1939-05-26

[Stage Direction]
On the orders of the day:
Mr. JEAN-FRANQOIS POULIOT (Temis-couata) (Translation): Mr. Speaker, I wish to ask a question of the government and particularly of the Secretary of State (Mr. Rinfret). Does he not think that the government would obtain a more complete and less costly record by purchasing copies of the newspapers of each place at which the royal train stops instead of continuing to make use of the historian or historiographer of the royal visit, who is not over regular in his attendance at the various functions? It seems to me that it would be possible to compile a very complete scrapbook from which the government could afterwards select the most interesting illustrations and articles.
Hon. FERNAND RINFRET (Secretary of State) (Translation):: In answer to my hon. friend, I have to say that the duties of Mr. Gustave Lanctot, the dominion archivist, do not consist in making daily reports of the tour but in writing about the tour as a whole a book which is to be published when the royal visit is over. The newspapers, which are very largely represented, publish daily reports of the tour, not only in this country but also in the United States and in Europe. The newspapermen are making the trip in a special train which is travelling ahead of the royal train. The archivist's functions, as I said, are limited
fMr. Euler.]
to the taking of notes with a view to preparing a book to be published after the termination of the royal visit.
I have never been told that Mr. Lanctot was not regular in his attendance. During the few days when I took part in the tour myself I noted that he was at his post.



CENTRAL MORTGAGE BANK


[Stage Direction]
On the order for resuming the adjourned debate on the motion for second reading of Bill No. 132, to incorporate the central mortgage bank:
Hon. CHARLES A. DUNNING (Minister of Finance):	Before this order is called, may
I say I am advised that there is doubt in the minds of some hon. members as to the procedure the government propose to adopt in connection with this bill. I wish to repeat what I said the other day, that following second reading of the bill it is my intention on behalf of the government to move that the bill be referred to the committee on banking and commerce. I make that statement again to remove any doubts which may be in the minds of any hon. members.

[Stage Direction]
The house resumed from Tuesday, May 23, consideration of the motion of Mr. Dunning for the second reading of Bill No. 132, to incorporate the central mortgage bank.
Mr. MALCOLM McLEAN (Melfort):: In rising to say a few words in support of this bill I should like first to express my appreciation of the introduction of such a measure by the Minister of Finance (Mr. Dunning) whom we are all glad to see back with us to-day with his new honours freshly upon him.


Some hon. MEMBERS:: Hear, hear.


Malcolm McLean: I am sure the
country will appreciate his receiving from McGill university the degree of Doctor of Laws, just as the house, by its applause, has indicated its own appreciation. It is particularly appropriate that a measure such as this should be introduced by the minister, not

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only because he is Minister of Finance but also because of his long experience with and interest in legislation of this kind, which has taught him to beware of pitfalls and to include the necessary provisions to make such legislation successful. In briefly running over the features of this bill that appeal to me and dealing with the difficulties that may exist,
I have in mind the long experience of the minister in dealing with such matters.
This bill is an outstanding contribution to the solution of the problem with which it deals. It is the most far reaching piece of legislation to be proposed in this house for a long time, in regard not only to what it is likely to accomplish immediately, but also in the long range effect it will have on this and related problems that we may have to consider in this country. In this bill we are providing public credit in terms of the needs of a great many of our people in a simpler, more practical and safer way than has ever been suggested before, and in that sense I believe this is a most practical piece of legislation. I hope, and feel confident, that hon. members will approach its study without any desire to delay or hinder the passage of this measure. I hope the attitude hinted at the other day by a few hon. members who suggested that the bill would require lengthy consideration, for reasons they suggested, will not be too manifest. After all in this country we have had a great deal of experience in such matters, and that experience should be readily available.
The features of the bill of which I most approve are few and simple. In the first place it ensures that the interest on all mortgages on farm lands, and on homes where the amount of the mortgage does hot exceed $7,000, will be reduced to five per cent per annum; for as the lending companies that come under this scheme will have to reduce their interest charges to five per cent, it will be necessary for other companies to follow suit, and as a result five per cent will be the rate in effect. At this time, when money is plentiful and good investments not so easy to find, probably five per cent is a fair return. Then, interest arrears will be reduced so that not more than two years' interest can be included in the adjusted mortgage, and finally, the mortgages are to be rewritten to not exceed eighty per cent of the present value of the property, which will benefit a great many people. One outstanding defect of past legislation has been that city and town homes have been neglected. I admit at once that the first consideration of governments past and present, and quite rightly, was to keep on the
land those engaged in agriculture in order that they might continue to produce wealth and so that the economic system of the country might not be disturbed too greatly. But the time has come when some consideration should be shown home owners in cities, towns and villages, and I believe this legislation will take care of their problem.
In connection with farm mortgages the thought has been expressed by some hon. members that it will be impossible for farmers to pay even at the reduced rates. I find from the explanation of the minister, however, and from the bill itself that crop share payments may be made on these mortgages. That is the way farm lands in many parts of Canada have been paid for. Some hon. members did not believe monthly payments on city homes would be practicable. As a matter of fact that system is being followed now in many cases. In some cities taxes are paid in that way; it is done under the home improvement plan in connection with advances from the banks; it is done under the national housing scheme, and I think it can be taken for granted that it wiil work out equally well under this plan.
The other day some hon. members expressed the belief that the lending companies were going to get advantages under this legislation. I do not know to what extent that may be so, but I would say that the lending companies, composed of life insurance policyholders and other investors of that kind, are entitled to a square deal just as much as any other class of the community. If these companies suffer, the burden is sure to be reflected immediately upon individual citizens. On the other hand the hon. member for St. Paul's (Mr. Ross) thought the lending companies would be penalized, and went so far as to say that the only people who would suffer as a result of this legislation would be the life insurance policyholders. After declaring himself in favour of the general principle of this bill, at page 4402 of Hansard; after saying there was no doubt that legislation of this kind was necessary, the hon. member went on to disagree with the bill on minor points. However, after sizing up what were the likely company gains and company losses apparently he came to the conclusion, at page 4403, that the particular company he was taking as an example could not afford to become a member of this bank, and went on to say that the policyholders of the life insurance companies were going to be stuck.
I mention this to indicate that there are two opinions on this matter, as there are on almost everything. Some hon. members thought the companies were responsible for this legislation; the hon. member for St.
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Lawrence-St. George (Mr. Cahan) asked who had demanded this bill, which of these companies had asked for it, to which the minister replied that none of them had requested it. But even if it tends, as I hope it will, to improve the position of the companies generally, that is not an unreasonable thing to do as long as it does not mean an unfair loss to the treasury of Canada. When such rigorous terms are imposed as to provide that companies operating in the lending business, after they become members of this discount bank, have to administer their business on a margin of from one and a half per cent to two per cent over and above the rate at which they can secure the money from the 'bank, and when they have to state a maximum interest rate on mortgages to be given of not more than two per cent over the current rate for longterm dominion securities, I think there is reasonable assurance that borrowers will not suffer much from too high interest rates. It will be such an improvement over present and past conditions that it will be welcomed throughout the country.
To me, one of the hopeful and signficant things with respect to the legislation is that it will remedy some conditions which have arisen from the time of the depression, and the adoption of restrictive legislation. I have heard hon. members from central Canada, and particularly from Ontario, say that it would not be of any advantage to them because in Ontario individual lending has been the custom in the past. No doubt that is true. The other day the leader of the opposition (Mr. Manion) referred to it as having been the rule in western Canada in years gone by. That was about the only investment open to the small investor in the cities, towns and villages of the west. There was a time when such mortgage loans could be made readily at eight per cent, and the security was counted to be as good as gold-and in those days that meant as good as wheat. But the situation has changed, and that change has been brought about by the depression and by restrictive legislation. I do not believe many private investors are willing to put money into mortgage loans to-day. The result is that we find idle deposits in the banks, but plenty of money available for the purchase of dominion securities, when such are offered on the market. Meantime there is a dearth of new money for investment in mortgages on homes or farms, and I can see no hope of any immediate loosening up of private money in investments of the kind in the near future.
That condition is not to be wondered at. If hon. members had money to invest would

they care to put it into securities which are liable to interference before the ink on the signature is dry. They would hesitate to put it into securities liable to interference from provincial authorities, from dominion authorities and perhaps even from local authorities. So that, so far as I can see, the outlook for the continuance and increase of loans by private parties is not very hopeful.
All right; how are we going to get over the difficulty, if not through a measure such as the one now before us? If private investors are to be able to purchase government securities only, then the next course is that government securities, or the money obtained from the sale thereof, should be available where necessary to do the business the private investors used to do. And so long as this trend of investment continues, we shall have to follow a course such as the one suggested in the measure. I am not quite sure but that even in the province of Ontario, where in the past few years private lenders have been discouraged, this legislation will be found useful.
Some hon. members are inclined to complain about the country absorbing part of the written down losses of the lending companies. My view is that it is time we were getting away from the emergency measures of the last few years and getting down to something that will be more equitable, more evenly distributed and more fruitful of results. This bill promises to do that very thing by providing that the people who insist on writing down losses-that is, the country as a whole- shall absorb part of them. The effect will be more beneficial than has any legislation of the past few years under which the creditor alone absorbed the loss, and neither the state that imposed that loss upon him, nor any other authority, shared any part of it- although in many cases the creditor was perfectly willing to take over the property or the security on which he had lent his money. It is only fair that the state which imposes restrictive legislation should absorb part of the loss thereby entailed.


Mr. McCANN:: In the final analysis, is it not all done by the same people?


Malcolm McLean: No, it is not all the same people. Let us suppose that we levy a contribution on the whole of the membership of the House of Commons to buy a new mace. That might be a fair and equitable distribution, but if we were to place the responsibility on nine or ten hon. members only, it would be most unfair. On individual holders of securities who made investments in good faith and who were willing to take the security promised them was placed the

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whole burden of the losses provided for under recent legislation. That condition cannot continue indefinitely. If it does, no one would have confidence to lend money, although probably at the present time some private individuals continue to do business.
I hope this legislation may go through quickly. There is an old proverb which says in effect that a thing quickly done is doubly well done. I was pleased to hear the leader of the opposition, the hon. member for St. Lawrence-St. George and the hon. member for St. Paul's support the principle of the bill, but there seemed to be a little doubt in the mind of the leader of the opposition. While supporting the principle of the bill and the necessity for it, and while reminding the house that four or five years ago his associates had promised, if returned to office, to redress the burden of home owners, I caught in his words a desire to delay.


Mr. MANION:: No desire to delay, at all; but there was a desire to make the legislation better. If it is to go through, then it should be put through in good form, and I think it requires a good many amendments to put it in that good form. That is the attitude I take.


Mr. POULIOT:: It is all wrong.


Robert James Manion: Who?


Jean-François Pouliot: The legislation.


Mr. STEWART:: Well, I suggest that the hon. member should speak to his friend over there.


Malcolm McLean: I agree with the leader of the opposition that it ought to be put through in the best possible form, but I also say that during the time the bill has been before the house hon. members have had an opportunity to study it. In the past ten years thinking men in public life everywhere have been studying these problems, and they have had every opportunity to come to wise conclusions. There is no necessity of putting off this bill until another session.
The suggestion of the leader of the opposition reminds me very much of one made about a dozen years ago by a predecessor of his, at a time when we were discussing the old age pensions bill. He pointed out how strongly he approved of principal of the legislation, but added, "I appeal to my hon. friends opposite not to force this measure through at the present session, not to ask that we vote for it just now." Of course if we were to put off measures of that kind from year to year we would never get anywhere. I believe there 71492-289
has never been a time when the passage of a measui'e of this kind has been more necessary.


Robert James Manion: But it should have been brought in a month and a half ago.


Malcolm McLean: It was, as a
matter of fact. The Prime Minister gave notice of it two months ago. The Minister of Finance introduced the resolution about a month ago, and it is no fault of the government or, indeed, of any individual member, that it has not been proceeded with earlier. But my hon. friend knows as well as I do that much time has been spent in the house at this session in unnecessary talk about theories which have never received much favour anywhere in the country.


Robert James Manion: The measure could have been brought in any time; the government had complete control.


Malcolm McLean: But they could not ensure its passage through the house.
Some hon. M EMBERS: Surely.


Malcolm McLean: Oh, no. Just
look at the other measures that have been before the house. Surely my hon. friends are not going to say to me that the government should have railroaded or forced it through, or exercised rigid control over the house. I am sure my hon. friends will agree with me when I say that the democratic form of government is dependent on responsible representatives' who are members of chambers of this kind, and, unless we discipline ourselves, democracy cannot function and it cannot endure.
For a moment I am going to deal with some of the objections taken to the bill by the hon. member for Peace River (Mr. Pelletier). He said deliberately that this bill should not now be proceeded with. Why? Because we have not accurate information. Can anyone imagine a more foolish reason, given by a member representing a rural constituency in western Canada who came down here to solve the monetary problems of the nation? He has said that we have no accurate information about the problems involved in this bill, that the ability of the debtor to pay has not been considered, and that the measure should not be proceeded with. The bill contains a section providing for crop share payments, and the payments that will be asked from a debtor are to be reduced. But his ability to pay is not to be reduced.
Then the hon. member was afraid that this legislation would cancel provincial legislation. We have no responsibility in that

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regard as long as we keep within the realm of dominion authority. He said also it would be an invasion of provincial jurisdiction. It ill lies in the mouth of an hon. member supporting a provincial administration which has sought to invade federal jurisdiction so often, but fortunately so unsuccessfully, to say anything like that. The last complaint he had to this bill was that in the final analysis the companies would suffer no loss. Apparently this is a wrong principle to adopt in this house. It is harmful in the eyes of some members, fortunately few in number, if in the final analysis the companies are to suffer little or no loss.
I want to deal with two or three objections which were raised by the hon. member for St. Lawrence-St. George, including one or two apparent slips on his part. He is reported on page 4398 of Hansard as follows:
The policy in the past has been to allow individual creditors or companies to deal by compromise with individual debtors, and that policy has prevailed in this country thus far.
There was a time when that was correct, but on reflection I think my hon. friend will agree that during the past few years, under the legislation enacted by the dominion in connection with bankruptcy proceedings, this has not been so. Individual creditors and others have not been allowed to deal simply by compromise with their debtors. A compulsory method has been used rather than cooperation.


Mr. CAHAN:: Only in the case of insolvency or bankruptcy.


Malcolm McLean: Under the
Farmers' Creditors Arrangement Act.


Charles Hazlitt Cahan: In the case of insolvency; on any other basis its application would be invalid.


Malcolm McLean: Legally, perhaps, but in practice it was not.


Charles Hazlitt Cahan: Practice should conform to legality.


Malcolm McLean: I think my hon. friend will admit that there are people whose affairs were reviewed under that act and who are going on as they were previously. They have never been declared bankrupt and they are not going to be declared bankrupt unless some change is made in the law. That affected many more than those who passed through farmers' creditors arrangement proceedings. We were told by my hon. friend that the farmers in the west are likely to be deprived in the future of any hope of obtaining money on mortgages under such a universal lending system. Unfortunately that
*Air. M. McLean.]
is the position in which they now find themselves. Compulsory restrictive measures have been in effect. I am not saying that they were not necessary at one time; I am not criticizing an}' government or administration for passing such legislation, but the effect is that many farmers are not now able to get any new money. In order that the farmers may adequately finance their operations, in order that young men may be able to start out for themselves and improve their positions, it is important that new money should be available.
There was one other objection raised by my hon. friend to which I should like to refer. He said that the farmer or home owner who has not been able to pay six to eight per cent interest:
-could not hope to meet the interest and principal payments of his newly adjusted loan at the rate of ten per cent per annum, which rate, or something near it, would necessarily apply during the earlier years. That would be five per cent for interest and five per cent for amortization of principal.
I would point out to my hon. friend that
the amortization rate on a twenty year mortgage at five per cent in equal annual payments would amount to 8'03 per cent. The man who is paying from six to eight per cent-we will take the larger rate because that has been the one most generally charged -on a mortgage running twenty years, with the principle due at the end of the term, would still have all of the principal outstanding against him; he would have paid only the interest. If that mortgage were revalued down to eighty per cent and the interest reduced to five per cent, with 3-03 per cent for principal, a total rate of 8-03 per cent on eighty per cent of the value would bring the interest and principal payments down to 6-64 per cent. At the end of twenty years not only would he have paid a lower total rate annually, but the principal would have evaporated along with the interest.
I am not criticizing my hon. friend; I am glad that he brought up this point so that it can be dealt with. The annual payments of interest and principal to be made under a mortgage covered by this legislation will be less than the previous interest payments used to be. We have been striving for a great many years for the adoption of this principle. We believe that in the past many mortgages might have been paid off several times over if the amortization principle had been adopted. But only interest payments, and high ones, were required, and at the end of the term the principal still remained.
For these reasons, and many others I have not mentioned, I hope that this measure passes

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second reading and is sent to the committee to which it is to be referred. Its principles have been understood for a long time; they are quite simple and few in number.


Mr. DOUGLAS (Weyiburn):: In view of the provision in section 16, paragraph (k), does the hon. member think that this bill will operate in the province of Saskatchewan?


Malcolm McLean: I have the bill here, but I do not recall exactly the provisions of that section.


Thomas Clement (Tommy) Douglas: I have reference to the provincial legislation which prevents foreclosures.


Malcolm McLean: If there is any province in Canada that will be willing to cooperate with this government, it is Saskatchewan. I am sure that province will be ready to cooperate to the utmost in order that the benefits of this legislation may accrue to its people.
Mr. JEAN-FRANCOIS POULIOT (Temiscouata):	Mr. Speaker, I have suffered in
patience for four years when reading the financial legislation that has been introduced here, and I regret to have to say that for many reasons I cannot swallow this bill. Ever since I was a lad I have always been fighting for liberalism.


Robert James Manion: Why does not the hon.
member come over here?


Jean-François Pouliot: Not unless my hon. friend again becomes a Liberal. I have been fighting for Liberal ideas ever since I was a lad.
I was taught liberalism in my own family as soon as I could start to learn things. I regret to have to speak on personal matters, but my great grandfather, a very humble merchant of Isle Yerte, Temiscouata, was member for Rimouski county at a time when it included Temiscouata. He was a member of the legislative assembly at the time the ninety-two resolutions were passed, and he voted for them. When Baldwin was defeated in the city of Toronto it was my great grandfather who gave him his seat, and if any doubt it I would refer them to the Parliamentary Companion of 1874. where they will see that Jean-Baptiste Pouliot. who voted against confederation with the Liberals of the time because he saw in it a disguised legislative union, arranged it with my maternal great grandfather so that Baldwin was elected in a con-, stituency of which mine is now part.
What are the ninety-two resolutions? The chart of our liberties, our bill of rights, cannot be found in any treaty between England and France. It must be looked for elsewhere. It 71492-289J
cannot be found in any act of the British parliament. It was precisely those ninety-two resolutions which gave us responsible parliamentary government. I hold in my hand the reports of the legislative assembly which contain those resolutions. They are too long for me to read now, but I have made excerpts which I shall give to the house.


Charles Hazlitt Cahan: May I ask if that volume is in the parliamentary library?


Jean-François Pouliot: Yes, sir.


Charles Hazlitt Cahan: I have often wondered where I could find those resolutions.


Jean-François Pouliot: I will ask Hansard to send the volume to the hon. member when they are finished with it, or I can pass it over to the hon. gentleman if he will see that Hansard gets it. I have perused these resolutions and it is time for me to remind the Minister of Finance (Mr. Dunning) that my ancestors did not fight in vain for responsible government. Yesterday in Montreal the Minister of Finance spoke of self-government, something which can be discussed; but we have no responsible government in this country now, especially in the Department of Finance, because members of parliament cannot get the information they ask for about the expenditure of public money. What was said by these old patriots, French and English, the disciples of William Lyon Mackenzie, the illustrious grandfather of our Prime Minister? Here are resolutions 9 and 10.


Mr. DUNNING:: Mr. Speaker, I rise to
a question of privilege. My hon. friend says that members of this house are unable to get information regarding the expenditure of public money from the Department of Finance. That statement is wholly incorrect. No member has asked for more in the way of information, by way of correspondence, and no member has received more than the hon. member for Temiscouata. It is a serious reflection upon this house to say that it is unable to get from the Department of Finance information respecting the expenditure of public money, and I must raise the question.


Mr. SPEAKER:: I think the hon. member should not make such remarks, especially in view of the information given to the house by the Minister of Finance.


Jean-François Pouliot: Sir, I always bow to your ruling, but I have many cases I could mention. I refer, for instance, to Hansard of February 8, 1937, page 634, where I find this:
Bank of Canada-Leave of Absence to Employee Brooks.
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And in answer to my questions the Minister of Finance said:
Mr. Dunning:	.	.	. that questions as to
matters of internal management were not usually answered in the house unless in the judgment of the management they could be answered without affecting the day to day management of the business. . . . The government is giving consideration to the advisability of referring the annual report of the Bank of Canada to, say, the committee on banking and commerce, in order that members of the house may have the same general opportunity with respect to the affairs of the Bank of Canada as they have to-day with respect to the affairs of the Canadian National Railways.
Which does not mean much. At the time Brooks was just a porter or doorman of the Bank of Canada who accompanied Mr. Bennett throughout the world. I asked questions about it and was told it was not proper to give me an answer. I thank the Minister of Finance for the information he has given me. Some of the information can be found in report No. 17 of the banking and commerce committee. It was just in order to defend sound theories of money that I asked about bank clearings, and I thank him for the information he has given me. I think we are entitled to information. I do not say that in any offensive way. I am not here to bolt at all. I stand by the party. When there is a measure I do not agree with, I may express myself accordingly, but I am loyal to my colleagues. No one can pre-vent me from expressing my views here because they are the expression of my very deep convictions, for which I have suffered at times, as the Minister of Finance knows better than anyone else. Here are some of the resolutions. The legislative council was-
9.	.	.	. the most serious defect in the
Constitutional Act-its radical fault-the most active principle of evil and discontent in this province-the most powerful and most frequent cause of abuses of power-of the infractions of the laws-of the waste of the public revenue and property.
27.	. . . the same malign influence which has been exerted to perpetuate in the country a system of irresponsibility in favour of public functionaries.
28.	. . . that form of government would not be less essentially vicious which makes the happiness or misery of a country depend on an executive over which the people of that country have no influence.
45. . . . the conduct of bad servants of the crown, who called in the supreme authority of the parliament and the British constitution, to aid them to govern arbitrarily, listening rather to the governors and their advisers, than to the people and their representatives, and shielding with their protection those who consumed the taxes rather than those who paid them.
67.	. . . divers subordinate public functionaries summoned to appear before committees of this house, to give information . . . have refused to do so. fMr. Pouliot.l
Just as the Bank of Canada has refused to answer.
68.	. . . the result of the secret and unlawful distribution of a large portion of the public revenue of the province has been, that the executive government has always, except with regard to appropriations for objects of a local nature, considered itself bound to account for the public money, to the lords commissioners of the treasury in England, and not to this house.
69.	. . . the pretensions and abuses aforesaid, have taken away from this house even the shadow of control over the public revenue of the province, and have rendered it impossible for it to ascertain at any time the amount of the revenue collected, the disposable amount of the same, and the sums required for the public services.
71.	. . . this house will hold responsible for all moneys which have been or may hereafter be paid, otherwise than under the authority of an Act of the legislature, or upon an address of this house, out of the public revenue-of the province, all those who may have authorized such payments or participated therein, until the said sums shall have been reimbursed, or a bill or bills of indemnity freely passed by this house, shall have become law.
72.	. . . The Commons of England . . . have happily obtained the entire control of the revenue of the nation. . . . The respect shewn to their opinions with regard to the redress of grievances and abuses, by the other constituted authorities, has regulated the working of the constitution in a manner equally adapted to give stability to His Majesty's government, and to protect the interests of the people.
79.	. . . This house, as representing the people of this province, possesses of right, and has exercised within this province, when occasion has required it, all the powers, privileges and immunities claimed and possessed by the Commons House of Parliament, in the United Kingdom of Great Britain and Ireland.
80.	. . .It is one of the undoubted privileges of this house, to send for all persons, papers and records, and to command the attendance of all persons, civil and military, resident within the province, as witnesses, in all investigations which this house may deem expedient to institute; and to require such witnesses to produce all papers and records in their keeping, whenever it shall deem it conducive to the public good to do so.
In paragraph 75 it is stated that at the time, the number of inhabitants of French origin was 525,000; of British or other origin, 75,000.
52. . . . the majority of the inhabitants of this country are in no wise disposed to repudiate any one of the advantages they derive from their origin, and from their descent from the French nation, which, with regard to the progress of which it has been the cause in civilization, in the sciences, in letters and in the arts, has never been behind the British nation, and is now the worthy rival of the latter in the advancement of the cause of liberty and of the science of government, from which this country derives the greatest portion of its civil and ecclestiastical law, and of its scholastic and charitable institutions, and of the religion, language, habits, manners and customs of the great majority of its inhabitants.

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This, sir, may be found in the journals of the Quebec legislative assembly, 4 William IV, February 21, 1834. For the motion there were 56 patriotic Canadian members; amongst them we find English names like those of Child, Kimber, Leslie, Scott, Toomy, Vanfleson. The nays were 23.
With regard to questions put to the government: I do not wish to say anything which is unfair to anyone, but, coming to what I said a moment ago about the reference to Hansard, I quote the following:
Mr. Pouliot:	What powers does the Bank
of Canada presently exercise and which, (a) the Minister of Finance could exercise, and (h) which he could not exercise, prior to the establishment of such bank?
Mr. Dunning: With reference to this question, it seems to me to be a matter of examining two statutes, the Finance Act and the Bank of Canada Act. The hon. member who asks the question is a distinguished member of the legal profession, and the statutes speak for themselves.
That is from Hansard of April 6, 1936, page 1810. The very same question was asked of the governor of the Bank of Canada, in the banking committee this year, and he refused to answer it.
Before examining the bill, and in answer to what my hon. friend the Minister of Finance has said, I would point out that on March 3, 1937, with regard to the Bank of Canada not belonging to the dominion civil service but being part of the dominion organization, I wrote him as follows:
Answering your letter of March 1st, would you please give me the total of the personnel of the Bank of Canada (1) in Ottawa and (b) in each of the outside branches.
Here is the answer of the minister. I could not get even the number of the personnel of the Bank of Canada.
March 1, 1937.
Dear Mr. Pouliot:
Replying to yours of February 25th; the government some time ago gave consideration to the position of the Bank of Canada in connection with matters such as that mentioned in your letter, and it was decided that the same procedure would be adopted as in the case of the Canadian National Railways. I cannot, therefore, supply you with the information requested.
This is not an answer to my question. If I am not to know even the salaries of the personnel of the Bank of Canada, I should at least know what is the number of employees, but I cannot get that information.
Now, sir, there is something which I want to read to this house, to show what is done in England. My great grandfather, my grandfather, my father and myself were strong upholders of British parliamentary practice.
We were not born in England, but as good Canadians we have made a deep study of British parliamentary institutions and know more about them than some Englishmen who try to teach us these things. I take this opportunity to appeal to all those who have lived in free England, who have voted, if not for Gladstone, at least for Campbell-Bannerman, Asquith and other great Liberal leaders, to come back to responsible government, the real form of government. We should not generally go backwards, but in this case it seems that we are doomed to go backwards on account of the stupid finance legislation which was passed some time ago, when the Audit Act was changed and the comptroller of the treasury appointed.
At Westminster there is the committee on national economy which studies every question that affects the treasury. The members of that committee are members of parliament; they meet together from time to time and study deeply matters which interest the taxpayers of England'; and here is what has been decided.


Mr. MacNICOL:: Including estimates?


Jean-François Pouliot: Surely. But I am more
interested at this time in general lines of policy.


Charles Avery Dunning: There is a separate and
different committee which deals with estimates.


Jean-François Pouliot: Whether it is the same
or not I will ask hon. members to give me the opportunity to read a report of one committee. In England: these men are required to follow a real tradition, a parliamentary practice which has evolved for the good of the country, for the better and not for the worse. Here is what was decided by the committee on national economy on March 12, 1920. There was a proposal to put representatives of the treasury in each department. This was strongly objected to by that committee, and the suggestion -was not put into effect. I quote:
The proposal that the accounting officer shall be a treasury official does not commend itself to us.
(i)	In the first place, it offends against the cardinal principle of ministerial responsibility. A minister could not be properly responsible to parliament for the conduct of his department if a large part of the responsibility falls actually on the servant of another department to whom he is unable to give orders.
(ii)	In the second place, the tendency to evade financial control alluded to above should, in our view, become more marked if the officer to be evaded were an emissary of another department. At present the financial officer is the servant of the same minister as the administrative officers, and is entitled to the same
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access to official papers and confidential information as they are; these are advantages of great value in financial control which might be lost if he became an officer of the treasury.
(iii)	Thirdly, the treasury officer could not work single-handed. He would require staff. This would presumably have to be treasury staff, too. There would thus be an elaborate interviewing of the staff of two departments under one roof, under conditions which would almost inevitably give rise to friction and discontent.
(iv)	The position obtaining in the ministry of transport does not afford a precedent for the proposal that the accounting officer should be a treasury official. The accounting officer of the ministry of transport is responsible to the minister, but works in close association with a treasury officer specially attached to the ministry in view of peculiar circumstances arising out of the ministry of transport act.
That was in England. Here it is different. I have here a return, a letter which contains mostly extracts from speeches of my right hon. leader and1 the then prime minister. The reasons for the creation of the office of comptroller of the treasury were futile reasons. It was because Mr. Bennett was discontented with some answers he had received. It was Tory legislation; it was centralization, to which I am strongly opposed-I am for decentralization. Each minister should be responsible for the payment of every cent expended under his authority. Here that is not the case. As I said the other day, no minister is responsible for payment, therefore all estimates should be presented to the house by the Minister of Finance. Here in Ottawa when a new organization is created it is like a dirty snowball; it goes on always, becoming bigger and bigger. I am afraid that some day it may crush down the pillars of the state.
I might say much more on this point, but I have other things to deal with. I ask hon. members to take Bill No. 132 and follow it with me. In section 2(d) there is first mention of the deputy minister of finance. And long after in subsection (h) there is mentioned the Minister of Finance. When I asked the Minister of Finance what was the difference between the powers exercised by the Bank of Canada now and those that were exercised before by ministers of finance, such as Fielding and Jim Robb, and Charlie Dunning, until 1930, when Mr. Bennett changed the whole thing on account of the fact that his minister of finance was highly incompetent, I received no satisfactory answer.
By section 3 of this bill the central mortgage bank becomes "the agent of His Majesty the King in the right of Canada," and we shall have no information about it, just as we have none about the Bank of Canada, because

under section 12 an oath of secrecy has to be taken by the employees of that bank. According to section 3 (2) the Bank Act shall not apply to the central mortgage bank; this is a law of exception. I am against centralization and against exceptions also.
By section 5 the central mortgage bank shall be under the management of a board of directors composed of a governor, who shall be the governor of the Bank of Canada- mark you-a deputy governor, who shall be the deputy governor of the Bank of Canada, the deputy minister of finance, and three other directors appointed in accordance with the provisions of the act. It is intermingling. We have the Bank of Canada on the one hand and the very same people, with three others, composing the management of the central mortgage bank; and the deputy minister of finance, who passes ahead of the minister.
Then let us look at section 11, which provides that there is to be an executive committee consisting of the governor, who is the governor of the Bank of Canada, the deputy governor, who is the deputy governor of the Bank of Canada, and the deputy minister of finance-the very same three people *-and one director selected by the board. They will have direction "and control" of the business of this mortgage bank. There will be an issue of $10,000,000 from the consolidated revenue fund for that bank; they will be the agents of the government, and I am sure that it will be just as hard to get information about the mortgage business as about the business of the Bank of Canada. Anybody can go to the registry office and find out what mortgage is on any property; it is the privilege of our citizens-it is of the very essence of a mortgage to be public. Why is there this secrecy? Is it to protect those who wiil make unjust refusal to those who seek to secure a mortgage?
And the salary. Oh, the salary! Everyone knows that the governor of the Bank of Canada receives a salary of $35,000 a year.


Charles Avery Dunning: No, that is not correct.


Jean-François Pouliot: Well, perhaps it is more, but I remember at the time it was said it was to be $35,000 a year.


Charles Avery Dunning: No, Mr. Speaker, it never was $35,000 a year; it was and is $30,000 a year.


Jean-François Pouliot: Well, that is enough; I
should be satisfied with it, although I did not ask for it. Thirty thousand dollars a year; I thank the minister for the information. I hope I shall get more information in due course.

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But now according to section 9 each one of those people will be on the board, and will be entitled to an extra $7,000 a year- not more than $7,000 a year. The deputy minister of finance, according to the statute, receives already $12,000 a year, which will mean he will have $19,000 a year.


Charles Avery Dunning: That is entirely wrong. Provision is made that the deputy minister and officers of the bank shall receive no salary in this capacity. My hon. friend surely cannot have read the section.


Jean-François Pouliot: I should like the minister again to give us some information, and tell us the salary and other remuneration of the deputy minister of finance. According to the estimates he receives as deputy minister of finance a salary of $12,000.


Charles Avery Dunning: That is correct.


Jean-François Pouliot: I wonder if he does not receive some other considerations for being attached to the farm loan board and other such bodies. I did not have time to look with a magnifying glass all the time.


Charles Avery Dunning: I can answer the question, and the answer is no.


Jean-François Pouliot: So much the better.


Charles Avery Dunning: My hon. friend made the statement that the deputy minister of finance by virtue of this bill would receive a total salary of $19,000 a year. That is entirely wrong. I cannot allow such an impression to go out. The bill makes it quite clear that no salary will be payable to the deputy minister of finance by virtue of this legislation.


Jean-François Pouliot: Without the approval of the governor in council.


Charles Avery Dunning: No, Mr. Speaker, even that is not correct.


Jean-François Pouliot: That is all right, but it is not in the bill, nevertheless. I wonder whether there will not be means to satisfy the greed of some civil servants who are never satisfied with w'hat they have.
What I strongly object to also is that the board will be entitled to pass by-laws-by-laws to provide that we shall not know, any more than we know the by-laws that are passed by the office of comptroller of the treasury for that office. It is a substitution of those people for parliament and even for the privy council. It is a blank cheque that is given to them.
Now look at section 8. It is very interesting. No one who is employed in any capacity in the public service of Canada or any province of Canada or any office or position for which any salary is payable out of the public moneys
of Canada shall be appointed a director. The governor of the Bank of Canada, the deputy governor, the deputy minister of finance are not in the civil service, if we interpret the act strictly, but they are in the dominion's pay. There is a fine distinction there in respect of those who already are fatly paid by the dominion government, although strictly speaking they are not in the civil service.
The governor shall be the chairman of the board of directors. There again I object. I object to that as I did under my own name in the local paper of my constituency against the president of the Canadian National Railways being appointed chairman of the board.
Then the central mortgage bank may enter into agreement or agreements with the Bank of Canada for providing such service as the executive committee may deem advisable for carrying on the business of the central mortgage bank. It reminds me of a character of that great writer, Moliere. Maitre Jacques was one servant who could accomplish dual roles. When he had a topper he was the coachman, and when he had an apron he was the valet. It is the same thing with the Bank of Canada and the central mortgage bank.
There will be an issue of $10,000,000 from the consolidated revenue fund, another issue to the public, not exceeding $200,000,000. Let me ask one question of the Minister of Finance-I am sure he does not know, because I tried years ago to get it from the proper sources, the provincial secretary of each province, and I was never successful in getting it. The question is this: What is the amount and number of the mortgages in force in each province at the present time? Some years ago I wrote the provincial secretary of each province and did not get a satisfactory answer from any except from Mr. David, the then provincial secretary of Quebec, covering one year only. If one wants to know the indebtedness and the assets of those who live in a certain community one should know the amount and number of mortgages held within that district. Why is there secrecy under this bill, when any man can go to any registry office and get complete information, which is public, as to the mortgage on any property? It is public information. By paying thirty-five cents anyone can see what mortgages, if any, are against any lot; why should these people shift their responsibility and use that secrecy in order to escape blame? I am strongly opposed to that. The Minister of Finance seems to be in a happy mood to-day following the celebration of yesterday, on which I congratulate him. I ask him if he has that
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information. It will surprise me greatly if he has, because I tried to get it from coast to coast and was unsuccessful, though it should have been available.


Charles Avery Dunning: If my hon. friend will permit me, he is quite right in saying that accurate information with respect to the number of mortgages in each province is not available from the provincial governments. I have only figures respecting the amount of mortgages held by different classes of companies, gathered from the corporate records of these companies in the office of the superintendent of insurance, who deals with trust companies, loan companies and insurance companies. The hon. member is quite right in saying that the information is not complete and cannot 'be complete, and in any event it does not deal with the number of mortgages but only with dollars. An approximation of what is involved in the legislation can be gathered., however, from the figures I have before me, which are long and detailed and which I hope to place before the committee.
Before I sit down would my hon. friend permit me to again ask him to retract his statement that the deputy minister will receive a salary of $19,000 or that he can be paid anything under this legislation by order in council. I direct his attention specifically to section 9, which states:
The directors, other than the governor, the deputy governor and the deputy minister of finance, shall be entitled to receive-
There is in this bill absolutely no authority to pay the deputy minister of finance, the governor or the deputy governor of the Bank of Canada anything for their services. I hope my hon. friend will take that back.


Jean-François Pouliot: On a question of privilege, Mr. Speaker, the only thing a member of the House of Commons is required to withdraw is language that is not parliamentary. When an hon. member makes a statement that is not accepted by another hon. member, there are the two affirmations and members of the house may decide between them.


Charles Avery Dunning: I did not ask for a ruling; I merely appealed to my hon. friend's generosity.


Jean-François Pouliot: I want the proper procedure to be followed in this house, as you do follow it, Mr. Speaker. I do not see why I should withdraw any words that are not unparliamentary. I made a statement in good faith; and if at times I direct a few words at any particular section of the bill it is because it is drafted so badly and in such bad English.

What I very strongly complain about, sir, is that we had a great deal of correspondence with regard to farm loans. I do not know how many letters I have written on behalf of farmers of my constituency in an effort to get money from the dominion farm loan board, and it is very seldom that I have been successful, because there is too much red tape. I had to spend days and nights writing those letters and receiving people to whom I had to say, "Unfortunately we have received an unfavourable reply." This legislation will be like other legislation we have passed; horn, members will be showered with letters from all parts of their constituencies where people owe money, asking that advantage be taken of the mortgage bank, and probably they will receive just such answers as we have received from the farm loan board. It will be useless correspondence; there will be deceit and we will get nowhere.
I thank the minister for the information he has given with regard to insurance companies. He knows very well that only the insurance companies will benefit from this legislation. The debtors will not benefit. The minister also knows very well that no one in my province will be able to take advantage of this scheme. This legislation will give more influence to people who already have too much.
Now, sir, it is time for me to tell you something I feel very strongly in my heart. I do not wish to be offensive to anyone; I do not wish to go to great trouble to kill a fly, but when it is in the public interest I have to inform hon. members of what I know. I am going to ask them to look at the Parliamentary Guide and read the history of the deputy minister of finance. They will find a gap of seven years between 1923 and 1930.


Charles Avery Dunning: On a question of order, Mr. Speaker, it has long been a tradition of this house that personal attacks on civil servants cannot be made in the manner in which my hon. friend is now proceeding.


Walter Edward Foster: I think the hon. member should not refer to members of the civil service who cannot defend themselves on the floor of the house.


Jean-François Pouliot: Well, sir, perhaps I may be permitted to read a letter I wrote to my right hon. leader in regard to the very same question, under date of March 16, 1939:
My dear Chief:
Referring to your remarks at page 1862 of Hansard of March 14, you stated that you did feel that, as leader of the House of Commons, it was part of your duty to see that members

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of the public service "who are not in a position to speak for themselves during the course of debates which take place in this house, should be protected against any remarks in the nature of a reflection upon themselves."
The suggestion that the wrongdoings of public servants cannot be discussed in the house was at first an invention of the Ottawa papers which cater to the public service and it was brought to the house in the first place by the members of the C.C.F. party to prevent any exposure of their own friends in the service.
I submit respectfully that according to British parliamentary practice, every civil servant is represented in the house by the head of his department. Therefore, as you stated that you were the last person in the house who would wish to curtail in any way my freedom of discussion, I have the unquestionable right of expressing my opinion about any civil servant who cannot sit in the house and be present there because he receives an emolument from the crown. The minister is there to take cognizance of and answer any complaint made by any member of parliament. If the minister is familiar with the matter, he may answer at once; if not, he shall take note of what has been said and give an answer in due course.
Some ministers assume that they always have to take the side of all civil servants in their departments, even when some things have been done against their own instructions or outside of their own knowledge. It seems all wrong because it is an incitement to civil servants to do worse, as they can rely upon their minister's continuous defence to consider themselves unimpeachable, except perhaps when they have been found guilty of a criminal offence.
You went further in objecting to the "references to their personal history such as the hon. member I gather was about to make."
It is pretty hard on a member to object on a guess on what he is going to say. For your information, I must tell you that what I intended to show was the record of experience of the deputy minister of finance, to which your predecessor had vaguely referred but which he, himself, had conspicuously hidden.
I had reference to the statement of Mr. Bennett, which is on record.
I agree with you that "members of the public service have to look to the administration for protection in the discharge of their duties," but, on the other hand-


Walter Edward Foster: Order. The hon. member has exhausted his time.


Jean-François Pouliot: May I finish reading the letter?


Walter Edward Foster: Only with the unanimous consent of the house. Do I understand that the hon. member has unanimous consent?


Some hon. MEMBERS:: Finish the letter.


Jean-François Pouliot: The letter continues:
I agree with you that "members of the public service have to look to the administration for protection in the discharge of their duties," but on the other hand, it is the duty of members of parliament to inform the government
on everything they find wrong in the civil service, in order to secure a possible improvement.
For the above mentioned reasons, I regret to have to disagree with your statement that "if deputy ministers or leading public officials or any members of the public service are to be attacked here, in justice to them they should have the right to make reply on their own behalf from wherever they may happen to be." They are entitled to no right of reply to what is said by members of parliament, but it is the duty of the minister concerned to reply, in his capacity as head of the department.
Again for the above mentioned reasons, if the method which you have suggested "were to be adopted with regard to the conduct of our public affairs I am afraid the public service of the country could not be carried on in the manner in which the country has a right to expect it will be carried on." I want you to understand clearly that I did not intend to bring "personal matters" in the debate; my intention was solely to tell the house about the record of experience of a man who is mainly responsible for the blind and bold dictatorship of the Finance Department in dominion government.


Mr. THORSON:: How many more pages in
the letter?


Jean-François Pouliot: One. It continues: Standing order No. 41, speaks for itself:
"No member shall speak disrespectfully of His Majesty, nor of any of the royal family; nor of the governor or person administering the government of Canada; nor use offensive words against either house, or against any member thereof."
It makes no mention of any one in the civil service.
My intention was not at all to attack you nor your colleague of the finance department, but to inform both of you on matters of public interest which are purposely kept in the dark by those concerned.
The first duty of a member of parliament is to inform the government on what he considers of public importance, and it is only after he has done so that he may be justified in attacking the ministers concerned, in case no action is taken to redress the wrong which was complained of.
I would not feel myself "justified" of "attacking" any cabinet minister for anything done outside of his knowledge by anyone in his department, unless such minister were previously informed about the facts and where is it to be done elsewhere than in the house?
Then you said I was "quite within (my) his rights in bringing to the house anything at all in connection with the attitude of individual civil servants," etc.
The competence and qualification of any civil servant are even more important than his attitude and how can they be rated if their record of experience is to be left outside the picture?
I am just reading the wonderful biography of your illustrious grandfather who was a champion of free speech and I hope that all the sacrifices that he made during his lifetime
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for the freedom of speech in the legislative assembly were not made in vain and that we have not regressed a century backwards, to the time of the "family compact." Otherwise, it would be just as well to suppress parliament.
Faithfully yours,
Jean-Fransois Pouliot.
Thank you, Mr. Speaker.


Mr. J. M. TURNER (Springfield):: Mr. Speaker, may I congratulate the Minister of Finance (Mr. Dunning) upon the high honour conferred upon him yesterday by McGill university. As I have pointed out many times and in many places, in my judgment the Minister of Finance is about the ablest man in the House of Commons, and the honour he has justly received serves only to deepen my conviction in that regard.
It is said in many quarters that once in a while the minister has forgotten the small man, the worker and the farmer. I never believed that for a moment. But to those who have harboured that thought I would say that I have no doubt they will find in this measure the very help they have been seeking. In my opinion this bill when passed will be the salvation of many people in the dominion. They will save their homes and their farms, and their small holdings they have struggled so long and so hard to retain.


Mr. T. L. CHURCH (Broadview):: Mr. Speaker, I should like to refer to some of the provisions of the bill which affect the industrial workers, many of whom have been driven in recent years into apartment houses, as a result of the depression and the very heavy burden of taxation placed upon real estate. I am sorry that with this bill to incorporate the central mortgage bank the minister has not seen fit to introduce also a complementary bill to help relieve the holders of real estate of some of the impossible burdens which are placed upon them, thus encouraging industry to proceed with a large building and housing and reconstruction program.
There was a long debate in the house on a motion I introduced in 1935 on reconstruction, housing and youth program and mortgage rates, and I believe the arguments I advanced at that time might be made with equal force on the second reading of this bill. I believe what I said with respect to the so-called shark loan companies would be equally applicable. I give the minister credit for having done some hard work and having made an effort to study this whole mortgage structure question since 1935, so as to bring about if possible some relief to the mortgagors in Canada who have been carrying a heavy burden.
I have in my hand the report of the assessment commissioner of Toronto, who has given careful study to this problem. While the bill is not complete, at least it starts something, namely to give people on the farms and in the cities the benefit of the use of the Bank of Canada to help solve our domestic problems through a mortgage bank. I believe the primary purpose of the Bank of Canada should be that of providing assistance in loosening up money now tied up in farm and urban property.
There is no doubt whatever that some people will benefit from this bill, but they are to be found chiefly on the prairie farms. Loan, mortgage, trust and insurance companies who care to associate themselves with the mortgage bank may benefit. Farmers or urban dwellers with mortgages of $7,000 or under, who owe money on mortgages to these companies, would come under the measure if the companies qualify. A farmer would benefit if he owed a mortgage to a company which associates itself with the central mortgage bank. First of all an appraisal would be made of the value of the farm, and a reduction would be made on the amount of the mortgage. That is all very good, as far as it goes. We know that on the prairies some of the older companies, including the Canada Permanent, and their predecessors, the Western Canada Loan, did advance large sums of money on prairie holdings. If they accept the terms of the scheme they will benefit, as will the mortgagors directly.
But what about the city man? We have devoted weeks and weeks to a discussion of wheat. We have talked almost a week on fish, but we have had very little time in parliament, so far, to give relief to that fifty per cent engaged in industrial work largely in the two central provinces, many of whom are suffering untold hardships I could not adequately describe here.
The report of the assessment commissioner for the city of Toronto is the report of conditions in a city of 600,000 people, sixty-four per cent of whom used to own their own homes. Toronto was known as a city of homes. Against thirty-six per cent of those homes were mortgages, the large majority of which were held by individual builders who had been responsible for a great deal of the housing development of the city. Let us, for instance, speak about one of these districts. now represented by the hon. member for Trinity (Mr. Plaxton), that part of the city west of Bathurst and from Queen to College street. Some years ago the land was vacant, but after protection came in 1878

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that part of the city was built up for the industrial workers by individual builders who built whole streets of houses. Some of those men were carpenters, and some were engaged in the lumber and other trades in the building industry. They bought lumber and built on the property. They were the persons who lent the money-such people as these are classed as individuals-and I fail to see how a bill of this kind would benefit them.
However there is much to be said on the other side of the question. There is no doubt that this is a step in the right direction; it is an attempt to curb, reduce, regulate and control the high mortgage rates charged by the old companies, who if they come under the act, will benefit. Only a short time ago I referred to their action, in the debate on one of the shark loan company bills. Some of those old companies were and are now the worst offenders and usurers, and they forced foreclosures. I could name them, but I shall not take time. The other night I mentioned the case of one person who in nine or ten years had paid $4,000 for the use of $6,000. I know of another man who paid one of these older companies $6,000 in interest charges during the last nine or ten years on a loan of $9,000. This bill is a step in the right direction, because it utilizes the powers and functions of the Bank of Canada to help sections of the people. If it only went further and allowed a board to be set up to bring in the individuals to qualify, it surely would do good.
I am a supporter of the party system of government, but our party system ought to do something to remedy these high charges of all kinds. I have referred to this matter during the present session and in many previous sessions. We have high interest rates, high mortgage rates, high insurance rates, high telephone rates, high rates for domestic essentials, a high cost of living and high rates of all kinds for the toilers and workers with no relief.
As far as it goes this bill is a step in the right direction. The other day I asked if this would apply to city homes and the homes of individual industrial workers, and the answer was that it would. However, it will be necessary for an individual mortgagee to link up with one of the companies in order to come under the bill. If that indivdual mortgagee is not willing to come under this scheme by qualifying through a company which enters, then there is no change so far as the individual is concerned. He cannot come under the bill unless he can arrange to
have the mortgage transferred to one of these companies. There is no doubt that there is discrimination.
While the bill does not go as far as I should like to see it go, I think the minister is making a sincere effort, handicapped as he is by conditions, to find ways and means to solve this complex and intricate question. The loan companies have a good deal of influence in this house. I can remember in 1934 or 1935 when a bill was introduced by Mr. Coote, a member of the Cooperative Commonwealth party, to limit the interest charged by loan companies of all kinds, foreign, British and domestic, to five per cent. That bill, which I strongly supported, was not placed on the statute book. If it had been, it would have proved of great benefit to the individual mortgagor. I am sorry the minister has limited the provisions of this bill to $7,000. Some properties mortgaged for $7,000 are not worth $3,500 to-day. In some of the northern districts in the part of the country in which I live, hundreds of homes have been taken over by the mortgagees owing to the high taxes, unemployment and the depression. Had it not been for the wise action of the province in enacting the moratorium legislation, hundreds of industrial workers in Toronto would have lost their homes forever. This bill will not benefit them much. For a few years this moratorium legislation acted as a safety valve to tide the industrial worker over that particular time. Some relief is being provided by this bill for the holders of individual mortgages in amounts under $7,000 who can qualify, but all should qualify through a board such as operated under the Farmers' Creditors Arrangement Act.
The bill should be tried out for a year and then perhaps additions or amendments may be made to have the individual mortgagees link themselves together to qualify under the bill through a board before whom later they may appear and qualify.
The industrial worker is not getting much protection from parliament in the curbing of these high charges. The report of the assessment commissioner of Toronto gives the number of vacant houses, tax arrear sales, vacant lots, tax appeals, apartment houses, duplexes, apartments over stores, triplexes and all that kind of thing. The unofficial figures given a year or two ago by construction evidence before our housing committee here showed that
60,000	industrial workers had been driven out of their small homes in Toronto and into apartments as a result of the depression. Because of high charges, the cities of Canada are more or less now becoming apartment
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cities, whereas in the past, sixty-four per cent of the population of Toronto owned their own small homes. During the recess the minister should try to help work out a policy of reform with the provinces and municipalities, something by which there would ibe fewer apartments built and more small homes, as in the eastern section of east and1 west Hamilton. That would be a step in the right direction. Sales of real estate for taxes have never before been so high in many cities. This burden should be shifted from the municipalities. I am sorry the minister is not also giving the municipalities the benefit of the protection which could be given by, through and with the aid of the Bank of Canada. There should be a complementary bill to this one to relieve real estate and to give the municipalities part of the taxes, income and others, collected by the federal government which they appropriated in 1917-1918.
The one feature of the bill that I do not like is that there is no allowance for proper depreciation. Some properties cannot be sold for the amount of the mortgage. Some have depreciated fifty per cent. Reference is made in the annual report of the assessment commissioner of the city of Toronto to general and local improvement taxes. I can say that owing to real estate being so burdened, on some small homes the taxes amount virtually to a rent. I should like to see some means provided to bring the individual mortgagee under this scheme through a board. Sections should be added to the bill which would wind up an individual mortgagee if he did not succeed in getting a company to come under the scheme. There should be a mandatory section to force the individual mortgagee who is now outside the bill to come under its provision. There should be some provision to transfer the individual mortgagee who charges such high rates to a general scheme, and some way to check such usury.
If this bill were properly fortified I venture to say that you would see the end of a lot of these loan shark companies and of usury by individuals. That is what would happen if the suggestions I have just made were carried out. I think the limit should be raised to $9,000 or $10,000. When allowance is made for depreciation, many properties which were worth $10,000 in the olden days can be sold now for no more than $4,500 or $5,000. I live in a district where real estate has depreciated fifty per cent. North Toronto was built up largely because the city took over the light and power and transportation services and provided good roads and local improve-

ments. I think the minister might well amend the bill to include that class of mortgagor who is suffering so much or give him some better assistance.
The minister does not allow for the fact that some of the worst sharks are not loan companies, but unpatriotic individuals who are exacting six and one-half to seven per cent and more, when, as the minister said this session, he can borrow money for Canada to-day for two-thirds of one per cent. While the bill is not perfect, it is a start in the right direction. I am not one of those who is willing to listen to the agents of these loan companies who are around this parliament every session and who have had generations of high rates. They have been here every session before our committee since I first came to this house. We see the agents and lobbyists of these companies down here this session trying to have legislation passed in their favour, whereas there is no representation for the people on the other side of this question except a few members of the house.
I think the minister should be given credit for having introduced this bill. I agree to its general principles. It will start something to give the workers of Canada at least a chance to qualify under and through the functions of the Bank of Canada. I hope he will also consider the suggestions I have made and enlarge the scope to a little above $7,000.


Mr. M. J. COLDWELL (Rosetown-Biggar):: The legislation now before us is to be welcomed because of the principle which is involved. I listened with a great deal of interest to the Minister of Finance (Mr. Dunning) when he was introducing the resolution which foreshadowed this bill, and I was glad to hear him outline the object he had in view. Legislation for the drastic adjustment or removal of debt and the lowering of interest rates on mortgages has been long overdue. Apart from the fact that home owners are heavily mortgaged and are now being invited through the companies which own the mortgage to come under this bill, the debt burden of the agricultural producer, the farmer, has become very largely impossible. Thousands of our farmers across Canada in every province have accumulated debts which often are greater than the equities in the lands they occupy. The immediate outlook for agriculture offers little hope, it seems to me, of an automatic adjustment. Seventy-cent wheat in the west and increasing surpluses of butter and other farm produce in the east can give us little encouragement that the condition of the farmer, and therefore of the people who

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depend upon him, will improve sufficiently to meet the obligations he undertook in far more prosperous times.
The problem of agricultural debt is not entirely a western problem. The census of 1931 revealed that at that time 40-8 per cent of the fully-owned Ontario farms were mortgaged to 44-8 per cent of their appraised value, and since then we have had all across the country a substantial reduction in the value of farm lands. In the west we have had almost ten years of crop failures and disastrously low prices for farm products all across the country. So I say that the ailment is no longer acute; it is chronic, and like other chronic diseases it requires a major surgical operation rather than another dose of ointment. My first criticism of the bill is that it does not perform the necessary operation.
I am going to say what I think is involved in the bill. I may not have entirely appreciated its provisions; we shall know more about it when it is discussed clause 'by clause and word by word in committee, or, as I hope, in either the banking and commerce committee or a special committee appointed by the house to consider its provisions and examine its implications.
First, the bill sets up a central mortgage bank with a capital of $10,000,000, and with power to guarantee up to some $200,000,000 more. Its officers are to be the present officers of the Bank of Canada, with three additional directors. The question arises, first, whether we are not placing too much responsibility, too much power, and too much work financially in a comparatively few hands when we obligate officers of the bank and the deputy minister of finance to do this work. I am not expressing any lack of confidence in either of these gentlemen. I have had the privilege recently of hearing the governor of the Bank of Canada and the deputy minister of finance before the banking and commerce committee, and though I may not agree with their point of view I recognize their ability in advancing it. There are, of course, advantages in appointing these gentlemen to the board, but we should be very careful, I think, not to overload a few officials with too much work or too much responsibility or, perhaps what is even more serious, too much power.
The principle of the bill, as I see it, is to be found in section 17, dealing with appraisals; because I believe that upon the appraisals made much of the success or failure of the measure will rest. As I understand it, any mortgage, loan, trust or insurance company operating in Canada, whether under federal or under provincial charter, may by agreement and its own consent come under the act.
No provision is made-this has been mentioned already by several who have spoken-to enable individual mortgagees to come under it, unless, as the Minister of Finance noted, they are prepared to form some cooperative body which will bring them under the act. I may as well say now, because it is a point I should like cleared up before we vote on the second reading of the bill, that in the eastern provinces, in Ontario and Quebec particularly, the majority of the mortgages, I understand, are owned by individuals.


Charles Avery Dunning: Oh, no.


Mr. COLD WELL:: A very large proportion of the mortgages-we will put it that way- are owned by individuals.


Charles Avery Dunning: It is very difficult to say. If my hon. friend will permit me, in the larger urban centres in the two central provinces most of the mortgagees are corporate mortgagees. With respect to the rural areas of both these central provinces, in Quebec, apart from the recently developed operations of the provincial farm loan board and the operations of our own federal farm loan board, the majority of rural mortgagees probably would be individual rather than corporate. In Ontario, judging from information I have received from time to time, the proportion might be about half and 'half-half corporate and half private.


Major James William Coldwell: I am glad to get that statement from the minister. At the moment I was thinking more particularly of agricultural conditions, but I know that I should take into account both ufban and rural areas, because both are covered by the bill. The fact remains that a large proportion particularly of rural mortgages in eastern Canada are held by individuals, and unless they form some cooperative arrangement among themselves they will not come under the provisions of the act.
Then we have the four western provinces, all four with certain debt legislation.


Charles Avery Dunning: Other provinces, too.


Major James William Coldwell: Yes, but now I am thinking particularly of the western provinces, having already alluded to the eastern provinces from another point of view. All four western provinces have debt legislation, and before we vote on the second reading of the bill I think we should have clarified what the effect of the clauses will be dealing with the repeal of provincial debt legislation. Do those provisions mean that unless the debt legislation of Manitoba, Saskatchewan, Alberta or British Columbia is repealed or

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considerably modified these four provinces shall be excluded from the operation of the act?


Charles Avery Dunning: No. That is definitely not the meaning.


Major James William Coldwell: I am glad to hear that, because the bill itself is not clear in that particular. Does the minister wish to say something?


Charles Avery Dunning: My hon. friend said that he wanted information before the second reading, and it is rather difficult to do otherwise than give it now. Looking at that particular section-


Major James William Coldwell: It is section 16, paragraph (k).


Charles Avery Dunning: "In the case of mortgages adjusted or to be adjusted under this act." That is the qualification to my hon. friend's statement.


Major James William Coldwell: I do not want to deal with the sections of the bill, because we are not in committee, but the words I had reference to were those on page 7, paragraph (k) of section 16.


Charles Avery Dunning: That is what I was reading from.


Major James William Coldwell: I had reference to these words:
. . . in a province where in the opinion of the central mortgage 'bank debt adjustment or other legislation unduly impedes, restricts or penalizes the exercise of the right of action or proceeding for sale under or foreclosure of a mortgage on land . . .


Charles Avery Dunning: Now go on to line 23,- "unless and until."


Major James William Coldwell: . . . unless and until such province passes legislation which, in the opinion of the central mortgage bank, provides relief from such undue impediments . . .


Charles Avery Dunning: A little bit further.


Major James William Coldwell: . . . restrictions and penalties in the case of mortgages adjusted or to be adjusted under this act.


Charles Avery Dunning: That is it.


Major James William Coldwell: Yes, I can see that; but the legislature is still compelled to modify legislation which in the opinion of the central mortgage bank unduly impedes or restricts. .


Charles Avery Dunning: Will my hon. friend permit me? Under that section it is quite competent for a provincial legislature to enact legislation relating solely to mortgages adjusted under the terms of this measure.


Major James William Coldwell: Yes.


Charles Avery Dunning: That is to say, if a legislature enacts legislation affecting the conditions as applying to mortgages adjusted under this act, and some one or more companies do not wish to come under the scheme, then they will not receive the benefit within that province of the easier legislation which may be made by the province to apply only to mortgages the subject of adjustment under this act. I want that to be clear to all hon. members.


Charles Hazlitt Cahan: The section will need to be clarified a bit in order to give it that meaning.


Charles Avery Dunning: Possibly there may be needed a little clarification. My hon. friend sees the point I am making.


Charles Hazlitt Cahan: I can see the two points which the minister has tried to make which are not expressed in the legislation.


Charles Avery Dunning: Well, if my hon. friend sees it, it must have been fairly clear.


Charles Hazlitt Cahan: I know my intellect is dull; for I seldom understand the hon. gentleman.


Major James William Coldwell: If a company comes under this act, the people who are dealing with this company are removed from the protection of any other debtor legislation which may exist in that province; is not that right?


Charles Avery Dunning: I would not say, any other, but any legislation which in the opinion of the central bank would have the effect of impairing the dominion's security. The variety is so great that one cannot particularize it. It differs in each province.


Major James William Coldwell: The difficulty I see with regard to the minister's answer is that of a province having one piece of legislation applying to one group of people within the province, and another piece of legislation applying to another.


Charles Avery Dunning: It would apply not to the people but to their mortgages.


Major James William Coldwell: Well, to one group of mortgages in comparison with another group of mortgages.


Charles Hazlitt Cahan: That difficulty always arises when the dominion enters the provincial field and attempts indirectly to overcome provincial legislation.


Mr. PELLETIER:: As it does in this case.


Major James William Coldwell: The dominion enters the field and endeavours to override this provincial legislation. That, I think, is one point we shall have to understand and weigh very carefully indeed before we support this particular provision.

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Charles Avery Dunning: No point has given me greater difficulty, and I would welcome any suggestion to meet it better than it is met here, although I doubt-


Leslie Gordon Bell: Of course the minister has the advantage of the advice of the law officers of the crown. I am afraid that I cannot advise him legally in any particular. I am just pointing that out as I see it in reading the bill. What I am saying is this, that a large number of mortgages may not receive the benefits which are implied in this legislation-[DOT]


Malcolm McLean: Immediately.


Major James William Coldwell: -immediately, and it seems to me that that is a weakness. Particularly it is a weakness when we are dealing with individual cases; because, as I think we have found from experience, the individual is often a mortgagee who is unwilling to make the adjustment for the other individual, and that is understandable. The large corporation or company with its tremendous reserves and resources can, of course, afford to bear a loss when an individual cannot do so.
I want also to get clearly in my mind the basis of adjustment under the act. The appraiser values the property on which the company holds a mortgage. Let us say that the new valuation placed upon the farm is $15,000. But there happens to be a mortgage in excess of that amount-let us say, of $18,000. In the west a case of that sort is quite likely to occur, because many of the mortgages were put on land in times of relatively high prices of property. If we need to find any proof of that, I believe bulletin No. 64, which was quoted quite extensively in the wheat legislation debate a short time ago, will give the desired information. Under the agreement the adjusted mortgage would be 80 per cent of the $15,000, or $12,000. If the company had to bear the entire loss it would stand to lose $6,000.


Charles Avery Dunning: Plus any arrears of interest in excess of two years.


Major James William Coldwell: Under this measure the government assumes one-half of the loss of $6,000, that is $3,000, and the government gives the company a bond for $3,000, bearing three per cent interest, to be liquidated over a period of years. I am going to give my personal opinion regarding the adjustment of such mortgages. The contract between the mortgagee and the mortgagor ought to be regarded as in the nature of a partnership.
At one o'clock the house took recess.
The house resumed at three o'clock.


Major James William Coldwell: Before lunch I remarked that in my opinion, under the conditions that exist at the present time, a mortgage contract ought to be considered more in the nature of a partnership. In our society the marriage agreement places an obligation upon the husband to provide adequately for his wife and family. Yet in the same society prior to the right of the family is the claim of property, mortgages, and such things, which must be paid even at the risk of doing harm to the family. And even this legislation I submit gives little consideration to the changed economic conditions which endanger the family life in the fulfilment of such contracts as we are discussing at the moment. Moreover, mortgage contracts make no provision for extremely low price levels, loss of employment, crop failures through drought, grasshoppers, frost and other uncontrollable disasters.
The debt structure of western Canada at least can be traced in large part to the rapid development demanding the acceptance ol a very high debt structure by the producers on the land. The war encouraged this. Farmers were urged to get more land and put it into cultivation. In a speech made in Moose Jaw in 1919 the Minister of Finance drew attention to the fact that he had appealed to the people of western Canada and they had "responded nobly" to the needs of the allies in relation to food during the great war. The war encouraged the increase in this debt structure, and mortgage companies both then and subsequently lent money on their own valuation of the properties. They did not trust to the valuation of the mortgagor. nor in many instances did they trust to the valuation of the municipalities assessing that property, although often they used that as a basis. Consequently I suggest that in a measure they themselves are to blame and ought to share the loss with those who had less facilities for forming accurate judgments of property values when the mortgages were placed. I have often said that, in my opinion, if there is to be a reduction of debt it should be a reduction that would give a greater measure of justice to the man on the property, who often has developed it from a worthless holding. He should be given more consideration than he has received in the past, and than he is receiving under this legislation.
To illustrate what I mean:	A mortgage
of $15,000 on a farm property must have been valued originally by the company at around $30,000 taking fifty per cent as the
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basis of the mortgage, and in the majority of the cases that is rather high. If, as we said in the illustration used this morning, the property is now appraised at $15,000, or about half, in my opinion the mortgage should be reduced proportionately from $18,000 to $9,000. If this loss is to be sustained by one party it should be sustained by both parties more or less equally. And if compensation is to be given to one party-and that is what the bill does in the reduction of the valuation of the mortgage-then I say that compensation should be given to both parties; for in my view a man or a woman, or both, who have put in ten, fifteen, twenty years in developing a piece of land into a farm, have more in that farm than those who simply lend surplus money on the land.
With regard to the bill itself, the provisions for limitation of interest and for amortization are of course useful


Charles Avery Dunning: Will my hon. friend
permit a question before he leaves that point?


Major James William Coldwell: Yes.


Charles Avery Dunning: On the point of compensation to both parties, I was trying to follow my hon. friend's thought. Surely it is clear, is it not, that the whole write-off goes to the benefit of the debtor, both the portion which is borne by the mortgagee and also the portion for which the mortgagee is compensated? The debtor gets the whole of it; the mortgagee gets merely half.


Major James William Coldwell: Yes, I see that. But my point is that if the equity of one party, the mortgagor, is reduced below the point at which the proportionate interest in the property of that party ought to be established, there should be some compensation also for his loss in the equity. Because it is true, as the minister says, that the company is being compensated up to fifty per cent of the reduced value of the mortgage.


Charles Avery Dunning: But the whole of its loss is the debtor's gain.


Major James William Coldwell: Nevertheless the company itself does not bear the loss to the extent of the debtor's gain, because the government puts up fifty per cent of the loss. Incidentally, when I speak of the government putting up fifty per cent, that of course is ultimately all the people of Canada.
I said that I thought the amortization plan and limitation of the rate of interest to five per cent will be generally welcomed, because we have felt for a long time that with the price of money in the market being what it is, the rates on mortgages should come down.

But again I emphasize the fact that we are dealing only with a relatively small number of properties mortgaged; in any event we are leaving quite a wide fringe untouched. The mortgage to an individual is not being touched, and in some provinces that is what needs consideration and adjustment most. Just a few minutes ago I read a letter from a gentleman in Toronto drawing attention to the fact that a friend of his had borrowed money on mortgage in 1932, right at the depth of the depression, and is paying 7i per cent interest. In spite of the fact that he is able to borrow money at a lower rate of interest to repay that mortgage since the mortgagee will not accept the principal sum he is still paying his 7i per cent.


Charles Avery Dunning: Under the law the
mortgagee must accept.


Major James William Coldwell: When it becomes due, but I suppose this mortgage runs for ten years. That was not stated.


Charles Avery Dunning: There must be some misunderstanding in that case, because there are provisions in the laws of most provinces whereby the right to pay off a mortgage in advance is accorded.


Major James William Coldwell: Is there such a provision in the law governing mortgages in Ontario?


Charles Avery Dunning: That is my understanding.


Major James William Coldwell: Well, I happen to know of another case, in Saskatchewan, where a friend of mine several years ago actually tendered the principal of the mortgage and the company refused to accept it. This is an analogous case.


Charles Avery Dunning: If my hon. friend will permit, in some provinces I recollect clearly laws the effect of which is something like the following; that after a mortgage has run a certain length of time, then upon the tendering a certain bonus of interest-my memory is that in Saskatchewan it is three months-*


Mr. DONNELLY:: Right.


Charles Avery Dunning: Then the debtor has the right to pay off in advance of his contract date. ,1 believe similar laws exist in most provinces.


Major James William Coldwell: But that is only after maturity?


James J. Donnelly: No, before maturity.


Charles Avery Dunning: No, before maturity, but after a period of years set out in the law.

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Major James William Coldwell: Well, that would be the date of maturity as far as that term of years is concerned.


Charles Avery Dunning: No, prior to the date of maturity of the mortgage, but after the mortgage has run a certain time.


Major James William Coldwell: So far I have dealt with the rural position. But the provision in the bill to bring in urban mortgages of $7,000 and less is in my opinion a step in the right direction. So much of our debt and mortgage legislation, such as the Farmers' Creditors Arrangement Act, did not provide an avenue of escape for urban dwellers.


Charles Hazlitt Cahan: Might I ask the hon. gentleman a question? Suppose an urban mortgage is for $7,000, and the mortgagor in addition to that property has a certain amount of wealth. He may have $5,000 in the bank, he may have $20,000 life insurance, he may have bonds of the dominion government for $15,000 or $20,000. Why should he be given a remission of any part of his mortgage debt when he has ample property with which to satisfy his engagement with the mortgagee into which he entered with his eyes open?


Major James William Coldwell: That is a pertinent question. I think any legislation of this kind should take into account the circumstances of the debtor.


Mr. MACDONALD (Brantford):: Whether rural or urban.


Major James William Coldwell: Yes, whether rural or urban. It should not provide a wealthy man with means of escaping his obligations.


Charles Hazlitt Cahan: Then the hon. member
agrees that it should take into consideration the debtor's ability to pay?


Major James William Coldwell: His ability to pay, yes; I quite agree with that.
From my reading of the bill all the advantages seem to go to the loan companies, who reduce the mortgages to 80 per cent of the new appraised value and for which they receive compensation up to 50 per cent of the reduction. I am wondering if in spite of what may be the intention of the government in regard to this legislation it may not be a means of enabling some of the companies to salvage some of their bad loans and mortgages. I think that is a point into which we should inquire very carefully indeed. Another point is that naturally the companies will try to have the property appraised at as high a figure as possible; it will be to their advantage to do so. And if they are dissatisfied with that appraisal the bill provides that they may
appeal to a committee composed of three persons, one appointed by the new mortgage bank, one by the participating companies and the third by the bank and the companies, satisfactory to both. The debtor class is not represented on that appeal board; and since in my opinion the appraisal is an important feature of this legislation, the appeal committee becomes of paramount importance.
In my opinion some means should be found of giving representation to the mortgagors, who are vitally interested in the appraisals of their property. Since we are all creatures of our environment and are governed very largely by the ideas we accumulate in the course of our daily life and activities, I believe we should not allow the board of appeal to be the creature of the representatives of the Bank of Canada, or of the Department of Finance or of the mortgage bank, all of whom naturally have the viewpoint held by those who believe we must keep these obligations sound and sacred. By the method of its appointment this committee will have a preponderant representation of only one point of view. I suppose it will be said that we can trust these people to be fair; but after all in being fair we judge a set of circumstances according to the light that is within us, according to the point of view we hold. We cannot divorce ourselves from that; hence I think the appeal board under this bill is not the kind of board that should be appointed to deal with this matter.
I do not propose to say very much more about the bill at this stage. I think the principle is sound, because it looks to the adjustment of debt, the reduction of interest and so on; nevertheless it is a bill which requires the most careful investigation that can be given by this parliament. I am sorry it has been introduced so late in the session, but in spite of that fact it seems to me it should go either to the banking and commerce committee or to a special committee, and I understand the minister is in agreement with that idea. In any event the consideration given it in such committee should be very thorough indeed; all the points which to me seem of paramount importance, and those which seem supremely important to other members, should be given every consideration before we enact legislation so far-reaching in its implications.


Mr. L. A. MUTCH (Winnipeg South):: I should like to make one or two general observations before we reach the committee stage. I welcome this legislation as a recognition at last of what in my opinion is one of the chief problems confronting the great majority of our people to-day, namely, the

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problem of the adjustment of what I conceive to be unpayable debts. I should be surprised if this or any other legislation should be perfect or succeed in doing all the things I am certain the minister hopes for it or which those who welcome its introduction may anticipate. But I think now is the time to enact this type of legislation. It deals with questions which in my opinion never can be settled or perfected by conversation, by discussion, by committee meetings or in any other way than the test of experience. After having examined the bill-and perhaps at this stage that can be done only superficially-when we enact this legislation and put into effect its provisions we will give an indication to the debt burdened populace that at last-some will say at long last-we are going into this whole question of individual debt. During the last three or four years in particular I have concerned myself, in the house and out of it, with the problem of urban home owners who have been losing their homes or, at best, living in them under impossible conditions. Under this legislation I hope to see an adjustment to their benefit.
I should like to suggest to the minister and the government that in considering this or similar legislation they should not pay too much attention to the popular theories of finance and business held by the people who got us into this jam. Generally speaking I am reasonably respectful toward my elders and those who, through fortune or ability, have been put in high places. But in common with a large percentage of our population I have lost patience with those who are our seniors and who, having got into an impossible financial morass, have no idea how to get out; who content themselves with reaching backward for straws that have sunk under them; who view with horror and alarm anything new or different for fear it may be tainted with radicalism, and whose chief condemnation of any new departure is that it has not been done before. I stand in my place to-day with some satisfaction and see a measure introduced, which I suppose in some degree could be termed radical-certainly some of our friends have thought of it in that way-being sponsored by a man who, whatever else may be said of him, cannot be called radical. Perhaps it is a good thing that the experimental period of this measure-because there will be an experimental period with this type of legislation-will foe under the guidance of which he is so capable.
Before the bill goes to a committee I should like to remind the minister, as I have no doubt he has been reminded before and will

be reminded again, of the predicament of some of our citizens who have invested their money in providing for homes in the form of apartment blocks. I am particularly interested in that aspect of the matter, as a representative from an urban constituency. I hope when the bill is in committee serious consideration will be given to the possibility of providing some form of relief for persons who have built apartment blocks, who have maintained them decently, who have paid taxes in times when it has not been easy to do so, but who now find themselves in competition with new blocks built with cheaper money and in more modem style.
My first concern is with the person described within the terms of the bill, namely the home owner with a small mortgage. I am sure many of them will look upon this measure as the dawn of a new hope-if indeed it can be brought into the form of legislation. I am bound to say to the minister and the government, and to the hon. member who immediately preceded me (Mr. Coldwell), that I do not believe we are in a hurry to finish our deliberations. The hon. member who preceded me could see no reason a week or so ago for hurrying, and I did not quarrel with him on that. Personally I can think of no better way of spending the next month, if necessary, than in bringing out of this proposed legislation the measure of economic salvation which home owners, particularly those in suburban and urban areas, may hope to get from it. In the past few years other forms of mortgages have been reviewed and adjusted, but the people living in cities, and who, sad to say, were unfortunate enough to attempt to own their own homes, have been forgotten in this respect. If there is any ray of hope for them in this legislation, then so far as I am concerned I have nothing better to do than to stay here until such time as the necessary action to that end can be taken.


Mr. J. A. BONNIER (St, Henry) (Translation) :: Mr. Speaker, I take pleasure in congratulating the Minister of Finance (Mr. Dunning) on having introduced this measure to assist a section of our city population which has long sought some such protection without ever receiving it.
Owners of small city properties who for one reason or another have had to contract mortgage loans are compelled to pay high rates of interest in addition to heavy property taxes, while receiving very small incomes. It is to be regretted that such a measure was

Canadian Nalional-Canadian Pacific Act
not introduced earlier, as thousands of small owners have lost their houses and are now on direct relief.
A few years ago, as a delegate of the Montreal Property Owners League, I approached the Quebec government, then led by Mr. Taschereau, in order to make representations on behalf of the small property owners. The delegation pointed out that every day small owners were losing their properties because their insufficient incomes did not permit them to pay taxes and interest. The Provincial government replied that the matter did not come under their jurisdiction and that all they could do in the circumstances was to make an enactment limiting to 5 per cent the rate of interest immediately claimable. But under that enactment the difference between 5 per cent and the rate stipulated by the mortgage agreement had to be added to the principal. The act was put into force but it did not prove beneficial to the property owners, as the principal of their loans became larger each year.
Few loans are made with the object of taking possession of the mortgaged property. In Verdun, 85 per cent of the loans made by the Prudential Insurance Company are in default and the company has had to take over a large number of properties. This is not to its advantage. This company had invested its money with a view to getting some income from it and not to become the owner of the mortgaged houses, because it is not in a position to administer and repair them as economically as a small owner can. Many minor jobs, such as repairs to doors and bath-rooms, painting and paper-hanging, can be done by the small owner after his day's work, whereas a company has to employ for that purpose competent workmen at high wages, which wipes out its profit.
I disagree with some of the hon. members who have spoken on the subject and who claim that the insurance companies take possession of the properties in order to protect their policy-holders. It is just the opposite, I say, as the costs of administration are not proportionate to the return obtained. It is far more profitable for them to receive an interest rate of only 5 per cent and collect their principal after a certain time than to take possession of the property. This bill is to the advantage of both parties and the Minister of Finance is to be congratulated on having introduced it.
The Montreal Property Owners League offers to send representatives to Ottawa in order to discuss the matter with the proper
authorities. On my next trip to Montreal I shall lay the bill before the members of the league and invite them to come to Ottawa in order to discuss it and give their views as to the provisions likely to be satisfactory to both parties. I hope the bill will soon be enacted, as such a measure should have been adopted long ago for the greater good of the small urban property owners.


Walter Edward Foster: Is it the pleasure of the house to adopt the motion?


Some hon. MEMBERS:: Carried.


Charles Hazlitt Cahan: Mr. Speaker, the bill contains many provisions with regard to which there are differences of opinion, and those provisions will be investigated before a committee. I suggest that in view of the fact that investigation and further minute consideration is to take place the vote on the motion for second reading be taken on division.
Hon. CHARLES A. DUNNING (Minister of Finance): I understand that if any hon. member desires to indicate his dissent he may do so by saying "on division," and that is quite sufficient. I have no desire to put the house to the trouble of a vote. I do not wish to do that; it may be read on division.
Motion agreed to on division, and bill read the second time.


Charles Avery Dunning: Mr. Speaker, I move:
That said bill be referred to the standing committee on banking and commerce.


René-Antoine Pelletier: Mr. Speaker-


Walter Edward Foster: I am sorry, but this
motion is not debatable.


[Stage Direction]
Motion agreed to.


[Stage Direction]
Hon. C. D. HOWE (Minister of Transport) moved the second reading of Bill No. 138, to amend the Canadian National-Canadian Pacific Act, 1933.
He said: Mr. Speaker, the purpose of this bill is to amend the Canadian National-Canadian Pacific Act of 1933, to provide compensation for employees of the railways who lose their positions or are demoted because of any agreement made under the terms of the act. The act makes it mandatory for the railways to agree between them-
4610	COMMONS
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selves to bring into effect any saving that appears to be possible by cooperation between the two. It is inevitable that savings of this type must be made largely at the expense of labour. I think it is a well-recognized principle that, where legislation throws a man out of employment, that legislation should also provide for compensation to that man.
In Great Britain, the railway act of 1933 provided for the consolidation and reorganization of the British railways and provision was made in that act for compensation to employees displaced. In that case the compensation provided is about sixty-six per cent of the salary previously enjoyed by a longterm employee, the compensation to be paid for a period of five years. Employees with shorter periods of service receive compensation for a shorter period.
There has been a great deal of discussion in the United States about the consolidation into fewer units of the several hundred railway systems in that country. In order to pave the way for such consolidations, the railways entered into an agreement, known as the Washington agreement of 1936, with their employees, which provides a scale of compensation for those who may lose their employment or be demoted as a result of any consolidation. This Wasnington agreement was a voluntary arrangement between the railways and their employees, but I think the hint was given by official circles that if an agreement could not be effected, the United States government would intervene and enact legislation along the same lines.
The Washington agreement, Demg a voluntary agreement between the railways and their employees, has been taken as the model for this legislation. The changes from the Washington agreement are slight. Whereas that agreement provides compensation for men who have been in the employ of the railways for less than one year, this bill does not. The government feels that a railway employee with less than a full year's service has hardly established rights that required recognition in the form of compensation. There are one or two other deviations not of any great importance. The bill provides that when an employee receives compensation and is called back to service, his earnings and compensation combined shall not be greater in any calendar year than those of the last full year of service with the railway prior to his receiving compensation. In other words, it was felt that compensation should not be used to give an employee larger returns than those he enjoyed before the cooperative act took place.

It should be made quite clear that this bill provides compensation only for displacements resulting from agreements made under the Canadian National-Canadian Pacific Act. Employees who lose their positions through line abandonment caused by lack of traffic, and without any agreement with the other railway, do not come under this bill. Such loss of employment must be regarded as one of the hazards of the occupation. The bill is not retroactive in its provisions; it provides that only employees now or hereafter in the employ of the railways shall come under its provisions.
The bill also makes revision of that section of the .Railway Act which provides for compensation to employees living at a terminal which is closed, or having to change their employment because of the closing of a terminal, or through the making of a cooperative agreement. The scale of compensation is liberalized, provision is made for valuation by arbitration of any property involved, and also the payment of travelling expenses in the event of an employee being required to move as a result of a cooperative agreement between the railways.
The bill sets up a permanent board which will pass on the rights of the employees under this legislation. This board will consist of an official of the railway and an official of the particular union which holds an agreement to represent a particular employee. In case these two officers cannot agree on any point, it will be the d#ty of the Minister of Labour (Mr. Rogers) to appoint a third arbitrator.
I may say that the Co-Operative Legislative Committee of the Standard Railway Labour Organizations, which represents more than eighty per cent of all the railway employees, asked the government for this legislation. My first reply was that as the Washington agreement was the result of negotiations between the railways and their employees, in which the government did not intervene, I felt the same course should be followed in Canada. I arranged a meeting between the brotherhoods and the officers of the two railways, which was held in my office. Other meetings followed at which the solicitor of my department acted as chairman. There was no great difference between the railways and the employees as to the terms of compensation, but one railway took the view that the Canadian National-Canadian Pacific Act more or less debarred the railways from entering into any agreement which would reduce the savings which would result from cooperation. In any event the committee reported back that this subject was believed to be a proper matter for legislation.

Canadian National-Canadian Pacific Act
It has been said that a bill of this kind paves the way for amalgamation. This stand has been taken by a number of locals of a railway union which was not a party to the negotiations from which this measure evolved. Nothing could be further from the fact. The result of this bill will be that any cooperative measure will be viewed by the railways having in mind that the labour displaced must receive compensation. I believe that to view a cooperative measure without any thought of compensation for the displaced employees is to throw the whole position out of proportion, and any cooperative measure which will not carry sufficient benefit to justify compensation to the displaced employees in my opinion should not proceed.
Compensation is provided both for railway employees demoted and for those severed from the service. In a cooperative measure the railway endeavours to absorb its senior men, but sometimes this is not possible because of homestead or other agreements between the unions and the railways. In any event the procedure usually involves a series of demotions. The driver of a passenger locomotive, for example, will be bumped back to freight, the freight driver put back to fireman, and so on. This legislation provides for compensation to each of the men demoted, and it provides also for the man at the end of the line who loses his employment completely.
The bill provides that an employee who has been fifteen years in the service and is let out shall receive sixty per cent of his annual salary over a period of five years. The length of time during which an employee will receive compensation is reduced for shorter periods of service. I think the compensation scale is reasonable, because a man who has been fifteen years in the service has established certain pension rights, in addition to those acquired through cash contributions. On the railway there is both a contributory pension and a service pension, the latter depending entirely on the number of years the employee has served the railway. A man with fifteen years' service would have substantial rights to a service pension which might be extinguished as a result of a cooperative measure hetween the railways.
John Ritchie MacNicol: Will the employees of
railways the head offices of whose unions are in the United States also be certain of receiving pensions or compensation?


Mr. HOWE:: ,Yes, I believe that the employees on Canadian lines in the United States would come under the Washington agreement, to which the Grand Trunk Western
is a party. They would receive compensation either under the Washington agreement or under this legislation. The amount of compensation is practically the same in each case.
I am satisfied that this legislation is a proper corollary of the Canadian National-Canadian Pacific Act, which I believe will be a better and more workable act after this legislation is passed. I trust that the bill will receive the favourable consideration of the house.


René-Antoine Pelletier: Is there anything in
the bill to prevent wholesale dismissals before cooperation takes place?


Clarence Decatur Howe: There is nothing in the bill, but the unions are quite capable of protesting against that possibility.


Robert James Manion: Mr. Speaker, I rise to support the bill. I shall merely read the explanatory note, because the bill with the schedule included is lengthy, and the explanatory note makes its purpose quite clear:
The purpose of this bill is to provide for the payment of compensation by the employing company to railway employees who are deprived of employment or adversely affected by cooperative measures undertaken by the Canadian National Railway Company and the Canadian Pacific Railway Company pursuant to the provisions of the Canadian National-Canadian Pacific Act, 1933.
The purpose therefore is perfectly clear, and I feel that it is the proper attitude for the government to take and, so far as I am concerned, for the opposition to take. I therefore support the bill wholeheartedly. Why then, it may be asked, did we not make some such provision when we brought in the Canadian National-Canadian Pacific Act of 1933, which I had the honour of piloting through the house? The answer is that at that time neither of the railways agreed that it should be done. At the present time both railways have in a sense agreed to it, the Canadian National through the minister, and the Canadian Pacific, indirectly at any rate, through Sir Edward Beatty. The very fact that the minister is now piloting this bill proves to my mind that the Canadian National are agreeable to this provision being made. So far as the Canadian Pacific Railway is concerned, I take the liberty of quoting two statements, one from a circular issued by the Canadian Pacific Railway; the other from a circular letter signed by Sir Edward Beatty, which demonstrate that they believe that in the event of unification the men should be compensated. If they should be compensated in the event of unification, I submit that the same argument applies to cooperation. In
4512	COMMONS
Canadian National-Canadian Pacific Act
other words, if money will be saved to the Canadian Pacific and the Canadian National, and through the Canadian National saved to the people of Canada, by some cooperative measure, there is just the same right on the men's part and the same responsibility on the part of the railways to give protection to the men affected by these cooperative measures as there is in the event of unification.
Here is the circular dated July 15, 1938, which was sent out by the Canadian Pacific Railway to all its employees. It is unsigned but was sent out by the railway itself. I quote this sentence from the circular:
This company has merely suggested tp the government that savings could be made in all branches of the railway service by unified operation, with complete protection of the public interest, and of the rights of railway workers.
That is very clear, and they could not protect the rights of the railway workers except in some such manner as is provided for in this bill.
Here is another circular sent out by the Canadian Pacific Railway Company, from the office of the chairman and president, dated Montreal, November 15, 1938, last November. I shall read three or four clauses which give the gist of the statement so far as the point I am making is concerned. On the second page the circular states:
The relations between railway management and labour in this country are such that any conceivable management of a unified system will deal fairly with labour, but I suggested to the Senate committee that there should be statutory provision for protection of the interests of labour, confirming any agreement reached by negotiation between the employees and the railway companies at the time of unification.
A little lower on the same page:
The wise program would be, in the interest of all parties concerned, for you to study how it can be accomplished, while full protection of the interest of labour is maintained.
And still lower:
I know, however, that the Canadian government will never be a party to any arrangement which does not give fair protection to workers. The Canadian Pacific stand I have expressed very plainly. Only from the workers can there be obtained a definite statement of what they think they should obtain in the way of protection.
The last quotation I shall make is from the last page of the circular, a little above the signature:
I take it for granted that the unity of the interests of railway labour will be respected, and although, by necessity, I can only make this appeal for action in your own interest to the employees of the Canadian Pacific Railway, I assume that any plan which is suggested will contemplate absolutely equal treatment of the employees of both systems, and represent their joint opinion.
[Mr. Manion.l
By those statements of Sir Edward Beatty1- and I could quote many others-undoubtedly the Canadian Pacific Railway has come out strongly for the protection of the men in any plan of unified operation. If the men are to be protected under such a plan, there is the same justification for protecting them under cooperation; and I wholly agree with the idea.
To my mind cooperation is a feasible plan, whereas unification is not, and cooperation can bring about in large measure the same economies as are claimed for the much talked^ of unification. I will concede that somewhat greater economies might follow unification, but if the two railways would cooperate properly, much could be done in the direction of economy. In the past the railways have not cooperated; for some reason or other, both have been opposed to real cooperation. I think I could offer theories as to why that was so, but I do not intend to take up the time of the house by offering any conjectures of that kind. But I submit that under cooperation, with the rights of the men safeguarded under this bill, you will bring about great economies. You will not get immediately the full benefit of the economies, because you are taking care of the men who are replaced; but ultimately they will 'be obtained as the period of compensation passes by. I believe that a great proportion, which I would put at eighty or ninety per cent, of all economies which would result from either unification or cooperation, is made by laying off men. I doubt whether anybody who knows anything about the question will disagree with that statement.
This railway problem is very serious and needs attention. The present method of dealing with it is along the lines I suggested in 1933 when I introduced the Canadian National-Canadian Pacific bill. I still believe that cooperation is the method which should be followed to bring about the economies which are necessary and possible; and I contend that, under whatever method economies are brought about, the men deserve consideration such as is given them in this bill. A large proportion of them have given up much of their lives to work on the railways. Many of them are too old to begin working at any other job, consequently they should receive consideration when it is proposed to remove them from the positions they now occupy.
I listened to the minister's reference to the attitude of the unions, but I do not think I understood him quite clearly. According to my understanding the railway unions are largely in favour of this bill. I believe there is one Canadian union which is

Canadian National-Canadian Pacific Act
opposed to it. I have a statement which was sent to the minister by the cooperative legislative committee of the standard railway labour organizations setting forth the point of view of the other unions, and I will read one clause:
Our co-operative legislative committee are strongly supporting the principles of the bill, and hope for its enactment at the present session of parliament.
I have received from representatives of the other union, which I believe represents a much smaller number of men, protests against the bill. But I submit that the legislation is supported by the vast majority of men.
Under the present plan of carrying on the operation of the two roads, cooperation seems to be the only method by which we can hope to reduce the deficits. I say to-day what I said a few days ago in the house in the budget debate, that there is no method of solution of the railway problem, if by "solution" you mean the wiping out of the deficit of the Canadian National Railways. I am going ito quote my exact words. This is what I said in reply to the hon. member for Lambton West (Mr. Gray):
I say there is no solution-
Of the railway problem.
-if by solution is meant the wiping out of the deficit of the Canadian National Railways. The business is not there; it has dropped so much.
Later in my speech I said:
But something could be done. The Canadian National Railways and the Canadian Pacific Railway could do very much more in the way of cooperation than they have done, and by that means both of them could effect economies. Most of the economies have been made, thanks to the last government, on the Canadian National Railways, but the two railways together could, there is no doubt, do more than they have done, and so wipe out part of the deficit. In my opinion, however, there is no method possible whereby the Canadian National Railways deficit can be completely eliminated or whereby we can even approach wiping it out.
I quote that for this reason. One Montreal financial paper quotes part of that statement and leaves out the rest. They quote what I said, that "there is no solution of the railway problem," but they leave out "if by solution is meant the wiping out of the deficit of the Canadian National Railways;" and this Montreal financial paper said that it was muddled thinking on my part. With due respect I submit that it is muddled thinking on the part of the Montreal financial paper, because anyone who knows the subject knows that you cannot, by any method, wipe out the whole of the Canadian National Railways deficit. That is particularly true to-day,
in view of the fact that the Canadian National Railways have put into effect huge economies from 1930 right up to the present time. I see that even the gentleman who in another place supports unification so strongly admits in his speech that it will not wipe out the deficit of the Canadian National Railways. I hope that the financial paper which was kind enough to talk of "muddled thinking" will take a lesson or two from him in this particular aspect if it will not accept one from me.
I say this, however, to the minister and to the government, that I believe it is the duty of the minister, whatever government is in power, to see to it that these cooperative measures and arrangements are put into effect. We did not succeed very well in that respect; this government has not succeeded very well, either. But I believe that if there were less talk of unification there would be more cooperation. So long as the talk goes on about unification there will not be that measure of cooperation which otherwise there could be between the two railways.
I have noticed the assumption by some of the critics of my position and of the government's position-because upon this issue the government and ourselves are taking the same attitude-that apparently anyone who opposes unification is just an ordinary politician, by which is meant "politician" in its lowest sense. That means that practically every hon. member is a politician. But the men who support unification are "statesmen." It is an interesting reflection that if you look over this House of Commons it is doubtful whether you can find one member-I do not know of any; there may be one or two-among the whole 245 who supports unification.


Mr. ROBICHAUD:: The "statesmen" are very scarce!


Robert James Manion: As my hon. friend says, the statesmen are very scarce. They have all been promoted. But what I was going to say was not that. What I was going to point out was that if 240 to 245 members of this house are opposed to a certain proposal, they represent, whatever some other people may say, a fairly complete cross-section of the opinion of this country. The fact that practically all hon. members take the same attitude seems to me to prove conclusively that unification is not feasible. In other words, members of parliament are supposed to have a little intelligence; I suppose some of us have, speaking generally. If our people were all for unification, surely you would find some hon. members here being swayed by that public opinion. But when practically all take the attitude against unification, it seems to
4614	COMMONS
Canadian National-Canadian Pacific Act
me it should teach those preaching unification that it is not feasible, and they might as well accept cooperation for the good of this country and try to put it into effect. That is my feeling.	*
I say in conclusion that those who keep on preaching unification are simply preaching something that is impossible. They are not constructive, and those of us who preach cooperation, as it is preached by all hon. members of this house, are the constructive thinkers on this question. It is my idea that the only constructive proposal before this country to-day which could do something towards solving the railway problem is the proposal of further cooperation between the two railway systems. I repeat that practically the same economies can be made under cooperation as under unification, yet the two railways would be kept separate. The result would not ultimately be one combine, one monopoly, or one group having a power which would be dangerous in a country such as this.


Mr. A. A. HEAPS (Winnipeg North):: The speeches to which we have just listened by the present minister in charge of railways (Mr. Howe) and the former minister of railways (Mr. Manion) were extremely interesting. They are interesting from the point of view that to-day they accept the 'principle of giving compensation to railway employees who lose their positions, through no fault of their own, but on account of arrangements for cooperation between the two railway systems. On many occasions our small group in this house have been accused of being impractical and failing to put forward anything constructive. Nothing is further from the truth; for during this session only the government have adopted three pieces of legislation which emanated from our group. The first was the legislation amending the criminal code with regard to the right of workers to organize into unions. Second, this morning we were considering legislation dealing with mortgages, such as was advocated here by us many years ago. And now I am pleased to find the government again adopting legislation which we advocated here six years and three years ago.


Mr. REID:: So did I.


Clarence Decatur Howe: Everyone gets a good idea occasionally.


Abraham Albert Heaps: It is true there may have been other hon. members who advocated the proposal now before us, but they did not vote for it when the time came. But even though some time has elapsed, I am glad to observe that the government have now adopted

the ideas which we suggested six years ago, which were not approved by the then minister of railways, and then three years ago, which were at any rate not adopted by the present Minister of Transport.
Let me call attention to the resolution that we moved in this house, in order to have it on record. On April 7, 1933, a little over six years ago, I moved, seconded by the hon. member for Vancouver East (Mr. Maclnnis), as follows:
Any employee of the railway companies affected by this act or any employee who loses his employment as a result of cooperation of services between the railways shall be entitled to such compensation to be determined by a board of three to be appointed: one by the employees, one by the railways, and a third to be selected jointly by the preceding two parties.
In case of failure to select a third party, who shall be chairman of such board, then such selection shall be made by the Minister of Labour.
The funds for such compensating board shall be derived from a levy on the gross receipts of the two railways and the award of such board shall in all cases be final.
To all intents and purposes what is proposed to-day is in line with what we suggested here six years ago.


Thomas Reid: What was the vote on that occasion?


Abraham Albert Heaps: The vote, on a technical point of order, was 49 against and 21 for the resolution.
In 1936 we proposed a similar resolution, which was not approved by the government and was not adopted. I am not going to deal further with this aspect of the matter, except to say that even though it is somewhat belated I am glad that the government have now adopted what we proposed in the past. I am not even going into the question of amalgamation or cooperation, because to me if an employee loses his job it is equally serious to him whether it be through amalgamation or through cooperation.
Reference has been made this afternoon to the economies that could be effected. I have listened to discussions of this kind for a number of years. I believe that, if the railways are to economize, the first .place where we have a right to expect economies is in the bond interest charges. Until successful efforts are made by both railways to cut down on the interest charges that are levied to-day on the railways of this country I do not think anything should be done in the way of either cooperation or amalgamation. I am told on good authority

we have had the figures in this chamber-that if the interest charges on the two railways were cut

Canadian National-Canadian Pacific Act
to three per cent, which is a fairly good interest rate to-day, savings would result to the two railways in the amount of $18,000,000 a year, which is more than could foe effected by any process of cooperation.


Mr. POTTIER:: Is that $18,000,000 for the two railways or $18,000,000 for each?


Abraham Albert Heaps: For both railways. I think it is about $12,000,000 for the Canadian National and about $6,000,000 for the Canadian Pacific. Some of those interest charges in the case of the Canadian National go back seventy or eighty years, and some of the bonds run in perpetuity. I do not know why a bond should be so much more sacred than the human element which makes operation of the railway system possible.


John Ritchie MacNicol: Some of them carry 5i per cent.


Abraham Albert Heaps: And some, I believe, even higher than that.


John Ritchie MacNicol: And are selling on the market at 120.


Abraham Albert Heaps: The time has come, in view of the railway situation here and in other parts of the world, when there should foe a cut in the rate of interest paid on railway bonds. In the United States the railways are in just as bad shape as they are here, and in some cases worse. There are many railway bonds on which the interest is not being paid. I do not see why in this country, even where there is a government guarantee, we should pay interest in perpetuity on the bonds of a concern which is unable to pay its way or meet its obligations.
A good deal has been said in this chamber and in another -place with regard to the wages earned by railway men. We heard a good deal about what I term the myth of high wages on railways. Figures indicate that the average rate of pay for men employed on the railways is between 50 and 60 cents an hour for all employees, including the highest to the lowest. People who say that railway wages are too high and that a cut should -be made surely have not gone to the trouble of investigating what the wages are. A small percentage of the men employed on the railways may receive what may foe regarded as fairly high wages, but the number is insignificant compared to the vast number of those who receive low wages. I have some figures here which I think it might be -well to place on Hansard, because they were put on record in another chamber. They were given under oath to a committee of parliament, so I think I might refer to them for a moment or two.
It was stated by Mr. A. J. Kelly, chairman of the Canadian- cooperative legislative committee of the standard railroad labour organizations of Canada, that in 1920 there were employed on the railways 175,702 persons. By 1937 the number of employees of the railways had decreased to 12-1,541.


Robert James Manion: That is of the two railways?


Abraham Albert Heaps: Yes. In other words to-day only two men are employed by the railways where seventeen years ago there were three men employed. Then we come to the question of wages and salaries. In 1920 they received by way of salaries and wages $280,353,910. By 1937, however, that figure had decreased to $179,110,674. Now let us see the numbers in the various wage groups as far as our railway service is concerned. According to the figures compiled by the Dominion Bureau of Statistics for the year 1937, these wage groups were as follows: '
Number of
Wage group	employees
$ 60 per	month	and	under	
6,67075 per	month	and	under	
12,22985 per	month	and	under	
34,369125 per	month	and	under	
76,235150 per	month	and	under	101,601200 per	month	and	under	111,601Over $250 per month	2,448Of the last group, 617 were executives and general officers of the railways. Now let us go a step further with the same argument. In 1920 Canadian railways -paid dividends amounting to $29,942,556. In 1928 dividend payments were $33,729,273. Then, still quoting the figures given by the same gentleman when he appeared -before the railway committee of another chamber; in 1920 it required 57 cents out of each dollar of total operating revenue to pay employees' compensation, while in 1937 it required only 50-4 cents for the same purpose, a reduction of 11 [DOT] 6 per cent. On the other hand in 1920 it required 12 cents ou-t of each dollar of total operating revenue to pay interest on funded and unfunded debt, while in 1937 it required 21-9 cents, or an increase of 82-5 per cent. I am putting these figures on record for the benefit of those hon. members of this house and others who continually talk about the high wages paid on the railways while they conveniently forget the fixed charges of the railways in respect to interest on- bonds.	_
Now may I say a word or two in regard to the bill itself. I need hardly assure the house, in view of what I have said during the past six years, that I am in favour of the principle of this bill. We asked for this six years ago, and while we did not get it then, nor did we get it three years ago, we are pleased to see the principle recognized to-day.

4616	COMMONS
Canadian Naiional-Canadian Pacific Act
In the bill I find one or two anomalies, one in particular. I refer to the maximum, compensation that may be awarded an employee with fifteen years or more of service. I am inclined to believe some hardship may result there. I realize that the measure as it stands has been approved by the standard railway organizations, yet I believe it possible that in its operation it may work some injustice. After a person has given fifteen or twenty years of service to a railway he is likely to be somewhere around fifty-five years of age. He may find his job done away with by some process of cooperation. He thereby loses his right to pension and is entitled to only five years' compensation under this measure. To-day men fifty-five years of age find it the most difficult thing in the world to secure new avenues of employment; so that in the case of the long-term employees I think some provision might have been made for extra compensation, because after all they have given a much greater part of their lifetime to the building up of the railway service and the betterment of the community than the man who has been only four or five years in the railway service yet who receives in proportion exactly the same compensation. I see the minister shake his head. I believe a man receives compensation for about thirty per cent of the time he has been with the railway, does he not?


Clarence Decatur Howe: No. The second man receives the same percentage of compensation for a shorter period. A man who has been with the railway for two years receives compensation for six months.


Abraham Albert Heaps: He gets the same percentage in proportion. If a man has been with the railway for fifteen years he is given compensation for five years which is equal to one third of the time he has been with the railway. A man who has been employed for six years would receive compensation for two years.


Clarence Decatur Howe: The ease of a man in the
service for fifteen years being thrown out of employment is not likely to arise under cooperative measures, because he is protected by the seniority rules. He is usually demoted, while the man let out is the man with four or five years of seniority. Those are the people who bear the brunt of it.


Abraham Albert Heaps: That is perfectly correct
so far as it goes, but unfortunately I have seen many men with fifteen and twenty years of service who have been let out of railway employment during the last few years.


Clarence Decatur Howe: Oh, no.


Abraham Albert Heaps: I have seen and spoken to
them, and I am afraid there may be quite a number of such cases. However, in a general way I wish to give approval to the measure, because it recognizes the principle that a man who loses his job is just as much entitled to compensation as is the man who has money invested in one of these corporations.


Hugh Alexander Stewart: I find
myself perfectly in accord with the principles of this bill, which I believe are very sound. The day has long gone when the only interest of an employee in the corporation which employs him, particularly if it is a public utility, is in his pay envelope. Over a period of years he has made a contribution to the success of that undertaking which may be difficult to estimate and impossible accurately to measure, but which deserves some recognition. This bill embodies a principle which from time to time I have advocated in discussing amalgamation, unification or cooperation of the railways. The Railway Act, which is chapter 179 of the revised statutes of Canada, 1927, provides by section 179:
179. The company shall not, at any time, make any change, alteration or deviation in the railway, or any portion thereof, until the provisions of the last preceding section are fully complied with nor remove, close, or abandon any station, or divisional point nor create a new divisional point which would involve the removal of employees, without leave of the board; and where any such change is made the company shall compensate its employees as the board deems proper for any financial loss caused to them by change of residence necessitated thereby.
I am familiar with the history of the last part of that section. It will be found first enacted in the statutes of 1913, and the amendment arose out of the following circumstances. The Grand Trunk Railway proposed to change the divisional point at Brockville to a point some twelve or fifteen miles east. Of course the municipality was very much exercised and the railway employees were disturbed. At that time I happened to occupy a position in the municipality which brought me in close touch with those conditions.


Clarence Decatur Howe: And the Minister of Railways happened to be from Brockville.


Hugh Alexander Stewart: No, not after 1911. That
was after the election.


Clarence Decatur Howe: I thought it was Doctor Reid.


Hugh Alexander Stewart: No,, it was the Hon. Frank Cochrane, who was minister of railways in the government of Sir Robert Borden. The community was very much disturbed by the proposed change-and well it might be

Canadian National-Canadian Pacific Act
Here were three or four hundred employees drawing a large monthly payroll, which was distributed and spent in tire municipality. These men were fine citizens who had lived in the community for many years and had made their contribution to its churches and to its municipal, social and business life. If action had been taken on the basis then proposed, the result would have been the removal of these men and their families from one community to another. Not only that, but they were to be located at a point where probably a new town would have to be built to accommodate them, so that notwithstanding their contribution to the building up of the public utilities and general advantages of a well-established town, they would have had to start all over again and go through a pioneering period. A memorial which I assisted in drafting was prepared, representations were made to the government, and as a result this provision for compensation in the event of the removal of a terminal was introduced.
I believe that is the germ of the bill now before us. Employees are entitled to consideration in circumstances of the kind, and the bill proposes a measure of justice for them. In the instance I have described the removal of the men would have involved heavy loss to the municipality. The properties they had acquired over a period of years would have been depreciated in value; in fact it would have been difficult for them to realize even half the value. At that time the recognition of the principle I have described was sound, and I believe recognition of the same principle is equally sound to-day. I am pleased that it is being embodied in legislation and I am sure it will assist in bringing about that measure of cooperation which we desire and which in the public interest is necessary. After all, I believe that is what will make for permanent and steady, rather than part time, employment of railway men.
The only suggestion I would make is that possibly the bill should provide for a threeway contribution. These changes are made in the interests of the public. When a grade crossing is eliminated the legislation provides for joint contributions. It appears to me the burden upon the railway companies and upon all parties concerned might be lightened by a three-way contribution-from each of the railways concerned, and from the federal treasury.
If the scale of compensation has been accepted or generally approved by the employees, it seems to me that scale ought to be satisfactory to all concerned. The measure embodies a just principle and a 71492-290J
measure of compensation to employees who, in the public interest-not on their own account or in the interests of the corporation they may have served for a long time- are deprived of their positions.
For these reasons, and for others so ably expressed by my leader, I heartily concur in the measure.


René-Antoine Pelletier: Mr. Speaker, I too rise to support in principle the measure sponsored by the Minister of Transport (Mr. Howe). The explanatory note states the following:
The purpose of this bill is to provide for the payment of compensation by the employing company to railway employees who are deprived of employment or adversely affected by cooperative measures undertaken by the Canadian National Railway Company and the Canadian Pacific Railway Company pursuant to the provisions of the Canadian National-Canadian Pacific Act, 1933.
I believe that a substantial measure of economy could be effected in connection with high interest rates now paid on railway issues, as well as in connection with the salaries of the high officials of both railways. We know, for example, that in the past it was common knowledge that certain high railway officials in Canada received fabulous salaries. It was also believed throughout the country that railway employees were receiving wages on a standard higher than that enjoyed by any other class of labour in Canada. From time to time, however, it has been shown definitely that that is not the case. As a matter of fact, so far as salaries are concerned the railway employees themselves have, from time to time, shown the way. When the worst years of the depression came round and it was decided that many railway employees must be laid off, of their own accord certain branches of the railway services decided to help those who were not receiving work because they did not have the same amount of seniority, and they were instrumental in bringing into effect a voluntary system which permitted them to help out those who were not fortunate enough to be employed.
I believe the process of railway cooperation in Canada is not commonly understood. Most people have the vague idea that the railway companies through cooperation are going to do away with their own trackage, and things of that kind. Perhaps that is one way in which cooperation might be achieved; but I am firmly convinced that closer cooperation in railway operations in Canada is more closely connected with express services, telegraph services and pool trains. For example we have across Canada two efficient telegraph services, operated by the two railway companies. In
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every city of Canada of any size we find both telegraph companies and both express companies. I am inclined to believe that when closer cooperation does take place it will begin with the telegraph and express services. It is quite possible that in the larger cities a number of competitive offices will be closed down, which will lead to a large displacement of skilled workmen. It is for this reason that we welcome this type of legislation, which will provide at least some compensation for those displaced. I became a member of the order of railway telegraphers as long ago-it may not seem so long to some hon. members, but it does to me-as 1926. Since that time I have seen considerable technical development in this industry which while permitting the sending of more messages by fewer men, has brought about the displacement of many skilled workers. All along the line, for a number of years past, technical improvements have brought about a displacement of human labour. When skilled workers are to be displaced not because of any technical development but through a desire to bring about closer cooperation between the two railways, it is only right that we should make some provision such as this.
A moment ago I referred to the high interest rates which were being paid in this country to carry on our railway services. I hold in my hand a pamphlet published by the national railway league, 137 Wellington street west, Toronto. I know nothing about this organization and I intend to use this publication only to quote some statistics the accuracy of which I have no reason to doubt. On page 13 the following appears:
The people pay:
At the end of 1922, the year that all the government roads were brought under one management, Canada had expended for railways, without counting subsidies received by the C.P.R., the following amounts in cash:
Canadian Northern Railway Company	$298,799,591
Grand Trunk Railway Company.. 84,560,342 Grand Trunk Pacific Railway.. ..	123,586,034
Canadian government railways-
Capital expenditures, less deficits 429,563,445

I neither support nor oppose the contention of this organization; I simply use the statistics which they give in their pamphlet.


Mr. FINN:: They are most unfair.


René-Antoine Pelletier: I believe the statistics are quite accurate. If necessary they can be checked with other sources. I quote further:
In addition to the above, the government assumed with respect to these roads liabilities due to the public amounting to $804,503,144.
.
It became quite clear even at that time that the government was giving its sanction to bonds of doubtful value. It seems to me that the least thing that can be expected from the bondholders is an agreement to a reduction in interest rates. A great deal could still be done to effect savings to the Canadian people by bringing the interest rates down, not to an unjust level but to a level more in keeping with the times.
There is another aspect of this matter which should be considered. As the minister said, the act is not to be retroactive. The leader of the opposition (Mr. Manion) has just stated that up to the present there has not been a great deal of cooperation between the two railways, and possibly not many persons have been affected. I think that is the one argument which will support the contention I now make, that in view of the fact that the number of those affected in the past is not great, they should- be included in this legislation. If the principle is right now, it must have been right when these people were dismissed as a result of cooperation during the past few years. If we now admit the principle that we should pay a certain amount of compensation to those who may be dismissed in the future, I submit it is only right that we should pay compensation to those who were dismissed in the past.
Generally speaking, we find ourselves much in agreement with the measure. The hotel services is another branch that should be watched most carefully. I admit it is very fine to have a number of beautiful hotels throughout the country. It may be all right for both railways to have these hotels; they add beauty to certain localities and provide work from time to time, but, as we all know; they are not a paying proposition, However, that is beside the point. Whenever we go about reducing the debt of the railways, we generally do so by a reduction in the salaries of the employees. The employees have never *been considered when it comes to the question of saving money in the operation of our railways. They are never asked whether they believe certain capital expenditures should be made, -but when capital expenditures result in deficits, the deficits are usually followed by a reduction of the wages of the railway employees.
We hope that with this legislation it will be possible to bring about greater cooperation and at the same time take care of employees who may be dismissed. For these reasons, I believe that all of us in this group are entirely in accord with the principle of the bill and intend to support it.

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Robert Emmett Finn: Mr. Speaker, there is just a word I desire to say in reference to the measure which has been introduced by the Minister of Transport (Mr. Howe). Apart from the explanatory remarks of the minister, one would imagine from what has been said by members in all sections of the house that this bill was going to be a panacea for all the ills that affect our great railway systems. Cooperation should be carried on when it can be done without doing an injustice to the employees of the railways. I lay that down as a general principle. These employees have been paying into superannuation funds, and if they lose their positions or are demoted they should receive compensation. At this late date in the session of 1939 we are undertaking to deal finally with this question of cooperation between the railways.
As was referred to iby the leader of the opposition (Mr. Manion), for two years this matter has been under review in another chamber. In the public mind there have been so many conflicting viewpoints that to-day one hardly knows where he is in reference to this important question of our railways. Transportation is the basis and foundation of the prosperity of any country. If our great transportation systems are to reduce trackage through cooperation, if trains are to be taken off and employees removed, what hope will there be for young Canada in the future? I do not say that this problem should not be dealt with, but it should be dealt with only after every consideration has been given to it. The bill was first introduced in the senate, that other chamber which is one of the three branches of government in Canada-the Senate, the House of Commons, and His Excellency the Governor General as representative of his majesty; and if there has been any poisoning of the public mind so far as public men are concerned-I do not mean wrongly

it has been in that other chamber where for the past two years investigations have been going on into the railways; and it has been a onesided investigation.


Walter Edward Foster: The hon. member should not make any reference to what has taken place in the senate, whether last year or this.


Robert Emmett Finn: If I had said the other chamber, as the leader of the opposition did, I might have been able to get away with it; but I bow to your ruling, Mr. Speaker, and apologize for having made reference to that august body.
There is one part of this bill, and one part of the Railway Act of Canada of 1919, that comes home to me and should come home to
every member who sits in this house representing the maritime provinces. The Intercolonial railway was built as one of the terms of confederation. The Railway Act of 1919 as passed by Sir Robert Borden's administration provided that when the Grand Trunk in the United States became a part of the Canadian National Railway system the Intercolonial railway should also become a part of it and be subject to it in every respect just as other parts of the Canadian National Railway system did.
The bill before us, which has come from the senate, provides that anything, save in three cases, which is inconsistent with the provisions of this act shall go by the board.
I protest, Mr. Speaker, here to-day because the Intercolonial railway was built under the terms of the British North America Act-


Mr. SPENCE:: Where is that railway?


Robert Emmett Finn: That railway is in God's
country, in the east where the wise men come from and which the western men do not know. Let me say to my hon. friends that under this legislation this parliament cannot remove one piece of track of the Intercolonial railway, which was built as one of the terms of confederation. Under the act that was passed by the British parliament at Westminster several years ago, any act passed by a parliament or legislature of the British empire which is inconsistent with an act passed by the British parliament shall no longer be subject to the provisions of the Colonial Laws Validity Act and be superseded by the British law, save only that neither an "i" could be dotted nor a "t" crossed in the British North America Act of 1867. If it is desired to tear up railway tracks in the western part of Canada, to give less railway mileage and less transportation facilities to the people of the west, that is the business of the people of the west; but we, the wise people of the east, were wise in 1867, when the fathers of confederation saw to it that the conditions with reference to the Intercolonial railway were to last so long as Canada was Canada and the maritime provinces were a part of this great dominion.
I say further, in connection with the Canadian Pacific Railway in the province of Nova Scotia, that the Dominion Atlantic railway was owned, completely equipped and well operated by an English company until it was gradually absorbed by the Canadian Pacific Railway Company through stock control. It was declared to be for the general advantage of Canada and became a part of the Canadian Pacific Railway system. The Dominion
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Atlantic was taken off. It became an asset of the Canadian Pacific; and within the last few months an order went out that certain railway stations along the Dominion Atlantic from Yarmouth to Halifax should be closed and the station masters or others in charge put out of employment. Those employees are not entitled to any compensation under this bill, and I say with all due deference to the opinion of gentlemen who sit on the government benches and have direct responsibility and the assistance of technical advisers that this parliament should not let any of those rights be finally dealt with by a body of men who are responsible to nobody-not to this parliament, not to the government, not to the Minister of Transport, but simply to their own whim, their own fancy and to influences that may be brought to bear either to save this part of the road or to destroy some other part. If there is to be a measure of cooperation, if there is to be a closing down of certain lines or parts of lines of railway in this country, a report on the subject should first be made to the Minister of Transport and to parliament, to the people's representatives here, and through parliament to the people, who should be the final ones to say what shall be done with the Canadian National system, instead of leaving it to two or three or four or five men who are responsible to nobody. If the Canadian Pacific Railway Company have got themselves into financial difficulties, it is not the business of this parliament to pull them out. The railway has been an asset to Canada. The great development of our Canadian west was brought about by the influx of people in those splendid years which Canada was experiencing up until the great war of 1914, but from then on things started to go downward. To-day you have your great western country grid-ironed with railways. We in Nova Scotia and New Brunswick have as our only railway asset, save for the Canadian Pacific running into St. John, the Intercolonial railway, and I for one, Mr. Speaker, intend so long as I am in this house to see to it, so far as I can, that every inch of that railway shall be protected for the people of the maritime provinces; that every employee of the railway shall continue to be employed under the terms of the agreements which have been entered into. If they want to have this cooperation and not amalgamation, in reference to railways which are not protected, I sound a note of warning that the only action on the part of the provinces would be to make application to the courts for an injunction to

restrain any action which would result in the destruction or removal or closing down of railways or railway stations or the dismissal of railway employees.
This bill is to my mind the thin end of the wedge in relation to Canada's railway transportation system. Action will not stop there; it is going to grow and develop to such an extent that, if parliament does not take the whip hand, the country will find itself in anything but a happy position. In the Canadian west the farmers have received millions of dollars in relation to grain, to the land situation, and to irrigation schemes. Let us do the best we can to assist them in every way, but let us not, while we are building up one class of people by the direct vote of funds in this parliament, pull down another class by the destruction of railways and the dismissal of railway employees. The control of thirty-five or thirty-six thousand miles of railway is a tremendous responsibility, and parliament should not divest itself of or evade its responsibility by handing it over to any set of individuals to deal with; otherwise the end will be requiescat in pace.
Let this house have the fullest investigation; let the report come back to parliament; and let the people's representatives from Vancouver to Halifax decide what should be done in the way of cooperation as suggested by the railway experts and others who are in a position to advise in this matter. I understand that Mr. Fairweather, of the Canadian National railway system, who is an expert and has the confidence of the Minister of Transport and of the officials associated with him, says that the greatest measure of cooperation has been put into effect since the act which was passed for that purpose was put on the statute book. If Mr. Fairweather's statement is correct, there cannot be a greater measure of cooperation than there is now or any greater speed than they are making to-day. To do more will only be forcing a willing horse to death and will go far to injure the future of this young country. When I say "young" I have in mind the Canadian west. I can well remember a speech of the late Hon. Robert Fofke, while leader of the progressive party, in which he referred to the east. That evening I reminded him of the fact that as a young man he came over as an immigrant to Canada, and that through his industry and his ability he became leader of the progressive party in this house and a member of the parliament of Canada, his country by adoption. But, I said, he should not forget the great men, from the days of Sir John A. Macdonald, including Sir Wilfrid

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Laurier, the Hon. Alexander Mackenzie, Sir Charles Tupper, Sir Robert Borden, Hon. Arthur Meighen, our present prime minister (Mr. Mackenzie King) and others-irrespective of political position-who have moulded the destinies of Canada; that he and his western followers must not be unmindful of the aid which the west had received from the east when it could do little for itself. By the brains and the vision of these men Canada built a railway from Halifax to Vancouver, through the great Rocky mountains, and much engineering skill and genius were exercised in the construction and development of these railroads. Is all this to go for naught, and are these railways, which cost millions to construct, to be doomed as a result of policies of " cooperation " to have grass grow between the ties, or to be torn up for people to look upon the right of way as upon a country which has been devastated?
I would plead only that parliament shall not divest itself of its final authority, of its final say, and that as regards this matter of cooperation, we obtain all the information possible, with the recommendations of the experts who are available, whether they be in the pay of the government or of the Canadian Pacific Railway Company; and also independent experts if necessary. The cost could well be defended. When the report finally comes back to this parliament, he who runs may read, and every hon. gentleman representing a constituency and a province will know what is to be done. Then the responsibility will be his, the duty will be clear, the obligation unavoidable.
I therefore make this suggestion to the house and the Minister of Transport, that when the bill is in committee it be amended to give some protection to the people of Canada who know nothing about this question and could not vote intelligently upon it if there were an election to-morrow or if a plebiscite were held on the question of amalgamation or a proposal to tear up certain of the railways. The young man or the young woman of twenty-one years of age, voting "Yes, I am in favour of amalgamation"-what does he or she know about it? These people have never studied the problem, and probably will not do so until they attain riper years. Yet at the age of twenty-one they have the right to vote. They have also the right to be protected by this parliament against themselves, in the interests of the country. It is because I love my country -I love the maritime provinces and I have a place in my heart for the other provinces- that my duty as a maritimer is clear. I am
going to stand by the rights of the maritime provinces, the province of Quebec, and the province of Ontario-the four old provinces which were the original confederation. I am going to get for them everything within the four corners of the British North America Act to which those old provinces are entitled which formed the original confederation and to-day so largely sustain our mighty dominion.


Mr. H. B. McKINNON (Kenora-Rainy River):: I wish to commend the government for introducing this bill. To a large extent it follows the precedent established not only in Great Britain but also in the United States.
I believe, however, that it should be made to a certain extent retroactive. In the last two or three years quite a large number of men have been entirely deprived of their employment due as a result of cooperation.


Clarence Decatur Howe: Can my hon. friend give me the name of one man who has been put out of employment in the last three years as a result of cooperation?


Hugh Bathgate McKinnon: I can give Mr. Hunger-ford's statement of a year ago in the railway committee, when he agreed that there were.


Clarence Decatur Howe: A large number were put out in 1933>-34, but I know of none in the last three years.


Hugh Bathgate McKinnon: I said within the last two or three years, as a result of cooperative services between Toronto, Montreal and Ottawa.


Clarence Decatur Howe: That took place five years ago.


Hugh Bathgate McKinnon: Well, I stand corrected, but a number of men have been laid off during the last few years as a result of cooperative measures. It seems to be that when progress is made in our railway systems through technical improvements and increase in motive power, larger cars and things of that kind, the railway employees suffer. No body of men in 'Canada have suffered more than the railway employees during recent years, through men being displaced entirely from their employment. About forty per cent of those employed six or seven years ago are now out of employment, and this was not due entirely to the depression.
While commending the government for introducing the bill, I believe serious consideration should be given to making it retroactive. Railway employees have established themselves in small communities from one end of Canada to the other, and it is easy to realize how through cooperation many of
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them might lose their homes and everything that they have been able to put by through the years for the protection of their old age. This bill is contributing something that is worth while. I think we all agree that in the railway situation we have a serious problem, and we have to do something about it. It is also generally agreed that cooperation is the best method at the moment of dealing with the situation, and I am glad that the government have taken this action to protect those who have given the major part of their lives to the building up of this important industry.
I should like to emphasize my hope that the minister can see his way clear to make some provision for those who have suffered through cooperative measures in the last number of years.


Mr. HARRY LEADER (Portage la Prairie):: I wish to add my support to this bill, inasmuch as it will contribute to the welfare and happiness of some of our people who, if conditions continue as they are, will be thrown out of employment. However, I do not think it is going to solve our railway problem.
In making my choice between cooperation and unification I would support cooperation. I am sure that that is the feeling also of my constituents. I do not think the time will ever come when the people of Canada will be satisfied to hand our national railway over to a private monopoly.
In seeking the solution of our railway problem we must go further than merely to contemplate the abandonment of certain sections of existing lines, which would be done at the expense of the employees and the districts that these lines serve. In my constituency it is rumoured that the railway companies contemplate abandoning some lines adjacent to the city of Portage la Prairie. It is the general opinion that this is contemplated, but as yet the board of transport commissioners have not been notified of any action. The lines that it is proposed to abandon have in the last ten years transported some seven million bushels of grain, as well as considerable quantities of other farm produce such as hay and live stock. There are over a dozen loading platforms and three grain elevators along these lines. Their abandonment will mean something to the grain growers as well as to the employees, whose position should not be forgotten. Where they now have convenient loading platforms, and elevators within a short haul, if the lines are abandoned they will have to carry their grain by truck or wagon perhaps fifteen or twenty [Mr McKinnon.]
miles to Portage la Prairie, which will add considerably to the cost of producing and marketing the grain. It is something that we must keep in mind.
Reference was made to the interest charges being borne by our railways. I agree with other hon. members that we must make a more determined effort to scale down these interest charges and thus lighten the financial burden that the railways are now carrying. This should be done before we contemplate depriving employees of their livelihood or making it more difficult for districts to carry on their industry for lack of railway service. I think it was the hon. member for Winnipeg North (Mr. Heaps) who said something should be done about refunding the outstanding high interest bonds; with this I heartily agree. A newspaper printed in the maritime provinces-that country which produces so many wise men-the Fundy Fisherman, carried in its issue of December 14, 1938, an item headed, "Food for thought." It reads as follows:
There is a small issue of perpetual, i.e. eternity, bonds outstanding against the Canadian National Railways of about $70,000. The railway, i.e. the government, has already paid over $190,000 interest on these bonds, and still owes the original amount. This is a sample of the kind of financing with which our railways have to contend, and unless something is done about these bonds and similar issues, millions and millions of interest will continue to be paid without reducing the principal one nickel, in fact the interest is often reborrowed. Surely we do not need any further argument for refunding our railway debts than the above example.
I am quoting this to the house in order again to direct attention to the fact that we could save millions of dollars if we would make a real, honest-to-goodness attempt, to refund our outstanding railway bonds at the lower rates of interest now prevailing.


Mr. J. N. FRANCCEUR (Lotbiniere) (Translation) :: Mr. Speaker, I desire to submit as briefly as possible a few facts concerning the railway problem in the constituency of Lotbiniere which I have the honour to represent in t-his house. Two main lines cross my constituency, one running through the southern part via Richmond and Sherbrooke to Montreal; while the other, not far away, runs almost in the centre of the constituency via St. Hyacin-the-Drummondville to Montreal. A branch line, originally the Lotbiniere and Megantic railway, until August 26, 1931, was operated from Levis via Villeroy to Desehaillons. The Lotbiniere and Megantic railway was incorporated by 62 Victoria, chapter 89, statutes of Quebec. All these lines have been acquired

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by the crown and are operated by the Canadian National Railways. By 54 Victoria, chapter 88, land subsidies to the extent of
250,000	acres were granted the company by the provincial government of Quebec under the conditions outlined in section 8 of that statute, which reads:
Before claiming any portion of the subsidies above mentioned, the company shall establish to the satisfaction of the lieutenant-governor in council that it has sufficient means and is in a position to complete the projected road and keep it in good working order.
Payment of the subsidies was to be subject to further conditions and obligations. Under 56 Victoria, chapter 4, section 3, it is provided as follows:
3.	No such company shall exact or receive
the payment of the whole or any part of any subsidy in money to it granted, unless it has proved to the satisfaction^ of the lieutenant-governor in council that it is m a position to maintain its line in regular operation by itself or by another company.	_
4.	Any law to the contrary notwithstanding, no company shall have the right to any subsidy from the government unless it has complied with all the requirements of the preceding sections and unless the formalities thereby required have been observed.
These sections are reproduced in the revised statutes of Quebec, 1925, chapter 5, section 10, volume 5. Subsequently the land subsidies were converted into money, and a total amount of $131,000 was paid the company before its railway was bought by the government. As is clearly indicated, the Lotbiniere and Megantic railway was obliged 1 to maintain its line in regular operation by itself or by another company." That was the condition of the granting of the subsidy. Since taking over these lines the policy of the Canadian National Railways has been one of rigid economy, without taking into account the fact that in addition to being a public utility it is a public necessity. That fact was^ disregarded when in 1931 the Canadian National Railways decided to abandon its railway line between Parisville and Deschaillons. Until that date the terminal was at Deschaillons. Train service between Parisville and Deschaillons was given continuously for over forty years. Deschaillons is on the south shore of the St. Lawrence river and has a population of nearly 2,000. Several industries are located there, among them brick plants giving employment to approximately 100 men. During the summer months Deschaillons has transportation facilities by means of a highway along the south shore of the river; but during the winter this community, together with the neighbouring parishes of Ste. Emelie, Lotbiniere, St. Pierre les Becquets, Ste. Sophie de Levrard and Ste. Cecile de
Levrard, is dependent upon the railway which, as I have said, since 1931, has operated only as far as Parisville, a distance of several miles from the municipalities I have just mentioned.
The reason given by the company for the abandonment of its service between Parisville and Deschaillons was the urgent necessity of making repairs which would call for the expenditure of a substantial sum of money. Near Deschaillons the railway crosses the du Chene river over a long trestle bridge. Prior to 1931 this bridge was badly in need of repair, the cost of which was estimated by the railway officials at about $30,000. Many people, although not experts, believe $10,000 would have been sufficient to meet this requirement, but no one can deny that if small sums of money had been spent annually for the upkeep of the road, and particularly the trestle bridge, there would have been no necessity for the expenditure of a huge sum for repairs. Moreover, if the bridge had been maintained in good order it would not be necessary now to rebuild it. That policy of rigid economy, suddenly applied in 1931, has deprived the most important municipalities of that region of the railway service to which they were and still are entitled.
As soon as the decision of the railway was known, petitions, requests, and resolutions adopted by the municipal councils of Deschaillons, Lotbiniere, Ste. Emelie, Parisville, Ste. Philomene de Fortierville, St. Pierre les Becquets, Ste. Sophie de Levrard, Ste. Cecile de Levrard and others, were transmitted to the Canadian National executive. _ All these communities were steadfast in their opposition to the step taken by the Canadian National Railways, but the demands of these important centres were ignored or rejected. They petitioned in vain; their efforts were of no avail. In 1936 the petitioners, having received no favourable reply from the railway, decided to lay their case before the then board of railway commissioners. The hearing was held at Quebec, before three commissioners, and on March 30 of the same year the chief commissioner, Right Hon. Mr. Guthrie, speaking for the majority, rendered a decision summing up the situation as follows:
At the time of the abandonment of this portion of the line in 1931, a railway company was not required to obtain the approval of the board before abandoning portions ot its line. The amendment to the Railway Act, providing for the board's approval to abandonments, was enacted in 1933, when section 165A was inserted in the Railway Act . . .
Prior to the amendment made to the Railway Act in 1933 iby the enactment of section lb5A, in my opinion a railway company might abandon any portion of its line of railway without reference to the board, unless there existed in its act of incorporation, or in some otter

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act, some provision against its so doing or unless the company was bound to continue operation under the terms of some contract or agreement in which it had entered.
Commissioner F. N. Garceau dissented. His finding is quite elaborate. He contends, with reason:
It seems to me that, contrary to the claim put forth by the majority of the eommis-sioners, there existed in the act of incorporation of the Lotbiniere and Megantic railway, and particularly in the other acts (52 Victoria, chapter 89, Quebec statutes; 54 Victoria, chapter 88, Quebec statutes), by which $131,000 were paid to 4h6 said company, the provision to the effect that it was bound to continue or bound to keep it in good working order to maintain it in regular operation by itself or by another company.
By "another company" is evidently meant the Canadian National Railways, which had acquired the rights of the Lotbiniere and Megantic railway, and this in virtue of a contract well established. May I be permitted to quote some excerpts from the findings of Commissioner Garceau:
The first question to decide is whether the board has jurisdiction to grant the application, order the railway to resume its service to Deschaillons.
I submit that the Lotbiniere and Megantic railway had accepted the implied and explicit obligations imposed by the statutes above mentioned when they accepted the payment of the subsidies, that is to say, to maintain and operate their line. We have no evidence that aiiy contract was passed, but we may presume that it had been passed, because the government would not have paid the subsidies unless such contracts had been entered into and signed by the company (see chapter 4, 56 Victoria). Ihe Canadian National Railways, unless the contrary is established, are under the same obligations as the former railway to which they are substituted.
referred to were not specific, it should be understood and interpreted in such a way as to have some effect.
Public moneys were not given for the sole purpose or building and maintaining the railway in a proper state of repair but also to operate it; it could not be otherwise, and if we refer to contracts exacted by the statute, we find these clauses:
(e)	The said company shall be bound, after the completion of the works on its subsidized line as above described and required, to constantly maintain the same in good order and condition as well as the rolling stock required for the regular running of trains in accordance with the needs of traffic and of the travelling public; and it further binds itself to operate such railway without interruption and to faithfully fulfil this obligation subject to all lawful charges and responsibilities;
(f)	The land subsidy above mentioned shall be granted or conceded in the manner above indicated, solely under such conditions as the lieutenant-governor in council may determine to assure the right of running, and the traffic arrangements, as well as all other rights calculated to procure the said company, party ot the second part, or its assigns, all possible accommodation and facilities and equal running rates with and upon all other railways connecting with the line belonging to the company, party of the second part;
(g! J-t is also agreed that the said railway line and the works dependent thereon as well as all the rights, privileges, immunities, personal and real property of any kind, whatso-eyef>
belonging to the said company, party of the second part, shall after the completion ot the said line of railway and of the works connected therewith, be deemed to be the property of the said company, subject to the charges and obligations above specified and which would become applicable should occasion arise.
With due deference for the opinion of my colleagues, as expressed in the majority judgment. I believe that the railways could not legally abandon their operations in 1931 without authorization from the board
Section 153 of the Railway Act is forma] and says:
(1)	Notwithstanding anything in any agreement made or sanctioned under the provisions or the last two preceding sections, every act, matter or thing done, effected or confirmed under or by virtue of this act, or the special act, before the date of the coming into effect ot such agreement, shall be as valid as if such agreement had never come into effect; and such agreement shall be subject and without prejudice to every act, matter or thing, present or future, which would be incident to, or consequent upon such act, matter or thing if such agreement had never come into effect.
(2)	In the case of an agreement for amalgamation, as to all acts, matters and things so done, effected or confirmed, and as to all such rights, liabilities, claims and demands, the amalgamated company shall for all purposes stand m the place and represent the companies who are parties thereto and the generality of the provisions of # this section shall not be deemed to be restricted thereby
The former railway company received $131,000 tor services to be rendered to the public, to operate: Even if the wording of the provisions 
The Canadian National Railways have decided this year to spend over $12,000,000 for the construction of a terminal at Montreal. However, the Minister of Finance (Mr. Dunning) in his budget speech mentioned a deficit of $54,000,000. I have no objection to the spending of millions at Montreal, but it is only fair that rural communities should receive their share. Deficits of the Canadian National Railways are paid not by the1 directors, but by all the ratepayers of Canada, such as farmers, merchants and others. In short, all provinces contribute to the payment of its deficits.
The railways complain of the competition they suffer from auto-buses, trucks, taxis and so forth. However, they do not struggle against it. Is the removal of rails the proper means of coping with it? It would seem to be so.
The administrators of the Canadian National Railways seem to direct their attention to transcontinental trains running east and west,

Canadian National-Canadian Pacific Act
and vice versa-particularly those from Saint John, Halifax, Montreal, Winnipeg and Vancouver. To local service no care is given. This policy is unbearable. As we have a large annual deficit, it is obvious that our railways are not paying enterprises. Is that a reason for destroying them? I am not of that opinion. Even if we have to operate them at a loss, we must not lose sight of the fact that they are a public utility, a necessity, and must be maintained, unless our super-men, the presidents and directors of the railways, succeed in changing our climatic conditions, or do away with winters. Or, again, so long as aviation has not become the sole means of transportation, and so long as this progress has not been realized, the abandonment of lines with the object of effecting economies is nothing more or less than pure sabotage of our railways. It is not only an error in administration, but a blunder which must not be repeated, and in certain instances must be remedied. In its editorial of April 27, the Ottawa Journal appropriately points out this aspect of the problem:
So with our railways. We hear a great deal (and we shall hear much more following Mr. Dunning's speech) about the "crushing burden" of the Canadian National. But do the people who talk stop to reflect upon what the Canadian National (and our railways as a whole) means to the country? What they mean in a country of such vast distances; what they mean in their contribution to national unity; what they mean in the facilitating of production that has placed Canada so high among the trading nations, and has given our people a standard of living which is amongst the highest in the world?
The truth is that the production of new wealth which has so benefited Canada would never have taken place if railways were not to be built unless they could pay operating costs and fixed charges, or were to be abandoned if they ceased to earn a profit. The truth, equally, is that if this country to-day started to tear up, or abandon or even degrade, all railway lines that do not earn an operating profit, it would be inviting the danger of retarding gravely the country's growth and development.
In other words, the dividends from our railways are in public value; the deficits what we pay for one of the most vital national services that the state can render its citizens.
As it is admitted that our railways, especially our branch lines, will never be able to compete efficaciously or successfully with auto-buses, trucks, taxis, et cetera, during the summer months, they must none the less be kept in good order the year round so as to permit farmers to have a Choice of transportation either by highway or by rail. After the board of railway commissioners rendered their decision, the only recourse left to the petitioners was to appeal to the board of directors of the Canadian National Railways 71492-291*
through the Minister of Transport (Mr. Howe), and that is what I did. During the session last year, having no desire of raising a debate which I did not consider necessary either in the railway committee or in the house, I communicated with the Minister of Transport informing him of the decision which had been rendered by the board of railway commissioners, and requesting him to have the matter reconsidered by the Canadian National Railways board. The minister was good enough to hand my petition and letters over to the railway executive. I do not want to put on record all the correspondence exchanged with the minister, but I should like to quote a letter I received from the president of the Canadian National Railways, dated April 9, 1938, and reading:
This will acknowledge your letter of March 30 enclosing a copy of a communication you addressed to the Hon. Wilfrid Gagnon, director, on March 29 in connection with the reestablishment of train service between Deschaillons and Levis, Quebec. To give effect to this request would involve the rehabilitation of an abandoned line.
Our requests for capital funds, due to the financial circumstances that exist, have been limited to those things which are necessary to the safe and continued operation of the property, and no funds are available for the rehabilitation of lines in the territory referred to.
Yours faithfully,
S. J. Hungerford,
President.
As the house will see, the minds of the administrators are always haunted by the fixed idea that the cost of establishing the service between Parisville and Deschaillons is not warranted because the traffic is not sufficient. If this way of thinking is applied to the Quebec district, and to the constituency of Lotbiniere in particular, it should apply equally to Montreal and other large centres, because it has been proved that the volume of traffic in these communities cannot justify the cost of the additional expenditures contemplated.
The natural market for the farmers, merchants and manufacturers of the constituency of Lotbiniere is the city of Quebec. The municipalities having the greatest population and means of production are located on the shore of the St. Lawrence river, but unfortunately the only railroad at their disposal is the former Lotbiniere and Megantic. Do hon. members know in what way these municipalities are served? They are served by a small mixed train which leaves Parisville during the winter at seven o'clock in the morning. It does not go directly to Quebec via the Quebec bridge, but goes to Levis. This compels the farmers of Deschaillons and the neighbouring
4626	COMMONS
Canadian National-Canadian Pacific Act
municipalities to leave their homes around five o'clock and travel ten or twelve miles before they can take the train, which usually arrives at Levis at eleven o'clock or sometimes at noon, although the distance between point of departure and destination is a mere fifty miles. At Levis the farmers and merchants are obliged to transfer their products from the train to the ferry that crosses the St. Lawrence to Quebec. At Quebec the farmers have to unload their products and again transport them to the market about a mile away. In the evening these farmers are obliged to return to Levis by the ferry in order to take the same train which leaves at six o'clock and makes the same trip, to Paris-ville in the winter and to Fortierville in the summer.
This is a most intolerable state of affairs. We have asked the Canadian National Railways board to allow the train to run on market day, at least once a week, directly to the market via the Quebec bridge instead of to Levis, but we have been unable to obtain this improvement in service. Evidently common sense and logic seem not to disturb our administrators. Still they continue to complain that the railways are not encouraged, although it cannot be denied that in winter the competition is nil. The money contributed has not been spent solely to maintain the railway in good order, it has been spent to operate it even at a loss. I do not deceive myself because I realize that the facts I have just submitted to the Minister of Transport will perhaps again be ignored and no favourable decision rendered. But I know the mentality of those whom I represent. They will not cease to protest or to claim. They do not make any threats, but sooner or later the justness of their claim will have to be acknowledged.
I believe it would be in the public interest if the Minister of Transport would demand that the Canadian National Railways board reconsider this question and adopt the following suggestions:
1.	The immediate reconstruction or repair of the trestle bridge over the du Chene river between Deschaillons and Parisville.
2.	The reestablishment of train service between these two points.
3.	The improvement of transport conditions between Deschaillons and Quebec and the affording of proper facilities to the farmers to enable them to reach the market at Quebec directly by passing over the Quebec bridge instead of having to make a useless detour by way of Levis.


Mr. A. W. NEILL (Comox-Alberni):: Mr. Speaker, this is a good bill, founded as it is upon similar legislation in Great Britain which has been successful, within certain limitations, for a number of years. The purport of the bill is to facilitate cooperation between the two large railway companies in the reduction of track mileage, rolling stock equipment, elimination of terminals and so on. It will succeed in that way to the extent to which it reduces the opposition of the railway workers who would otherwise be thrown out of employment, and of such unions and other people as would sympathize with them. In that way it will facilitate the cooperation to which I have referred, but it must be obvious that to some extent it will have an opposite effect.
When a proposal for cooperation is made, each railway will naturally look at it from the point of view of the financial effect upon their body politic so to speak. If, in addition to the saving to be effected, or in contradiction to the saving, it is found that there will be a large outlay for pensions, it is possible that this might sway the balance and that there would be no cooperation in that particular instance. There is this to be considered, and I believe it has had some effect in England. Will the proposed legislation apply to companies which are not exactly subsidiaries of the main company but are under its control? I have in mind a railway on Vancouver island, the Esquimalt and Nanaimo Railway. Quite a number of years ago the Canadian Pacific Railway took it over, but they did not wish to acknowledge ownership and the railway was said to be leased. But as time went on, it became desirable from their point of view to admit a more definite control, and so they allowed that they held a predominant stock interest in the Esquimalt and Nanaimo Railway. It is not exactly a subsidiary, but would a railway in that position come under this bill?


Clarence Decatur Howe: A railway that is connected
with a transcontinental railway automatically comes under the Railway Act and therefore under this legislation. Of course, if the railway has a provincial charter and has no connection with a transcontinental railway-


Alan Webster Neill: It has a dominion charter.


Clarence Decatur Howe: If it has a federal charter,
I think it comes under the provisions of this bill.


Mr. DANIEL McIVOR (Fort William):: Mr. Speaker, coming from a constituency which is largely made up of railroad workers,
I declare myself as absolutely opposed to any form of unification or amalgamation of the

Canadian National-Canadian Pacific Act
two railways. But this bill is in keeping with the character and past record of the Minister of Transport (Mr. Howe), who has always believed in treating the toiler fairly. I hope there will be no need to compensate any railway workers under this bill, because my hope is that the two railways will be so busy that there will be no need for cooperation. I cannot see very much good in their cooperation. because ultimately it would in all probability mean some unemployment. However, I support the minister because in this bill he is taking care of the men who absolutely need it, and that has always been in keeping with our campaign.


Mr. ANGUS MacINNIS (Vancouver East):: Mr. Speaker, the hon. member for Winnipeg North (Mr. Heaps), speaking for the group with whom I sit, has stated our approval of the principle of this legislation. I must say, however, that in my opinion the bill has been brought down six years too late in view of the fact that it is not made retroactive. To what extent i-t will be of advantage to railway employees will depend upon the extent to which cooperation between the two railways takes place in the future. If a large measure of cooperation should take place in the near future, undoubtedly other problems will arise. While this legislation will be, as it should be, of advantage to the employees of the railways, it will not in any way help to solve the railway problem.
I do not know whether this bill is brought in at the present time because the government has in mind that large measures of cooperation are contemplated in the future, or whether it is introduced with the expectation that it will never become operative because cooperation so far as it is possible has already been carried out. When the legislation could have been of value it was refused by parliament, although the principle was offered to parliament for its acceptance.
One feature of the bill which is satisfactory to me is that the principle was proposed by the railway men's associations and in the working out of the legislation the unions will have some part in its administration. I do not know that there is more I need say. I hope that the bill will go through. We may have some suggestions to offer in committee for the approval of the government.
Mr. JEAN-FRANCOIS POULIOT (Temis-couata):	Mr. Speaker, many railway employees have been set back in recent years, but this bill does not apply to them. Like the hon. member for Fort William (Mr. Mclvor), I am strongly opposed to unification, and the Minister of Transport (Mr. Howe)
knows it. I ask him if he will be kind enough to do something one way or the other for the railway employees at Riviere du Loup who have been set back.


Mr. ARTHUR SLAGHT (Parry Sound):: Mr. Speaker, just a word to express my unqualified approval of this bill. In my experience there is no class of workmen in Canada deserving of fairer treatment than the men formerly employed on our railways. Their training and their discipline are severe and their task one requiring eternal vigilance, and if they are retired at various ages from their own special work their training has been such that it is more difficult for them to rehabilitate themselves in other callings than the average workman in other lines of work. I feel that this measure should receive the support of the entire house.


[Stage Direction]
Motion agreed to, bill read the second time, and the house went into committee thereon, Mr. Sanderson in the chair.
On section 1-Short title.
Jean-François Pouliot: Would the minister be
kind enough to answer the question I put to him on the second reading on behalf of the railway employees at Riviere du Loup?


Clarence Decatur Howe: I am not familiar with the ordinary cases of employees dismissed at Riviere du Loup, and I have no information why they were dismissed, but if they were dismissed as a result of cooperative measures, they would come under this bill. I hardly think, however, that any cooperative measures have been put into effect at Riviere du Loup. I would say, therefore, that the matter is one for the management of the railway.


Jean-François Pouliot: I thank the minister for his answer, but I referred not so much to dismissals as to railway employees who have been set back. Some time ago I received a letter from the then mayor of Riviere du Loup, who died recently, giving the names of all the employees working in the shop or on the railway who had been set back, and it was on their behalf I was speaking. I hope they will receive favourable consideration from the minister and also from the railway.


René-Antoine Pelletier: I notice that every hon. member who so far has taken part in the debate has deplored the fact that this measure has not 'been made retroactive. Perhaps the minister has the figures to give to the committee showing the number of people who have been dismissed up to the present time as a result of cooperation between the railway companies. In this way the committee will have an idea as to the number
4628	COMMONS
Canadian National-Canadian Pacific Act
of individuals who will not come under the
benefits of this bill, who otherwise, if the views expressed by hon. members were adopted, would be brought under the scheme.


Clarence Decatur Howe: I have no idea as to the effect, and I doubt whether it wrould be possible to trace the effect of cooperation at this time. I imagine that the men who were laid off temporarily as a result of cooperative measures were taken back into the service long since. The only cooperative measures which resulted in any considerable unemployment were the pooling of trains which took place back in 1933 or 1934; and the men thereby affected, I imagine, have been, by the exercise of seniority, put back in their old positions. To go back at this time five years to determine what they lost by demotions or lay-offs would hardly be feasible; nor is it, I think, desirable. I might say that the representatives of eighteen brotherhoods who were in Ottawa asking for this legislation did not suggest that it should be extended in any such way as is mentioned by my hon. friend.
Mr. MaoINNIS: What will be the position of the men who were laid off when cooperation began and were later taken on? Will they be considered as new employees, with their time of service reckoned as from the date they began work after their period of lay-off?


Clarence Decatur Howe: I think that if my hon. friend will wait until we reach the schedule he will find that it is specific as to what constitutes length of service.


[Stage Direction]
Section agreed to.
Sections 2 and 3 agreed to.
On section 4-Schedule.
Clarence Decatur Howe: The schedule is fairly important, Mr. Chairman.


Angus MacInnis: I think it would be better if we took this by paragraphs.


Clarence Decatur Howe: It is suggested that we take each paragraph separately; for instance, paragraph 1, paragraph 2. This is really the meat of the agreement.
Paragraph 1 agreed to.
On paragraph 2.


Abraham Albert Heaps: Under this paragraph there comes up the question which I have already raised regarding persons with service. I was wondering whether the position of persons having fifteen years' service and longer will not be worse, in some ways, than that of other employees with shorter terms, if they should be laid off or lose their positions as a eon-
IMr. Pelletier.]
sequence of the process of cooperation between the railways. A person with fifteen years' service or over is entitled to sixty months' payment. It is inevitable that such persons, having fairly long terms of service, will be on in middle age when they are laid off, and their chances of reemployment are much less than those of younger persons. An employee who has spent from two to three years with the railways is entitled to twelve months' compensation, or one-third of his period of service, but a person with twenty years' service is entitled to no more than 25 per cent compensation, assuming he gets the full allowance. In addition to that, the older employee has some pensionable rights which he loses if he is laid off. While I do not want to press the point too much at this time, because I understand the difficulties which may be in the way of amending the bill and sending it to another chamber, I think more sympathetic consideration should have been given to employees with longer terms of service. Has the minister given any thought to that aspect of the question with a view to seeing whether something can be done, at some other time, to meet it?


Clarence Decatur Howe: I might say that the Washington agreement, which was the pattern for this one, was worked out by negotiations between the representatives of the men and the railroads. In the presentation of the matter to myself, a very full representation of the unions represented the interests of the men, and no request was made by them for any deviation from the Washington agreement so far as the schedule of compensation is concerned. I assume that the men themselves felt that the scale of the Washington agreement was reasonable.
Section stands.
Progress reported.
At six o'clock the house took recess.
After Recess
The house resumed at eight o'clock.



PRIVATE BILLS


[Stage Direction]
Bill No. 145, for the relief of Lucy Violet Siggins Hopson.-Mr. Walsh.
Bill No. 71, for the relief of Zdenka Pauline Ottilie Josefine von Ehrenfeld-Pop Drummond, otherwise known as Yvonne Drummond.-Mr. McPhee.

Fisheries Act-Seine Fishing


[Stage Direction]
The house resumed from Tuesday, March 28, consideration of the motion of Mr. Reid for the second reading of Bill No. 29, to amend the Fisheries Act, 1932.
Hon. J. E. MICHAUD (Minister of Fisheries):: The mover of this bill, the hon. member for New Westminster (Mr. Reid), according to the explanatory note accompanying the bill, seeks to prohibit by statute the catching of salmon by the use of purse seines in the waters adjacent to the mouth of the Fraser river. In order to accomplish this purpose he is asking this house to pass a bill amending the Fisheries Act, 1932, which is the general act pertaining to fisheries. Section 1 of this bill reads as follows:
1. Section twelve of The Fisheries Act, 1932, chapter forty-two of the statutes of 1932, is amended by adding thereto the following subsection:-
"(2) Seine fishing for salmon is prohibited within the boundaries of a line drawn from the extreme westerly point of Point Grey to the most northerly point of Galiano island; thence in a straight line to and following the international boundary line to the outer range light on said boundary; thence in a line drawn in a westerly and northerly direction to the point of commencement."
This, in other words, describes an area in the Gulf of Georgia immediately south of the mouth of the Fraser river, or to the point where the Fraser river empties into the strait, where for some years, that is from 1933, purse seining has been permitted under certain conditions at certain specific times in a limited way. The point in question is immediately to the north of the boundary or line dividing the United States waters from the Canadian waters in that area. The United States authorities have always permitted the use of seines to catch salmon there, and my information is that it is the method most employed by the fishermen of the United States to catch salmon in those waters. Naturally the Canadian fishermen, seeing the advantage of using purse seines in Canadian waters, sought for many years that privilege. But it was only in 1933, as a result of certain representations having been made to the then acting minister of Fisheries, that such method of fishing at that location was permitted by order in council.
In 1935 the hon. member for New Westminster sought by legislation, I believe, to prohibit absolutely this method of fishing in those waters. The bill which he then introduced was referred by the house to a committee, which, after looking into the matter
for some time, reported adversely. I understand the bill was defeated in the committee by a very narrow margin.
Then in 1936 the hon. member, with the persistence characteristic of his race, again brought before the house a bill seeking prohibition of purse seining in the same waters. After listening to his arguments, I asked the hon. member to give me time to look into the matter and devote more attention to the problem which he was bringing before the house, and which was new to me. He graciously agreed to my request and withdrew his bill on my undertaking that during the following season I would investigate the whole question, which I did in his company; and upon my return to Ottawa I saw to it that the area in which purse seining was permitted was reduced.
This, however, did not satisfy the hon. member, and during the session of 1937 he introduced legislation to bring about an absolute prohibition of purse seining in those waters. Again he withdrew his bill, and again the area was reduced, to its present size. At the present time the strip of water in which purse seining is permitted is only two miles wide, and I am told by those who are conversant with that method of fishing that this width is not sufficient to permit the successful operation of seine boats. For the benefit of hon. members who are not familiar with this .method of fishing, I may state that the gear for salmon purse seining on the Pacific coast, including the boat, the nets and all the apparatus, comprises quite an outfit. The boats are quite large, employing some twelve or fifteen hands-


Thomas Reid: Seven.


Joseph Enoil Michaud: -a crew of about twelve. A purse seining boat, with the necessary gear, represents a costly investment. Apparently that is an attractive ground for this method of fishing. In the beginning, in 1937, according to my information relatively few boats resorted to those waters in order to carry on purse seining, but in the meantime that number has increased. I am told that during the short period last year when purse seining was permitted and was practicable in those waters, about 105 boats came from all parts of the British Columbia coast to try their luck.


Alan Webster Neill: Has the minister a note as to how many days they fished there?


Joseph Enoil Michaud: About ten or twelve days.


Alan Webster Neill: I thought it was only eight.


Joseph Enoil Michaud: I believe the majority fished for only eight days, but I think some of them were there for ten or twelve days.
Fisheries Act-Seine Fishing

la any event the time during which purse seining was permitted last year was very short. Nevertheless 105 boats came to those waters, much too large a number for the area. Since that time complaints have been made by fishing interests, or by people interested in fishing and purse seining, suggesting that the number of permits for purse seining in those waters should be restricted.
The contention now made is that these operations at the mouth of the Fraser river are detrimental to the fisheries and may tend to impair the ascent of fish up the river in sufficiently large numbers for reproduction purposes. But opinions on this matter, as on almost every other matter pertaining to fisheries, is divided. Some people contend that this method of fishing, under the limitations which have been imposed both as to area and as to time, is not injurious to the industry or to the fisheries generally. Some people contend that purse seining is the only method by which fish can be taken in that area because the water is too clear for successful gill net fishing, so they say there is no harm in permitting the purse seiners to take fish which otherwise would not be caught.


Thomas Reid: Who offered that argument?


Joseph Enoil Michaud: Some people have advanced those views, and they are on record. Others contend that gill netting could foe carried on successfully in those waters and that purse seining crowds out quite a number of individual gill netters who otherwise would derive quite a revenue from these operations. Therefore they say the purse seining method of fishing is injurious to the gill netters.
The permits issued at the inception, in 1933, were justified on special grounds. At that time it was claimed that the late run of fish which frequented these waters in the fall, if not taken at the time, at the place and in the quantities possible only by means of purse seining, would not be of any value to the industry. Representations were made to the effect that if purse seiners were not permitted to take fish at that point it would be a loss to the industry, that if these fish were caught further up the river their physical state would be such that they would not make a first quality pack. On this point also there is a wide difference of opinion, and the true situation has never been ascertained definitely; or, in other words, it has not been possible to get the different factions to agree with regard to this point. We must not forget the fact that whether we prohibit or permit the use of purse seines in those waters, the fishermen of the United States who fish in the waters adjacent to the imaginary line Which forms the boundary will continue to operate seine boats and catch fish by that method.

On the other hand it is contended that were we to prohibit completely the use of purse seines in those waters, the gill netters or the individual fishermen farther up the river would have a chance to get at the fish, catch them and supply them to the packing industry in as good condition as it would be possible to get them in any other way.
The obvious object of the bill is by statute to prohibit one method of fishing, and to allow other methods to be used, subject to regulation by order in council. Many arguments are being advanced pro and con, and I suppose so long as purse seining is permitted, even in a limited way and over a limited area, those arguments will continue.
In 1938 the gill netters caught 1,526,117 sockeye, while the purse seiners caught 214,264.


Thomas Reid: Fish.


Joseph Enoil Michaud: Of the pinks, the fall variety or late run of fish, the gill netters caught 816, and the purse seiners, two. There is no doubt that the quantities of fish caught by the purse seiners in those areas have increased to a certain extent on account of the fact that a larger number of fishermen or fishing boats are resorting to those waters for the purpose of catching fish by that method. We are faced with this question: Will parliament sanction the principle of regulating or prohibiting by statute a method of fishing? Unless extraordinary circumstances are offered in favour of that course, I submit the practice hitherto followed by all governments and parliaments in Canada, acting under the Fisheries Act, is to continue regulation by order in council of the methods, the areas and the time of fishing.
I claim that the use of purse seines or any other gear for catching fish is a natural right which should be available to all who want to use or take advantage of that right, and that they should be permitted to choose whatever method they may wish to catch the fish. There is no particular reason offered why purse seines should be prohibited by statute. The use of purse seines is a natural method of catching fish resorted to by many people on the coast, and one which should be curtailed or limited only when the interests of the majority or of the public would require such action. But it seems in this instance that so far there is only a difference of opinion between two classes of fishermen as to who should have the first right to get at the fish.
There is, however, a further element in connection with the matter which has been advanced this year and which, I believe, should receive consideration. I believe the argument is not strong enough to support the adoption of the bill or to justify parliament in saying that this or any other method of

Fisheries Act-Seine Fishing
fishing should be prohibited by statute; but there is the argument advanced, supported by fact, that the area has been restricted within a very narrow compass. It is only two miles wide, and stretches across the strait from the mainland to the southern part of Valdes island. In that small area 105 boats fished last year, and I admit that was too large a number successfully to carry on. Also it involved too great an impact on the fisheries. We shall have either to restrict the area or enlarge it, or-and this is a further alternative-limit the number of boats which might resort to those waters to take advantage of that method of fishing in order to get at the late run of fish in the fall.
I feel, therefore, that at this time parliament would not be justified in adopting the extreme measure outlined in the bill; but now that the hon. member for New Westminster has brought to the attention of parliament a matter which he believes to be of vital interest not only to his constituents but to the public generally, and more particularly to the fishing industry of the Pacific coast, and specifically at the mouth of the Fraser river, he should be satisfied. I think, if the hon. member for New Westminster would withdraw this bill, ask the people in his constituency.to be content with the privileges they now enjoy and give the department a chance to look into this other aspect of the matter, that is the over-fishing of that area, he would have accomplished his purpose. A royal commission is to be appointed shortly to investigate certain aspects of our fisheries on the Pacific coast, and I would be disposed to refer this matter to that commission for consideration as soon as it is appointed. The commission could very well study the matter from every angle and it would have the evidence of those interested. A report could be made to the department as to whether purse seine fishing in those particular waters is likely materially to affect the run of pink and sockeye salmon in the Fraser river. If it is found that this is likely to occur, then it will be in the public interest to prohibit by regulation fishing by that method in those waters. I believe the hon. member should be satisfied to leave this matter to the department to be investigated during the summer from this new angle.


Mr. H. J. BARBER (Fraser Valley):: Mr. Speaker, fishing on the Fraser river extends into my district and for a number of years there have been bitter complaints against the operation of purse seines at the mouth of the Fraser. It has been pointed out to me that as the salmon approach fresh water they form
into schools and remain there for some time, when along come the seine netters and scoop them up. This practice is claimed to be detrimental because it prevents fish from ascending the Fraser river in sufficient quantities to reach the spawning grounds. It is claimed to be most unfair to those men who are trying to make a living by fishing on the Fraser river. I think the minister has admitted that there may be too many boats or the district may be too small or too large.
The department has had an opportunity to go into this matter for a number of years, and I would have thought that after this government had been in power for four years something would have been done at least to satisfy themselves as to whether or not the case put before this house was correct. From my conversations with men engaged in the industry and with others who are interested, I am led to believe that purse seine fishing is detrimental to the salmon industry. I want to give my support to this bill at this time. The minister objects to this action being taken by statute, but that is the only method we have in the House of Commons to do anything of this kind when the government refuses to do it by regulation.


Thomas Reid: Mr. Speaker-


Walter Edward Foster: I would draw the attention of hon. members to the fact that if the hon. member for New Westminster (Mr. Reid) speaks now, he will close the debate.


Thomas Reid: In the short time at my disposal I should like to place some certain information before hon. members. First of all, let me say that I appreciate the offer of 'the minister, although to be candid I must say that I am disappointed that he could not see fit to accept this bill. I am not presenting this case from a personal viewpoint, I am presenting it simply on behalf of an organized body of fishermen on the Fraser river. My persistence in bringing this up year after year is on account of the grave injustice that we feel is being done to the gill net fishermen on the Fraser river. Without any notification to the fishing industry or to members of parliament, this area was declared by order in council to be open for seine fishing, for the first time since confederation. It had always been a gill net fishing area; but the seine fishermen having depleted certain other areas, new areas had to be found and so the area of the mouth of the Fraser river was opened up to them. My reason for introducing a bill is to prevent anything being done other than by statute.
Fisheries Act-Seine Fishing

I want to prevent action similar to that taken in 1933 being taken in the future by order in council.
The minister referred to a royal commission which would investigate the dispute, but mentioned only the pink and sockeye salmon fishing. Unless the scope of its reference goes much further, I feel that the investigation will be all one-sided. I intend to show that this seine fishing has hurt not only the sockeye and pink varieties, but other varieties of fish as well, which were never intended to be taken in that area but are being taken. The answer made to our protests in 1933 was that quality fish was required and that the late run of sockeye and the variety of salmon known as pinks could be caught in better condition by the seines before they came into the river. I protested then, and protest now, and it has worked out exactly as I forecast. These seine boats take not only the late run of sockeye and pinks, but the main run of sockeye and other varieties of salmon as well. I have not the time to give all the figures before nine o'clock, and this is the last opportunity I shall probably have this session to air this grievance, but let me give a few figures to show the depletion which has occurred in the varieties of salmon extremely valuable to the gill net fishermen. The following figures show the catch on the
Fraser river:	1932	1937
	Cases	Cases
Red spring	. . . 19,994	3,622Pink salmon	... 3,622	84White spring	. . . . 11,020	1,738Blue back	. . . . 16,558	1,354Cohoe	. .. 28,685	11.242Chums	... 45,100	20.934
Those are the figures of the catch of other varieties of fish which mix with the great hordes of sockeye or pink salmon and are caught by the same seine fishermen.
The fishermen of the Fraser river are put to a great deal of expense for their nets and boats, and if they were allowed to fish for sockeye alone they could not exist at all. They have been catching other varieties and have done so for many years. But the drop in these varieties of spring salmon has been severe ever since the seine boats were allowed in the gulf of Georgia.
I am sure the minister will be interested in the figures shown in his latest report. They show that out of the total number of seining areas in British Columbia, twenty-seven in all, in areas 17, 18 and 19, in the strait and gulf of Georgia, 74,873 fish were taken by purse seines out of a total catch of 85,260 spring salmon caught by purse seines off the entire Pacific coast. I think there is a mistake 
in those figures, and that it should be pounds instead of number of fish. But if we take even the numbers of fish caught, it means that only 520 more spring salmon were caught in the remaining areas of British Columbia by all the seines that were operating. This shows conclusively that the greater proportion of spring salmon are caught right in the gulf of Georgia or in the waters of the Juan de Fuca strait after the fish pass the Sooke traps.
No protests whatsoever have been made by the industry this year, nor have any protests been made by the seine fishermen. It is true that there have been protests by the hon. member for Comox-Alberni (Mr. Neill), but I do not think he was speaking officially on behalf of the seiners. He picked out some items from newspapers and quoted them when speaking to the bill. But, Mr. Speaker, in speaking to this bill I am speaking for the fishermen of the Fraser river. I do not think the hon. member for Comox-Alberni was speaking on behalf of the industry. My information is that no representations were made directly to him to speak against my bill when he spoke on March 28 last. Let me deal for a moment with some of the arguments he used, and if one takes all the inaccuracies and untruths and what-not out of his speech on that occasion there is mighty little left.


Alan Webster Neill: Order.


Thomas Reid: Let me deal briefly with his speech on that occasion. He said that the waters down there are clear. His words were, "the water down there, I say without fear of contradiction is clear." Well, I can read a letter from the president of the British Columbia Fishermen's Protective Association absolutely denying that. He says he has fished down in those waters. But even if the waters were clear, which they are not, what did we witness when the trap question was up? The hon. member said that the gill net men could fish outside Sooke harbour. But in the committee he said, "No, those waters are muddy." What is the use of dealing with a man who jumps round like that? It is like a flea that jumps round all the time. It is difficult to pin the hon. member down to one position.
He said further that the waters there cannot be gill netted, that they never have been. Again I quote from a letter from the president who says:
I wonder what is wrong with old man Neill? He must have gone crazy when he says this area has never been gill netted. He did not make the same protests when they were taking the seines out of Barclay sound or Alberni canal.

Fisheries Act-Seine Fishing
To take the seines out of Barclay sound would have been all right with him. He could then say, "I can get them allowed in the gulf of Georgia for you, where there are more fish." Of course, there are more fish in the gulf of Georgia.


Joseph Enoil Michaud: What word do you use
for that kind of an argument?


Thomas Reid: I have a name for it, but the house would not allow me to use it; I hope to use it after the house is closed.
The statement that I have from the president of the fishermen's protective association is that the waters have always been fished by the gill net fishermen. Not only is it difficult for the gill net fishermen to fish there now, but many of them had their nets cut last year by the seines. The seine boats on their way back home ran amongst the gill nets, cutting the nets in two.
In 1922 a commission, of which the hon. member for Comox-Alberni was a member, recommended something which is just as applicable to-day as it was then. The commission at page 19 of their report have this to say:
We think that an unlimited and widespread use of either purse or drag seines is a sure and quick way of depleting the supplies of salmon. But it was made clear to us that there are places on the coast outside of rivers where gill nets have not .as yet been proved to be effective in catching salmon in reasonable large quantities. With this in mind, therefore, we recommend that drag and purse seines be not permitted to be operated for salmon except where their use has been demonstrated to be the only effective and reasonably economic method of catching such fish.
Since confederation the gill net fishermen have been fishing in that area. The hon. member talks about clear waters. The waters are just about as clear as his argument, which is as clear as mud. I doubt if he has ever been there. I witnessed the fishing there last fall. Many of the nets of the seine boats were dragging on the bottom and bringing up everything in the shape of crabs and debris. The water is very shallow indeed and the seine boats should not be operated there. When they were allowed to go in there in 1933, some sixty-four went in. It was never expected or intended that nearly all the seine boats of British Columbia would swoop down on the area and take the fish.
We have heard a great deal about the traps both this year and last. I have supported the elimination of the traps because I believe they are detrimental to the fishing industry to the fishermen, but they are not nearly
as destructive as the seine boats in the gulf of Georgia because, while the trap has a lead which the fish follow, the seine boat is a mobile trap and can swoop down into the midst of a school of fish, throw a net around them and take up sometimes as many as ten thousand fish at one time. The seine is more dangerous and more destructive than any trap could be because the seine boat moves round following the school of fish wherever they may be. In 1933 some sixty-four seine boats went in there, and last year the total number was 105. If this is allowed to continue, not only will the great salmon fishery run of the Fraser river be depleted, but the gill net fishermen on the Fraser river will be deprived of the greater part of their livelihood.
I repeat, not only do the seines take sock-eye and pinks of every variety, but the seines in the gulf of Georgia take the greater proportion of the variety of salmon known as springs, a far greater proportion than is taken by seines from all other areas in British Columbia. In fact, nearly all the springs were taken from the area of the gulf of Georgia.
Bear in mind that only so many fish come in the strait of Juan de Fuca, and if you allow 105 seine boats to go among those fish when they are schooling and ready to head up the waters of the Fraser to spawn, it cannot but deprive, the gill net fishermen of part of their livelihood and damage the fishery. Allowing 105 seines will not bring in any more fish into the area; the numbers of fish are limited, and certain species have been decreasing. Therefore every seine boat you allow in there helps to deprive a gill net fisherman of part of his livelihood. Even if that were not the result, something would happen which is equally bad, namely, the destruction of many fish of different varieties which are heading up the headwaters of the Fraser to spawn. If the greatest good to the greatest number is the motive of any one person or any one party, he or they would not allow the seines to fish in the gulf of Georgia.
The minister- has proposed a commission. I suppose we shall have to accept it because it is better than refusing the bill itself. I feel sure the fishermen, when they are made aware of this will be satisfied to argue the case before the commission, provided the regulations drafted for the guidance of the commission are favourable and not too one-sided in favour of seining. I would again warn the minister not to confine the reference to pink salmon and sockeye only; let him include also
Fisheries Act-Seine Fishing

white springs, red springs, pink springs, cohoes and chums. Let him put these also in the order of reference and include the following:
Is it in the best interests of the salmon fishery of the Fraser river system that seine boats be allowed to operate in the gulf of Georgia?
Is it not a fact that the seines catch immature fish and likewise other varieties as well as sockeye and pinks?
Is it not a fact that the salmon congregate in the area in schools or large numbers preparatory to ascending the Fraser river to spawn; and is it not a -fact that the seines take advantage of this condition to catch the salmon in great numbers, at the same time breaking up these schools of salmon?
Has the continued operation of the seines in this area reduced the annual returns of the individual gill net fisherman, especially on white and red spring salmon, cohoes and chums?
Until 1933 was it not a fact that the waters of the gulf of Georgia were fished almost exclusively by individual gill net fishermen?
I also draw the minister's attention to this fact. Many men who were formerly in the fishing industry and had endeavoured to maintain themselves on small ranches along the banks of the Fraser river have been compelled-and I speak particularly of those above the bridge at New Westminster-to go back into fishing, and thus increases of fishing licences are noticed over the past few years. In 1930 there were 200 licences issued to those fishermen who had small ranches but who fished most of the time and also endeavoured to maintain a garden and some small stock on a small ranch. Later figures are: 1935, 229; 1936, 273; 1937, 318; and last year 407 of these licences were issued. I draw that to his attention 'because we maintain that, the more seines allowed in the gulf, the fewer fish will there be caught up on the waters of the Fraser by the gill net fishermen, and the fewer fish will there be for spawning.
Speaking for one moment as a member of the international pacific salmon fisheries commission, I can see a great difficulty when the time comes that we have to apportion fifty per cent of the Canadian catch. The Americans will be allowed fifty per cent on their side and they can apportion it as they see fit. But when we are called upon to distribute fifty per cent of the total catch on the Canadian side among the various types of gear, there is certainly going to be great difficulty in deciding how many of the fifty

per cent the seines will be allowed to catch and how many the gill netters will be allowed to catch.
This, Mr. Speaker, has always been a gill net area. In the past year many of the gill netters went further out than in former years, and with considerable success. Even if the waters were clear it would not deter the gill net fishermen from catching fish in that area, because they would fish mostly at night time, and there is no phosphorescence in the water there because the mud from the muddy waters of the Fraser precludes it in that particular part of the area.
We are not asking that seining be prohibited from the entire area of No. 17. There is still part of that area which, under the provisions of my bill, would be left out. That, of course, was overlooked by the hon. member for Comox-Alberni, who said that if the bill passed there would be no seining in No. 1 district, it would all be confined to No. 2 and No. 3. "But I ask," he stated, "why should it be confined to two districts; why should it not be distributed over the three?" This, Mr. Speaker, relates to only part of the area, the part which the gill netters have used since the time of confederation, a part which can be easily gill netted by the individual gill net fisherman, but which has been prohibited to him by seines being allowed in on the gulf.
The first concession made in 1935 was a splendid one in its way. The second one, of course, took the seines out a little further. The present bill would take them clear out of the headwaters of the Fraser, clear entirely of that area where the fish assemble preparatory to ascending the headwaters of the Fraser to spawn; and remember it is in that little two-mile area that the seines make their great catch.
If I have persisted in my efforts on behalf of the gill net fishermen it is because, as pointed out in the opening remarks of my speech, we feel that seining in the area should never have been allowed. If the matter of the opening up of the area had come before the fisheries committee, or before the house, I feel sure that the area would never have been opened at all. It is true that in 1935, when the matter was discussed before the fisheries committee, we lost, but only by one vote. The chairman of that committee, who is not now a member of the house, told me that had the vote been a tie he for one would have given the deciding vote in favour of the gill net fishermen and eliminating the seines.
Mr. Speaker, it is nine o'clock.

Supply-Trade-Subsidies

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



DEPARTMENT OF TRADE AND COMMERCE

[Stage Direction]
Mail Subsidies and Steamship Subventions
896. Pacific ocean.
British Columbia and China and/or Australia, service between, $118,800.
British Columbia and South Africa, service between, $80,000.
Canada, China and Japan, service between, $600,000.
Canada and New Zealand, on the Pacific, service between, $300,000.
Prince Rupert, B.C., and Queen Charlotte islands, service between, $12,000.
Vancouver and the British West Indies, service between, $25,000.
Vancouver and northern ports of British Columbia, service between, $15,000.
Victoria, Vancouver, way ports and Skagway, service between, $10,000.
Victoria and west coast Vancouver island, service between, $10,000.
Angus MacInnis: When we were dealing with this item last night, I asked the minister if he could give any explanation why no attempt had been made to give effect to the recommendations of the committee on industrial and international relations which looked into this matter in 1936.


Hon. W. D. EULER (Minister of Trade and Commerce):: My hon. friend refers, I think, to the request that has been made repeatedly, perhaps more by the hon. member for New Westminster (Mr. Reid), with regard to employing Canadian seamen instead of orientals. The explanation has been given quite frequently. One of the reasons is, of course, that on these vessels travelling to the orient there are a great many oriental passengers, and it is thought that white men do not care to serve orientals. Another reason given by the steamship company is that it would be extremely expensive to rearrange their accommodation on the ships, they would have to make provision for the two classes of people; and whether it may be regarded as a good reason or not, it would mean also a very large increase in the expenditure for labour; in fact, so much so that I think practically the whole amount they are now obtaining as subsidy would disappear. This is a question that has been debated from year to year. As I stated last night, the company has agreed to take on a number of boy seamen, and, I think, have employed some twenty-four. After the report of the committee came in, an investigation also was made, in which I think it was pretty clearly shown that it would be quite impossible to obtain a sufficient number of qualified
men to serve on these ships. I know that statement has been contradicted, but our own officials made some investigations and I think the claim of the company in that respect is pretty well founded.


Mr. STIRLING:: Not as to boys; there are plenty of boys.


William Daum Euler: No, I am not referring to boys; the company are putting on boys. The Canadian Pacific Railway Company state that their experience has shown that from the point of view of both adequate supply of labour and the competitive conditions with which they are faced in this service-they are competing with subsidized boats from Japan and the United States-it is neither practicable nor economically possible to adopt the policy asked for by my hon. friends. They made a further reply from which I give these extracts:
I can assure you that if it were practicable al)9 economically possible it would be the policy ot the company to comply with the request. However our experience has shown that from the standpoint both of an adequate supply of labour and of the competitive conditions with which the company is faced in this service it is neither practicable nor economically possible to adopt such a policy at present.
According to the report of the departmental representative of the Department of Trade and Commerce following the investigation made, there were only forty-five competent and suitable deckmen available in Vancouver and seventeen in Victoria, or a total of sixty-two.
The shipping master at Vancouver reported only yesterday-
This is 1937.
-that the situation regarding unemployed seamen is unchanged and that lie has practically no inquiries from seamen seeking employment. Ihe manager of the sailors' home states that there are fewer unemployed whom he describes as unemployable, and some boys who have had a few voyages on seasonal employment on coastal vessels, and some of them are finding employment in camps.
The whole gist of the matter is that from the point of view both of expense and of a sufficient supply of seamen the company does not feel that it can comply with the request. I would be glad myself if it were possible to employ all white men. At the same time I think most of these Chinamen who are employed on these boats are British subjects, coming mostly from Hongkong.
This question has come up from year to year. I do not know that I can add anything further. I think that by and large the attitude taken by the company is fairly reasonable.
Supply-Trade-Subsidies


Angus MacInnis: I am not greatly concerned about the colour of the men engaged on these ships. What I am concerned about is that the orientals are engaged because they can be hired cheaply, that this company is manning its ships with orientals to take advantage of cheap oriental labour, while getting a substantial subsidy from the Canadian government. Further, I am not greatly impressed with the statement that there are no unemployed trained seamen at the port of Vancouver. How are we going to get trained Canadian seamen, or trained white seamen, if we engage on our ships oriental seamen exclusively? It takes experience as a seaman, actual time working on board ship at the various kinds of work on a ship, to become experienced. Until we give men an opportunity to become experienced, we shall not have experienced men, either with or without employment.
I wish to refer to the 1936 report of the committee on industrial and international relations. The reference to the committee was a resolution moved by the hon. member for New Westminster, namely, the question of the employment of Canadian citizens on ships and vessels the owners or charterers of which receive moneys from the public treasury of Canada. The committee heard evidence and made recommendations not only in regard to ships on the Pacific coast but also in regard to ships on the Atlantic coast. I do not know whether the parts of the report that referred to the Atlantic coast have been implemented, but I do know that the part which referred to the Pacific coast has not been implemented. I should like to read briefly from this report, found at page 461 of the votes and proceedings for 1936. There were three statements made, and the third one reads as follows:
Oriental shipping: the third type is chiefly carried on by the Empress boats of the Canadian Pacific Railway transpacific service. These ships receive a substantial subsidy from the government. The total number of men employed to man them is 2,033, of whom 265 are white British, engaged as officers and engineers. The remaining 1,768 are Chinese, comprising 277 deckhands, 558 in the engine room, and 933 victuallers. It is claimed by the company that, as much of their passenger trade, namely, 67 per cent, through and local, is oriental, this type of labour is not only cheaper but infinitely more satisfactory than -white labour, since the latter could not be gotten to cater to oriental passengers on the one hand, or mix with oriental labour on the other. It is moreover claimed by the company that the service is now supplied at a serious yearly loss, and that the extra cost involved in the substitution of Canadians for orientals would make the service practically impossible of operation.
Your committee therefore recommend-

Here we have the recommendations of the committee, which I submit were reasonable:
1.	That, in view of the substantial subsidy granted yearly to the Canadian-Australian line by Canada, the small number of Canadians employed in its service be brought to the attention of the company, and that they be requested to afford Canadian seamen a reasonable degree of employment at the earliest possible convenience.
I did not read the submission in regard to the Canadian-Australian line:
2.	That, as up to the year 1913 the decks of the Empress boats were manned by white seamen, and inasmuch the deck service is an important and responsible branch of the work of these boats, the Canadian Pacific Railway Company be requested to replace the orientals now- so employed by Canadian seamen, and that this change be made at the company's earliest opportunity.
The committee realized that the company had some difficulties to contend with and consequently did not ask that the company should change at once from orientals to white seamen. We did suggest, however, that the deck hands, who at that time comprised only 227 of the 2,033 men required to man these ships, should be Canadian citizens of the white race. I do not think that was unreasonable, and I believe we should insist that the company do something to fulfil these very reasonable recommendations before any further subsidy is granted.


Thomas Reid: Not only was the recommendation just read by the hon. member adopted by this house; the following year, when I introduced the same resolution, the minister was in Australia on behalf of the government and the acting Minister of Trade and Commerce suggested that if the bill were withdrawn he would set up a committee on the Pacific coast to ascertain if the statement made by the officials of the Canadian Pacific Railway were true; that is, that there were not enough men to fill the vacancies in the deck service if the Chinese were displaced. That committee went out to the Pacific coast and held various meetings. I do not know where the minister got the report he read a few moments ago. If I had time I could get from my office the report of the committee I just mentioned, which recommended that there were sufficient experienced seamen to man the decks of two of these vessels. They also recommended-this was in 1937- that the Canadian Pacific Railway Company be asked to carry out the recommendations which were adopted by this house, and which were just read by the hon. member for Vancouver East (Mr. Maclnnis).
I agree with the hon. member for Vancouver East that pressure should be brought to bear

Supply-Trade-Subsidies
upon this company, because I claim they have defied a report of this house. It may not have been an order, but it came as close as possible to being one. There are able-bodied seamen walking the streets of Vancouver who would be only too glad of an opportunity to work on one of these ships. The statement made by the minister that the Chinese sailors are British subjects from Hongkong has been exploded so often that I hardly need to do it again. No one who knows the situation in Hongkong would seriously put forward the argument that a Chinese from there was a British subject. There is a certain section of that city known as the white section, while the outlying parts are Chinese, and there is just a barbed wire separating the two. A Chinaman goes under the wire into the white section and is signed on by the number one man of the Canadian Pacific ship. Then the company claims that he, having come from Hongkong, is a British subject. The whole thing is ridiculous. Proof of that is seen in the fact that when these ships arrive in Vancouver, there are police on hand to see that none of these seamen leaves because the Canadian Pacific are responsible-I believe they are under bond of $500 a head-for none of these seamen escaping. None could prove his British citizenship or even his birth within the white settlement of Hongkong. So I appeal to the minister to study this matter seriously, because I am sure there are on the Pacific coast enough men to man the decks at least. We should not be voting $600,000 for this company and at the same time allow them to employ 2,033 men from China on these ships while our own people are walking the streets.


William Daum Euler: I do not know that I can add a great deal to what I have already said.
I have before me some comments by the company, and a note that the Department of Trade and Commerce asked the Department of Labour to verify some of the statements that were made. I might, in any event, read this short quotation:
The shipping master stated that he had few inquiries from seamen for employment on deep-sea vessels because there were no appointments available. The only deep-sea sailors being engaged in Vancouver are men to replace those who may occasionally be left behind by British and foreign vessels calling at British Columbia ports.
I might again mention the difficulties to which I referred previously. This line is in competition with a Japanese line which engages only Japanese sailors, of course at very low wages, and which receives a subsidy of something over S800,000. It is also in competition -with United States vessels, which are
very, very heavily subsidized. If the white men really can be obtained, the only alternative would be to increase the subsidy very heavily; otherwise probably the ships would fail to operate. There is an investment in these ships amounting to some $20,000,000, and in recent years the profit has been extremely small, while in many years there was no profit at all. That argument may not appeal to some people who think perhaps wages should come ahead of dividends, if you want to put it in that way, or interest on capital; but, after all the people who have the capital are not compelled to use it in that way. Certainly it would not be in the interests of this country to have a Canadian line driven off the Pacific in favour of a Japanese or United States line. I recall that two or three years ago one line which operated between New Zealand, Australia and San Francisco had to go out of business, and for some time there has been a real danger that the Canadian-Australasian line, in connection with which it was proposed a year or two ago to build two new ships, also would have to discontinue service unless something was done. In order to construct new vessels they required support from this government. As I said last night, that proposal has been abandoned for the time being because the cost of building vessels at the present time is too great.
It practically comes down to this:	The
company claimed they could not obtain enough seamen to man all the Empress boats, of which there are four. It might be possible- this has reference to the conditions which prevailed a year or two ago-to obtain sufficient men to man the decks of one of the boats, but the company claims that you cannot mix orientals and white men. You cannot put them in the same quarters; you cannot feed them at the same tables, and it would be impracticable to have white men on one boat and orientals on all the others. Again there is the matter of expense, which may or may not appeal to members of the house. Certainly I think it would be creating a considerable difficulty for the company, and frankly I have not felt disposed to insist upon that. They possibly would not accept the subsidy and might even discontinue the service.
But I am always of opinion that we ought to be reasonable in these matters. It is entirely necessary that we have the best of service and seamen on these vessels-and I am not going to cast any reflection upon the white people. But when we read of what takes place on some of the boats of other

Supply-Trade-Subsidies
countries, I think we must agree that the Canadian Pacific boats are manned and conducted in a way entirely superior to those of other countries-and I must add that I have no particular brief for the Canadian Pacific boats.
I, for one, do not care to take any chance of interfering with the efficiency of those boats, and I think the committee might very well pass the estimate. If in another year the committee feels disposed to suggest that this vote of $600,000 be doubled, well and good; but I would not recommend that to the government or to the House of Commons. On previous occasions I have spoken personally to the president of the Canadian Pacific Railway, and have impressed upon him the desire of parliament that more white men should be employed; and I think it is quite true to say that the Canadian Pacific would like to do so. But, as they say, they find it is impracticable. I am quite willing to continue pressing, in the hope that we may have more success than we have had in the past.


Angus MacInnis: I must say I am not greatly impressed with the arguments the minister has used.


William Daum Euler: I would not expect the hon. member to be.


Angus MacInnis: But I am sure he tried to make a good argument. He has said that some people may think that wages should come before dividends; that after all., the companies did not necessarily have to invest their capital in this way. Well, I think the minister is intelligent enough _ to know tlmt in these days people are finding great difficulty in investing their capital. They cannot be "choosy," and they will be less "choosy" in the future than they &ie to-day.


William Daum Euler: They do not invest unless they can get a return.


Angus MacInnis: That is correct; but
when that capital is a means by which the people of the country must live, and when that capital is, itself, socially produced or socially created, the government of the people will have to see that that capital is used, whether the company likes it or not-because the living of the people will depend upon it, and demand it.
If we take the position that just because of the additional cost this company are not going to be compelled to employ on their ships help to whom they will have to pay a decent wage, wages that will enable them to take part in the life of their community as citizens, having a decent standard of living,

then the same argument can be applied to every other industry, and we could bring in millions of Chinese under guard to operate our factories. There was a time about ten or fifteen years ago when orientals were working in bond on the ships of the British Empire Steel Corporation. The same could be done with any industry in Canada, if we wish to do it in that way.
But is that the way in which the government or the people of this country want to see their industries operated? After all, the Canadian Pacific Railway is only another industry. It is a great industry, and one which receives substantial revenue from the Dominion of Canada. It is an industry that is made possible because the people of this country use the service it offers. So I say some effort should be made to improve the condition of the men employed, and if the Canadian Pacific Railway will not engage white seamen, at least they should be compelled to pay decent wages to the men they employ. The moment we compel them to do that, they would engage white seamen.


William Daum Euler: Would my hon. friend tell me how he would "compel" this company to pay wages of any kind? All one can do is withdraw the subsidy. And I should like to say, if the hon. member will permit me, that I am not going to be placed in a position where I am represented as being opposed to fair wages being paid to any man, whether he be a white man or one of any other colour. That is not the attitude I take.
My hon. friend speaks about "compelling" capital. Well, I am afraid that at that point there comes a radical difference between us. That perhaps can be done under the system of socialism which he advocates. But I would point out to him that we are not yet operating under that system. I am not a socialist-although I must confess that sometimes I am accused of entertaining some rather radical ideas, and that in some respects I do agree with the hon. member. But I must repeat that we are not yet in a position where we can compel capital to do so and so-and certainly not with this company, because it is not located within Canada.
May I make this further point:	A large
proportion of the passengers on these boats are orientals, and possibly they would have a right to say that they would like to 'be served by people of their own race.
There is nothing more I can do in the matter. The committee is faced with this proposition: If we are not prepared to give a subsidy unless the men are changed and unless only white men are employed on these

Supply-Trade-Motion Pictures
vessels, we could withhold the subsidy. But I do not think we would be justified in doing that, under the circumstances. I am perfectly willing again-and repeatedly-to make such representations as I can to induce the company to use as many white Canadian seamen as possible. Failing that, then it is just a matter of deciding whether or not we are going to wipe out the subsidy of $600,000. For my part, and so far as the government is concerned, I would say that we are not prepared to do that.


Angus MacInnis: When I used the word "compel" I had in mind that we could give a subsidy conditionally. If they do not think the subsidy worth while they could refuse it. I have not looked up the report, but if my memory serves me correctly there is an enormous difference between the wages paid to white seamen by the Canadian Pacific and those paid orientals.


William Daum Euler: True.


Angus MacInnis: And, again if my memory serves me correctly, they would be able to employ nine orientals for the wages they would pay one white seaman. United States ships are operating


William Daum Euler: With large subsidies.


Angus MacInnis: -with white seamen.


William Daum Euler: And with large subsidies.


Angus MacInnis: Let me tell the minister that the wages for officers and men on United States ships, in both the local and deep-sea service, are very much higher than the wages paid on Canadian vessels.


William Daum Euler: And so are the subsidies.


Angus MacInnis: Yes, but if they would-


William Daum Euler: And the service is not as good.


Angus MacInnis: Well, of course that is a matter of opinion.


William Daum Euler: But it is the truth.


Mrs. BLACK:: It is not a matter of opinion; it is a matter of knowledge to anyone who has travelled on the coastal steamers of the Canadian Pacific. I have been going up that coast for forty years; I know.


Angus MacInnis: Well, I have not travelled on the Canadian Pacific boats, so I cannot say just what the service is like. But I have travelled on the United States coastal boats from Vancouver to California, and the service on those boats is good enough for me and, I think, good enough for anybody. But if a person would rather have a number of obsequious,
cringing, servile individuals waiting on him, rather than a person who stands up like a man-well, if that is what he wants, he is entitled to that kind of service. For myself, I do not want it. I prefer service of a different kind. Those who want the other kind of service can have it, if they like-and they will get it cheaply, and plenty of it. Our ancestors were not of a servile race, and we hope that our children will always keep their heads up as men. I hope that before the government brings down these estimates again that something be done to get the Canadian Pacific Railway Company to show some respect for the recommendations of this House of Commons.


[Stage Direction]
Item agreed to.
6J/8. Motion picture bureau-further amount required, $18,000.
Mr. PERLEY:: What is the reason for this increase?


William Daum Euler: It is entirely due to the cost of taking documentary films of the royal visit.


[Stage Direction]
Item agreed to.
Canada Grain Act.
649. Grain Futures Act, 1939, $25,000.
George Halsey Perley: What is this amount for?


William Daum Euler: I rather think my hon. friend knows.


George Halsey Perley: I have a pretty good idea.


William Daum Euler: It is to cover the administration of the Grain Futures Act which passed the house a few weeks ago. It is intended to provide for inspection work and the supervision of the Winnipeg grain exchange.


George Halsey Perley: Will the salary of the
supervisor be included in this?


William Daum Euler: I have not any details. I do not know what the salaries will be because the matter has not been seriously discussed. The bill went through the house only very recently. This item is an approximation of what may be needed for this purpose.


George Halsey Perley: Is it the intention to have an extra man attached to the board of grain commissioners?


William Daum Euler: There will be a supervisor as was provided for by the act, and whatever staff may be necessary.


George Halsey Perley: He will have to be paid a salary.


William Daum Euler: I am not certain as to just what may be done. What I am saying now

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is largely conjecture. It may be that they will be able to use someone now in the employ of the board.


David Spence: That is all to the good.


William Daum Euler: I rather think that may be done.


[Stage Direction]
Item agreed to.
Dominion Bureau of Statistics.
650. Administration - further amount required, $6,850.
Grote Stirling: What is the connection between the national nutrition committee and the bureau of statistics?


William Daum Euler: We had an item in the estimates last year to provide $25,000 which was asked for by the Department of Labour. This particular work was done by the bureau of statistics because that branch was particularly qualified. The vote of $25,000 was not sufficient, and this is a supplementary amount.


Grote Stirling: Does this committee
travel?


William Daum Euler: I think the man in charge does.


Grote Stirling: What does it do?


William Daum Euler: They collect food records, information as to the seasonal variation in food consumption and so on. This work was recommended to be done by the Canadian council on nutrition, and I must admit that I do not know a great deal about the work. This vote was desired by the Department of Labour, but it was thought the bureau of statistics could do the work better than any other branch.


[Stage Direction]
Item agreed to.	.
National research council.
574. New premises for annex laboratories, estimated to cost $1,459,895-amount required for 1939-40, $729,000.
Grote Stirling: Will the minister give us a description of these new laboratories?


William Daum Euler: As the committee may know, it was decided that no further additions should be made to the building on Sussex street, and it became necessary to provide new laboratories at a different location. I am told by the head of the national research council that if the work covered by this vote was carried on in the old premises the cost would be almost as great.


Grote Stirling: That is at the New Edinburgh site.
[Mr. Euler.l


William Daum Euler: The cost to be spread over two years is $1,459,895, and half is being appropriated this year. The acquisition of a site of about 100 acres will cost about $40,000.


Grote Stirling: Where is it?


William Daum Euler: It is near where the rifle range used to be or still is, a couple of miles out.


Grote Stirling: Who has been employed as architect?


William Daum Euler: I think the plans have been drawn and the work will be done by the Department of Public Works. The fencing of the property will cost $10,000; the provision of services such as water, sewage, electricity and so on will cost $116,745; the heating plant and electric substation building and equipment, $120,000; the engine testing laboratory, $96,000; the wind tunnel, aircraft instrument laboratory and administration building, $207,000; the model testing basin, $103,100; the gasoline and oil laboratory, $25,200, and the workshops building, $123,000. The whole amount will be expended in two years.


Grote Stirling: Will certain of the activities now carried on in the old building be moved out to these new laboratories?


William Daum Euler: There is a constant expansion in the work. For instance, the Department of National Defence require a great deal of work in connection with testing engines and things of that kind to be done by the national research council.


Mr. CLARKE (Rosedale):: Were there any expenditures under this item or an item of this type last year?


William Daum Euler: No.


Mr.   CLAKE@Rosedale: No new premises of any kind were erected last year?


William Daum Euler: None whatever. This vote is for entirely new buildings and equipment in a different location.


Abraham Albert Heaps: Approximately $1,500,000 is to be expended under this item. The minister tells us that these laboratories are to be constructed on a new location of 100 acres approximately two miles from the centre of the city.


William Daum Euler: It may not be that far.


Abraham Albert Heaps: There probably are good
reasons why these buildings should be located so far from the parliament and other government buildings, and I should like to know what they are. As other hon. members have

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stated on previous occasions, some effort should be made to centralize the government buildings. I do not approve spreading out these buildings so far because they have to be visited by many people.


William Daum Euler: While there will be an administration building, these are mainly research buildings. It is desirable where they are carrying on research work of various kinds that they have a quiet place, and with pure air, it is suggested to me. They need a large area, and if it were to be obtained very close to the city it would be tremendously expensive.


Abraham Albert Heaps: Does it need 100 acres?


William Daum Euler: The 'board seems to think so.


Abraham Albert Heaps: Which board?


William Daum Euler: The national research council.


Abraham Albert Heaps: When new public buildings are erected, is there not some coordination between the various departments to ensure proper planning for the construction of government buildings, whether in the centre of the city or elsewhere? I do not like the idea of one department putting a building up here, and another department putting another up there. I was under the impression that now we had an experienced planner in the city, a proper planning scheme for government building construction would be worked out.


William Daum Euler: It is not a building at all of the same kind as departmental buildings. It is for mechanical and experimental work of various kinds. They have to have wind tunnels, for instance. While I do not know much about the technical requirements, my hon. friend can readily understand that testing engines, wind resistance, and all that sort of thing, and the building of tunnels for the purpose, require a considerable area, and they go further out in order to obtain sufficient space for their purposes.


Abraham Albert Heaps: Do they do these things outside the building or .within the building?


William Daum Euler: I do not suppose the tunnels are in the building. All sorts of experimental work is being carried on. My hon. friend has me at a bit of a disadvantage because I air. not familiar with scientific work, but I do know that the national research council, besides conducting many experiments, is doing a great deal of work for the industries of Canada for which they receive considerable revenue. Last year they collected something like 1103,000 for work they did for industrial concerns, making experiments with regard to met-als, machinery and that kind of thing. They also do a great deal of experimental
work in connection with wheat and grains generally, work that is beneficial to agriculture; also work for the various departments of government, more particularly the Department of National Defence, which has expanded tremendously, and if the work it requires to be done had to be done by industrial concerns it would mean a tremendous expense to that department. A great deal of that work is being done by the national research council. They also have a health branch and make investigations with regard to health, grain, forests, and fifteen or twenty other activities of a scientific kind. The men in charge of the national research council are qualified men drawn from all over Canada, and they are in charge of this work.


John Ritchie MacNicol: But unless you control them they will expand so rapidly and to such a size that research will become a nightmare to take care of.


Mr. GRAYDON:: Has the minister given
personal attention to the cost of this building? I wish to emphasize the necessity of the minister giving personal attention to expenditures on public buildings. Throughout the country-I do not say this in any political way at all-there is a strong feeling that a great deal of money is being spent on buildings in the city of Ottawa, and that this expenditure might be cut down to some extent. Here is a building costing about SI,500,000. Then we have the supreme court building, costing nearly S3,500,000. Actually the cost of the supreme court building is as much as the assessed value of one of the townships in my riding. That gives one some idea of the expenditure which is being made here on public buildings. I would be the last to criticize expenditure that was made in the right direction, and I am not in a position to criticize this particular building, but I do point out that where large expenditures of this kind are being incurred, the minister, with his knowledge of business, should apply some of that knowledge to make sure the money is well spent and that not too much of the taxpayers' money goes into it.


William Daum Euler: The board in charge of all
this work is composed not only of scientists but of some prominent businessmen in this country.


David Spence: To whom are they
responsible ?


William Daum Euler: They are responsible to a
committee of the cabinet of which the Minister of Trade and Commerce is chairman, so that whatever they recommend must first
4642	COMMONS
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pass the scrutiny of that committee, and the estimate must later be approved by the whole cabinet itself. I can give the names of the members of the board. There is Sir Frederick Banting. Then there is Mr. W. R. Campbell, president of the Ford Motor Company of Canada. My hon. friend will agree that he is a well qualified man.


Abraham Albert Heaps: Did they select the site?


William Daum Euler: The board selected the site, certainly.


Gordon Graydon: Is there a farmer on the board?


William Daum Euler: I will see.


David Spence: Does this S700,000 buy the land and construct the building?


William Daum Euler: No; twice that amount,
spread over two years.


John Ritchie MacNicol: I should like to say a
word or two with reference to these public buildings, having in mind particularly the supreme court building, which will be under discussion when the appropriate estimate is before us. Did the department select an outside architect to draw the specifications for the proposed research building, or was it done by the public works architect?


William Daum Euler: I am not sure who drew
the plans but the Department of Public Works is undertaking the construction of the building.


John Ritchie MacNicol: Did the Department of
Trade and Commerce specify any of the mechanical equipment that is to enter into the construction of the building?


William Daum Euler: They intimate what the
building is to be provided for, and plans are drawn to meet the requirements.


John Ritchie MacNicol: If I were in the minister's place and had anything to do with the construction of that building I would see that it was constructed properly. With reference to the supreme court building, it is interesting to my mind what has taken place there. I imagine that if the building had been designed by our own architects the general plan that is being followed in the construction of government buildings would have been followed, but that is not the case with the supreme court building.
This national research building is to be erected outside Ottawa, and its construction will require a great deal of supervision. It is up to the head of the department to see that the building is properly constructed, and
[Mr. Euler.1
that the plans and specifications are wide open. I do not think any government building should have the plans and specifications tied up so that only one manufacturer can supply the mechanical material. I say to the minister that he should write a letter to the Department of Public Works directing that departs ment to see to it that the specifications be kept wide open in reference to all the mechanical equipment entering into the construction of that building, so that any one of half a dozen firms can figure on the material, instead of having only one firm supply mechanical equipment as is the case with the supreme court building.


William Daum Euler: I do not know why my hon. friend should assume for one moment that anything of that kind is contemplated. With regard to the minister of this department exercising supervision over the construction of the building itself, the actual construction, as my hon. friend knows, is the duty of the Department of Public Works.


John Ritchie MacNicol: This department has no control over the cost of the building at all?


William Daum Euler: This department is not particularly concerned with the construction once the plans are approved. Would my hon. friend expect that the minister could be particularly helpful in laying out and planning for a building which has to do with services such as these:	aeronautical research, asbestos
research, building and construction industry, electrical committee, field crop diseases, fire hazard testing, forestry research, grain research, hydraulic research, magnesian research, magnetite research, mining research, national building code, national committee on fish culture, parasitology, plant hormones, radio research, rubber and metal research, storage and transport of food, wood research, compressed gas cylinder research, corrosion research, and so on. I am quite free to admit that I know very little about these things. Certainly I would not be able to design any building to take care of these services.


David Spence: And the minister has not any knowledge that they require this space at all.


William Daum Euler: Why, certainly.


David Spence: I would not expect him to. I am not condemning him.


William Daum Euler: Under the law constituting the national research council the work of supervision and conducting the council is placed under the control of a board of men whose names I can give here. These men are supposed to be qualified to do the work

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for which they were appointed. They have as their head Major General McNaughton, in whom I have a great deal of confidence. He was appointed by the former government. I believe he is a very competent man. And if we have confidence in these men-


David Spence: But they all have extravagant ideas. That is the difficulty with men of that type.


William Daum Euler: I am afraid that my hon. friend is not exactly speaking from experience, or at least he is taking for granted something which perhaps he is not quite justified in taking for granted.


Abraham Albert Heaps: The minister, in answering one or two questions I put to him, made it appear that I was not altogether in favour of this extension of the work of the national research council. I am very much in favour of extending the work of the national research council, because I believe they are doing excellent work. I have some knowledge of what they have done in research and other lines, and I should like to see their activities extended because I believe they are a great benefit to the dominion.
In this connection, however, there is one point I should like to make. It is directed not particularly to the minister 'but to the government as a whole. In choosing and laying out sites of buildings we should make some effort to coordinate all the government structures in and around Ottawa. For instance, it seems to me that the selection of a site which they purchased some time ago, in the direction of Rockcliffe, was not good policy; I refer to the places where the bureau of statistics and the national research council are located. A few years later, when the government decided upon another building as a sort of adjunct of the research council building on Sussex street, they put it two miles away. I do not know anything about these matters. I realize that we in this chamber have to rely largely on the information we receive from the minister, and he in turn has to rely on the information he receives from the officials. But I do not know as yet whether the national research council recommended the site and whether they also recommended the purchase of 100 acres. We are told that they require tunnels and so on. I do not know whether they require those tunnels to be built on a large new area; they have, I believe, tunnels in some form at the present time in the research council building. It seems to me that if possible these buildings should be concentrated in an area where they would be easily accessible to all concerned.
I do not know that, beyond what the minister sajts, there is any special reason why this building should be two miles away from the centre of the city.


William Daum Euler: It is, for one thing, a matter of fire hazard where experiments are being carried on.


Abraham Albert Heaps: Is there not the same fire hazard on Sussex street?


William Daum Euler: There is not the same danger of fire. We are taking it away from there.


Abraham Albert Heaps: Entirely?


William Daum Euler: Yes.


Abraham Albert Heaps: What are you going to do with the building on Sussex street?


William Daum Euler: The large building remains there for other purposes.


Abraham Albert Heaps: When we are planning for the erection of government buildings, let that planning be done in some coordinated way so that it will be convenient for the people who have to use the building and good policy, I think, for the city of Ottawa. That does not apply merely to the Department of Trade and Commerce, because I believe the minister administers that department, as he has administered any department of which he has had control, in an efficient way.


Harry Gladstone Clarke: I should like to direct a question to the minister with reference to the break-down of this expenditure for 100" acres of land. What amount of money is being paid; is the area 100 acres or 150 acres; and of what does it consist?


William Daum Euler: About 100 acres, costing


Harry Gladstone Clarke: Were there any buildings on that site?


William Daum Euler: I do not think so.


Harry Gladstone Clarke: Was that good, fertile land?


William Daum Euler: They thought it was suitable for the purpose for which it is intended.


Harry Gladstone Clarke: Yes, but was it of a fertile type? Was there any bush on parts of that land or anything from which the owners could receive benefit?


William Daum Euler: I cannot give that information. The selection was made, not by any member of the government-if that is in the mind of my hon. friend-but by the national research council. I can give him the names of the board. All of them are gentlemen of

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undoubted integrity, who would make the selection with just one purpose in mind, and choose the most suitable site they could find-and that goes for the price as well. I am sure they satisfied themselves that the price they paid was fair.


Harry Gladstone Clarke: That is, $40,000 for 100 acres of land within two miles of the city of Ottawa?


William Daum Euler: Perhaps I was unfortunate in saying "two miles"; that was just an estimate; but it is not very far from Ottawa, and it would have more value, I am sure, than land situate fifty miles from Ottawa.


Harry Gladstone Clarke: And it was purchased through a real estate agency?


David Spence: And worth about $15,000.


William Daum Euler: I am informed that it was not purchased through an agency.


Harry Gladstone Clarke: Can the minister tell me who was the owner of the farm, and at what it was assessed at the time of purchase?


William Daum Euler: If my hon. friend wants detailed information I will have one of the officers of that branch come down and we will give him all the information we have.


Harry Gladstone Clarke: Could the minister not give me the assessed value of that land which he purchased for $40,000? I think he should be able to do that.


William Daum Euler: I am not refusing to do it, but I think my hon. friend will admit that a minister cannot carry all these details in his head. I am willing to give all the information that we have.


Harry Gladstone Clarke: Thank you. I am sorry. Go ahead.


William Daum Euler: The land was expropriated, and the public works department is making a valuation. The price is not yet fixed. This is merely an estimate.


Harry Gladstone Clarke: At what
amount was the property assessed?


William Daum Euler: I have not that information, but I will get it for the hon. member if he wants it.


[Stage Direction]
Item agreed to.

[Stage Direction]
Lands, parks -and forests branch.
Government of the Northwest Territories-
131.	General administration, operation and maintenance of services, including Wood Buffalo park, $265,980.
Leslie Gordon Bell: What is the Wood Buffalo park?


Hon. T. A. CRERAR (Minister of Mines and Resources):: The Wood Buffalo park is partly in Alberta and partly in the Northwest Territories. It is almost in the northeast corner of Alberta. Its area is a little over 17,000 square miles.


Major James William Coldwell: They have a number of wood buffalo there?


Thomas Alexander Crerar: Yes, some wood buffalo and some ordinary prairie variety of buffalo.


Grote Stirling: How are they getting along together?


Thomas Alexander Crerar: So far we have had no reports of any differences of opinion between them.


[Stage Direction]
Item agreed to.
Lands, parks and forests branch.
132.	Eastern arctic expedition, $27,000.
Major James William Coldwell: Under which item do the reindeer come?


Thomas Alexander Crerar: Not this item; this has to do with the expense of sending the Nascopie to do the arctic patrol in the eastern arctic.


[Stage Direction]
Item agreed to.
Lands, parks and forests branch.
Government of the Yukon Territory-
133.	Administration, $45,000.
Donald Elmer Black: Naturally I must say to the minister that I specially regret the decrease that the department has seen fit to make in the Yukon allowance. The Yukon is charged up with so many expenses-telegraph lines in northern British Columbia, while other expenses are lumped together with the northwest-so that I sometimes wonder exactly what is Yukon, what is the northwest and what is northern British Columbia.
From 1898 to 1937 and 1938 about $225000,000 in gold was brought out from the Yukon. Silver production from 1925 approximated $14,000,000. There was no previous record. Lead up to date amounts to over $3,000,000.
Customs duties collected from 1898 amount to over $8,000,000. In 1938, 60,000 pelts were shipped out from the Yukon, consisting of marten, mink, lynx, ermine, fox and muskrat, and good taxes were paid on all those.
To date the government have expended a little less than $35,000,000 on the Yukon, so it seems to me that the amount which has been produced by the Yukon is a fairly good return on that expenditure by the government. Of course the minister may say the return is indirect, but at the same time when one considers the number of people who have

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come out from the Yukon and bought farms in British Columbia and the middle west with money made in that territory, I think we are doing fairly well for Canada at large.
It was with great regret that I learned recently of the destruction of the Indian school at Carcross. That school has done good work. It was too small for the work it was expected to do. The building was owned by the government, and I am told that it will be impossible for the government to replace that school this year, because they have- perhaps not expended all their money, but decided where the money they have to spend will go. I would ask the minister to consider carefully this question of rebuilding that Indian school. It has done a good work. They have brought in those boys and girls, they have splendid instructors, and at that school in particular I know they teach the Indians so that when they go back to their ordinary surroundings they know how to go on with the work that men and women living in a natural state should know.
I would particularly ask the minister, when he sends his geological survey parties into the Yukon this year, to see that they keep an eye on the lode deposits in the Carmacks district. There are about twenty or twenty-five men working there now. It is the first satisfactory result from gold quartz mining in the Yukon. They have been working against great odds this year because of lack of water, on account of a light snowfall. They are twenty miles over a bad trail from the Yukon river, bad enough in winter and impossible in the summer. At the second run of the mill put in there by a few men, eighty-eight ounces of gold were processed, and twelve tons of concentrates, although for four months they were able to run only four to six hours daily. This district particularly needs a road in from the river, and if the geological survey party visits there doubtless the minister will be thoroughly informed that good work is being done. In the winter the transportation is not very difficult because it can be done by tractor, but when the thaw comes it is impossible.
It is only recently that people living there have put in the radiophone. A severe accident happened there this winter. A young man was badly burned, they had to walk twenty miles to the river before they could get in touch with the telegraph to call for a plane from White Horse, and after several days the man was brought down and taken by plane to White Horse.
Last year they had in the Yukon over five thousand tourists, with practically no
advertising save by the transportation companies, the Canadian National, the Canadian Pacific and the White Pass. Tourists mean a great deal to us in the Yukon. The big-game hunters go there in larger numbers each year. Our guides are complaining of the destruction of game by wolves and coyotes. Two packers lost forty horses last winter by depredations of wolves. At one time we had a bounty on wolves and coyotes.
The money that is sent to us by the government is used for roads, hospitals and our out-of-works. Our young people are not out of work; but people who went into that country in 1898, as I did, are growing older, their health is failing, they must be taken care of. I can say no words of too great praise for work the sisters of St. Ann are doing at St. Mary's hospital. They look after tlm aged and unfit just as gently and as lovingly as if those men and women had any amount of money. They are indigent patients, people who are too old, too ill or too unfit to work, and they must be looked after. A number of years ago, when Lord Byng went into the territory, he said to my husband, "Captain Black, you represent the only truly socialistic constituency in the British empire." My husband looked at him and replied, "Your excellency, we are not socialists up here." To this Lord^Byng said, "Oh, yes; you are socialists in the truest sense of the word. You have practically no class distinction. You have no very rich and no very poor. You all work as long as you can and then, when you are unable to work, you take care of each other."
That is still true in that great country. We are so isolated that I sometimes think the government hardly understand our needs and conditions. The aeroplane and radio have annihilated time and space, and for that we should be thankful. The minister is a western man, who knows what hardship is, who has had to fight nature. Perhaps if he would take enough time to visit us in the north-I do not think it would take more than a week-he would understand our conditions better than they have been understood by any other minister. He has lived in the great open spaces, and I should like him to come to the north country as well as the parties he sends.
I am sure he would be welcomed, not only by me as a " half-baked opposition member," as I have been called, but also by his friends and my friends. We would see that he learned the country at first-hand.
I particularly ask the minister to be as generous as he can with us. We need help; we need money. Living conditions are difficult and expenses are very high. People who

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bring up children in that country must send them out if they want them to have a college education. We have so many expenses in the north that people here do not have. A year ago my son and his wife visited me; my daughter-in-law had done the housekeeping while they were here, and she said to me one day, " Mother Black, you have good turkeys here." I replied that they -were very nice turkeys. She said, " I think Donald and I would like a turkey for dinner," so I said, "Lovely; just order it." Later she came to me and said, "Did you know how much the turkey would cost?" I said, "Yes; I suppose about 95 cents or a dollar a pound." She said, "Yes, the turkey cost $12.75, and I really feel as though I had eaten money." So when the minister pinches a little with us I wish he would remember our turkey. I wish he would remember how much we have to pay for what we buy. Lettuce comes in iby aeroplane now and the transportation costs thirty-six cents a head. We in the Yukon like fresh vegetables just as much as people like them here. We need help for our roads, for our mines, for our hopsitals, for our schools; we need help to do away with the predatory animals, the wolves and coyotes that are a menace and a danger to the camps. With the amount the minister has, I am sure he will exceedingly regret having pinched us^jown this year. He did very well for us last year, but now, like all hon. members, I come with hands outstretched, saying, " Gimme, gimme, gimme "1


Thomas Alexander Crerar: The Yukon always has an earnest advocate in the person of the hon. member who now represents it. I hasten to assure her that the picture is not really quite so gloomy as she surmises from these estimates. It is true that under this item there is a reduction of $3,000, which is on account of the fact that it is anticipated that fewer mental cases will require treatment. Such eases must be taken to Vancouver, and of course we are always anxious to cut down expenditures wherever we reasonably can.
The other point mentioned by the hon. member in that regard really has to do with the next item, in which there is a reduction of $20,000, but I might say a word about that now. This does not represent the entire expenditure in the Yukon. My officers advise me that we have appropriated $40,000 under another vote for the construction of roads, which I think will bring the total amount nearer to that voted last year.
With regard to the Indian school, which unfortunately burned down a few weeks ago, our estimates for the year had been prepared when that occurred. I understand that fairly satisfactory arrangements have been made to

carry on the work, and I can assure my hon. friend that this matter will receive consideration next year, if I still have responsibility for this department. I mention that simply to give an encouraging thought to my hon. friends who sit opposite, although I fear very much that their hopes will not be realized.
In regard to the gold deposits in the Carmacks district I may say that Doctor Bostock, the geologist who has been in charge of the parties we have sent there for several years, has prepared a special report on the mineral production and outlook in the Yukon, which will be published shortly. I may tell my hon. friend that her remarks to-night will be particularly drawn to the attention of the deputy minister and of Doctor Bostock, who is now on his way into the Yukon for this season's work, and we shall be happy to cooperate as far as possible in meeting the suggestions she has made.
The hon. member referred to the difficulty of keeping down the predatory animals, the wolves and coyotes, in the Yukon district. The Yukon council, which is the local governing body, derives all the revenue that comes from the royalties on fur, and that being the case, we thought they should be able to make some provision for bounties to assist in the destruction of these wolves. However, that suggestion will receive consideration also. The Jion. member was kind enough to invite me to pay a visit to the Yukon. It is a pretty long distance away, and it is a large country to cover. I shall be happy to take this suggestion under consideration also, and if I could persuade my colleague the Minister of Justice to come with me I would be happy, if at all possible, to accept the invitation.


Donald Elmer Black: I particularly wish to express my thanks to the department and to the minister because they have always been so very kind to me and have always at least taken my suggestions under advisement.


[Stage Direction]
Item agreed to.
Lands, parks and forests branch.
1ST. Forest products laboratories, $151,109.
John Ritchie MacNicol: When the Minister of Trade and Commerce (Mr. Euler) was presenting his estimates a few minutes ago, he referred to the fact that in the new laboratoiy to be erected by his department they wdl be experimenting with forest products. Are we to have two departments looking after the same matter, each one spending a large sum of money to do the same work?


Thomas Alexander Crerar: No. The national research council have nothing to do with the administration of this vote, beyond at times acting

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in a consulting or advisory capacity. I recall that a year ago there was some discussion on this vote when the then leader of the opposition suggested that it should be merged with the work of the national research council. It has been conducted wholly apart from the work of the council.
I would say briefly that there is one laboratory at Montreal which deals especially with scientific investigations in connection with the manufacture of pulp and paper, and gives assistance to our important paper industry. Then, there is one on the Pacific coast which studies and examines the woods of British Columbia which are of a different type from those in eastern Canada. The third laboratory is in Ottawa. The studies made in these various laboratories have to do with the most efficient utilization of wood products and economies that can be developed, and deal with the handling and use of those products, and general scientific work of that kind.
While I admit that there is room for argument on the point that this work might be associated with the general work of the national research council, it was not done in that way in the beginning. I assure the committee that there is no duplication of the work of the national research council.


David Spence: Where will this be built?


John Ritchie MacNicol: The Minister of Trade and Commerce outlined some of the work. I may have misunderstood him, but I understood the work he planned was going to be along the same lines as that outlined this year and last year by the minister.


Thomas Alexander Crerar: No buildings are to be erected out of this vote. This is purely for the payment of salaries and other expenses incidental to the investigational and experimental work. There is nothing for construction.


Angus MacInnis: Are those laboratories government laboratories?


Thomas Alexander Crerar: Yes, with the exception of the one in Montreal. The laboratory in Montreal is the result of contributions made by McGill university, by the government and by the Canadian Pulp and Paper Association, and each of these bodies is represented on the advisory committee.


[Stage Direction]
Item agreed to.
Lands, parks and forests branch.
National parks bureaul/,0. National parks and historic sites services, $1,261,500.
John Ritchie MacNicol: Two years ago I brought to the attention of the minister an historic 71492-292
site called Watson's Corners, in Lanark county, and at that time he kindly said he would have the matter brought to the attention of the historic sites and monuments board. On June 10, 1937, I received the following letter from the department:
On the 19th of March Mr. Crerar advised you that the Historic Sites and Monuments Board of Canada would consider the suggestion that the site of the old library at Watson's Corners, Lanark county, be fittingly marked.
In the minister's absence, I have received a report from which it appears that the board is of the opinion that this could not be considered as a site of sufficient national importance to warrant the board making a favourable recommendation in the matter.
If I were to take particular note of the letter I really should move that the vote be reduced to one dollar; but I shall not do that this year.


Mr. LAPOINTE (Quebec East):: Thank you.


John Ritchie MacNicol: I shall not do so because of the lateness of the session; but next year I may pursue the matter much farther, because if the site at Watson's Corners is not of national importance, then I want to know what is the national importance of the monument erected up Yonge street in front of one of the golf clubs-I have forgotten which one. I should also like to know the national importance of the monument erected on the height of land between the Mackenzie and Saskatchewan rivers at the old portage. I should like to know the national importance of the site of the monument erected on the town line between the townships of Markham and Scarboro, to the Reesor family. I have made notes of scores and scores of sites, none of which has anything like the historic significance of the site at Watson's Corners. I know that a great many of the sites on which the board has erected monuments are not one-two-three in national importance when compared with the historic library site at Watson's Corners.
Lord Dalhousie was one of the early governors general of Canada, but at first was Lieutenant Governor of Nova Scotia, and I believe Dalhousie university was created as a result of some of his activities while in that part of Canada. After he became governor general he contributed to and started a library at Quebec city. Later, when he came farther west, he subscribed to one of the first libraries in Ontario-if not the first- which was situated "at Watson's Corners, in the county of Lanark. He was particularly interested in that part of the country because the Scotch settlers who had settled there

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had been sent out by the immigration societies of Scotland, following the Napoleonic wars, and had been sent out by the British government, in view of what had happened during the war of 1812, in order to establish a thoroughly loyal community north of the Rideau river. A great many of those settlers came from Lord Dalhousie's estates in Scotland. For that reason one township was called Dalhousie township, and another, Ramsay township, the earl's family name being Ramsay. If any member of the board went out to inspect the Watson's Corners site, I cannot understand why he reported it was not of national importance. I talked to one member of the board who is an educationalist and he told me he knew nothing about it. He was greatly surprised when I told him of the great importance of the site and that it had been turned down as not being of national importance.
Because of the lateness of the hour I shall not take up any more time, but I would ask the minister to look into this matter. When the session is in progress next year I hope there will be more time to discuss this. In my judgment, this is one of the most historic sites in Ontario. It may not be important from a war point of view, but it has great educational significance. In an old building at Watson's Corners are many of the old books which had been donated by Lord Dalhousie in 1828. They are now in an old wooden building. The old library has not been in existence for some time. These books are of historical importance. It was from these books that the early pioneers in that community received their education. Many members of their families have carried all over Canada the learning they obtained from these books. The minister is of Scotch extraction and he will know these Scotch pioneers prized these books. I am thoroughly in earnest when I say that this library site should be looked into.


Thomas Alexander Crerar: Following representations which were made by the hon. member for Davenport (Mr. MacNieol) a year or two ago, this matter was referred specifically to the historic sites and monuments board. I am advised that the practice in the past has been to act only on the recommendation of the board. Naturally many applications are made to the department in connection with particular places that are considered to be of historic importance. As I understand it, the historic sites and monuments board was set up a number of years ago to act in an advisory capacity. Its members are familiar with the general history of the country. I shall be 
happy indeed to bring this matter once more to the attention of the board. Since my hon. friend rose in his place a few moments ago I have been advised that the 'board are to meet in this city early next week. I think it would be quite appropriate if my hon. friend would seek an interview with them and present the claims of this particular site. I would hesitate to act independently of the advice of the board because, if the rule in that regard is once broken, many difficulties will be created. The board is really a sort of buffer between the demands that come from all parts of the country and the administration. It is an independent, non-partisan board and is guided only by a sense of its own responsibilities.


Mr. GRAY:: I may be showing my ignorance, but where is Watson's Corners?


John Ritchie MacNicol: In the county of Lanark, in the township of Dalhousie, about six or seven miles from the village of Lanark and about eighteen miles from the town of Perth. It was settled by veterans of the Scotch regiments which fought during the peninsular war under General Ramsay, who later became Lord Dalhousie, and who was made an earl after the battle of Waterloo. These Scotch regiments took a most prominent part in the battle of Waterloo, and following that battle and the war of 1812 they were settled in the township of Dalhousie.


Mr. BROOKS:: Now that the geography and history lessons are over, I should like to say a few words with reference to a proposed national park in New Brunswick. I think I can truthfully say that New Brunswick is the only province in Canada which has no national park at the present time. While we have a number of historic sites, we have no national park. I am rather ashamed to bring up this matter again because it has been brought up every year since 1936. The minister will remember that in that session a bill was passed authorizing the establishment of national parks in the three maritime provinces. Prince Edward Island and Nova Scotia have taken advantage of the provisions of that act and their parks are now being developed.
I understand that the sites of these parks were well selected, and they are proving quite popular with tourists and the people of the provinces.
I should like to see some action taken in New Brunswick. The people of the province are growing weary of the delay, but I do not think the minister is being blamed particularly. I have good reason to believe that the delay is more the responsibility of the

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provincial government at Fredericton than it is of the federal government here at Ottawa. Has any definite site been chosen as yet for a national park in New Brunswick? If no definite site has been chosen, what prospective sites have .been reviewed and what is the order of preference? Can the minister give any assurance that the development of a national park in New Brunswick will be undertaken in the near future?
I have not his exact words, but in the session of 1937 the minister intimated that unless the provincial government took some steps to provide for a site, the federal government might have to act in the matter. I do not think it is necessary for me to point out that our province is losing tourist business every year because we have no park. Some $4,000,000 was spent last year for the development of parks throughout Canada, tout not one dollar of that was spent in New Brunswick. The fact that our province is beautiful is self-evident to anyone who visits it. We have splendid roads, and I believe that if a park were established it would prove a great added attraction so far as tourist trade is concerned.
There is another matter in connection with which the province is losing. I refer to relief projects. I understand that between $600,000 and $700,000 has 'been spent for relief purposes in developing the Nova Scotia site. I have heard considerable criticism of the way in which this money has been used, but we in New Brunswick feel that the federal government and the provincial government should endeavour to get together on this matter and provide a national park for our province. I should like to have some comment from the minister in this regard.


Thomas Alexander Crerar: Up to the present time no site has been selected for a national park in New Brunswick. My hon. friend is in error when he says that according to his memory I stated in the house a year or two years ago that if the provincial government did not act the federal government would.


Alfred Johnson Brooks: The minister intimated that he was growing impatient.


Thomas Alexander Crerar: I do not wish the committee to get any wrong impression. I have stated several times when the parks votes have been under consideration in the past that the provincial authority has first to acquire the area and deed it over to the federal administration.


Alfred Johnson Brooks: I think that is generally understood.


Thomas Alexander Crerar: There are several sites in New Brunswick, perhaps of varying degrees of suitability, any one of which would be a 71492-2921
good park site; but I understand the provincial government, which has to provide the area free to the parks administration, finds itself in the position where it has to acquire considerable private property. We will not take over a park area if private property is held within its boundaries because we want complete control, which is necessary if we are to develop the area suitably for park purposes. I can assure my hon. friend that so far as the federal administration is concerned, we shall be prepared to go ahead when we secure the area; or rather I will put it in this way:
I am prepared to recommend to the government the commencement of development work on such a park site once the area is selected. At the same time I am bound to say that I recognize the difficulties which the provincial government have to overcome in getting an area. If they were starting de novo in an area where there was no settlement it would be a comparatively easy matter. That was the situation not only in connection with the Cape Breton Highlands park site in Nova Scotia, but very largely in Prince Edward Island.


Alfred Johnson Brooks: They surmounted the difficulties.


Thomas Alexander Crerar: They surmounted the difficulties, but the difficulties were not nearly so great as I understand they are in New Brunswick. That is the position. I know the matter has been engaging the attention of the provincial government, and possibly by another year we shall be able to make a definite start.


Alfred Johnson Brooks: The minister did not answer one question I asked with reference to the survey that has been made by his department and as to whether there was any order of preference in the sites surveyed-first choice, second choice, third choice, et cetera. My opinion. I might state to the minister, is that the difficulty is not so much in obtaining the land as local jealousy in different parts of the province, and the provincial government does not seem to have the back-bone to go ahead and make a decision.


Thomas Alexander Crerar: If there are such difficulties I know nothing of them, but I do know enough of the situation to be quite certain of what I said a moment ago that there are difficulties in the way of securing the necessary area. I cannot recall at the moment the order of preference, and I am sorry I have not the information here. Various sites suggested have been examined by competent parks officials, men who have done that work in the other provinces. They furnish maps and complete detailed information regarding the different areas. I believe they did classify
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the areas in order of preference according to their judgment. I have not that information here tonight, but I can give it to my hon. friend if he desires to have it.


Alfred Johnson Brooks: I should be glad if the minister would supply me with the information.


Abraham Albert Heaps: I should like to draw to the attention of the minister a matter affecting the employment conditions of some men who work in the Clear Lake national park in Manitoba. I have been asked to do so by a certain organization in Winnipeg. While these men are not employees of the government, they work as musicians for a man who has a dance-hall concession in the Clear Lake park. He is their employer, and there has been a dispute between the concessionnaire and the men he employs as musicians. The hon. member for Winnipeg North Centre (Mr. Woods-worth) and I have had communications from the city of Winnipeg in reference to conditions of employment there. This man has a monopoly of the concessions there from the parks branch. While I am not personally familiar with the situation beyond what I have learned from communications received, I must say that there seems to be something in the complaint of the Winnipeg musicians' organization, which has taken this matter up on behalf of the musicians working at the dance hall in the park. From correspondence we have had with this organization, it appears that these musicians are employed seven days a week at a salary of fifteen dollars a week.


Thomas Alexander Crerar: If my hon. friend will permit me to say a word, I do not think it will be necessary for him to labour the point. The matter has been drawn to the attention of the department. This concession was secured several years ago. It was granted not by the present government but by the previous administration. There is an annual licence fee charged, and in the licence issued this year a provision was inserted that the licencee must pay the scale of wages approved by the province for that class of employees. I hope that will overcome the difficulty mentioned by my hon. friend.


Abraham Albert Heaps: While I do not want to
labour the point at any length, I do not know whether the provincial government have set up any scale of pay for musicians. They may have schedules applying to other classes of work, but I doubt very much whether there is such a thing as an approved scale of pay by the province for musicians working in any part of Manitoba. But if an annual licence is granted by the department, there would

be a means of seeing that the men employed as musicians receive at least decent remuneration for the services they render. I draw the matter to the attention of the minister this evening, and if necessary I can take it up with the department later if the grievances are not properly adjusted.


Thomas Alexander Crerar: We have been advised
that rates of pay will be established by the provincial department of labour covering the employees engaged in this particular dance hall. I do not think we can go beyond that. The question of what the operator of this hall shall pay to his employees is not, as my hon. friend knows, a question over which the federal government has control.


Abraham Albert Heaps: I cannot allow that statement to go unchallenged. If that were to be accepted, it would be establishing a bad principle. At the present time the federal government in its own contracts always inserts some kind of a fair-wage clause. In this instance we are not exactly letting a contract but are giving a lease to some person who is using it for purposes of gain. I am sorry that I could not accept the statement of the minister, but no doubt we shall hear a little more about the matter at a later date, and we can see how it works out in the present year.


Thomas Alexander Crerar: I think it will be remedied.


Angus MacInnis: Has the minister received any recent request from the government of British Columbia to take over the Garibaldi area as a national park?


Thomas Alexander Crerar: I understand that the
matter was brought to our attention some time ago-I am not in a position to say at the moment how long ago it was-by the British Columbia government.


[Stage Direction]
Item agreed to.
Surveys and engineering branch.
I.'i9. Engineering and construction service,
Grote Stirling: Would the minister
explain this considerable reduction?


Thomas Alexander Crerar: I shall have the officer
here in a moment, but my recollection is that an adjustment of the work between the branches of the department reduced the number of employees that come under this particular vote.


Grote Stirling: In general terms would
the minister describe the work .under the reorganization of the department which comes upder the heading "engineering and construction?"

Questions


Thomas Alexander Crerar: In the department we
have this branch of surveys and engineering. Members of the committee may recall that the department was doing considerable work in road construction.


Grote Stirling: That was within the
parks, was it not?


Thomas Alexander Crerar: Within the parks; and also what was known as the Big Bend section of the trans-Canada highway in British Columbia. Under an arrangement made some years ago, the federal government undertook to build1 the section of the road between Donald and Revelstoke. That was done by the department. The work has not been done by contract ever since it started. The same procedure was followed in connection with the Banff-Jasper road. Then there is the construction work which is going on continuously within the parks.


Grote Stirling: This engineering service is for work done in the parks? I thought that was done under the parks vote?


Thomas Alexander Crerar: No; the engineering work is done under the surveys and engineering branch.


Grote Stirling: Under this vote?


Thomas Alexander Crerar: Yes. And that, with the other items I have mentioned, explains the purpose of this vote.


[Stage Direction]
Item agreed to.
Surveys and engineering branch.
152. International Boundary Commission, $30,800.
Angus MacInnis: How many members are there on this commission, and who are the Canadian members?


Thomas Alexander Crerar: We have one representative on this International Boundary Commission, and he has a small staff. This has to do largely with the maintenance of the markers on the boundary and the settlement of questions relating to the international boundary. In some instances, where the boundary line passes through areas which have been forested, the line between the two countries has been cleared for a certain width. In certain places that requires some attention every year. There are other parts where the monuments which are set up at stated intervals to indicate the boundary line have to be restored or renewed. This commission is an international commission in the sense that the United States have a representative on it, and these two representatives are the ones who carry on this work.


Angus MacInnis: Who is the Canadian representative?


Thomas Alexander Crerar: Mr. N. J. Ogilvie.


[Stage Direction]
Item agreed to.
Progress reported.
At eleven o'clock the house adjourned, without question put, pursuant to standing order.
Monday, May 29, 1939