rigidity with respect to our liability, namely, twenty-five per cent of the advance by the lending institution and the crown. The only thing that remains is flexibility as to the amount to be advanced by the lending company.
Take the case put by the hon. member for Queens-Lunenburg (Mr. Kinley) of a man who had more money but did not want to go the whole seventy per cent. I am quite content that the minister should still have power between seventy and ninety per cent, but I do not wish to make it obligatory and say the man must take seventy per cent.


Joseph-Arthur Bradette: I would not be in favour of making it too low. If it is not made of interest to the lending companies, they will not lend money in the unorganized sections, and we suffered from that in my part of the country last year and the previous year. The higher we make it, the more inducement there will be to the lending companies to loan in the unorganized sections, where we are suffering from not being able to get money for new homes.
Paragraph stands.
Section stands.
Progress reported.
At six o'clock the house took recess.
After Recess
The house resumed at eight o'clock.

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



DEPARTMENT OP MINES AND RESOURCES

[Stage Direction]
Indian Affairs branch-branch administration, $53,362.50.
James Samuel Taylor: I desire to speak on the potlatch custom. Would the minister prefer to have it spoken to now?


Hon. T. A. CRERAR (Minister of Mines and Resources):: Perhaps we might pass the first item, branch administration, dealing with expenditures in connection with the head office of the Indian Affairs branch. Remarks on the potlatch might better come under item No. 163. However, it is immaterial.
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Richard Bedford Bennett: The whole administration of the Indian Affairs department must necessarily have undergone some change by reason of the consolidation of departments, and as this is the first opportunity the minister has had to explain what changes have been brought about in the administration, and this being the administration item, he might be able to make a short statement as to what is now the administrative practice with respect to Indians as covered by this item.


Thomas Alexander Crerar: Very few changes have taken place in the administration since the consolidation of these various departments under mines and resources; that is, if the question of the leader of the opposition has reference to organic changes in administration. Previously the Indian Affairs department was a separate department of government; I believe it was associated with the Department of the Interior, under one minister.


Richard Bedford Bennett: And he was Superintendent General of Indian Affairs.


Thomas Alexander Crerar: The Superintendent General was the Minister of the Interior of the day. There was a deputy superintendent general, who under the set-up of the new department becomes director of Indian administration. The work of the Indian Affairs department continues as it has been hitherto, prior to the union of the various departments into the Department of Mines and Resources. It is concerned with education, medical care, welfare work, administration of agencies all over Canada and the like. We are endeavouring to make some changes in the administration, not in the organic sense, but more in the direction in which the work relating to this very important department is carried on.
In my opinion, Indian Affairs administration is one of the problems of this country. There was a time, if we look back thirty-five or forty years, or to more distant periods, when the consensus of opinion throughout Canada was that the Indian problem, if we had an Indian problem, would probably solve itself with the effluxion of time. At that time there was a decline year by year in the Indian population of Canada. That has changed now and our Indian population is on the increase, increasing at the rate of about one and one-half per cent per annum. That is due to better care. If we compare the expenditures in medical services alone at the present time with what they were thirty-five or forty years ago, we see that there has been a vast increase in the amounts of money voted by parliament each year for medical care, hospitalization, and general welfare work. All this has tended naturally, as it was intended to do,

to lift the standard of living of the Indians. Better medical care and better hospitalization mean lower mortality, and they are the factors which I think may be said to be mainly responsible for the change-over from a declining to an increasing Indian population.
For instance, in these estimates we have included $275,000 looking towards the eradication of tuberculosis in our Indian population. Tuberculosis has been one of the most difficult diseases to combat among the Indians, and we find that as our various provincial administrations have taken steps to deal with it in the white population it is necessary to deal with it among the Indians. As I intimated to the committee a year ago, representations have been made from practically every province urging the federal government to take some steps to reduce and control mortality from tuberculosis among the Indians. Every reserve was a centre of infection, and consequently pressure of public opinion in that direction has moved on further towards inducing the federal administration to take some preliminary steps this year in a program looking to that end.


Richard Bedford Bennett: Oh, it has been going
on for years.


Thomas Alexander Crerar: Not directly with tuberculosis.


Richard Bedford Bennett: Oh, yes.


Thomas Alexander Crerar: Well, we shall not quarrel over that.


Richard Bedford Bennett: No; I am only glad it
is so.


Thomas Alexander Crerar: The point I want to make is that the effect of all this is simply to decrease the mortality and accelerate the increase in Indian population.
We have another problem, in this sense, that practically one-third of the Indian population of Canada are known as hunting and trapping Indians; that is, Indians who live by the chase. They are mostly in the northern parts of our provinces. The reserves where they are located are not suitable for agriculture. They live by fishing as far as their food supplies are concerned, and by the chase and such purchases of other food as they may be able to make from their meagre income.


Richard Bedford Bennett: Some of them get treaty money.


Thomas Alexander Crerar: The treaty money is a
comparatively small item. No one can say that the treaty money was a generous provision for the Indians; it was not. But the effect of all this is being seen more clearly

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as the years pass. Since the resources were turned over to the western provinces there has been a marked increase in the number of white trappers trapping in these areas where formerly the Indian had free sway. Owing, I think, to rather short-sighted policies which governments of Canada have at times followed, there has been a decline, and in some places almost complete eradication, of the fur-bearing animals. As the number of fur-bearing animals went down, the natural means of livelihood of the Indians went down also, and they were thrown in greater degree from year to year into dependence upon the federal administration. That, to my mind, is one of the serious problems we are facing in respect to at least one-third of the Indian population of this country. It is estimated that the Indian population to-day is about 118,000, and at the present rate of increase it will not be many years before it reaches 150,000. If some steps cannot be taken to enable our Indian population to depend more upon their own resources, it is a safe assumption that they will become an increasing burden upon the state. To-day many of these Indians desire to become more or less independent. That was one of the reasons behind the legislation I introduced a few weeks ago to set up a revolving fund from which advances might be made to individual Indians, or to Indians on reserves in a communal sense, or to Indian schools, for the purpose of providing materials to educate Indian girls and boys in handicraft arts.


Richard Bedford Bennett: Would it interrupt the minister to ask the relative number of the 118,000 in the east and the west?


Thomas Alexander Crerar: British Columbia has about 24,000.


Richard Bedford Bennett: That is, who live by the chase and fishing?


Thomas Alexander Crerar: Well, some live by fishing; some work in the lumber or logging camps.


Richard Bedford Bennett: And canneries.


Thomas Alexander Crerar: But in the main they live by the chase. Alberta has about 11,000; Saskatchewan, 12,000; Manitoba, 13,000; Ontario, about 30,000; Quebec, 13,000, and there are about 4,000 altogether in the maritime provinces and the remainder in the Northwest Territories and the Yukon. That is a rough approximation of the distribution of the Indian population.


Richard Bedford Bennett: Of that type, or of the whole?


Thomas Alexander Crerar: The whole population.


Richard Bedford Bennett: The minister said one-third of the Indians lived by hunting and fishing, and then he said that number was 118,000.


Thomas Alexander Crerar: No; the total number is about 118,000; roughly one-third of those are regarded as hunting and trapping Indians, or something under 40,000.
Many of the reserves are suitable for agriculture, and efforts are being made on those reserves to induce the Indians to take up that mode of livelihood. In Ontario many of them find opportunities for work, some of them adjacent to mining camps, others in the pulpwood industry and the like. I recall a few reserves east of Port Arthur where this work has been taken up; contracts were made for the delivery of pulpwood; they also engage in the manufacture of canoes, snowshoes, skis, and I believe they have taken some contracts for supplying grain doors for railway cars and that sort of thing.
The problem is an interesting one, and difficult in some aspects. It must be borne in mind that since the beginning of Indian administration they have been regarded as wards of the state. Under the terms of the surrenders of their lands there is a definite responsibility in wardship on the part of the federal government to the Indians. But I think the methods we have followed in the past have tended to perpetuate that idea among the Indians themselves. I recognize the difficulty of changing that state of affairs. I am not optimistic enough to think that change will be other than gradual and slow. But I do think we can shape the policy of Indian administration to that end, not only in the administration of the reserves, but as well in the whole field of Indian education.
I wish to pay tribute to the splendid work done by the various churches in the field of Indian education. I know I shall not be misunderstood if I say that I think there were times when a somewhat different direction might have been given to education and much better results thereby secured. If mistakes have been made in the past in that respect, it has been in the effort to graft.the white man's way too quickly upon the Indian population. I know of Indian girls and boys coming to the residential schools at the age of six or seven, remaining perhaps ten or twelve years, acquiring an education in the sense we ordinarily understand, the ability to read and write and figure, the three R's, learning habits of personal cleanliness, how to operate an electric washing machine and an electric iron; but when they left the school there was only one place for them to go, namely,

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back to the reserve, and often the education they received in the schools was not adapted to that mode of living. I may say that I have discussed this matter with many of those engaged in educational work in connection with the churches, and I have found nothing but the finest spirit of cooperation when I offered some suggestion as to where I thought improvements might be made in that respect. I think the education could be made more vocational in character,, with much better results.
So far as the organic set-up of the branch is concerned, those members of the committee who are interested will find the details on page 188 and succeeding pages in the report of the Department of Mines and Resources, tabled at the beginning of this session, for the year ending March 31, 1937. Generally speaking, there are five divisions in the branch, with some subdivisions. First, there is the division of field administration, which has to do with supervision of the various Indian reserves and agencies throughout Canada. Second, there is the medical service, which has grown to very considerable proportions. There is next a division that has to do with reserves and trusts. For instance, there is something between thirteen and fourteen million dollars of trust funds, or band funds as we call them, in the branch. Some of the bands have very large funds. The greater number, however, have very little if any; probably a majority of the reserves have no band funds at all. The next division is the welfare and training service, which has to do with the educational side of the activities of the department and the general welfare work. Then there is a records service, where all the records of the administration are kept and classified, so that information going back as long as there has been an administration may be available.
That very briefly sets out the five general divisions into which the Indian administration work is divided. Possibly this brief summary, given in a rather fragmentary fashion, will give members of the committee an idea of the general set-up, and I shall be glad to supply any additional information when we discuss the items in detail.


Richard Bedford Bennett: Mr. Chairman, I am sure the members of the committee appreciate, as I do, what the minister has said. I confess that to me the Indian problem has always been one of great interest and, I might add, of considerable concern. I know that the changes which have been made during the last ten years have been marked and very striking indeed. We have provided for the care of the Indians in this country a medical service

which in my judgment is as good as that of any country in the world, if not better. It has involved the expenditure of substantial sums of money, but I think the reasons given by the minister as to why we should deal with tuberculosis and other diseases in the manner in which we are endeavouring to deal with them need not be amplified by me.
There are essentially two problems of which we have to think in connection with the Indian. The one concerns his living, which is very important, and the other concerns his health, which may be divided into his mental and physical health and his spiritual wellbeing. The churches are not lacking in their efforts to care for the latter; and upon us rests the responsibility for caring for his body and mind, and in a broad and general way I think we have made great advances in that regard. The minister has detailed them. I need not go into them now, because there are some about which I may have to offer some little criticism as we proceed. As to his getting a living, after all the Indian regards that as important, and in my observation he is not alone in that regard. How is he to get a living? At some points in the east they have splendid reserves. They farm; they are agriculturists in the large sense of the term, and they do very well. In some of the western reserves, for instance at the Blackfoot reserve at Gleichen, they have their coal mines and their cattle on the ranges, and grain is grown in considerable quantities. You have the cattle ranges of the Indians at Macleod and in that section of the country; and then you have the Stoneys who are essentially hunters. On the rocky reserve which they inhabit the Stoneys are unable to make for themselves an adequate living. So you have two classes to consider when you come to the question of a living: one class that lives by its hunting and fishing ability, on the' proceeds of the chase-and each year it is getting more difficult, as the minister has pointed out, to make a living in that way-and the other class.
How are you going to care for the first class? That	is	a real	problem. There areforty thousand people who must be cared for. We exercise supervision over them. We have given them reserves, and they have surrendered their rights	to	surrounding territory.	Thereserves are not sufficient, either in area or in quality of soil, to produce a living. That problem we	have not	mastered. We	haveplayed with	it,	and I	do not mean	that
offensively. We have attempted to deal with that branch of it, but we have had no settled policy to deal with it, and I do not know what policy we could adopt. You could not

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confine those Indians to those particular reserves; they are going to go out and hunt and fish.
Then you have the second class, who derive some benefits from agriculture, from farming in the large sense, including cattle raising, and from mining. In some instances they get something from their forests, because some of them did have a few trees scattered around their reserves, though in the main these reserves are not near forests. Well, we have provided them with farm machinery; we have provided them with supervision; we have provided them with pure bred stock to lay the foundation of their herds; but as yet we cannot say that we have established them in lines of endeavour that ensure their livelihood. I think that is not an unfair way to put it. I think the effort to stimulate the activity of the individual Indians, as indicated by the bill passed the other day. by means of the revolving fund, may have some beneficial results; but, Mr. Chairman, the Indian is still an Indian. He cannot change his racial characteristics, which are as firm and as well marked to-day as they were when this country was discovered. They have been weakened by contact with the whites; they have suffered the consequences of contagious diseases which they have contracted; they have been weakened physically; but essentially the Indian is still an Indian.
I am going to say something that may be regarded as almost heresy, but I do not think the efforts we are making to educate the Indians are worth any fraction of the money we spend in doing so. This is not a sudden conversion; I have had this conviction for many years. I have looked into the matter pretty closely, and frankly I do not think we are getting from our endeavours to educate the Indians results that are at all comparable with the results that might be obtained by the expenditure of the same money in endeavouring to make the Indian economically independent. I believe that a limited expenditure of money towards education, and generous expenditures towards developing his tendency to improve his own position economically will give us excellent results.
I happen to know of three or four cases which came to my direct attention. As the minister stated, we take ten or twelve years to educate a boy or a girl. I have in mind a boy-I believe the minister spoke about a girl -who six months after the time he was out of school was back to the reserve, the only place where he could go. I am sorry to say that boy was just plain ignorant. What is more, Mr. Chairman-and I regret to say thisfrom the standpoint of his tribe and his contribution to the life of his band, he is not as good as was his contemporary who did not go to school at all; for it has unfitted him,
unless he drops straight down into the stratum from which he came.
There is the difficulty. I know the minister is deeply interested in the matter. I confess one never talks to an Indian of intelligence without looking at him and wondering what is in the back of his head; for he has a tradition; he has an uncanny way of knowing things. He has a knowledge of everything about him which makes him one of the most wonderful studies to be found in this world. He looks out across the great prairie and you see in his eye something more than the mere looking at the land, the trees, the forests or the mines. You see something which makes you realize that he is thinking of days and generations which have gone by, when he had handed down to him from sire to son, and on and on and on, the story of their past. If you could only get them to tell you about it, you would realize how difficult is the problem to make of them something they are not. All you have to do is to visit the burial ground of the Blackfoot tribe and see where their old leader was laid away, and the provision they made for his future. You see how he was to go to the Happy Hunting Ground, and the way in which he was to carry on when he got there. You see the provisions that those who had been left behind made for him as he went, the little covering they placed over the supplies which were to serve him in that Happy Hunting Ground. You need only to see these things to realize how difficult is the problem of dealing with them.
I assure the minister that any assistance which can be given to improve their physical condition, their health, their happiness of mind, or anything which bears directly on their happiness of mind or on efforts to strengthen their physical resistance to the very conditions to which the minister referred, is time well spent. Speaking as a Canadian I am extremely proud of the way in which we have handled our Indians. True, at times we have made mistakes; but in the main we have treated them better than have most countries. If we have deprived them of their inheritance, we have at least paid a price for it, and we shall continue to do so till the end.
I want to say this to the minister: He will find it impossible to induce the Indian to part from the thought of wardship. What does he say to me? He produces his silver medal, a great medal as large as a saucer, which the great White Mother gave to his father or
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grandfather. That means that so long as the sun shines and water runs he will be cared for. In that sense wardship crops up in the most unexpected moment; it is an amazing thing. I can recall talking to one old fellow and hearing him say, "White man take my land, my home; great White Mother, she say we never want as long as sun shine or water run." That thought is handed on from generation to generation, and will continue.
I think we must frankly recognize the sense of wardship, to which the minister has referred, as the basis of our policy. On the other hand I venture to direct the attention of the department to a complaint I have received. They sent a man out to try to ascertain what the conditions were with the Stoneys and the complaints made with respect to the Kootenays. I must say I did feel for a moment a little bit ashamed of my country, because a citizen of the great republic to the south was talking to me on the train about the way in which these Indians were being cared for. He has expended of his own substance for the purpose of keeping them from starvation. That is a condition which the minister cannot help, but which we must frankly realize involves us as a nation in spending money to keep them alive, whether we like it or not. That is what they look upon as the obligation which we assumed when we took from them their land and gave them these reservations. The Kootenay band is not far from Cranbrook, and certainly they put in a terrible time last winter. I know of a citizen, not of this country, but of another, who did take them supplies and provided them with, shall I say, a few of the necessities of life to keep them alive.
In eastern Canada one is not so familiar with the story, but one does know something about the great band which lives in the reserve near the St. Lawrence river where the bridge crosses. They have a very interesting history, and in the main, I would say, not an unhappy one. I refer to the Caughnawaga tribe. Among them have been men who have accepted education in an amazing way. I suppose the minister has come in contact with a number of them, and must realize that education there has accomplished a very great deal. Then, when we come to Ontario, around Brantford and that section of the country, we find a high type of Indian. When I have come in contact with some of them especially during the great war, and have had occasion to talk to them, I have realized they were men who differed from their white brothers only in colour, in the straightness of their hair, and in those small physical attributes

which distinguish the Indian from the white man. That was what I found when I came into personal contact with some of them. I saw their farms and homes, and realized that the problems they had to face were entirely different from those of the Kootenays, the Stoneys or some of those other Indian tribes in the far north, who rarely come as far south as Edmonton in Alberta or as Prince Albert in Saskatchewan. Certainly they do not get farther south than the northern towns of Manitoba. They live, fish and hunt in the far north.
I can only say to the minister that I for one would personally be glad to expedite any grant which would involve greater medical attention and care for the Indians, but I am more concerned about their economic life, which does not consist in keeping them in schools for a while, and then letting them go back to the reserves where they may revert to savagery. I do not refer to the savagery of old times, but to the refined type of savagery which has developed from their contact with the white man, which has come about as a result of our having appropriated their property, and given them reserves.


Mr. MacNICOL:: When a previous item was under consideration I intimated to the minister that I should like to say a word or two about his department. In my travels over Indian reserves I have known where the minister has been, and have strongly endorsed his endeavour to improve the lot of the Indians. I have listened with interest to what he has said to-night. If he continues along present lines, I believe the Indians may have a better time than they are now having.
I first became interested in the Indian problem through using Indians as guides, motor mechanics and canoeists in travels I have made in the northern country. I expect to use them again this summer in northern Ontario where I propose to go again. I shall do my level best to see that these Indian lands in northern Ontario are not exploited by the diversion of the Albany river into the great lakes.
On leaving there I visited about five different reservations and I shall refer briefly to one or two matters that came under my observation. The minister and the right hon. leader of the opposition have both referred to the education of the Indians, and I believe they both recommended some improvements. I visited many homes of Indians, but in one home in particular the daughter had just come back from school. She was a fine looking girl of about eighteen years and had been trained in the Indian school on the reservation.

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As the minister relates, she had been taught to read and use the different utensils now employed in modern homes. She had been taught how to cook and preserve. I saw some of the work that had been done when I visited the school later on. But one fact struck me most strongly. When that girl returned home, to what did she return? She returned to nothing but a hut. I measured this particular hut myself; it was ten feet by twelve feet, and six people were living in it. You could see out through the walls and the roof in every direction. There were two bunks in the one room which made up the hut, and I suppose the two old folks slept in one, while the four children, including this girl of eighteen, slept in the other.
What is the use in sending these Indian children to school to teach them modern civilization and then having them come home to something like that? We should give some consideration to the homes of these Indians as well as to providing schools on the reservation. I saw many of the children attending these schools and they appeared just as bright as other children, but they seemed to lose their brightness once they left school. It is not right that they should receive this education and then have to come back to living conditions such as I have described. This hut was one, not the worst, on the reservation.
I found the officials to be very good. The doctors, the Indian agents and the police officers were a fine type of men. I found the teachers in the school on the reservation to which I refer to be excellent. The doctor on one reservation discussed the matter of tuberculosis with me. He suggested that on those reservations where there are no hospitals, hospitals should be provided. The Indian parents love their children just as much as other parents, and they do not want to have them sent to hospitals many miles away from the reservation. In order to prevent this, they try to hide the fact that their children have tuberculosis. This doctor told me that if I lifted my voice at all in this connection, I should try to persuade the minister and the department to establish hospitals on those reservations where there is none. Then the Indian father and mother could visit their child in the hospital on the reservation. It was felt that this would mean the saving of many lives.
There is one thing I found to be very satisfactory. I do not know how long this practice has been in force, but on this particular reservation prizes have been given
for the last few years at Indian fairs. Perhaps the minister could tell us if prizes are granted to Indians on all the reservations. This encourages the Indians to raise various kinds of vegetables, and they are pleased with the idea. One suggestion I would make is that instead of buying vegetables and so on from whites to be used for the relief of Indians, these commodities should be purchased from the Indians. When I came back to Ottawa I checked up on the Indian estimates and I found that large supplies of potatoes had been shipped in to one particular reservation for relief purposes. These potatoes had been purchased from whites a hundred or a hundred and fifty miles away, whereas there were on that reservation large piles of potatoes that had been frozen and rendered useless because the Indians did not take care of them. If these supplies were purchased from the Indians, they would be encouraged to that extent.
In some of the reservations in northern Ontario I found a growing feeling of resentment against the whites. The newspapers all over the country have indicated just what is going on. I shall not read any of these articles, but perhaps the headlines will be illuminating. Some of these read:
Geographer deplores wresting of hunting grounds from former native owners.
Indian rights being defended.
Indians organize league, demand return of " rights."
Chief urges fair chance for Indians.
Indians claim rights invaded.
Fear hunting war will flare between whites and Indians as game preserves depleted.
A few days ago I made a brief reference to what I had found in northern Ontario.


Joseph-Arthur Bradette: To what section of
northern Ontario is the hon. member referring?


John Ritchie MacNicol: North of lake Nipigon, where I propose to go again this summer. Many miles north of that lake I found the hunting grounds and the old trails to be as they had been for perhaps a thousand years. Over the height of land to the Albany and towards James bay the trails were as they had been since the earliest record of the whites. But what did I find? I found that the Indians are not engaged by the government as guides and fire rangers. My opinion is that they should be. I asked the Indians if they could do this work, and they told me they could. It may be that they are not efficient. I am not saying that they are, because I am not familiar with their habits.


Joseph-Arthur Bradette: That would be provincial.
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John Ritchie MacNicol: Going up and down t'he rivers I met white trappers, and the Indians who were with me told me that when white trappers came on a river where Indians trapped, the whites simply took their trapping places and interfered with their natural bent to trap and fish. I do not think that should be allowed. The country I was in is further west than that of the hon. member for Cochrane (Mr. Bradette). That country is still unsettled; but if it becomes settled, where are the Indians going? Are they going to be driven further north where the climate is more severe? I have surveyed this Indian question, and in my travels in the last five years I have visited the places where they had their origins in America and first came in contact with the whites, and visited also every reservation in the Mohawk valley. In the early days there were great men among those Indians. Brant was a great man; Half King was a great man; Red jacket was a great man, and so were many other Indian chiefs of those days. They must have had ability; they were dealing with the whites in those early days. I am afraid'-I may be wrong- we are not perhaps, as the minister himself said a few moments ago, directing our efforts to the best advantage so far as the Indians are concerned, and if the department has any new plan for directing the Indians along lines where they will become -more self-sustaining and tend to get out of the class of being simply wards of the government, it would hold out -t'he hope of a very great advance being made.
Why should the red man be so backward? The coloured people are able to take their places with the whites. The coloured people of South Africa, for example, vote to elect members to the parliament of South Africa. Last year when I was in London I read of a bill that was to allow the natives of South Africa exclusively to elect three members, Europeans, to the legislature and two to the senate, and we may be sure that those members elected solely by the coloured people of South Africa will look after their interests in the legislature. But we have nothing like that here. I wonder if the time will ever come when Indians will be able to return a member to this House of Commons to present their views.
During the last eight years, of my attendance in this house, every time the Indian estimates have come up they have been voted one after another usually with just a "carried," "carried," "carried." In fact, when I rose to speak this evening a colleague on this side of the house said to me, "Sit down; you do not

know anything about the Indians; you have none in your riding; what are you going to talk about the Indians for?" That may be quite true; but somebody has to speak for the Indians and try to help them; I propose to make a more thorough study of their conditions, visit more Indian reserves and come in contact with more of the Indians so that I shall be better able on some future occasion to say a word on their behalf, and I shall be glad to support any measure that will help to improve their lot.


Thomas Alexander Crerar: I appreciate the suggestions that have been made by the hon. member for Davenport (Mr. MacNicol) and by the leader of the opposition (Mr. Bennett). The committee may rest assured that I wish to get all the assistance I can in dealing with this Indian problem.
The hon. member for Davenport referred to his experiences in northern Ontario, north of lake Nipigon, and I quite agree with his observations. The fur has been depleted in that region, and it has been depleted largely by white trappers who have too frequently frightened the Indians off their usual trapping grounds. Unfortunately that is something we cannot control. The Indians in northern Ontario, and indeed in several provinces, are now segregated almost entirely upon reserves. It is true they have been given permission to trap over areas outside their reserves; but we cannot control the white trappers, and while we do the best we can to assist the Indians, that is a problem over which we have no control.
But on the Indian reserves in the more settled communities, undoubtedly progress can be made. In western Ontario, for example, we have a reserve on which the relief bill in the past year has been cut in two, on account of the fact that a year ago we started community gardens on the reserve, where under the supervision of a foreman the Indians produced enough vegetables, properly looked after, to supply their needs throughout the winter. These community gardens were started on a great many reserves in 1937, and the plan will be extended to more reserves this year. The director just tells me that on a reserve a very considerable distance north of Prince Albert they have planted a community garden from which the Indians will get vegetables that will help to carry them over next wdnter.
There is one aspect of Indian administration which I think may be of interest to the committee. My observation has led me to the conclusion that one of the most important cogs in the wheel of Indian administration is the Indian agent in charge of the reserve. In

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Indian agent requires qualities that cannot be assessed in the ordinary way. I should say that some of the necessary, almost indispensable qualties that he needs are firmness, sympathy and understanding, and a little bit of the missionary spirit. He must win the confidence of the people he is looking after; for in many respects they are like children, and my observation has led me to conclude that where we have Indian agents of a certain character, type and quality, there you will find the reserves that are doing the best. In the Nipigon area, for example, to which the hon. member for Davenport referred, the Indian agent secured contracts for taking out ties cut from timber on the Indian reserves, and this year some $18,000 worth of ties have been taken off the reserve by the Indians. As a result of this agent's work practically no relief has been necessary on a number of the reserves in his agency during the last three or four years. In other words, he has brought the Indians to a point where they are sustaining themselves. That can be done in a great many instances, I am convinced, but it is by a process of education and of building up.
The leader of the opposition referred to conditions in the northern areas. It was, I think, unfortunate when the resources were transferred to the prairie provinces several years ago that areas were not reserved for Indian trapping grounds, particularly in the northern parts of the western provinces. We are now negotiating with the three western provincial governments to get back sufficient areas where we hope to build up the fur-bearing animals.


Richard Bedford Bennett: We still have the northwest territories.


Thomas Alexander Crerar: Yes, but the Indians of northern Manitoba do not wish to go to the northwest territories, and I shall say a further word about that in a moment. In Manitoba we are endeavouring to secure an area of, roughly, 175,000 acres east of The Pas. We are negotiating to lease it from the provincial government at a very low rental so that we may get control of it, and then we shall make a survey-there is an item in the supplementary estimates to cover it-and probably build some dams or cut some ditches to secure uniform water levels, and then we shall endeavour to bring back the muskrat, because that territory is the natural home of the muskrat.
In another part of Manitoba we are trying to secure a block of 300,000 acres. We had a survey made of it last summer. It is an excellent beaver country, and we are planning 51952-241
to take beaver from our national parks, where they are becoming a bit of a nuisance, and to leave them in this area and let them multiply.
Work of this kind has been carried on by a few private individuals across Canada. There is one not far from Ottawa, and some in Manitoba, proving beyond reasonable doubt that fur-bearing animals can be brought back by proper conservation measures. I am told that the state of Louisiana went into the muskrat industry a number of years ago. and as a result of the application of simple methods Louisiana is to-day one of the great producers of muskrat pelts. In northern Canada we have the natural habitat of the muskrat, and I am satisfied that if we can get control of the areas and forbid white trappers trapping there we can restore these animals. The Indian is naturally a conservationist; he is so by tradition and training, and no difficulty arises with him. But when an Indian sees white trappers trapping everything ahead of them, he considers he may as well do the same and get all he can while it lasts, and the result is a complete loss of fur-bearing animals.
In Alberta I have had conversations with the minister of resources; and while there has been a great deal of criticism of the Alberta government, I have had the fullest cooperation with the minister there in getting areas in northern Alberta taken care of. I have discussed the matter with the authorities in British Columbia and they are sympathetic. In the province of Quebec we have recently secured a considerable area south of James bay where we have about a thousand Indians, and we hope to introduce the beaver and other fur-bearing animals. If that policy is carried out consistently over a period of years we shall, as time passes, reach the point where many of the Indians can, at any rate, largely sustain themselves by trapping. In the northwest territories we have better opportunities. In the Mackenzie basin we have recently set aside on the west side of the Mackenzie river a very large area running into tens of thousands of square miles, and we shall control it as far as fur is concerned. At present we are closely regulating trapping permits in the northwest territories. No outsider can come in and get a licence to trap fur there to-day. He must have been a resident of the territories for at least four years. We are contemplating even stiller restrictions so far as trapping there is concerned.


Richard Bedford Bennett: Is a permit required for trapping in Hudson bay?

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Thomas Alexander Crerar: They require a trading
permit, I am told. These are all problems relating to administration. We shall have another problem in the eastern arctic before a great many years in connection with the Eskimo. So far as the administration of Indian affairs is concerned, I think I can say this of all the officials, that they are alive to these problems that are developing. We can learn from experience of the past, and I have no doubt that as regards the northwest territories, where the area is completely under federal control, we can maintain conditions of life that will enable the Indians to live.
We are trying an experiment this year. In our parks we have taken several bright Indian boys from the Indian schools and are training them to be guides. That is a field which may open up useful employment for boys from Indian schools. Only last summer I was told of a gentleman from Minneapolis who, with a party of four or five including his wife, went to northern Manitoba. They wanted an Indian guide, a good canoe man who could build fires, cook, and wash dishes. They could not find one for several weeks to fill their requirements. That is something which might be taken up by the Indian schools. Why could we not direct the education of Indian boys to this sort of thing, for which they are naturally fitted? I have offered this suggestion to one or two residential schools in the northern part of these provinces, "Why do you not develop a fur farm adjacent to your school?" We find fox farms and mink farms all over Canada in the older settled communities. Why cannot that be adopted as part of the education of Indian boys in Indian schools? Then there is the making of snowshoes and canoes. We are having an increasing tourist business in Canada, and I am quite sure that by wise and judicious methods we can gradually increase the number of tourists coming to Canada. One of the things these tourists desire to buy is Indian handicraft work. They go to a store in Winnipeg and buy some goods that are supposed to represent Indian handicraft work, but if you trace it back you will find that it was probably made in some city of eastern Canada or possibly in Japan. It is not the genuine article. I have suggested to some of those in charge of the Indian schools that they teach Indian girls work of this kind. We hope to supply the materials, get these things made and find a market for them in the tourist traffic of the country.
There are many ways in which opportunities can be made available to the young Indian

lads in the future. There is one other point and that is with regard to the observations made by the leader of the opposition touching the East Kootenay reserve. I recall the occasion on which he brought it to my attention.


Richard Bedford Bennett: I telegraphed from Victoria.


Thomas Alexander Crerar: Yes, and I immediately had an investigation made. As it happened, the Indian commissioner for British Columbia had been there a short time before. When I got back to Ottawa I found that representations had also been made to the Prime Minister; knowing the source from which they came he passed them on to me, and a very complete investigation was made. I am bound to say that in my opinion Mr. Drayton, the gentleman in question, was misinformed. I checked up with the Indian agent who is very well regarded in the administration, the district nurse of British Columbia in the community, and the Indian doctor who had had many years of service on the reserve. I checked up on the amount of relief that had been distributed month by month to the reserve, and I could come to no other conclusion than that the gentleman who had made complaints had been misinformed. As a matter of fact he wrote a letter later to the Prime Minister regretting that a good many of the supposed facts upon which he had based his representations were not well founded.
When I am travelling around t'he country and have opportunity I talk to the Indians. A year ago I was in a little northern town in Manitoba where the Indian chief came to see me with two or three of his councillors to talk about some grievances. I listened, and then I said, "Have you anything else?" And he started another story of grievances. I continued with that for the better part of an hour, and I think if I could have remained for five hours the chief and his councillors would .have kept on digging out new grievances and complaints. In considering these things you have to take into account the Indian character. I assure my right hon. friend that I was grateful to him for bringing to my attention the matters to which he referred, because the only way by which these things can be checked is to have them brought to one's attention. But they were investigated very fully, and I do not think there was much ground for the complaint made.


Daniel (Dan) McIvor: Perhaps what I have to
say might be said on the next item; but when Thunder Bay district is being considered

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that, of course, is treading on ground with which I am quite familiar. I cannot agree altogether with the hon. member for Davenport (Mr. MacNieol). I have visited those reserves ninety-five miles up lake Nipigon, and I have frequently visited the other bands. I find in Squaw bay that the agent there was instructing the Indians in making canoes and motor boats and snowshoes, such snow-shoes that when even a white man goes out in the snow with them on he will feel almost as fleet as an Indian. When I visited the bands on lake Nipigon with the agent and the inspector of schools I was delighted to see the condition of those schools. When the hon. member for Davenport said that the Indians are living in huts I do not think he was referring to the whole district, because if he visited one band he would see the cottages placed in crescent shape just as they would be at a summer resort on the shore of lake Superior.
Another thing that interested me very much was about thirty acres of potatoes. If anything gladdens the hearts of an Irishman it is a fine crop of potatoes, clean, juicy and tasty. I have not seen anything better since I left the Green Isle. There was a reason; these Indians were encouraged by the agent to fertilize. They could not buy fertilizer very well, so they went to the lake and took out fish, coarse fish, by the wagon load, and filled the drills with fish. They planted the potatoes, Wee McGregor or Irish Cobbler, and those potatoes grew in abundance the like of which I had not seen before. They were able to sell enough potatoes to buy their groceries for the winter and to store enough potatoes for their own needs in fine root houses; I have not seen anything better in the west. If I had as good an imagination as the hon. member for Davenport, and sat down to a plate of those potatoes properly French-fried, I would not have much trouble in imagining it was fish and chips.


John Ritchie MacNicol: Let me interject that
anything I said was not imagination. I spoke about what I saw.


Daniel (Dan) McIvor: I never doubt my hon. friend; he is as truthful as I am. I will do the imagining for him. I would have no trouble sitting down to a plate of those potatoes French-fried and feeling that they were just as good as fish and chips.
Having taught in an industrial school, I know that the Indians respond to leadership. I took a group of Indians from the industrial school at Regina, and in at least one instance we were able to put it over the civic football team of that city. The Indians respond in
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other ways. They get more like the white man every day, and I am convinced that with agents like Mr. Jerry Burk the Indians are not going to take second place to the white man even on the reserve.


Mr. WARREN:: I have not had much experience with Indians, but these references to the education of the Indian remind me of a little experience I had during the past year which tends to prove that the Indian, if educated, can take his place among any Canadians. Last year a young woman came to visit me; I was surprised to find that she came from 'the Indian reserve at Golden lake. She had been holding a good position as stenographer for eight or nine years. She came to me because she was interested in a young brother who had attended public school and had gone to continuation school for two years. She said she did not want that brother to be idle; she wanted to get him at some kind of work. Eventually that boy got into the Royal Canadian Air Force as a labourer. I have met that boy two or three times since then; he i3 as bright and happy and capable looking a young man as I have met, happy at his work and sending money home to help the family. The father of that family is working all the time as sectionman on the railway-On that reserve we have Indians who are just as good bushmen as any whites. If we give the Indians the education and opportunities that we give our own people, I do not see that the education will hurt them at all. Apparently, if they have the necessary education, they are just as able to fill important positions in our everyday life as any of the rest of us.


Mr. NEEDHAM:: I congratulate the minister upon what he is trying to do for the Indians. I should be interested if he would explain something more in regard to administration on the reserve. Last summer I spent some time on several reserves, and I find they have this difficulty: They feel that too much is left to the agent or the department at Ottawa, and they are kept in the dark as to their financial standing. Will the minister explain whether the agent makes an accounting to the tribe of how they stand with the department and how each individual stands in relation to the tribe? I found this to be one great difficulty, that they did not know whether they had a credit or a debit, what was coming to the tribe or what was in trust for the tribe and whether they could or could not use it. They were absolutely in the dark. I talked with two of the chiefs and some of the young men who have been through the schools and are fluent, bright young fellows.
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and they are anxious to know where they stand. They do not seem to be getting the encouragement they think is their right.
In addition to other things, they feel that they should be consulted more than they are in connection with what is planned for them. In regard to education, they think they should have some say in the selection of the teacher on the reserve. That, I understand, is left largely to the church which has charge of the school. The church selects the teacher; the Indians have no say in the matter, and when they are discussing these matters they say very often they get a lemon or someone who does not apply himself, because he is responsible only to the church. There is another point as well. You may have two reserves very close together, without even a fence between them. On one reserve there will be an Anglican school and on the other, a Roman Catholic school. That does not make for harmony, and I think matters of that kind should be rectified in some way.
On the reserves I visited I had some conversation with the farm instructors and also with the Indians. In one instance I found that the stock was greatly depleted. I asked the instructor how long he had been there and he said, "Some twenty odd years." I asked what was the amount of stock on the reserve when he went there, and he told me. I asked what the stock amounted to then at the time of my visit, and found it was less than half what it had been in the first place. As a consequence the Indians are putting up hay, getting a permit, peddling a load now and then, and doing the same with firewood and things of that kind. I should like the minister, if he would, to explain the system and show how the Indians stand with the department at Ottawa, and how they may get an accounting of the funds held in trust for them.


Thomas Alexander Crerar: I think what the hon.
member is referring to is the matter of band funds on the reserve.


Joseph Needham: And how their yearly
production, whether it be in stock or grain, is accounted for.


Thomas Alexander Crerar: I am dealing with the point raised in regard to the Indians getting information as to the position of their band funds. The chief and counsellors of the tribe can always get that information from the Indian agent. If he has not that information he can easily obtain it, and there is no reason why it should not be given to the Indians. As a matter of fact I think we have the right to use the increment of the fund for the purposes of the Indians without

their consent, in connection with certain matters such, as relief and medical care, but no disposition can be made of band funds without the approval of the Indians themselves. On the other hand the Indians cannot dispose of the band funds without the approval of the administration. In other words, before band funds can be utilized for any purpose both the Indians who are interested in the fund and the department which administers it must agree as to its disposition. As I have already said, so far as I know there is no reason why the chief and his counsellors should not be able to ascertain at any time the standing of their fund and the disposition that has been made of it.
With reference to the other point, of course I do not know the reserve to which my hon. friend refers. I think what he has stated is true on some reserves; that is, that if anything they have progressed backward in their agricultural methods in the last twenty or twenty-five years. That is due perhaps to, shall I say, indifference in administration; or perhaps a farm instructor gets into a rut, as human beings sometimes do, and does not take his job seriously enough. The check on that I think is better and more constant supervision. I am bound to say this, that I think in the past administrations have perhaps erred on the side of too much economy in the administration of these services. If I could induce my colleagues to expand the Indian vote, I think I see where I could spend another $100,000 to excellent advantage. But even without that I hope a steady improvement will take place.
I wish, however, to say this to the committee. I do not think there is any more important unit in the administration than the man who has charge of the reserve, the farming instructor on the reserve, and those who have to do with the Indians in their day to day contacts. If there is understanding, sympathy, firmness and intelligence in dealing with situations as they arise, unquestionably you get better results. On the other hand if, as unfortunately may be the case in some instances, officials lack those qualities, then you have a certain amount of suspicion, distrust and retrogression. Probably that is the situation in the reserve to which my hon. friend refers.


Joseph Needham: I am very happy to hear that expression of opinion on the part of the minister, but I am given to understand that the agent will not give the chief or his counsellors information as to how the band stands with the department at Ottawa. Supposing they have a credit which they wish to invest

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in stock or in a fur farm such as the minister referred to, as I understand the situation, that band has the right to utilize that money in that way.


Thomas Alexander Crerar: Is my hon. friend referring to the vote we are now considering or to the revolving fund to which earlier reference was made?


Joseph Needham: I * am referring to any credit that the band may have with the government.


Thomas Alexander Crerar: The circumstances of each individual case will be studied. If you have a reserve that is adapted to the rearing of cattle,
I would hope that we would be able to put some stock, at any rate, on that reserve, and see that hay was put up to feed the animals and that they were properly looked after. If the venture were properly handled there would be a natural increase, and there is no reason on earth why on a reserve that is adapted to stock raising there should not be a substantial herd of cattle. In some instances some of these animals may be owned by individual Indians; or it may be a communal effort on the part of the band, but again I stress the importance of supervision and care in dealing with these questions. Sometimes, by his traditional way of living, the Indian becomes careless in looking after stock, and it is necessary to have someone to see that the stock is properly cared for. That is all part of the whole scheme of general welfare and improvement among these Indians. I know it is going to be a long, patient business, but I do think it offers some possibilities of getting many of these people into a much better position than they are in to-day. At any rate that is the principle which is guiding us in this action.


Mr. BLACKMORE:: I should like to express to the minister my appreciation for the vision which he manifested in his speech regarding the development of fur farming and other activities among the Indians. It is my feeling that he is producing very fine results, and I should like to encourage him. I believe he certainly should have that other $100,000 because beyond question there is arising among the Indians a very definite need. May I use as an illustration the reserve in my own constituency. For a long time the Indians have been able to go off the reserve and work at such jobs as picking up potatoes, harvesting beets, and working in the grain fields. The returns from that kind of labour supplemented their regular income. However, since the coming of the depression it has been virtually impossible for the Indian to get any such work, with the result that many of them
are suffering painfully. Unless something is done on the reserve to replace the revenue they have lost through their inability to get employment, manifestly the Indians are going to tend to decay in numbers and morale.
I believe the minister is thoroughly justified in asking for sufficient money to develop industries on the reserve. He has mentioned fur farming and stock raising as being possibilities. The reserve in my constituency would be well adapted to stock raising and also to grain growing. A good deal of the ground has been ploughed up, and in many instanses grain has been grown. In some respects, however, some of the Indians do not find themselves adapted to farming, though others do it very well. A number of them have found that the grasslands from which they cut their hay have been depleted, and for that reason they have been placed in a difficult position. If money were available and if the Indians who were adapted to fur farming were encouraged to go into it, it would be a great blessing.
I greatly appreciate what the minister has said, and I for one will certainly support him in any requests for additional money he may make to help the Indian. I believe the Indians are a very important element of our growing population.


Mr. LOCKHART:: Is there any coordination between the minister's department and the tourist bureaux? I refer particularly to the contact with guides.


Thomas Alexander Crerar: Yes; we are trying an experiment this year, which will probably answer the hon. member's question. We are taking over some bright boys who have been recommended to us by the principals in Indian schools. They are to be given training to act as guides in our parks, under the supervision of experienced park wardens. If the experiment works out satisfactorily, we shall expand the effort. This plan -may give opportunities to a number of these lads to become engaged in useful occupation.
I have suggested to some who are in Charge of the more northern schools that the boys be given some training in the art of guiding-because I am told it is an art-so that on occasions they may find useful work. So far as the matter of correlation with the tourist industry is concerned, I am not just sure what the hon. member had in mind, but I believe it is possible to link up the production of handicraft work among the Indians with a sales system for the benefit of United States or English tourists who may come to Canada. That matter is now being studied.
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I am satisfied if we can encourage the development of handicraft work, we shall be doing the Indians a good service. Some excellent specimens of work come from the teepees away back in the northern land. The Indians seem to have a natural capacity for this kind of work. I feel sure means can be found to find a sale for their work, and to transfer the proceeds of such sales to the credit of the Indians who produce the goods. In that way we could help them to be more self-sustaining.


Norman James Macdonald Lockhart: Perhaps the minister did not clearly understand my question. It has been my privilege to cooperate to a considerable extent with tourist bureaux. I believe I have given service to at least one hundred and fifty Americans who travel as far south as Mexico, and who are in the habit of coming to Canada periodically to travel in the far north. On two occasions by personal contact with one of the reserves I have been able to provide qualified Indian guides. On several occasions I have been asked if guides were available, and it occurs to me that in view of the fact that an experiment is being made this year, at the time advertising is being sent out to certain individuals it would be helpful to have those men, who are enthusiastic about the great Canadian north, supplied with Indian guides, and to have a condition whereby those guides would be available without great trouble, and would be found trustworthy and reliable. I pass that suggestion on because it has come to my attention particularly in the last two years.
I should like to make one further observation with reference to the matter of co-operation about which the minister has spoken. This may be a matter which is more or less within provincial jurisdiction, but I pass it on for what it is worth. I feel that it has some bearing on federal jurisdiction. About two years ago the great niece of General Brock came to Canada from the Guernsey Isle to place a wreath on the monument at Queenston Heights. On that occasion some eminent Indian chiefs attended. Had the minister been able to read a verbatim report of the speech made by one of the Indian chiefs, I believe he would have been impressed with the resentment expressed concerning the way in which the Indian is sometimes neglected. In passing, I would suggest to the minister that .in his negotiations with the provincial government-and I assume he was referring to the 'Ontario government-consideration be given to this matter. On the occasion of the celebration one of the chiefs said pointedly that

no recognition had ever been given of the part played by the Indian in the history of Upper Canada. I would point out that those tribes in southern Ontario would greatly appreciate some recognition of the part they played in the great war in which General Brock fell. I know the Indians would appreciate any recognition which could be given of the help they gave at that time.


Mr. STIRLING:: There is one phase of the Indian question to which I should like to refer for a moment, and when I have concluded I should like to hear the minister's observations on the matter. In southern British Columbia we find a considerable number of reserves. In my own constituency they are dotted all the way down the valley of the Similkameen river, and through the Okanagan valley. There is no doubt that in times past the Okanagan band must have covered a very considerable part of what is now the state of Washington, and have reached well into the present province of British Columbia. The difficulty to which I allude is that by intermarriage and constant visiting a mix-up has developed between United States and Canadian Indians. At times there is evidence of unrest, and when the trouble is looked into it generally boils down to a question of jealousy between United States and Canadian Indians. I often wonder whether this difficulty is confined to this particular part of British Columbia. It does not seem to me to be reasonable that there should be Indians of the same tribe resident on reserves in the state of Washington who are receiving certain benefits from Canada, while there are Indians resident on our reserves who are receiving official assistance from the United States government. I wonder if it would not be possible to arrive at some solution of this problem so that there might be a definite understanding between the two governments, or at least between the two departments of government that administer the matter? Perhaps a separation could take place between the Indians who are definitely Canadian and those who are definitely United States. If this were not a cause of friction, there would be no reason to raise the question, but I am persuaded that it is. I have had it up with the minister and with the deputy superintendent, and I should like the minister to let us have his observations.


Thomas Alexander Crerar: The only places where the difficulty referred to by the hon. member is to be found is on the Okanagan reserve in British Columbia, and in Manitoba, perhaps to a lesser degree, in connection with the Sioux Indians. As my hon. friend says, there

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are Indians living in the United States who get money from Canada, while there are Indians who were bom in the United States, who are now more or less residents of Canada and who receive treaty money from the United States government. There are some Indians living in Canada who own property in the United States. So far as I am aware, there has been no discussion between the two governments in connection with the matter referred to by the hon. gentleman. I suppose the free movement from country to country could be prevented, but I do not think the difficulties arising therefrom are such as to warrant anything in the nature of restriction.
I am inclined to think that as time goes on the problem will tend to solve itself. This has been the experience in Manitoba.


Joseph James Duffus: I desire to compliment the minister and the committee upon the sympathetic attitude displayed toward these original Canadians. They are obviously permanently among us, and our duty is to improve their circumstances in every way possible and to do everything reasonable in providing education. We should try to attract these people to the soil because they make splendid farmers. A large number of ploughing matches are held throughout Ontario every fall. For some years it was necessary to have the Indians in separate classes at these matches, but more recently they have resented this and have asked that they be placed in the same classes with the white men. In many instances they have carried off the championships. I believe there should be strong supervision, both temporal and spiritual, on these reserves. This is the duty that we should accept as a matter of course, since they are wards of the government.


Mr. WALSH:: I listened to the minister with some degree of interest when he referred to the educational policy being pursued by the government. It naturally gladdens the heart of an educationalist to hear that modem methods are creeping into the administration of the schools on the Indian reserves. I am hoping that the minister will persevere along this line so that the Indians may have the benefit of modem improvements.
Has the minister any further information as to the condition now prevailing on the branch reserve at Oka? I understand this is a branch of the Caughnawaga reserve. I have taken up this matter with the department, and I am interested to know whether there are any further developments and a possibility of a permanent solution of this problem.


Thomas Alexander Crerar: The Indians at Oka have not title to the lands upon which they are
living. This story goes back into ancient history. The order of Sulpicians was given a grant over two hundred years ago to land in this particular district, and my information is that at that time the Indians were allowed to stay. Some question has arisen in more recent years as to their right to be there, and this has given rise to some local difficulty.


Richard Bedford Bennett: If I remember rightly, they claim title by prescription.


Thomas Alexander Crerar: I am advised that a case was carried to the privy council, and the ruling was against the Indians staying there.


Richard Bedford Bennett: I knew of their claim, but I had forgotten about the decision.


Thomas Alexander Crerar: It is a difficult problem, and I may say to the hon. member for Mount Royal (Mr. Walsh) that it has engaged the attention of the department for some time past. I am not prepared at the moment to say just what will be the final solution, but it is a rather knotty problem.


William Allen Walsh: I understand the land has been sold by the Sulpician order to a Belgian concern, and the Indians have lost their rights to the woodland. At the present time I think the department have to purchase the wood and deliver it to the Indian reserve. Of course, the Indian still desires to go into the same bush he and his ancestors have been going into for some two hundreds years, and they are constantly being arrested for trespassing. It is giving rise to a certain amount of discontent among the Indians and considerable apprehension among the whites living in the immediate vicinity. I took the matter up with the department and received every consideration. I know the department is anxious to find a reasonable solution, and I was wondering if we had come any nearer to a solution or if the plan might be to move these Indians to a more desirable place, perhaps even to some other province, where they might be located to better advantage. I know the Indians would be loath to leave that particular spot which they have inhabited for several hundred years. Their old burying ground is there, and naturally they have an attachment to that particular part of Canada and feel that they have been deprived of their rights; but with a little gentle persuasion from the department, the Indians, if they were tactfully handled, could, I believe, be induced to move to a more desirable place where they would enjoy more freedom than they are enjoying to-day.
In the courts of St. Jerome this winter there were several prosecutions, which the Indian interprets as persecution, and if it
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continues for another year conditions might be more serious. Even last winter, as probably the minister knows, when certain police officers went there in the discharge of their duties there was friction that pretty nearly resulted in a charge of murder. It was only an accident that a murder was not committed. It would be deplorable to have such a thing happen if there is anything we can do to settle the difficulties amicably so that the Indian would feel that the white man was not trying to drive him into the lake of Two Mountains or out of existence. I know I have the sympathy of the department and that the officials understand and sympathize with the position, and I have no complaint whatever to make of the department, but I just wanted to impress on the minister the desirability of making further progress towards a complete solution of this thorny problem in that particular district.


[Stage Direction]
Item agreed to.
Indian agencies, $714,952.
Richard Bedford Bennett: How many agencies are there?


Thomas Alexander Crerar: There are 114.


James Samuel Taylor: Mr. Chairman, I feel constrained to impose somewhat on the time of the committee to deal at some length with the custom of the potlatch among the Indians of British Columbia, and especially those Indians of the Kwawkewlth agency, of which the head and front might be said to be Alert Bay. In the session of 1936 the government introduced an amendment to the Indian Act designed to establish greater strictures against this custom of the potlatch; but owing almost entirely to the efforts of the hon. member for Comox-Alberni (Mr. Neill), the member for the district in which this agency lies, the minister withdrew his amendment, and the act remains in statu quo ante. In that controversy I had myself taken some part, and predisposed thereto by a principle I have long held, supported the hon. member in his contentions. This principle was that customs of native peoples in contact with the culture of the present day, or the culture of any day for that matter, tended to sublime and the bad features of the custom to fall away and become only an interesting memory.
However, the situation in one part of British Columbia is quite different. About a year after the above discussion took place I received a very earnest communication from the Reverend F. Comley of Oak Bay, near Victoria, pleading for my cooperation, and to 
this letter I replied immediately stating that, if possible, at a later date I would investigate the condition nearer to its happening. In the meantime I developed considerable correspondence in an effort to discover whether there was a real grievance in and around the agency. I could read here copious extracts from this correspondence and detail much of the information I have received; but I am disposed to be very much the other way in the general objection to the potlatch which many of my correspondents voice, because it has always been my impression that the wisdom of the real conqueror, of the real colonist, of the real leader of people, is best demonstrated when he permits his conquered people or those over whom he exercises dominion to retain their customs and tribal traditions.
In this Kwawkewlth agency, however, I believe we are definitely facing a traditional rite and custom from which some of the bestializing elements have not been sufficiently or speedily enough removed, and it appears to me to be our duty to listen to the protests that are being made, to discover the reason and to remedy the cause.
My own inquiries made in Alert Bay and elsewhere from both potlatch Indians and those who have already renounced the potlatch leave me only with this conclusion:	It
is admittedly very difficult to understand the genesis of the potlatch; but if one goes outside the Indians ample evidence throughout history abounds of emissaries from one nation visiting a strange or neighbour nation bearing gifts to the potentate, arranging peace pacts, and returning to their own ruler with the largess of the country they have visited. The Arabian Nights, that cradle of our romantic literature, abounds in just such stories. Holy Writ has also complete evidence of the fact that these things had existed from ancient times. It is extremely likely that along the coast of British Columbia, with its many islands, there were in former times many self-contained tribes or phratries of Indians of widely differing origins just as there are to-day, and that because they could not read or write or count or estimate, it became necessary for them to rely upon memory for such records of history as, for instance, the marriage of the scion of one tribe into another or any other historical circumstance, which the tribe wished to record and remember. The ceremony of marriage, birth or death must under such circumstances be observed by the largest possible number of people even if they had to be brought from far cape Flattery in the south or from Fort Simpson in the far north. Such a gathering,

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invested with all the traditions of'the people, was coloured by dancing and made festive and notable by gifts.
Undoubtedly it formed in the history of these primitive peoples a definite encouragement to peace and promoted a union of interest as frequently as it did also union of blood. In the primitive lives of these people, living on the bountiful products of nature, gifts were simple in themselves or at the most they represented the deft workmanship of the worker, either weaver or carver, or some other clever or deft workman and were unique and valuable for that reason. There is great difficulty-and I have asked many questions about it-in discovering the origin of the word "potlatch," but it does appear to have come out of the Chinook jargon and to be definitely related to the giving of gifts. The giving of these gifts has always taken place at these large gatherings of which I have spoken, although the mere giving is only a part-quite an important part, I grant, but only a part-of the ceremony of the potlatch as we understand it. At the same time, irrespective of the meaning of the word, the customs to which it is annexed are rooted in the social structure of the people, and these customs have tended to become in some measure depraved instead of becoming sublimed-in contact, that is, with our present type of civilization. The people themselves are now increasingly realizing that their responsibilities to one another, translated in terms of dollars and cents, are beggaring them beyond hope of recovery, and that the solace of the creditor Indian is poor indeed; for all he frequently obtains is the knowledge that the individual obligations of the many people to whom he has given gifts may some day be met, but that in the meantime all his security is the memory of the debtor supported by the age-old traditions of his people.
Of course, it can be easily understood that in largess there is the implication of a return of largess. Among the Indians this has been an inexorable condition. When the man or woman makes a gift in the potlatch there is the silent but otherwise entirely inescapable obligation to return the gift not less than twofold. When a blanket is given two blankets or their equivalent is the debt assumed for all time by the donee and his family. If the gift be made to a poor person, the debt then is more difficult to redeem; for often 250 per cent and even 300 per cent is required in settlement. Imagine the involutions of a custom where a poor man borrows at 250 per cent to potlatch a 200 per cent obligation.
But, as I have said, the giving of gifts is only one of the outward and visible ceremonies apparently indispensable to the gathering together of a large number of tribal members to whom will be advertised the changes in the tribal history of the person or persons drawing the people together. Nor is the giving indiscriminate. In its proper functioning there is an order of precedence as rigid and as impenetrable as that of any court or the list of the filtered drops from the distillation of the social elite. Then, also, each tribe has an order of precedence which has been established for all by their original spirits, or temenwos, in the progress of the creative birth of these people; as for example, in the definite case of the eagle tribe, which is highest in importance, the eagle bird itself is, or can be invested spiritually by any of the original spirits of the tribe; and in like manner at will departed from. And, be it understood, these spirits are not spirits of departing Indians or members of the eagle tribe of Indians, but they are the transcendent original spirits or temenwos, responsible for the investiture of human beings on earth with their own spiritual qualities. So it is with the wolf tribe; so it is with the bear tribe; so it is with all the other tribes.
Now that is a very highly-developed conception of creative conditions. Such a religious conviction of their creation is, to the Indian, as profoundly inspiring as is the Biblical story of creation to the Hebrew or the Christian. In such a background then, the incidents of birth, adolescence, marriage and death are sacredly sealed; it is with these incidents that the ceremonies are developing, and it is for these ceremonies that the potlatch of goods is both a card of invitation and an inducement to attend. The incidents of birth and death in Indian ceremonies have little enough which we can criticize, and I believe that the Indians in the Kwawkewlth agency are permitted to bury their dead according to their own rites. But the incident of marriage is entirely different. Girls in the tribe speaking the Kwawkala tongue are not married as we understand it. I am not now referring to the licensed marriage according to our laws or religion when I say that. These girls do not select their own husbands; they are not even sold by their parents; they are transferred to their husbands in perpetuity, shall I say, subject to the repayment of the mortgage by which they are held. In tradition, nothing, not even death, releases them from their biological mortgagee. Release can come only by repayment of the money received in the original
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transaction. This physical bondage, of course, does not prevent the separation of so-called married people or the development of illegitimacy.
Let me enlarge on this so that the committee may understand completely and definitely the gravity of the situation. A certain man dies and leaves behind him a widow and one or two girls. To bury him and forget him the superior position he occupied in the tribe and among the phratries generally would be a crime against the traditions of the people, unthinkable to a true Indian, while the Indian wife herself would become definitely an outcast. There is no money, there is no property; none has been left by the deceased. There must be some declaration. Therefore there must be a potlatch. How can it be financed? The matter is settled by borrowing money for the potlatch, secured by mortgage on one or both of the girls. The girls, however, are only six and eight years old respectively. So, until they are ready for marriage, the mortgage over one or both may change hands several times. And neither the widowed mother nor the growing girls can know who the man will be who will claim the girls when their time comes.
Let me take another case. A chief has a son. It is time the boy was married. How fine it would be if the boy could one day be a Chief like his father! The chief looks around the various tribes and discovers a man with a daughter, who may be an idiot but is otherwise eligible because her father nas a copper, representing a potlatch value of some $5,000 or more. Negotiations are opened, and the girl's father agrees that he will permit the copper to become the property of the young couple by way of dowry with the girl, subject, however, to payment of the $5,000, paid as to a deposit of $200 on the sealing of the agreement, and a further $1,000 paid at the ceremony in reduction of the balance of the $5,000. The ceremony is held; the potlatch takes place; the mortgage money is paid over in part; the couple are mated, and thereafter day in and day out they-yes, they and all their friends and relatives-save and slave to complete the payment for the copper. It is easy to conceive the misery which will develop in the lives of that young couple, and to realize the truth that often the girl's body swells the fund which will make the copper their own sacred property.
The copper, let me explain, is the token coin, shall I say, of wealth among these Indians. It carries a varying and generally an accumulating value in the community; its possession is a hallmark of substance to its owner. It is handed down from generation to generation, or sold as a sacred asset. The

grudge against or the hatred of a man for his neighbour is in no way more maliciously and bitterly expressed than by the breaking of a copper and throwing the small fragments at the enemy, or, if he be dead, by nailing it over his coffin. Eternal woe follows the curse. Friends and relatives alike will struggle relentlessly to remove the burden.
Of course all this is not according to Canadian law, and is actually forbidden. But there is no policeman at Alert Bay, or at any of these ceremonies, and the Indian agent can do nothing. The Indians can fool the agent and the government, and they can fool the church too; for they will get married now in church and all will be well. And although the minister, the agent and the others know what has been done, the Christian ceremony proceeds and the Indian laughs as he dances, laughs as he potlatches, because in his clever, sly way he has fooled the white man. In 1935, just three years ago, three out of four girls trained for years in residental school in that area, on completing their term of scholarship went to their homes and were raped by their biological mortgagees, their Indian husbands. Well, some people will say, that is all right; that is their tradition, and that is their right to do things. But I charge all when I say that with knowledge alone comes responsibility. As we implant in these boys and girls our ideas of life and living, our codes of right and wrong, our whisperings of the romance of love and the selective choice of the loved one, we impose on them also the spiritual responsibility attaching inexorably to that knowledge, and we do not fail to attach it to ourselves. They live in the closely regulated atmosphere of school life and unconsciously develop their romances, and then, having learned enough of the viewpoint of their Canadian guardians, the government, they are dragged back into the worst feature of their native tradition and are lost to the finer ideals which we have struggled so hard to implant in their minds. True they often marry in church; but on both sides it is a hideous farce; for the minister too often senses if he does not know that the couple are thus seeking the religious cloak to cover their native susceptibilities.
In 1916 the last public potlatch was held at Alert Bay, when Charlie Newman married Lucy the daughter of Charlie James. All the tribes except the Cape Mudge Indians were present at this festivity. Since 1917 the potlatch has been going on clandestinely, although the facts leak out before or after. While I was in Alert Bay many Indians of the surrounding tribes were gathered at Gilford island and Village island, and many from Kingcome

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inlet had been there for weeks. They are bold now and are carrying on these practices consistently. The government is aware of these facts from its own agents as well as from many other sources, and it is essential that action be taken on that knowledge. The Indians know how utterly impossible it is for an agent to be a policeman as well, and in consequence they hold the law in contempt.
Within the last day or two I have received a further letter from the Reverend F. Comley of Victoria, B.C., which is so related to what I am saying that I think it well to read it here. The letter is dated May 9, 1938:
Dear Mr. Taylor:
You will remember we had an exchange of opinions re the potlatch last year. You requested that if anything else arose in connection with the potlatch that I thought might be useful, would I send it along. During the past winter the Indians of the Kwawkewlth tribes have had a large gathering at Gwyas-dums. This is an Indian reserve on Gilford island about twenty-five miles from Alert Bay. It is isolated and the Indians have not used it very often during the past twenty-five years, but when I went to Alert Bay thirty years ago it was a popular winter resort for their winter dances, especially "the red fir dance." That should be "the red bark dance." They take the red bark, the fibrous matter under the outer bark, and colour it, bind it around their heads, arms and bodies, also a huge band around the neck. The principal character is the "Hamatsi." He is sent naked into the woods and comes out surrounded by a bodyguard, he is called "the wild man." I have seen this awful dance from beginning to end at Cape Mudge, Alert Bay, Village island and Kingcome inlet. It is one of the most ghastly spectacles I have ever seen. Everybody bitten by the "Hamatsi" must give a potlatch. It was forbidden years ago and seems to me very closely related to the famous sun dance of the prairie Indians. I have only seen it once during the last twelve years, but this year, gaining confidence by being left alone, the Indians returned to Gwyas-dums and ignored all law and order.
This is very bad for the Indians in every way as you know; children are neglected, nothing matters but this hideous dance goes on night and day. I brought this matter up in our provincial synod on Thursday, April 28th, and the following resolution was passed unanimously:
"Resolved

That this provincial synod of B.C. in session assembled unanimously endorse the action of Mr. J. S. Taylor, M.P. for the Nanaimo division of British Columbia in petitioning the government at Ottawa to have the present potlatch law enforced among the Kwawkewlth Indians of Vancouver Island and the adjoining islands and mainland."
Moved by Rev. F. Comley.
Seconded by Rev. H. C. R. Gibson.
The secretary should send this to you, but if he forgets you will know what we tried to do.
More power to your efforts is the desire of all real friends of the Indians.
With kind regards,
Very sincerely yours,
F. Comley.
In order that you may realize that this is a matter which I have taken up entirely apart from Rev. Mr. Comley, I may say that I have never met the gentleman, and have dealt with him entirely by correspondence.
P.S. I am saying not what someone has told me but what I saw as I lived with these people at Kingcome, Fort Rupert, Alert Bay, Cape Mudge, etc.
The reverend gentleman's letter leaves little room for doubt that a serious retrogression is sedulously developing among these people, and in order that the gravity of the situation might become patent to the hon. members of this committee I shall read from Stories of Early British Columbia by Doctor W. Wy-mond Walkem, published in 1914 in Vancouver. The late Doctor Walkem was the father of the present mayor of the city of Ladysmith, British Columbia, and the particular incident written about occurred in the fall of 1876. I read:-
For six weeks or more the "would-be" shaman wanders sadly through the mountains picking his sustenance from the berries, or edible tubers which everywhere abound. His nights were wholly consumed in the never-ending appeal to the temenwos, or to those spirits good or evil which may hear his distressing appeals for recognition. They are spiritualists, pure and simple, but their spiritualism differs from the modern "ism" of the present day, in that the spirit or "temenwos" whom they appeal to is in their belief an original spirit, and not the spirit of one who has died. Privation and lack of food no doubt reduce the Indian novitiate to a condition bordering on hysteria, and when in that condition he is liable to believe that he hears the answer to his plaintive wails for help and recognition. It is at this stage that he determines to return to the homes of his tribe. He is now dangerous-a species of demon, whose hunger must be appeased by flesh.
Slowly and stealthily he makes his way back to where his former companions are anxiously awaiting his return. When within a short distance of his place of birth, he rushes in with frightful yells, and woe betide the unfortunate native whom he first encouters on his way. He leaps upon him like a wild beast, and probably bites a piece out of his victim's arm. No resistance is offered, as it is considered a great privilege to be thus bitten by the future shaman. The man is famished and he devours the piece of flesh like a hungry dog. If, instead of meeting with one of his owti kind, he sees a dog, he will, if possible, seize it with both hands and rend the animal in pieces.
Once inside the village or settlement, four or more sturdy members of the tribe pounce on him and confine him for the last and trying ordeal which I saw in the case of Johnny Chiceete, or "grey-haired" Johnny, as he v'as known to the whites. I will describe this shortly.
Then I turn to it:-
About three-quarters of an hour had elapsed when the drummers in the centre of the ground space began to beat a regular rhythmic strcke upon the gigantic drums which they had before
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them. Four shamans were walking up and down in this space, one of whom reminded me of a huge baboon I had seen at the zoological gardens in Regent's Park. While singing they were shaking rattles, as well as their ankles, most assiduously, which were adorned with shells and small rattles. In a few moments some of the women and men stepped out upon the floor, and began to move about in the usual dancing step. Their tunes are always the same, and the movements of the dancers also. These dances were kept up for some time, one middle-aged man showed his gastric capacity by Bwallowing a square gin bottle of dog fish oil without drawing a breath. He subsided in a helpless condition upon the earthen floor, from which he was promptly packed off to one of the platform seats.
At 8 o'clock everything was perfectly quiet, so quiet indeed, that you could have heard a pin drop in the dusty floor. Then a noise, with much howling was suddenly heard proceeding from the roof. In a few moments a human body was pushed through the square hole in the roof of the rancherie. As the body dangled inside of the skylight, as I will call it, I was able to see that the figure was pendant by four hooks and chains, from the pulley I have already mentioned as being at the ends of the four poles, lying across the skylight. It was the body of Johnny Chiceete which was dangling in the upper air. He was hanging suspended by four hooks, one through the muscles of each upper arm, and one through the muscles of each thigh. He was completely naked with the exception of a loin covering made from the inner bark of the cedar.
His attendants on the roof lowered him slowly to the ground, then back to the roof and down again. This was repeated three times. While going up and down he shouted out some words which I took to be a specie of ritual, for at every pause in his speech he was answered by the shamans on the ground below. They kept walking up and down in line for about twenty feet and back, silent while Johnny Chiceete was speaking, and picking up the words just as Johnny ceased. No sign on Johnny's face told of the horrible torture he must have been enduring. He could not have been more quiet if he had been lowered and raised in a capacious basket.
At the termination of the third drop, four big powerful members of his tribe rushed out and grasped him by the arms, while the hooks were kept quite taut to prevent his breaking away. Straps were slipped round his arms to give his captors a good firm hold and command of his body. The hooks were then removed, and Johnny sprang to his feet, and attempted to break away.
Many of the audience, fearful he should escape from his captors, began to seek safer positions. Now came the most curious part of the ceremony. Ten Indians came down the circular pathway, naked to the waist. Johnny saw them, and began to gnash his teeth in anticipation of a feast, for he was fearfully hungry, having arrived from the mountains a short hour before his appearance on the roof. As Johnny strained like a dog on the leash to get at the first semi-naked Siwash, he seemed more like a wild beast than a human being.
Gradually he dragged his keepers to his first victim, the shamans following in the rear with pieces or strips of cotton and Indian balm.

Arriving at the first man, he seized his arm, and bit a large piece out of it, and then passed on towards the next. The shamans to our surprise called our special attention to the wound in the first man's arm, to show there was no fake about it, I suppose. Then they applied some balm or ointment, and wrapped up the whole in cotton.
After binding up the wound on the first man's arm, a shaman slipped a ten-dollar geld piece into the victim's hand, according, as I was afterwards told by Mr. Horne, to an arrangement between the victim and Johnny Chiceete's friends. After his first performance with his teeth, Mrs. Horne and Mrs. Grant retired from the building. It was too horrible for their sensitive nerves. Mr. Horne, Mr. Grant and I stayed on to see the ceremony through. Johnny completed his round with the hired victims, and just as he finished with the last, he saw a small dog near the platform, which he seized with both hands and began to eat alive. He was pushed, with the dog in his hands, towards the entrance and was taken by his friends to a cabin specially prepared for him, where his hook wounds received special attention. All of those who supplied Johnny with arms to bite were rewarded in the same way as the first one was, who by the way was an Indian known to the whites as Siwash George. I only heard the names of three others. They were Three Fingered Jimmy, Saweetlum and Potato Johnny.
To face this matter, officially it must be regretted that there are no policemen at Alert Bay. I do not refer to the provincial police. Fine men they are, but they cannot deal in a proper manner with this which is a purely federal and departmental matter. The government should most certainly have a policeman and police engineer with a suitable fast boat to cope with the situation as it now exists. This boat and these officers should be based on Alert Bay.
But this action will noit in itself be sufficient. I consider that the chiefs who persist in potlatching and intriguing in the more uncivilized customs and traditions of their people should be denied recognition in every sense as chiefs by this government. They should be deposed officially by the government from their chieftainship. Further, some element of discrimination should be developed by the government which would distinguish the prac-tiser of the potlatch from the Indian, Christian or other, who has definitely renounced it.
We are perpetuating a serious evil and senselessly throwing away much money now being expended if we do nothing more than teach the Indian to despise our guidance. In effect, some of these people are in real danger of becoming more certainly savages than they now may be. These matters all want close investigation and a thorough airing. It is evidently not for nothing that the Indians at Kingcome inlet have taken to exchanging IOU's in their potlatches. In

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addition to what I have said I am prevented by time-not inclination-from reading letters of unequivocal value from men of long residence among these tribes, and I would certainly have liked to mention the opinions of students of Indian tradition and lore like Professor Hill Tout and many others. This I will say, however, that whatever has to be done-and it is important to record it and accept it thus-must be done firmly, considerately, intelligently, so that the Indians themselves may preserve the sublimed values of their customs, while casting away the practices to which they have been slaves.
I have claimed that contact with civilization tends to bring this about naturally if the contact is made real and forceful. There was a time in Europe when we stuck the skulls of our enemies on spears or poles in front of our tents or lodges. To-day we raise stone gate-posts and carve round balls on top to remind us of those early days. At one time before we understood the constructional technique of foundations we, the white people, offered living sacrifices, to seal the cracks in our city walls, our great buildings, our cathedrals. The good book tells us that Jericho's walls were rebuilt in the sacrifice of the first-born of the builder and they were completed in the sacrifice of the builder himself.


Frederick George Sanderson: I must inform the hon. member that he has exhausted the time at his disposal.


James Samuel Taylor: I would crave the indulgence of the committee for another few moments.


Richard Bedford Bennett: Mr. Chairman, I am sure we would like to hear the remainder of this instructive statement on potlatching. Now that I have made my little contribution, perhaps the hon. member could continue.


James Samuel Taylor: I thank the right hon. gentleman. Hamburg's city walls contained the bones of many sacrificed as votive appeasement of the wrath of the gods. These elementary conceptions gave way in the face of civilization and Christianity until in the cracks in churches lighted candles symbolized the offering of a life and were walled up in the necessary repair.
Everywhere this sublimation goes on and knowledge breeds its kind, but we do wrong to ourselves and the Indian if we complacently regard his efforts towards civilization as struggles for which we are in no wise responsible. I do most earnestly urge the minister to believe that the complaints of many citizens
who are deeply interested in these promising and lovable people are real and prompted by the most worthy ideals.
I understand that the minister has also been very fully advised by the Indian agent on the spot. Surely his understanding, training, and devotion to the service should also be set on the scales in this matter. It is possible that some advantage might develop from civil marriages to avoid the present farcical practices. Marriages could later be solemnized for Christian members of Christian churches, but do not let us perpetuate this evil of the potlatch, as it is now being perpetuated.


Alan Webster Neill: As I represent the district in which these horrible orgies are supposed to have taken place, it is perhaps my duty to say something in defence of these poor Indians whose character and reputation have been so bitterly and unfairly assailed. I yield to no one in this house in my regard for the good qualities of heart and mind of the hon. member for Nanaimo, but his judgment is negligible; that is the trouble.
I have listened with amused horror to his remarks which contained a little bit of sordid truth, very much exaggerated, and an immensity of imagination which would make another volume of Grimm's fairy tales. The two mixed together have produced the treatise which the hon. member has read. These people live from 200 to 250 miles away from the district which the hon. gentleman represents. They are in the far northern part of the district I represent.
In some respects we are a peculiar people in Comox-AIbemi, in a scriptural sense, and we do not very much care for outside interference. We somehow think we are capable of looking after our own political affairs, and we believe in doing as we would be done by. Six months ago I was asked to go down to the district represented by the hon. member and to interfere in a matter connected with the Indians. But it was purely a local trouble, one which had nothing to do with my district; and as it had nothing to do with provincial rights or interests I declined. I recommended that they go to the hon. member who I said I knew was a man of good intention and of good heart, and one who would do what he could. I w'as doing only as I would be done by. Therefore we hesitate to be guided by the advice of the hon. member.
So far as his statements are concerned, he has been talking out of the dead past. Let us realize that the passage of the Indian from savagery to civilization has been one which has taken place in two generations. In the case of the white man, it has been ten centuries. He is trying to compare the one with
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the other. If we are going to do that, we shall have to go back to the days when maidens were sacrificed on the altars of the Druids. That has long since passed. It is only two generations since the Indians were living under the same conditions as we were so long ago.
I can illustrate what happened to my hon. friend. I know quite well what occurred. He went up there looking for horrors, and he got them. Let me give an illustration of a similar case. Many years ago when I was Indian agent there came into my office a gentleman bearing credentials from the Ottawa department. They instructed me that he had come to write up Indian folklore and I was to give him every assistance possible. A Mr. Cox was chief of the white police at that time and he could talk the Indian language. I enlisted his sympathies, and we arranged for this gentleman to talk with some of the old people. In each band or tribe there is generally one old person who is regarded more or less as the historian of the band. He gets up at potlatch time and hands on the traditions of the tribe. That is the only way they can do it. I arranged for this gentleman to get in touch with the historian of this tribe, but we found out that that was not satisfactory. That would involve sitting in a dirty Indian hut with a mud floor and possibly in unclean conditions, draughty, smelly and everything else. He did not like that.
In the course of a few days he intimated to us that he was able to run things in his own way. He got hold of an Indian boy just out of school. He paid him what was a fabulous sum in those days, S3 a day, to come down and sit in the comfortable hotel room and furnish him with this folklore. Presently it got noised about what wonderful folklore this gentleman was getting. This information came to Mr. Cox and myself and we hunted up this Indian boy. We knew very well that the stuff he was giving this gentleman was pure nonsense. We knew it had no relation whatever to the folklore as we knew it. We asked this Indian lad what he meant by fooling this gentleman from Ottawa. The result was that we learned that this boy had given him what little folklore he knew, and then finished off with a garbled version of what he had gotten from a book in the Indian school. I often yearned to see that book published. This boy had a very comfortable job, and he wanted to keep it. The man from Ottawa wanted to get some folklore under comfortable circumstances, and he got it.
My hon. friend went snooping around in a district 250 miles away from the country with which he was familiar. He was asking for

horrors and he got them. He mentioned this Mr. Comley. Mr. Comley is quite an old gentleman, a former church missionary. He referred to this horrible red bark dance at a place called Quathiaski Cove.


James Samuel Taylor: I never mentioned that.


Alan Webster Neill: At Cape Mudge, which is close
by-


James Samuel Taylor: In the early days.


Alan Webster Neill: That is right. I hold in my hand a letter which appeared in the public press, from the Reverend M. F. Eby, a very reliable man whom I know well. He is in charge of the missionary society at this place called Cape Mudge, and he writes to protest strongly against Mr. Comley having suggested that this dance had been held by his Indians. He states that they are quite decent Indians and have not practised that dance for many years.


James Samuel Taylor: That is precisely what the Reverend Mr. Comley said.


Alan Webster Neill: Mr. Comley writes back to
Mr. Eby, and he prints the letter. Mr. Comley blames the press and states that he was misunderstood, that it did not take place recently at Cape Mudge, but twenty-nine years ago. He describes it as "The Most Devilish Spectacle" he has ever seen. Then he goes on to elaborate upon the whole thing. Remember, this is Mr. Comley, not me. It is interesting to note that the words "The Most Devilish Spectacle," are in capitals. He describes how this awful dance is carried on and states that the children are neglected. Are not our white children sometimes neglected when their parents go out to play bridge? He states these dances cause strife and malice, but unfortunately to-day we find strife and malice not only between people but among nations. But this "devilish spectacle" took place twenty-nine years ago. That is a long time ago.
Then he talks about selling women. He has twisted a very small matter and tried to make it into a large one. We do not need to go so far back into history to the time when the chiefs of the Scottish clans or the knights in England had the bestowal of the wards under their authority. Quite often a girl was given to one of the knights, and if the gentleman was a seemly looking man, the girl was not long in accepting him. That is the true explanation of this selling. There is absolutely no justification for the statement that these girls are biologically raped by their

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husbands. As to the tale that there is a mortgage which is in effect until it is repaid, it is like our dowry. The trouble I had when I was Indian agent was in getting the men and women to stick together. Wives and husbands had a playful habit of getting rid of each other and taking newer and younger mates. It was not a case of getting back their mortgage money. All the time I was Indian agent I never heard of one woman being sold in that way.
Another complaint is that there is no policeman at Alert Bay, and then he qualifies that statement later on by saying he meant no dominion policeman. By making such a statement he insults the reputation of the provincial police, a very fine body of men. I wrote to the chief of police in Victoria asking him if he had any trouble in handling the crime situation at Alert Bay. He told me that he had not. He said they had two men there now and if an extra one was needed, he would be put on. He told me that there was no need for an extra man up to the present. Then I asked him about these dreadful orgies that were supposed to go on and this potlatch business. It turned out that this was a most trivial matter. He told me there had not been a murder, a bank robbery or a burglary in many years. The worst crime was drunkenness and he told me he averaged one and a half cases a week over a period of two years. The provincial police are perfectly capable of handling the Indians. They also administer other dominion statutes, because that is part of the bargain made between the dominion and the province.
A long quotation was made from a book written by Mr. Walkem, describing conditions in 1876, sixty-two years ago. He talked about eating dogs. There used to be something about taking bites out of a living dog, but that never occurred in the district about which he is talking. That was away up in the north, and that practice has been out of date for at least thirty or forty years. He has been loaded up with all this stuff of the past. He wants to know why the law is not enforced. The law is strictly enforced. Any one who takes part in any Indian festival, dance or other ceremony of which the giving away or giving back of money, goods or articles of any sort forms a part, is liable to imprisonment for a term not exceeding six months and not less than two months. The question is whether it is wise to take these Indians by the throat, so to speak, and try to make Christians out of them. Here is a telegram
I received from the Indians. They did not send it collect either, as many white men would. It reads:
Investigator on potlatch went Alert Bay only, which not fair deal. We want investigator for both Indians and Indian agent, not one-sided. Hold his report until you hear from us. We desire square deal and want honest and truthful man. We know he is taking report on potlatch which he got from young people, not from older people.
And they send a letter in which they say the same thing. It is not in very good English, but they say that they are not satisfied with the work of the investigator who was at Alert Bay-that is, the hon. member for Nanaimo (Mr. Taylor)-and they want an investigator to interview them and their officials. The letter went on to say that there were people who were deadly against their custom who would feature one instance, possibly an undesirable one, and ignore everything else in its favour, and also listen to gossip and rumour.
I wrote to the minister and asked if he knew anything about the matter in his department, and I have a reply saying that he did not sanction anybody going up there and that he knew nothing about it.
I have a further letter from the chiefs to say that they had word that a Mr. Taylor was at Alert Bay, who is also an M.P.- that is how they express it-they ask me to find out what knowledge of the potlatch Mr. Taylor got from the people, and they remark with a good deal of truth that what he should have done was to meet the chiefs and the people of this agency. As a matter of fact, he was trespassing and stirring up one bunch of Indians against another, which is illegal.
There is one other phase. My hon. friend quoted the good book. Let me follow his example. Scripture says something about taking the beam out of your own eye before you meddle with the mote in your brother's eye. And when he was pussyfooting around my district, without invitation, and with a very restricted welcome, what was going on in his own district? I have a cutting here from a paper published in Nanaimo, the capital of his seat, with a population of about nine thousand people, and eight hundred Indians were turned loose there one day, these dreadful debauches, in his own capital cityl Here is the heading on the article describing it: "Day long potlatch is held at Nanaimo." The article goes on to say that eight hundred Indians participated and it reveals the dark and awesome tale. It all amounts to this: There was a marriage, which
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is neither an illegal nor an uncommon thing, and they had a feast, also not unusual. The article also goes on to say:
Potlatches are banned under British Columbia law, but special sanction was obtained for the Nanaimo celebration.
Very well, it was illegal, but special sanction was obtained. When or where? Was the hon. member a party to it? If he was, then he was allowing a potlatch to go on in his own district while he was denouncing one in mine. If he was not a party to it he was neglecting his duty by not taking the beam out of his own eye. It would have been very much better if he had attended, to put it roughly, to the details of his own district.
But I must hurry on. I have here a letter from these people. They write requesting me to get in touch with His Excellency the Governor General to ask if he would act as patron of the opening of their new church, to be dedicated by the bishop, and the ceremony in connection with a totem pole which they had erected at great cost and trouble to the memory of King George. I have the very kindly letter of his excellency saying that he was pleased to be a patron and that he was reporting their action of loyalty to the king. Then I have an invitation, very nicely printed, with "God Save the King" on it in dialect, and a picture of the totem pole. I will send the two photographs over to the minister and the Prime Minister, but they are to be passed as an order for return because I want them back again. I have here the Victoria Colonist, a half page of which is devoted to the ceremony. There is a picture of the hall and of the church, a much better one than I worship in at home; the bishop is shown in his robes on the steps of the church, and there is a picture of the communicants taking their first communion. It is very nicely written up, and there is also a picture of the totem pole. These are hardly the people, one would think, who would indulge in these bloody orgies about which my hon. friend talks. Surely good progress has been made in two generations.
Let me cite South Africa. They just recently, within the last few months, passed a law allowing native courts to be set up to deal with the natives in accordance with native law and customs, and among other things polygamy is allowed, which will horrify my hon. friend. The idea is to make decent, Christian natives out of these people, instead of imitation white men. They have passed that law in Africa, declaring that the law shall be in

accordance with the native customs, and that is how to make these people Christians, not by force of arms and by policemen, but by teaching them in a reasonable way.
Here is what a man, a missionary, wrote to the paper the other day; I quote one paragraph:
The mistake we have been making is in trying to make of the Indian what he was never intended to be-a white man. The church, by adopting compulsory measures, may succeed in suppressing the potlatch but she will never win the Indian.
He will respond, as he has always done, to sound leadership, wise counsel and, above all, consistent example.
It goes on to say:
It is not the intention of this letter to minimize the evils in some of these old Indian customs-
Nor am I trying to do it.
-or to cast any reflection upon those who, under great handicaps, are labouring in Indian communities: its object is respectfully to commend to the leaders of the church a far better and more effective way of dealing with this problem, namely the Christian way of sympathetic understanding and moral suasion.
Which is the better method? The policeman with his revolver in his hand saying, you shall not do that, or the kindly moral suasion of the church, leading the Indian step by step? My hon. friend himself says there has not been a public potlatch since 1916. The custom is wearing itself out. It only needs time and moderation. It is the old principle again, if you tell a man not to do something that he has been habituated to doing for a hundred years, that never stops him; but if you tell him that it is not a good thing, you can gradually lead him to different ideals. That is better than putting a policeman there and trying to make the Indians what they were never intended to be-white men.


[Stage Direction]
Item agreed to.
Reserves and trusts-administration, $55,9S0.
Richard Bedford Bennett: What is the amount of the fund now available for administration?


Thomas Alexander Crerar: Indian trust funds?


Richard Bedford Bennett: Yes.


Thomas Alexander Crerar: About S14,000.000.


Richard Bedford Bennett: How is it invested? It is part of the consolidated fund, of course, but what interest does it pay?

Banks in Alberta


Thomas Alexander Crerar: About five per cent. The capital fund has increased during the past year. I am not in a position to say how the accretion to the fund through interest was disposed of.


[Stage Direction]
Item agreed to.
Progress reported.
At eleven o'clock the house adjourned, without question put, pursuant to standing order.
Tuesday, June 14, 1938