1944-05-23

[Stage Direction]
Right Hon, W. L. MACKENZIE KING (Prime Minister): Mr. Speaker, in looking over the proceedings of the house I notice it has been suggested that some recognition should be taken by the house of the fact that this is Empire day in Canada.
An hon. MEMBER:: To-morrow.


Mr. MACKENZIE KING:: No, it is Empire day in Canada to-day. To-morrow, as I understand it, is Victoria day. I doubt if a more appropriate means could be taken by the house to recognize Empire day than that we all join in singing together the anthem which will be honoured in all parts of the empire on Empire day. If this meets with the approval of hon. members I suggest that we now join in the singing of God Save the King.
(The members rose and sang God Save the King.)
PETITION	'



SOLDIER SETTLERS, VETERANS OP FIRST GREAT WAR

Mr. ROBERT FAIR (Battle River):: Mr. Speaker, I have the honour to present a petition signed by approximately 12,500 citizens of western Canada, asking, among other things, that veterans of great war No. 1 who hold land under contract with the soldier settlement

board be granted clear titles. I do not think anything more appropriate could be granted on this anniversary than that which is asked for in the petition.



VACANCY

Mr. SPEAKER:: I have the honour to
inform the house that I have received a communication from two members informing me that the following vacancy has occurred in the representation, viz:
Of Eugene Durocher, Esquire, member for the electoral district of St. James, Montreal, by decease.
I accordingly issued my warrant to the chief electoral officer to make out a new writ of election for the said electoral district.



FARM LOAN BOARD


Mr. D. C. ABBOTT (Parliamentary Assistant to the Minister of Finance):: I beg leave to present parliamentary return, reference 248, asked for by the hon. member for Mackenzie (Mr. Nicholson), for a copy of all letters, telegrams and other documents with respect to the resignation of S. T. Shabbits.
While there is no objection to the production of the correspondence in this case, nevertheless it is not considered generally in the public interest to produce inter-office correspondence, and the production in this case is not to be taken as a precedent.
It is to be noted that the Canadian farm loan board has been constituted by parliament as a body corporate and politic and is vested with full control over the employment and dismissal of all its employees other than chief executive officers whose appointments are subject to the approval of the governor in council. The board, moreover, is charged with the responsibility of carrying on its operations on a self-sustaining financial basis and does not come to parliament for an appropriation of funds for administrative expenses.



QUEBEC SYNAGOGUE


[Stage Direction]
On the orders of the day:
Mr. M. J. COLD WELL (Rosetown-Biggar):: Mr. Speaker, I should like to ask a question of the Prime Minister, who has no doubt read the reports of the shameful incident which occurred in the city of Quebec, where a newly built Jewish synagogue was burned down. I am suggesting that since this is the kind of occurrence which we witnessed in Europe, the Prime Minister might express on

Statutory Holidays
315?
behalf of the house a condemnation of such proceeding. Then, possibly the Minister of Justice might enable the mounted police to cooperate with the city police to try to bring the culprits to justice.


William Lyon Mackenzie King: My hon. friend was kind enough to give me notice of his intention to ask this question. Although I have not had an opportunity thus far to read the newspaper account to which the hon, member referred, I would not hesitate to say that any act of criminal arson cannot be too strongly condemned, and is many times more reprehensible when its motive is that of in any way seeking to promote racial or religious prejudice.
So far as cooperation of the Royal Canadian Mounted Police with the provincial police is concerned, it is my understanding that it is the practice of the Royal Canadian Mounted Police to cooperate in every way possible with provincial police, when asked to do so by provincial authorities.



STATUTORY HOLIDAYS


[Stage Direction]
On the orders of the day:
Hon. N. A. McLARTY (Secretary of State):: On Friday last the hon. member for Broadview (Mr. Church) requested that a statement be made in connection with public holidays. Possibly it would clarify the situation somewhat if I were to make a brief statement.
Under the statutes of Canada Sunday is the only day upon which ordinary businesses are compulsorily closed.
With the development of the production of war materials in Canada on a large scale, it became necessary to make provision, as an emergency war measure, for a reduction in the number of holidays which had been generally observed. Accordingly, by an order in council passed under the War Measures Act and tabled in this house, it was provided that apart from Sundays or such weekly days of rest provided in lieu thereof, the following statutory holidays, and these holidays only, should be observed by employers and employees during the war: New Year's day, Good Friday, Dominion day, Labour day, Thanksgiving day, Christmas day; and that reasonable opportunity should continue to be allowed to employees for the performance of their religious duties.
It was also provided that the provisions of any collective labour agreement that are inconsistent with this declaration of policy 100-198i
should be suspended for the duration of the present war by mutual consent of the parties thereto but pending such suspension should remain in force and continue to be observed. This was a declaration intended to express the views of the dominion government in relation to industry and more especially to war industry.
It will be observed that the terms of this declaration are not mandatory but constitute a declaration of the policy which the government, having regard to the necessities of the war, felt should be followed by employers and employees throughout the country in these critical days.
The order in council, however, dealt with two specific statutes of the parliament of Canada. One is the Civil Service Act, which prescribes the holidays to be observed by the public service of Canada. The other is the Bills of Exchange Act, which contains a provision prescribing the days which in all matters relating to bills of exchange should be observed as legal holidays or non-juridical days. The order in council provided that the terms of these statutes relating to holidays should be suspended during the duration of the war or until otherwise ordered and that the only holidays which should be observed were the ones I have enumerated above.
If provincial governments and municipalities proclaim any day to be a public holiday within their jurisdictions, it is not a matter with which the dominion government has anything to do, but any day so appointed is not a day which can be observed as a bank holiday.
Victoria day, the 24th of May, is not a public holiday in the United Kingdom, and, while there have been suggestions that the order relating to the observance of Victoria day should this year be modified in Canada, the government has to keep in mind that at any hour, so far as we know, word may come of the beginning of military operations on a gigantic scale in which Canadian forces will be heavily engaged. It would, therefore, seem inappropriate that the government of Canada should select this particular time for modifying the regulations which it felt it its duty to make, having regard to the needs of our war effort.
It is, I am sure, the hope of all of us that before the 24th of May next year conditions may have so changed as to permit the public observance of this popular holiday on a national scale. In the meantime, however, as I have said, if provincial governments or municipalities set aside this or any other day as a holiday within their jurisdictions, for
War Appropriation-Agriculture

schools and the like, it is not a matter in respect to which the dominion government has responsibility.
There seems also to be some uncertainty as to the proper date for the observance of Dominion day, A perusal of the order of the Tth June, 1943, will show that Dominion day is to be observed and celebrated on Saturday, the 1st day of July, 1944.



WAR APPROPRIATION BILL


[Stage Direction]
The house resumed from Monday, May 22, consideration in committee of a resolution to grant to His Majesty certain sums of money for the carrying out of measures consequent upon the existence of a state of war-Mr. Ilsley-Mr. Bradette in the chair.

[Stage Direction]
Fertilizers and pesticides administrator-* administration, $31,850.
Mr. WRIGHT:: Can the minister now give the figures I asked for last night with respect to the amount of fertilizer and component parts thereof imported in 1942, 1943 and to date in 1944, and the amount exported during the same periods?


Hon. J. G. GARDINER (Minister of Agriculture) :: The figures asked for make up
quite a table. I think it would be better to have it placed on Hansard, if that is agreed.


Percy Ellis Wright: That will be quite satisfactory.


James Garfield Gardiner: I will first read the statement accompanying the table.
The three main plant foods required by our crops are nitrogen, phosphate and potash. There is no production of potash in Canada. Our entire supply has to come from the United States. It is essential in eastern Canada and
in British Columbia for the production of potato fertilizer and fertilizer for other crops requiring potash.
There is no suitable commercial phosphate rock mined in Canada. All our requirements come from the United States. The production of ammonium phosphates at Trail and of superphosphate at our plants in eastern Canada would not be possible without this phosphate rock. Even with this 310,000 tons of rock, Canada produces only approximately one-half of her requirements of superphosphate. The other half of our superphosphate, namely 135,000 tons, must be imported, and large tonnages of it come from the superphosphate plants in the eastern United States. Our maritime provinces especially depend on American supplies.
Of the 600,000 tons of fertilizer materials under allocation by the combined food board for export by Canada, all is surplus nitrogen with the exception of approximately 40,000 tons of mixed fertilizers exported to Maine and 53,000 tons ammonium phosphate to the United Kingdom and the United States. This surplus nitrogen was produced for export to meet the needs of food production of the united nations throughout the world. Much was produced in the government nitrogen plants established primarily for munitions purposes. In 1942-43 four tons of ammonium nitrate were shipped to the United States for trial as fertilizer. In this year, 1943-44, 162,367 tons are being shipped. Similarly, in 1942-43 we exported 94,689 tons of ammonium sulphate, this coming year 197,426 tons. These tonnages were exported only after the Canadian farmers' needs for these chemical materials were fully met. In exchange for them we received the potash and phosphate so badly needed.
I will now ask to have the table put on Hansard, Mr. Chairman:
Shipments of Fertilizer Materials from Canada to Other Countries
11-48 Ammonium Phosphate
United Kingdom	
United States	
16-20 Ammonium Phosphate
India	
United States	
Allocated by the Combined Food Board for the year ending June 30, 1944 (tons)

	29,000

	24,500
Comparable shipments during Fertilizer year
(tons)
53,500
16,050
57,770

73,820
64,979

War Appropriation-Agriculture
Shipments of Fertilizer Materials from Canada to Other Countries-Con.
Allocated by the
Combined Food Board Comparable shipments for the year ending	during Fertilizer year
June 30, 1944	1942-43
Ammonium Sulphate
Barbados	
Jamaica	
St. Kitts	
St. Lucia	
St. Vincent	
Ceylon	
India	
Middle East	
Malta	
New Zealand	
Nigeria	
Portuguese East Africa
Rhodesia	
Sierra Leone	
Union of South Africa
Tanganyika	
Uganda	
United States	
Iceland	
(tons)	(tons)
2,968 672 302 352 280 17,300 15,531 15,214 200 4,251 460 898 2,226 6,030 6,000 242 200
121,000
3,300
197,426	94,689
Ammonium Nitrate
Southern Rhodesia	 200
Middle East	 9,190
New Zealand	   100
United Kingdom Account	 15,678
United States	 137,199
162,367	4
Calcium Cyanamid
Middle	East	 2,905
Ceylon		 6,095
British	Guiana	
5,000United	States	
100,000114,000	100,000
Total
595,113
259,672
Total Fertilizer Materials Received by Canada from Other Countries
Muriate of Potash . Sulphate of Potash Potash Manure Salts Phosphate Rock ... Superphosphate ....
Fertilizer year 1943-44 United States Russia (tons)	(tons)
..	60,000	1,400
..	4.200
..	12,500
..	310,000
..	135,000
521,700	1,400
Fertilizer year 1942-43 United States Russia (tons)	(tons)
62.000	5,000
4,000
20.000
250.000
148.000
484,000	5,000


Mr. BLACK (Cumberland):: It is my understanding that the purpose of this vote is to-equalize the cost of fertilizer to the farmer in different parts of Canada, and the government pays the freight. But on referring to Canadian war orders, No. A-1036, dated December 23, 1943, I observe that in New Brunswick, Nova Scotia, and Prince Edward Island the cost is uniformly higher than it is
in Ontario and generally higher than it is in the province of Quebec. On most ingredients it is 50 cents per ton higher in the martime provinces than it is in Ontario. In the matter of fertilizer under 9-5-5, used largely by crchardists, more of which is used in Nova Scotia than in other parts of Canada, the cost per ton is $1.50 higher in Nova Scotia than in the province of Quebec. I
War Appropriation-Agriculture

would ask the minister for an explanation of these excessive costs in the maritime provinces and why these provinces are apparently discriminated against in comparison with the central provinces,


Mr. HANSON (York-Sunbury):: I would support what my hon. friend has just said. I have not my files with me but I have had extensive correspondence with the officials of either the Department of Agriculture or some other department of government. I think there has been discrimination in some parts of the country in favour of cooperative societies as against ordinary consumers, on the theory that the cooperatives are able to buy a little cheaper and distribute the difference by way of dividends among their associates. That is the theory which was sold to me by somebody; I do not state it as a matter of fact. I should like to know exactly what the position is. The fact remains, as the hon. member for Cumberland has just stated, that costs of fertilizer in the maritimes are higher than in the central provinces. We are supplied, as the minister has stated, from the United States side of the line. I do not see why on principle there should be any difference in price, especially as the government is paying . a subsidy so that, as I understand it, there may be support for these people, and equalization. Like the hon. member for Cumberland, I ask why there is a difference, perhaps more than fifty cents a ton-


Percy Chapman Black: Up to a dollar and a half.


Richard Burpee Hanson: -up to a dollar and a half as against certain parts of the country in comparison with the central provinces. It is the old story: down there we have to pay a little more for everything than is paid in the central provinces, and our people are just fed up with that condition. There may be a reason for it, I do not know; but the reasons which were given to me do not over-persuade me that there is justification for it. I should like to know what the justification is.


James Garfield Gardiner: Well, Mr. Chairman,
selling prices and price controls generally are not under this department.


Richard Burpee Hanson: I realize that.


James Garfield Gardiner: I understand there is a wholesalers' price which is established the same all the way across Canada, but for some reason which I am not able to explain-probably those who come from the maritimes can explain it-fifty cents greater profit is allowed

as between the wholesaler and the retailer in the maritime provinces than is permitted elsewhere.


Richard Burpee Hanson: I do not know why that should be.


James Garfield Gardiner: I am informed it has always existed, not only since the prices board took control, but before the board had anything to do with it. Apparently they simply acknowledged the business conditions which existed, which before control was taken, provided for the higher prices in the maritimes than exists elsewhere.


Percy Chapman Black: Is it not a primary duty of government in a war measure such as this to protect the consumer?


James Garfield Gardiner: Again I should not be speaking for the prices board. Some of us are occasionally very critical of them, but after all, what most of us have insisted upon is that they maintain the condition which was there in the four weeks over which the price level was taken and apply it for the period ahead. I assume that if business conditions in the maritime provinces necessitated that during that period of time and previously, it has been maintained down to the present.


Percy Chapman Black: If it is the policy of the government to protect the wholesaler against the consumer, they should make a reduced price and pay the extra cost from the government's funds rather than impose additional cost on the consumer. If they intend to perpetuate this excessive charge against the consumer, the government should certainly pay the difference and not impose that additional cost upon the farmer and the 'user of the fertilizer in the maritime provinces, in contrast with what is done in central Canada.


Richard Burpee Hanson: I realize that this matter does not come under the minister's department.


James Garfield Gardiner: And for that reason it is not very fair to be discussing it now, when the minister in charge is not here.


Richard Burpee Hanson: I am inclined to agree, and, knowing the great anxiety and care which the minister has for the farming population of this country-


Some hon. MEMBERS:: Hear, h^ear.


Richard Burpee Hanson: [DOT]-especially those on the western prairies, whom he has bonused time after time to cut down production, I suggest that he and the officials of his department look into this complaint, and that the minister try to persuade his colleague who operates the wartime prices and trade

War Appropriation-Agriculture
board to rectify what I believe is a discrimination, and what the farmers of the maritime provinces do not hesitate to call gross discrimination as compared with their competitors in Quebec and Ontario. I make that suggestion to the minister. I have to go to a meeting now. If I can find my file I shall be back to tell him what the excuses are-not the reasons, but the excuses which have been put up to me for this discrimination-and I ask him to be a friend of the farmers of the maritime provinces.


James Garfield Gardiner: I can scarcely let the suggestion go by that we have subsidized the farmers of western Canada to reduce production, because all one has to do is to look at the records to find that if that was the objective, we certainly have failed. Production in every line in western Canada has been very much increased, more particularly in the lines which we subsidized in order to get that increased production. On the other hand, dealing with the question which is now brought before the committee, I would again, submit that it is impossible for me to place before the committee the proper answers to the questions which are being asked.


Richard Burpee Hanson: I accept
that.


James Garfield Gardiner: All I can say is that
farmers right across Canada, in the maritimes and everywhere else, since price controls have come in, through the assistance we give, in addition to the price controls, by paying freight, are getting their fertilizers at approximately two dollars per ton less than they had to pay before we did anything about it.


Richard Burpee Hanson: What is
-the subvention?


James Garfield Gardiner: The subvention has to
do with the freights on shipping from the places where the fertilizer is made to the places where it is going to be utilized. It works out at approximately two dollars per ton.


Mr. ROY:: I wish to refer to a matter in
connection with the subsidy. The subsidy which was paid by the government last year to farmers on their purchases of fertilizers has been abolished, and replaced by the freight assistance provided for under order in council P.C. 89S68. This change of policy has resulted ' in quite a heavy loss to the farmers, of which I will give the committee a few examples.
On a carload amounting to some forty-one tons which was shipped from Quebec to Mr. Emile Frenette, of Portneuf, Quebec, the
subsidy last year would have provided, on
23,000	pounds of superphosphate, twenty per cent of the amount, or $34.50; on 46,000 pounds of mixtures 2 x 12 x 4, it would have brought $69; on 10,000 pounds of mixtures 4 x 12 x 6 it would have brought $19.50; and on 2,500 pounds of mixtures 3 x 18 x 0, $4.50; a total of $127.50. All that the freight assistance has brought to Mr. Emile Frenette under the scheme actually in operation is $12.13.
I have another case: some forty-eight tons of fertilizers bought by Mr. Armand Gama-che, of Iberville, Quebec. Actual freight assistance brought him $9.60 and last year the subsidy would have given $154.10. That means a loss of $14450. These two examples should be enough to prove that the farmers are receiving a good deal less than they did last year with the subsidy as formerly paid. At this time when the country needs to encourage farm production and when the government has given- the farmers to understand that they will receive more -help than ever, it is hard to understand the policy that has actuated the government in the rescission of the subsidy of last year. Can the -minister tell us why the change -has been made?


James Garfield Gardiner: The question is why the change from the policy of paying the farmers a subsidy on fertilizer, the policy which was followed last year, to that of paying so much on the freight, has been brought about. The answer is that a year ago, and earlier than that, we undertook to encourage the greater use of fertilizers, and through that policy, and the tendency of farmers when they obtain higher prices for their products to use more fertilizer, we finally came to the point where all the fertilizer we had was being utilized, and there was no point in trying to encourage the still greater use of it. In other words, all the fertilizer we had was being made use of by the farmers. The policy was therefore changed so that instead of trying to encourage the use of more fertilizer we endeavoured to equalize the cost of fertilizer to farmers. The result is that we now pay assistance on freight, so that the farther away the person is from the plant, and the more the commodity cost before, the higher the subsidy paid. One can take letters such as the hon. gentleman has just referred to and find that a person living close to a plant is paying more this year than last year, but he is probably not paying as much as someone who lives a considerable distance from the plant. If you went to the end of the road and took the quotations from that location you would probably find that there was as much difference in the opposite direction. The intention is to assist the

War Appropriation-Agriculture
farmers throughout the country in getting fertilizer at a more nearly equalized price, whether they live close to the plant or at a distance from it. That is the objective, and that is the reason for the change.


Joseph Sasseville Roy: Looking at the figures, it seems to me that last year the government paid to the farmers under the subsidy over 81,000,000. Does the minister expect to pay to the farmers throughout Canada as much this year under the new scheme of assistance as was paid a year ago?


James Garfield Gardiner: It will probably work out at about three-quarters of a million this year instead of a million-about three-quarters of the total amount.


Joseph Sasseville Roy: So that the farmers are receiving less.


James Garfield Gardiner: Some are, and others more.


Joseph Sasseville Roy: I am speaking of the farmers as a whole. Was the change in the policy from a subsidy to freight assistance suggested to the agricultural supplies board by the fertilizers advisory committee?


James Garfield Gardiner: It came from the
fertilizer administration after discussion with all the provincial governments. It came to the supplies board and from that board to the department.


Joseph Sasseville Roy: What is the personnel of the fertilizers advisory committee? Who is the chairman?


James Garfield Gardiner: The chairman is Mr. Peart. He is an official of the department.


Joseph Sasseville Roy: And who is the vice-chairman? While the minister is looking up the information I will supplement the question. I do not know if my information was wrong because I was told that the chairman of the fertilizers advisory committee was Mr. Grubb. He is general manager of C.I.L., Montreal. The vice-chairman, I understand, is Mr. A. Mooney, general sales manager of Canada Packers Limited. I am told also that one of the members for Quebec is Mr. Thomas Pope, general manager of International Fertilizers Limited. Is there any representative of the cooperative federation of Quebec, which handles about seventy-five per cent of all the fertilizers used by the farmers in that province? Is there also on the committee a representative of any of the farm organizations of Ontario or of the maritime provinces?


James Garfield Gardiner: Again I am afraid the hon. member is discussing another committee which comes under the prices board. The

names he refers to are those of members of the advisory committee which is working with the prices board in connection with the prices of fertilizers. The controller of whom I am speaking is an official of our department having to do with the other matters to which we referred a moment ago.


Thomas Miller Bell: Is the price practically set by a committee of manufacturers who advise the board? However, that is not what I rose to ask the minister. To-day fertilizer is being used in the west as well as elsewhere and from time to time farmers have told me that it has been very useful, while on other occasions they have said that they do not see any material benefit from it. Is there any organization to which the farmers in the various provinces could apply and get advice as to the fertilizer they should use, the type of fertilizer and the quantity per acre, as it is with us, or on some other basis as in the fruit growing area? Have we such an organization to which farmers can apply?


James Garfield Gardiner: For the information of the hon. member for Gaspe (Mr. Roy), may I say that the chairman of the fertilizer board is Mr. G. S. Peart; the secretary is Mr. A. M. W. Carter. These are two members of the board that I am speaking of when I refer to the activities in our department. The other question was to the effect that there are different results obtained from the utilization of fertilizer at different times.
The utilization of the same fertilizer may not give the same results at different times or on different lands. Of course there are two reasons for that. First, my understanding is that the commercial fertilizer shipped down from Trail to western Canada operates best under certain weather conditions. That is, if you have a dry season your results are different from what they will be if you have a fair amount of moisture. Then, there are different conditions all across Canada. The activities in the different provinces are different; that is, they require a different kind of fertilizer for potato crops in New Brunswick from what is required for grain crops in the west, and for that very reason it is best that those boards should be provincial boards, and they are provincial boards. The fertilizer boards that advise on matters such as those which have been referred to by the hon. member for Rosetown-Biggar are boards set up in each of the provinces. They do advise farmers as to what fertilizer to use and how to utilize the fertilizer that they are using. Application for information in that regard should be made to the Department of Agriculture in the province.

IFar Appropriation-Agriculture


Thomas Miller Bell: The reason. I asked the question is that I have been told it is impossible for small organizations in the province to do this job to the extent that may be required. I quite understand that fertilizer will give a different result in one year from that of another year. What I had in mind was this: extensive soil surveys have been made in Saskatchewan. It seems to me if that were known the farmer, instead of listening to some salesman's advice with regard to fertilizer, could get advice from the soil surveys branch. I have been asked on occasion by farmers where they could get some information regarding their land. I have told them to write to the soil survey branch of the university of Saskatchewan. I am not sure whether that is widely known or whether the university branch is sufficiently staffed and equipped. My observation is that while the university has done a very good job on soil surveys, it has an inadequate staff and therefore cannot do the detail work that is required to give the kind of information I have in mind.


James Garfield Gardiner: I think it will be found that the advice given is not exactly the advice that should have been given in that particular case. This is what the soil survey organization does, and we give some assistance to the universities in connection with that. They examine into the nature of the soil, and they can give the farmer information as to what . the soil is lacking. They can at least give him information as to the nature of the soil. The proper authority to whom to apply for information as how to utilize fertilizer in order to build up the soil on that particular land is the provincial fertilizer board. They are presumed to have the information which the farmer will require in that regard, and it is to them that the farmer should write for advice.


Percy Ellis Wright: Could the minister give us the names of the boards in Saskatchewan?


James Garfield Gardiner: The chairman is Mr. Auld, the deputy minister. I think the deputy minister in each province is the chairman of the fertilizer boards. Each has a certain staff of advisers who work under him.


Mr. McNEVIN:: Were the differentials in prices referred to by the hon. members for York-Sunbury and Cumberland in effect from 1930 to 1935?


James Garfield Gardiner: I am sorry; my information does not go back that far. I should be pleased to give it if I had it.


Mr. SENN:: Under what conditions is the freight assistance plan being carried on at the present time? If my information is correct it 100-199
is based on the freight rate from the nearest fertilizer plant to the farmer's nearest station. I have been given to understand also that the maximum amount which the farmer can receive is about one dollar a ton. Will the minister give the committee an outline of the plan and what amount can be realized by farmers who are purchasing fertilizer?


James Garfield Gardiner: I do not know whether the hon. member has been in the committee since the discussion started, but I thought I gave a sort of outline of it a few moments ago. I was probably wrong in saying that the freight is always paid from the manufacturing plant. That is not necessarily so, because it is paid from the mixing plant, which may not be the place at which the different ingredients that enter into the production of fertilizer are produced. For example, I think that some of the fertilizer manufactured at Trail is shipped down to Vancouver and the mixing takes place at Vancouver. The different ingredients are assembled there and the freight is paid from there out, which has an effect on the freight rate that is paid in the different communities. I am informed that mixing takes place at New Westminster too.


Mark Cecil Senn: Did I understand the minister to say that a subsidy or subvention is paid from where the stuff is originally produced to the mixing plant? I did not understand that. I do not think that is so.


James Garfield Gardiner: There is no premium, assistance or subsidy paid where the freight is a dollar or under. Up to three dollars is paid above that one dollar figure.


Mark Cecil Senn: Then three dollars are paid?


James Garfield Gardiner: Yes; that is the plan under which payment is made.


Percy Chapman Black: Does the
assistance apply to fertilizer used in the cultivation of potatoes? I understand that it did not apply last year. Is that still the situation, and if so, what is the justification for not applying it to fertilizer used in the growing of potatoes? That is one of the main crops in Prince Edward Island, New Brunswick and parts of Nova Scotia. It is one of the most necessary and staple food products. The feeling among potato producers is that they should get the benefit of any subsidies or payments on fertilizer used in the raising of their crops.


James Garfield Gardiner: The subsidy paid to the farmer has been paid over a period of about a year and a half. During that period it was part of the policy followed by the government to encourage the production of feed grain, and it applied only to feed grain crops. But since

War Appropriation-Agriculture.

the policy has been adopted of paying freight on fertilizer it applies to all crops on which fertilizer is used. It applies to potatoes as well as grain. There is no discrimination now as between the two.


Percy Chapman Black: When did that come into effect?


James Garfield Gardiner: My recollection is that the date of the order is January 3, 1944. I understand it applies from January 1 of this year.


Percy Chapman Black: It did not apply last year?


James Garfield Gardiner: No.


Mark Cecil Senn: Just one more question. Did I understand the minister to say that this freight assistance applies in cases where the fertilizer is hauled by truck rather than by rail? In a great many places in Ontario and the central provinces fertilizer is shipped by truck rather than by rail. Does the assistance apply in both cases?


James Garfield Gardiner: It does apply to trucking, but it is based on the rail cost, that is, if the trucker is travelling over a certain route which can be reached by rail it does not apply until he gets out to the dollar point, and from there on it applies in the same way as it would on the railway.


[Stage Direction]
Item agreed to.
Seeds administrator-*administration, $19,100.
Mark Cecil Senn: Before this item carries I should like to discuss the matter of seeds. I am not sure whether it might not better come under another item farther down under the special products board, seed export office. I have something I want to say in regard to-


James Garfield Gardiner: It would come under the special products board.


[Stage Direction]
Item agreed to.
Meat board-administration, $71,300.
Mr. BLACKMORE:: I should like to discuss the question of beef. I said yesterday that I believed the government had bungled the whole question of beef production in southern Alberta, Whether or not I was wrong in my judgment I think will depend upon the answers that may be given to a number of questions. I find a great deal of confusion in the minds of the people regarding beef matters; therefore I should like to ask the minister a number of questions and give him time in which to look up the answers, so that he may place them upon Hansard. Then we will be able to study

them and enlighten ourselves, and determine whether or not we have been wrong in our judgment.
The first question I wish to ask is this. Is it a fact that in August, 1942, the beef producers of Alberta waived the right to export beef to the United States? Did the beef producers surrender this right to the wartime food corporation, which means, was it understood that the wartime food corporation was to export beef to the United States? In return for the waiving of the right to export beef to the United States, did the Canadian government agree to review production costs from time to time, and wherever justified to adjust the selling prices of beef? How many times since August, 1942, has the cost of production of beef been officially reviewed by the government? By what agency was the review conducted, and on what dates? Was a report made on each occasion? If so, to whom was it made? Did the agency or board or committee to which each report was made have authority to adjust the selling prices of beef? Before giving the other questions I may add that there is an impression abroad among the people in my constituency that the government has organized a set-up in which it is able to give the run-around to anyone whatever who asks for information regarding the production of beef, so that it is quite impossible to find the truth from anybody.
Now I wish to go on with the questions. If the agency did not have authority, did the agency receiving the reports pass on 6ueh reports to the agency that did possess the power or authority to adjust selling prices upward? Was the report accompanied by a recommendation for an upward adjustment? If not, why not; and if so, was an adjustment made? If so, by how much, and how many times? If no upward adjustment was made, why not? Again, in return for waiving the right to export beef to the United States, were beef producers promised by the government-


The CHAIRMAN:: Order. If I may be allowed, we are discussing dairy products now, and I wonder if a discussion of beef would be in order at the moment.


James Garfield Gardiner: No, we are discussing
the meat board.


John Horne Blackmore: This is the item
covering the meat board, Mr. Chairman; this is the point at which I expected the beef discussion to be carried on. In return for waiving the right to export beef to the United States were the beef producers promised by

War Appropriation-Agriculture
the government that in case the price of beef fell below a certain level, live cattle would be purchased by a government agency? If so, how many grades and what grades of beef did the agreement cover? What government agency was given the authority and responsibility to buy such beef? At what price was the purchase to take place? On what dates did prices descend to that level? On what date was beef purchased, by whom; at what price; how much beef on each occasion; what grades of beef; how much of each grade, and on how many occasions did beef prices dip to or below the point at which purchases should have been made by the government in accordance with the agreement? In return for waiving the right to export beef, were the beef producers promised by the government that the government would protect the position of the beef industry in the United States market, by selling Canadian surplus beef? If so, how much -beef was sold in the United States by the Canadian government between August 31, 1942, and March 1, 1944; what grades; how many of each grade; on what dates; and what agency made the sales? From whom or what agency did that agency purchase the beef? At what price? And at what price did it sell the beef to the United States? Did the government agency at any time purchase any red or blue brand beef in Canada between August 31, 1942, and March 20, 1944? What federal government agency has authority to implement the resumption of exports of live stock to the United States?
Before going on with these questions, of which I have several more, I want to say -that it did not seem to matter a bit whom you asked in the government for details as to the position with regard to beef. No one seemed to know; and always the people who had the authority were the people whom you were not asking. In other words no one could do anything, nor -could you find out who had authority to. do anything, or who had the responsibility. These questions are designed to elicit the facts in regard to these matters.
Now I resume my questions. What federal government agency has power over beef marketing machinery? Is it the meat -board? If so, why did the meat board neglect to buy for weeks, until beef feeders began to lose heavily and prices came down? From all I can gather the whole marketing situation with respect to beef simply deteriorated and almost collapsed in my constituency this year; and considering what the government had promised and what the farmers had a right to expect, the situation was reprehensible.
The next question is:	Is the meat board
the policy-making body in respect to beef?
100-199i
. If not, what body is? -Again is it true that in February, 1943, packers were scouring southern Alberta for fat ewes, and offering unheard-of prices? Is it true that in the same area during the corresponding period of 1944 fat ewes were not salable? Why should conditions like that exist in a supposedly controlled market? The beef and mutton producers in my constituency had the impression that when government control went into effect it meant government control, not a slipshod, half-hearted control that did not control anybody -but the producers. Did not the minister say some time in February that we could not send live stock to the United States and sell them to better advantage than in Canada? I believe he did, but I want to know whether or not he actually did make that statement.
Then I come to this question: Have we reached the point where if boats are late or other transportation facilities are held up or congested, it is necessary to hold live stock in feed lots? I may say in commenting on that question that if feeders of cattle ever imagined that their ability to sell their cattle depended upon the possibility of ships being available, surely they would never have taken the risk of the terrible losses into which they could be forced. If such is the case, then do you not think weight restrictions should be modified to prevent loss to the feeders? And do you not think that in the light of increased cost, the ceiling should either be raised, or cattle and lambs should be subsidized, in the light of the precedent with respect to hogs?
Is it a recognized principle of the government live stock agencies that spreads are necessary in the winter feeding of live stock? If so, would it be your opinion that one and a half cents to two cents would be a reasonable spread, under present conditions? Do you not think steps should be taken to encourage the maintenance of live stock production at its peak, as a vital contribution to the nutrition of Canada and her allies, and to develop a reservoir of meat products and breeding stock for the post-war years?
Again, what was the price below which it was agreed fat cows were not to be allowed to fall during January and February, 1944? And is it true that fat cow prices in southern Alberta during January and February, 1944, ranged between $6.50 and $7.50 per hundredweight? Is this figure not definitely below the price agreed upon? Was the price of fat cows during January and February and early March of 1944 considerably below the price for fat cows during the corresponding months of 1943? When these cows came off the grass in September, 1943, was the price at least eight and a half cents a'pound?

War Appropriation-Agriculture
May I speak briefly in connection with that question? Yesterday the minister read a list of prices of beef at certain times in the year, in each of the years from the beginning of the war until now. I suggested that he give at the same time the cost of those beeves when they entered the feed lots the previous fall. The minister indicated that he would give such a list, but I think he must have overlooked doing it.


James Garfield Gardiner: I am just coming to it.


John Horne Blackmore: That is fine. I do not wish to be unfair to the minister, and I am sure that he does not wish to be unfair to the beef producers. But it is obvious that if the farmers have to pay eight and a half cents a pound for fat cows coming off the grass, and then have to feed them during the winter, into February or March, and sell them at six and a half to seven and a half cents, the stage is all set for calamity, so far as feeders of fat cows are concerned.
Was it for some time almost impossible in Alberta for feeders of fat cows to get bids on their fat cows? Whose duty and responsibility was it to buy fat cows for the government to keep up the price of cows? Had that body the authority to buy?
Then, with respect to heavy steers, our troubles in my area were aggravated this year. Here are some of the questions on this point: Did the Minister of Agriculture announce he wished stockmen to keep their steers a year to grow into heavy beef? Was it difficult to sell heavy steers in southern Alberta in January and February, 1944? The answer to each of these questions, according to my information, is yes. If that is so, then obviously the minister's administration went to pieces with respect to fat steers, and the producers were simply betrayed.
Now, with respect to handy weight steers, through the latter part of February and early in March, 1944, was there a period during which buyers evinced very little interest in handy-weight steers? And were the causes of this stalemate the lack of ships and of storage space? I expect that those questions would be answered yes. Then I wish to ask this question: Notwithstanding that, were steers bought when prices came down low enough to be highly lucrative to buyers, and was the market situation for meat, both beef and mutton, serious in southern Alberta around March 15?
It is reported to me that the minister in a letter dated February 15, 1944, written to the president of the council of western beef producers, used these words:
At the time this was done (when the United States market was closed) I stated publicly that just as soon as farmers had cattle to

deliver to that market, and the Americans were prepared to take them, I would be prepared to back farmers in insisting that that market 'be opened.
Did the minister use those words? Has he at any time backed the farmers in insisting that the United States market be opened? If so, on what occasion; if not, why not? The answer may be that the United States did not want this. I wonder what evidence can be adduced from various places in the United States to show that they did not want them. The information I have is that there are places in the United States where they were sold out of beef, and were much at a loss to know what to do to get it.
Did the deputy coordinator of primary products, wartime prices and trade board, assure lamb feeders during the 1943-44 season that supporting purchases of meat had been authorized and made at levels comparable with floor prices for carcasses, namely one and a quarter cents below the ceiling price? This is a very important point. Were such purchases made? Did the price of live lambs advance, as a reflection of these purchases? If the answer to those questions happens to be of the right kind, then they write a sad story.
Has the Department of Agriculture or any agency of that department at any time announced to the public what prices of live lambs and cattle ought to be? If not, why not? Otherwise, what protection can feeders or growers of lambs, calves and feeder cattle have?
May I just comment upon that for a moment or two. In the fall, when, it comes time to fill feed lots, prospective feeders naturally go to the various markets with the object of buying stock. They begin to bid, and sometimes prices are bid up to a considerable height. In that way some people are tempted to buy at prices which are rather too high. But when prospective buyers do not know what the prices are to be, and have no definite idea what the prices of the finished products will be, or indeed whether they will be able to sell the finished products, they are utterly helpless in the matter of using their judgment as to what prices they should pay, and how many stock to buy to put into the feeding lots.
If the minister will prepare careful answers for all those questions he will then pave the way for a more intimate discussion on this whole matter at a later time which, I promise him, I shall be glad to enter into.


James Garfield Gardiner: Mr. Chairman, if I were to prepare detailed answers to the questions which have been asked by the hon. member, I would have to ask the hon. member either

War Appropriation-Agriculture
to put his questions on the order paper or to submit them to me in detail in order that I might have such detailed answers prepared. However, I think there is a simpler way of answering the questions than by following his suggestion that the answer to all his questions would be yes.


John Horne Blackmore: I did not say that.


James Garfield Gardiner: My hon. friend said a minute ago that in his opinion the answer to those questions would be yes.


John Horne Blackmore: But I was referring
to only three of them.


James Garfield Gardiner: He indicated that if the answer were yes it would show that there had
been some-


John Horne Blackmore: Gross irregularities.


James Garfield Gardiner: Yes, gross irregularities, or something even stronger than that, in connection with the policy itself.
In my view the best way to answer a suggestion of that kind is to outline what the situation has been with regard to cattle and the marketing of cattle in Canada, not only for the period of years to which the hon. member refers, but for a considerably longer period.
This takes me back to the fact that in 1936, I believe it was, there was brought into effect an agreement between Canada and the United States respecting duties to be paid on cattle passing from Canada to that country. The effect of that agreement was that whereas the duty on live cattle weighing over 700 pounds had prior to the time of the agreement been three cents a pound, the Americans undertook to reduce the duty to li cents a pound until approximately 193,000 head of cattle of beef quality had been imported into the United States. During the first year of the existence of that arrangement some difficulties developed because the farmers rushed all their cattle into the United States in the early months of the year, and thus there was quite a supply of cattle on the United States market. Later, farmers in Canada, particularly in Alberta, where they market their cattle in the fall of the year, experienced some difficulty in marketing their cattle coming on the market in the fall, and so it was decided to divide the year into four quarters. An agreement was accordingly entered into with the United States whereby some 51,000 head of cattle would be allowed under quota in the first three quarters, with a smaller quota for the last quarter until the 193,000 head had been shipped into the United States. That agreement continued down until June
of 1942. After the price control policies to which the hon. member for Lethbridge referred were brought into existence, the record from March, 1942, is pretty much as follows-and again I say that much of this record has to do with the activities of the prices board, some of it with the activities of the Department of Agriculture. The chronological sequence of events in connection with that policy from March 23 down to the present is pretty much as follows.
On March 23, 1942, the wartime prices and trade board, by order 109, established general principles of a wholesale ceiling price for beef, cattle and pork as follows:
No packer or wholesaler shall sell at a price that is higher than the highest price charged in the basic period by the same packer or wholesaler to the same buyer for the same kind, brand, quality and/or cut of meat or meat products.
That was a general statement of the policy which was put into effect by the prices board on March 23, 1942. It simply meant that any wholesaler who was selling meat to retailers had to sell it at the price at which he was selling it in the basic period, which was during part of the month of September and part of the month of October of 1941. That order was revoked on June 1, 1942, by order 134. On June 25, 1942, order 151 of the wartime prices and trade board authorized the wartime food corporation, which is an organization under the prices board, and not under the Department of Agriculture, to issue licences to beef cattle exporters, requiring exporters to obtain authorization for each shipment. That is the order to which the hon. member for Lethbridge refers when he speaks of the first action taken to restrict or control the shipment of beef into the United States.
As I stated a moment ago the original arrangement was that in any quarter wrn could send into the United States up to some 51,000 head of cattle over 700 pounds in weight. During the early part of 1942 we sent in the full 51,000 head a few weeks before the end of the period. Then, immediately after April 1, 1942, cattle wmre shipped into the United States to a total, speaking from memory, of about 10,000 a week until the total number of
51,000	had been shipped into the United States. That was around June 1, 1942, when the wartime prices and trade board took action in accordance with the order I have just read, which required anyone shipping cattle into the United States to get a permit to do so.
At the same time, I think, the wartime food corporation was set up, which was the only body licensed to ship cattle into the United States, the corporation set out to purchase cattle to be shipped into the United
War Appropriation-Agriculture

States. The hon. member for Lethbridge asks me how many cattle were shipped into the United States, but as this operation was not performed by an organization under this department, I have not the numbers with me. The fact remains that that policy was found to be one which very rapidly brought about a situation where the purchasers for the corporation were about the only persons who would be on the market to buy cattle, the reason being that they could buy cattle at a higher level than this particular market provided for, and most people naturally wanted to sell at the highest price. The consequence was that the corporation found itself in the position where they were buying the cattle and then turning them on to this market to the extent of its needs, and if they had a surplus it was to be shipped to the United States. My memory is that there was no surplus to ship to the United States, that cattle were not shipped to the United States by the corporation but were purchased for consumption in Canada.
That brings us to the point of realizing that we had reached the period in Canada when we were consuming all the beef that we produced. That was about the middle of 1942. There were certain reasons for that condition developing. As I stated a few moments ago, we had entered into an arrangement with the United States in 1936, which was renewed later, to the effect that we were permitted to ship
193,000	head of cattle into the United States. We also shipped calves and breeding stock into the United States. We were shipping upwards of 300,000 head of cattle into the United States in certain years, prior to the experience of which I am speaking, and during that time we were sending to Britain two or three thousand head of cattle in onfe year and up to some 40,000 in another year. They were shipped live weight to Britain, but practically all the live weight cattle that we had to ship anywhere went to the United States.
After the declaration of war we undertook to supply Britain with bacon and ham, and yesterday I gave the amounts we have supplied. At this point I should say that I had intended at the beginning of the discussion this afternoon to correct a statement I made last night with regard to the negotiation of a contract with Britain for the marketing of hogs for the next four years. I was under the impression when I came into the, house last night that those negotiations had been completed and that we had now a definite programme for four years. But on going into the matter this morning I find that the negotiations are not completed with regard to the last two years. The negotiations are completed with regard to the first two years, and
"Mr. Gardiner.]
there is an undertaking by Britain to take from us at least 500,000,000 pounds of bacon and ham and pork products in each of the years 1944 and 1945 and any additional amount which they require and we are in a position to ship. That is final both with regard to quantities and with regard to price.


Mark Cecil Senn: I understood that that agreement had been in force for some length of time. Has it not?


James Garfield Gardiner: No. The agreement has not been in force on that basis for some time. It was in force on the basis of a two-year contract, with at least 900,000,000 pounds to be delivered within the two years. The new understanding which is reached is that the minimum figure for the two years for 1944 and 1945 will be 500,000,000 pounds and that the price will remain the same. as the price which was negotiated for 1944. But the present position is that we have not completed the negotiations with regard to quantity and price for the years 1946 and 1947. The British are prepared to enter into a contract with us and we are prepared to enter into a contract with them, but, as I have stated, the negotiations are not at the moment concluded. I wanted to make that correction.
But what I wish to refer to at the moment is that in 1939, after war was declared, we undertook to supply all the bacon and ham that we possibly could to the British market. This we did for two reasons: first, that the British needed it, for they had been cut off from other supplies and later on were cut off from further sources of supply; second, that before this war began we had never had the opportunity, or had never taken advantage of any opportunities we did have, to prove to the British that we could completely supply from Canada, if necessary, their requirements in bacon and ham. With these ideas in mind we entered into a contract for the outside figure that we could obtain from our farmers in Canada in any particular year. In 1940 and 1941 we restricted the amount of pork products to go on the Canadian market in order to make possible the greatest quantity to be shipped to the British market. That policy was continued through 1942, and indeed the restriction of supplies of pork on. the Canadian market was increased during that year; in other words we took more off this market and put more into the British market. The natural result was ^hat through 1940, 1941 and 1942 there was a gradual increase in the consumption of beef in this country. There was no decrease in production-as I could indicate by figures-and no decrease in j|. the slaughtering of beef for marketing pur-*i poses in Canada during that period of time,

War Appropriation-Agriculture
the increase in beef consumption being largely accounted for by the considerable restriction of consumption of pork products.
By January or February of 1942 we were not able to supply all the beef which was demanded by the markets at Toronto, Montreal, Winnipeg, and Vancouver. In all the important sections of Canada there was a shortage of beef in the butcher shops. The wartime prices and trade board being entrusted with the task of securing beef for the Canadian people, for those who were training in the armed forces in Canada, whether the air force or any other, some of whom came from other countries, undertook to control the marketing of beef into the United States for the purpose of seeing to it that sufficient beef was on this market to supply its requirements. So that when in June, 1942, they found it necessary to restrict shipments into the United States, or at least to issue permits to their own corporation to secure beef which possibly might be shipped into the United States, it became necessary to turn practically all if not all of that beef back on to the Canadian market at the United States price. That is the reason for what happened, and it grew out of a situation which developed in connection with the production of meat fed to the British, to our other allies, to the armed forces in this country and to our own people. That policy continued until 1943.
I should here answer, perhaps, one of the questions asked with regard to 1942. The hon. member for Lethbridge asked whether, during the fall of 1942 or the spring of 1943, when actions were being taken with regard to beef, I had made any statements regarding the shipment of cattle into the United States. He also raised certain questions as to the discussions which took place between the farmers and ranchers of Alberta and any authorities in Ottawa with respect to price control and its relationship to the marketing of cattle in the United States.
This matter did not take place under any actions started by the Department of Agriculture, but rather as a result of negotiations carried on by representatives of the prices board. My understanding, however, is that meetings were held in Alberta, and so far as I can remember the federal Department of Agriculture was not represented there. Those represented at the meetings were the producers of Alberta, plus representatives of the advisory committee of the prices board on meat, and the members of that advisory committee from Alberta were: Mr. Ross, who is an Alberta rancher; Mr. Taggart, who is a farmer at Olds; and, I think, at that time Mr. Grisdale, though perhaps he was an official of the board itself. AH these men were
Albertans, and, I assume, have a knowledge of cattle raising and ranching activities in that province. Discussions were held at public meetings and certain resolutions passed, and some of those resolutions were on the line of the suggestions made a few moments ago by the hon. member for Lethbridge. One was to the effect that they believed that, under all the circumstances, the United States market should be made subject to permits issued by some government authority. I think they also recommended that a corporation should be set up which would purchase cattle up to the United States price, and certain discussions took place with regard to that particular matter. I am quite sure that nothing of the nature of the undertakings suggested in the questions asked by the hon. member for Lethbridge ever took place. I mean by that I do not believe any agreements were reached between the producers and the board.


John Horne Blackmore: I think the minister had better reassure himself.


James Garfield Gardiner: I have had quite a bit of discussion with regard to it, and I state that with fairly good assurance.


John Horne Blackmore: We have a mighty good memory of these things.


James Garfield Gardiner: I have had serious difficulty even in finding the resolutions which were passed, perhaps because some people are not very proud of them.


John Horne Blackmore: It will not take me very long to find them for the minister.


James Garfield Gardiner: But these resolutions were passed, and certain actions were taken by the prices board, based largely on the suggestions made at that time. I do not think any assurances were given as to what would happen under certain circumstances; I believe there were discussions as to what might happen under certain circumstances, but I can say with assurance what I myself said, and what the hon. member has asked me to repeat on this occasion. I did state at that time what was read from a letter which, I think, was written to Mr. Ross, a rancher in Alberta and the gentleman to whom I referred a few moments ago as being a member of the committee who gave that advice. I wrote him to remind him of the fact that there were discussions at that time, and in doing so I also recalled a statement which I made at a public meeting, I believe in Brandon, Manitoba, during the time the discussions were going on, something to this effect, that when the time came that we had a surplus in Canada which was not required for the feeding of our allies, particularly the British, and the Americans

War Appropriation-Agriculture
desired to have any surpluses which we in Canada had, I would be a supporter of the farmers and everyone else, I assume, in Canada in asking that the United States market be opened up. That, I think, to all intents and purposes is the meaning of the statement read to the house a few moments ago. In order to determine whether or not that time has been reached, we should pursue the story as to what has happened in connection with beef. The suggestion was made that I had advised the farmers at that particular time to hold their cattle for heavier weight, and again I say I gave that advice to the farmers then.


John Horne Blackmore: They took it.


James Garfield Gardiner: And they were quite satisfied in taking it. They were wise in taking it.


John Horne Blackmore: They surely paid
for it.


James Garfield Gardiner: They made money by taking it.


John Horne Blackmore: They lost money.


James Garfield Gardiner: I will show in a few moments that they made money. Now, why was that advice given? The advice was given in the fall of 1942 because it had been demonstrated to the satisfaction of everyone that all the beef we had in Canada in the summer of 1942 was needed on this market. That was demonstrated right through until the fall of the year. I recall that the member for Lethbridge got up in the house following the fall of 1942 and made a statement. I have not forgotten what he said; I have always remembered it, because I intended to reply to it some day. He got up following the fall of 1942 and criticized me as Minister of Agriculture. He criticized the Department of Agriculture and criticized the government because commercial feeders in Aiberta and elsewhere were not able to buy cattle at as low a price in the fall of 1942 in relation to earlier prices as they had been for twenty years previously. Well, that means only one thing. It means that since less than ten per cent of the beef produced in Canada is produced in feeder lots, ninety per cent of the farmers in the country ought to have been prepared in the fall of 1942 to take at least one and a half cents less-and provision was made at the time for two cents less on beef- in the fall of 1942 for their cattle in order that somebody might be able to make a profit on them in the spring of 1943.


John Horne Blackmore: Was not a subsidy possible?


James Garfield Gardiner: I have no hesitation in saying that I did object to that policy. I did advise the farmers to feed their own cattle instead of selling them at one and a half cents to two cents less in September or October. I advised them to utilize the great crops of grain we had produced in Canada in order to feed their own cattle through the winter, and by so doing at least double the selling price which they were allowed to make on their grain if they sold it to other farmers to feed cattle elsewhere, or to commercial feeders. In other words, it is obvious to anyone that if a man has cattle on his farm which sell at nine cents a pound in the fall, if he has oats on his farm pegged at 61 cents a bushel, barley pegged at 64 cents a bushel, wheat pegged at 90 cents a bushel, and if he puts those cattle into his own stalls and feeds them through to the spring, putting from 200 to 300 pounds on each of them, and if he gets two cents a pound more for them in the spring than he would have got in the fall, he will make at least $1.25 on his oats, $1.70 on his barley, and a considerably higher price on his wheat. And so I said to the farmers, "Keep your cattle in your own barn. Feed them your own oats, your own barley, your own wheat. Instead of giving them to the commercial feeders in Alberta or anywhere else in Canada, feed them yourself, finish them, and then you will sell your grain to better advantage in the spring than you would have been able to do if you had sold the cattle and the grain as well."
My hon. friend says that the farmers took my advice. I now answer his question as to whether or not by doing so they made a profit by simply referring him to the facts that I have stated. Ninety per cent of the farmers made a profit by doing it. Ninety per cent of the cattle fed by the farmers brought greater profits to the farming industry by following that policy than the farmers would have received by selling the cattle at nine cents per pound in the fall of 1942 to some person who would feed them over the winter with the farmer's own grain, which the farmers sold to them, and in the spring of the year sell the cattle on the market at eleven cents a pound. I advised against that policy. The farmers, therefore, did not deliver as many cattle in the fall of 1942. They did hold their cattle through to the spring of 1943, and when my hon. friend asks who paid the bills, I refer him right back to the criticisms he made a few moments ago. He attempted to - indicate to the house committee, and as a matter of fact it is true to the extent of one cent or two cents, or four or five cents a hundred, and for as high as sixty-five cents a hundred at one

War Appropriation-Agriculture
time, that the farmers in the spring of 1944 were getting less for their cattle than in the spring of 1943. They did get slightly less, and the reason was that the farmers, in taking the advice given by the Department of Agriculture in the fall of 1942, benefited by following that advice through into the spring of 1943 and delivering their cattle when a higher ceiling was provided for on those cattle.
The ceiling established during the fall of 1942 was one that reached 18} cents per pound on sides of beef on April 27, 1943. It dropped by three-quarters of a cent on two dates later, and finally by one-half of a cent to place the lowest level. From September 20 to December 18 it was at two cents below the highest point in the ceiling, and from December 19 to February 6 it was at three-quarters of a cent higher. From February 7 to March 19 it was one-half of a cent higher, and on March 20, 1943, it raised another three-quarters of a cent, while on April 24 it was again back to the high point of 18} cents.
The fall ceiling price was two cents on beef below the highest point in that ceiling, which was between May 27 and August 14. I submit that under that arranged ceiling farmers would require to go into the market in the fall and sell their cattle at a lower price, because the price of the commodity was down at that period. Because the price of the commodity was down at that period of time the purchasers bought the cattle low and fed them into the higher period to be sold in the spring of the year.
In May of 1943, yielding to representations which were made by the Department of Agriculture, the prices board established a new ceiling, and that ceiling was made a flat ceiling. It was put at a quarter of a cent above the highest position in the previous ceiling throughout the whole year. In other words, there was a higher ceiling for 1943-44 than there -was for 1942-43. That ceiling was a quarter of a cent higher than the highest point in the old ceiling. But there was established at that time by the prices board a varying floor, and that varying floor was made exactly the same as the ceiling which had been asked for by the Alberta representatives in the fall of 1942. In other words, right down to the present time the lowest price at which cattle were presumed to be sold was established through the setting of a floor price on beef, which was equal to the eeiling price established in the fall of 1942; and the higher ceiling was established throughout the year on representations made by the Department of Agriculture at that time.
We have operated under that latter policy during the year and down to the present.
Certain difficulties have arisen, and some of them were referred to a few moments ago by the hon. member for Lethbridge. He asked why we did not buy meat in the early part of the season of 1943.


John Horne Blackmore: 1944.


James Garfield Gardiner: 1943 to begin with. We did buy meat through 1944.


John Horne Blackmore: I asked particularly about 1943.


James Garfield Gardiner: I will deal with it in my own way and say this. In 1943, from May on, there was a standing offer from the meat board of the Department of Agriculture to buy beef from any of the packing plants or any of those who had it for sale for export. It is true that we did not buy any until late in the fall, and there is reason for that. When you establish a floor such as was established- and such by the way as is still insisted upon by the men who have been mentioned by the hon. member for Lethbridge-when you establish a floor which is 2} cents below the ceiling for the months of September and October and rises by three quarters of a cent at one time and half a cent at another.-in other words, you step it up over the period of time until it gets back to within a quarter of a cent of the ceiling-in order to prevent the packing plants of this country from making a killing in buying cattle on a low level and selling them on a high level of price, you have to make a further regulation and say that if the packing house takes those cattle in at the bottom of the floor price he must, when he turns the surplus over to the government, sell that surplus to them on the same basis. Otherwise he would be buying his cattle at the low point of the floor, slaughtering them, putting them in cold storage and selling them to the government on the higher step. Therefore the regulation must say, and it does say, that at whatever level the packer bought the cattle and at whatever level the price was when he slaughtered the beef, he must of necessity turn the beef over to the government at that particular price.
That can result in only one thing, Mr. Chairman. It can only result in the packer doing what any other individual or member of this committee or a business man anywhere would do. He would say: There is no sense in my buying meat down on that lower step, putting it in my coolers and keeping it when there is no provision made for the carrying charges to take it up on the higher steps. What he actually did, and I submit any hon. member of this committee would have done the same thing, is this: he went out and
War Appropriation-Agriculture

bought the beef that he required for the business that he was doing and sold the beef that he bought at the price of that level; and then when he got up to the next step he paid the price that was possible under that particular price level, and so on until he got up to the present level, which is at the top, when we are only a quarter of a cent below the ceiling.
It was during the period when we were going up those steps that we met difficulties. We would go to the packing plants and say, "We want to buy your surplus." They would say, "There is no surplus here," and we were not able to get it. After a time we had to enter into special negotiations in order to get certain types of beef from the plants under that plan; and I must say that each delegation that came down from Alberta-and there were two of them-sat in my office by the hour, as a result of which the letter which was quoted here a few moments ago was written. I tried to convince them that they ought to recommend that that policy be changed. Up to date, so far as I know, they have not made any such recommendation. They have still, in so far as their advice to the prices board is concerned, given the advice that that floor, the old ceiling which was established in 1943 as the new floor, should be maintained in order that they could buy cattle feeder lots down at the bottom of the price in September and October and sell it up at the top of the price in the spring of the year.
That brings me to the answer to the question which was asked last night and referred to again to-day. It was:	What does the
minister think the farmer needs if he is to buy cattle in the fall and carry them over till the spring in order to be able to market those cattle successfully? I am going to answer that question by saying that the policy that is supported by 'the advisers who come down from Alberta, the policy that was supported year after year in the fall during the years in which we had great surpluses of beef in September and October, was based on twenty years' experience before this war, when every year the ranchers from Alberta came in in the fall with their herds off the grass and placed them on the market in Winnipeg or Moose Jaw, or shipped them down to the market in the United States. So far as this side of the line is concerned when that great quantity of beef came on this market it glutted the market and the price of cattle for every farmer in Canada was forced down. They realized that as well as anyone else, and therefore they established the policy themselves in Alberta with the intention of righting the position to that extent. That policy

was based on the idea that somebody should go out in September and October in Winnipeg or Moose Jaw or Calgary; that somebody should go on those markets, buy good butcher cattle, take them out and feed them until spring in order that there would be fewer cattle on the market in the fall and more beef on the market in the spring. Again I submit that that policy was logical and probably very helpful in time of peace. But what is the condition prevailing to-day? I have outlined the position through 1942 and the greater part of 1943, when we were eating all the beef that came on the market in every part of the year and when there was no difficulty in the marketing of it from day to day. But in the fall of 1943 the advice given to farmers in the fall of 1942 began to produce results, as did our hog policy also. We were taking such a rush of hogs on the markets of this country that we were unable to process them and take them over to Britain. Therefore we removed the restriction on the consumption of hogs in Canada, and said:	"Go ahead and
eat all the pork you like. There is so much of it to-day that we are not able to get it processed and shipped to Britain." The people of Canada proceeded to eat all the pork they wanted, but they ate less beef than they did before. Therefore our beef in time began to pile up on us, and we had to come out with the policy which is now followed. From the point of view of the consumer and many of the producers that worked all right during the period when you could not sell beef as fast as it came on the market at certain periods, but it did not work when the packer had to buy more than he wanted for his own business before he was in a position to sell any to the government; and the varying floor under which we were working made it difficult if not impossible for the government to get that meat.
To finish my story with regard to the feeding of those cattle, how did the commercial feeders make money by feeding cattle before the war? They took butcher cattle, which were then ready for slaughter, and fed them for a period. Those butcher cattle make very good eating and are very good beef; as a matter of fact most people like them at that stage rather than at the fatter stage, because there is not so much loss in connection with them, but there are people in Canada who like red label beef. About the only place I ever saw red label beef sold before the war was in railway dining cars, and they charged me $1.50 for a slice of the steak. It was sold also in some of the first-class hotels of this country, where they charged similar prices for it. The commercial feeders would take these good butcher

War Appropriation-Agriculture
steers which were ready for the block in the fall, put them in their feed lots and feed them through into the spring of the year, by that method producing extra fat or extra well-finished beef, which is called red label beef from one end of Canada to the other and sold at higher prices. By that system, under the conditions then existing, they were able to make money and at the same time serve the farmers to good effect by tending to keep up prices in the fall of the year.
Then we came to 1943, when we turned our pork back on to the market because we had enough of it to supply Britain with all she needed and to give our own people all they wanted to eat. Then beef started to pile rp on our markets. In January and February of this year we said, "The offer is still there; we still want to buy1 the surplus," and, as the hon. member for Lethbridge has said, the buyers on the Calgary market were prepared to pay certain prices for cattle until the packers got the supplies needed for the market that was immediately available to them. Then some rancher out in the country would phone in and say, "I would like to sell my cattle." The packer would reply, "Well, I have all I can handle at the moment," but the rancher would say, "I want you to come up and see them." So the packer would go up and look at the cattle and say, "I do not want your cattle at any price at the moment; I have all I need." But the rancher would reply, "I have to sell them. This is the usual time for selling them, and I want to get rid of them." Then the packer would say, "Well, if you are bound to get rid of them, though I do not want them I will give you a certain price for them. In the meantime I will see that somebody looks after them until I am ready to kill them." That is practically what it amounts to. The same thing would occur if you went over to your neighbour and said, "I have some cattle here which I am bound to sell." The neighbour might reply, "Well, I have all my stalls filled now; I have all the cattle I can feed, and I really do not want any more." But if you were to say, "Well, I cannot keep them any longer; I want you to take them," your neighbour might reply, "All right, but if I must feed them for another month or so, which means I will have to buy more feed, I will have to pay you a lower price for them." In other words no policy can be established by this government or anyone else which will make it possible for a person to keep his stock for a higher market than is available, and then insist that they be taken on a certain day or during a certain week. People must be prepared to spread the marketing of their product over a sufficient period of time to make possible the
handling of it to advantage by whoever is buying it, whether a private individual or the government.
So that they ran into some difficulties for a few weeks, while we were on the second step of the stairs I mentioned. There were also difficulties when the last step was reached, but when we got to the top the difficulties disappeared. To-day the farmers who are selling cattle are getting the prices they said back in January and February they should be getting. But my hon. friend says the government should have taken them. If the government had taken them, we would1 have had to hire some rancher to keep them, until they were required for the market, or until they could be handled by the packing houses. So that we would have been in the same position that we were in as a result of what actually did happen. But another difficulty arose, about which a question has been asked. There were cows for sale. Well, anyone who has lived on a ranch in western Canada, or who has walked across a ranch, knows what happens. I have been on ranches in the west on which there were six and eight thousand head of cattle. The sires are running with the breeding stock, and the cows are bred. When the herds are taken in and sorted in the fall of the year some of these cows are prepared for market, and the usual practice has been to sell them before they begin to show that they have been bred. In January of 1944 these cows were ready for sale, but because of the circumstances I have described to the committee there was not a ready market for them. In the first instance the producers insisted on the government buying the cows. We replied that w'e were prepared to buy the beef just as soon as they could get the cows through the plants and the beef into position so we could have it frozen and sent to Britain. Finally, after some little delay, arrangements were made under which these cows were taken in, but not before some of the producers had taken a loss on them because of what developed, and not before some of the cows were in such a condition that it was not possible to market them in the spring of this year, so that they will be held over for another year.
The difficulties eventually were overcome, and most of the meat was marketed at a reasonable price. It is true that during this period the so-called floor price on cows would have been about 71 cents a pound, and a few people were offered 61 cents. I do not know how many sold at 61 cents, but I do know that some producers wrote the department and said they had been offered this price, stating that this was one cent below the floor. Of course we replied that actually there was no floor price on cattle. The farmers have insisted
War Appropriation-Agriculture

that there should not be any ceiling on cattle, and as a matter of fact there is neither a ceiling nor a floor. Neither is there a ceiling nor floor on hogs, though there is both a ceiling and a floor on pork and beef. So that before cattle can get into the position that we buy them at the floor price, they must be in the form of beef.
I should like to offer a suggestion to the hon. member for Lethbridge. I am not stating my own idea as to the solution of the difficulty, but I have talked the matter over with the men in Alberta whom he has quoted; I have discussed it in the city of Calgary, and I think these people are convinced that this is the correct plan. I suggest to the hon. member that he go back to Alberta and convince those people living in the vicinity of Lethbridge, particularly those whom he has quoted this afternoon, that the advice they have been giving in connection with the marketing of cattle in Canada does not suit the conditions that prevail on at least ninety per cent of the farms in this country. He should convince them that there should be some variation of the plan of setting floor prices under beef and, in accordance with that floor price, a somewhat different arrangement for a floor price under cattle; that is, not an actual floor price under cattle but the price that would result from the floor under beef. I am quite certain that if this is done we shall not experience some of the difficulties that have been experienced in the past in connection with marketing.
It has been said that the policy which has been followed over a period of years has resulted in great losses to the farmers. Well, I happen to have here the prices for the years 1942, 1943 and 1944 on three different markets, namely, Toronto, Winnipeg and Calgary. Since we are speaking of the Alberta position, probably I should take the Calgary market. The same is true, however, proportionately, on the other markets, as we go farther east across Canada.
This table shows the figure for the last day of the week in each of the weeks from January to the end of May. I shall take only the first week of each month, in order to give an idea of what has happened. In January, 1942, at Calgary the price of beef cattle was $9.25 a hundredweight; in 1943 it was $10.50, and in 1944, $11.35. There is not any indication in those prices to show that there was any loss taken in the first week of 1944 as against the first week of 1943. But in order not to pass up that month, without covering the other weeks, may I take the third week. The figures show that in the third week of January, 1942, the price was $9.35; in 1943 it was $10.50, and in 1944, $1125. Those are the

prices for good butcher steers, the type we always take as a basis for prices. Some would be higher, and some would be lower than that.


John Horne Blackmore: They are handyweights?


James Garfield Gardiner: Yes. Then, these figures show that on February 3, 1942 at Calgary-1 that is the next month-the price was $925; on the same date, 1943, it was $10.75, and $11.15 in 1944.
In the first week of March, 1942, the price at Calgary was $925; in 1943 for the corresponding week it was $11.50, and in 1944, $10.85. This figure represents a drop in the first week of March, 1944, of sixty-five cents a hundredweight. Then, coming down to April, 1942, we find the Calgary price in the first week at $9.75; in 1943, for the corresponding date it was $11.65, and in 1944, $11.15. Again we find a drop of about 50 cents in 1944 as against 1943. Coming down to May we find that on May 4, 1942, the price at Calgary was $10.25; in the corresponding week for 1943 it was $11.35, and in 1944 it was $11.30. In other words, by that time we were up on the top step in the floor price.
These figures show, further, that on May 11, 1942, the price at Calgary was $10.25, whereas in 1943 on the same date it was $11.65 and in 1944 it was $11.30. Then, coming down to the third week, beginning on the eighteenth, the price at Calgary in 1942 was $10.50; whereas in 1943 it was $11.35 and in 1944 it was $11.35. We are back on exactly the same floor we had in 1943, and we have exactly the same price in 1944 as we had in 1943.
I have not the prices for the Calgary market for either to-day or yesterday, but I do know that on May 22 the price at Toronto was $11.00 to $12.25 in 1943. This year it is $11.75 to $12.50. In Winnipeg on that date it was $1125 to $11.75, and this year it. is $11.75 to $12.00. So that the price this year, when you get up on the top level of the floor, is just as much as or even a little higher than a year ago. That no doubt is due to the fact that the ceiling is a quarter of a cent higher than it was prior to the arrangement made in May of 1943.
That is the history of the beef situation, with this exception, that we have bought a great many cattle in the form of beef.


Mr. TUSTIN:: Would the minister put the remaining figures on the record?


James Garfield Gardiner: I have the figures for several months, and for each week in each month. Perhaps I might be permitted to place them on Hansard without reading them.


Joseph-Arthur Bradette: With the unanimous consent of the committee, that may be done.

War Appropriation-Agriculture
Weekly Beef Cattle Prices at Toronto, Winnipeg and Calgary
Week		Toronto	
ending	1942	1943	1944Jan. 6	... $ 9 10	$11 10	$11 8513	... 9 51	11 02	11 8520	... 9 51	11 31	11 7527	... 9 30	11 56	11 62Feb. 3	... 9 62	11 20	11 8610	... 9 82	11 70	12 0017	... 9 60	11 81	11 7024	... 9 75	11 64	11 75Mar. 2	.... 9 90	11 62	11 719	.... 10 08	11 87	11 6116	... 9 77	11 73	11 8023	,... 9 87	11 80	11 7530	... 10 21	11 84	11 51Apr. 6	.... 9 95	11 79	11 6013	.... 10 11	11 69	11 5920	
10 28	11 69	11 6427	... . 10 69	11 79	11 62May 4	
10 45	11 70	11 5511	.... 10 79	11 71	11 6418	.... 11 25	11 84	11 77Winnipeg	Calgary1942	1943	1944	1942	1943	1944$ 9	00	$10	50	$11	31	$ 9	25	$10	50	$11	358	65	10	43	11	12	9	35	10	50	10	659	00	10	25	11	53	9	35	10	50	11	258	75	10	75	11	25	9	35	10	50	11	258	75	10	67	11	12	9	25	10	75	11	158	50	10	68	11	25	9	10	10	75	11	259	25	11	16	11	25	9	25	10	75	11	159	15	11	00	10	95	9	25	11	50	11	159	34	11	25	10	78	9	25	11	50	10	859	25	11	00	11	14	9	00	11	75	10	859	12	11	12	11	31	9	50	11	70	10	859	19	11	18	10	87	9	50	11	65	10	859	50	11	00	11	05	9	70	11	65	10	859	81	11	25	10	87	9	75	11	65	11	159	75	11	12	11	06	9	75	11	35	11	1510	07	10	94	10	87	9	75	11	35	11	1510	37	11	15	10	91	9	75	11	35	11	1510	25	11	27	11	46	10	25	11	35	11	3010	31	11	29	11	60	10	25	11	65	11	3010	53	11	36	11	65	10	50	11	35	11	35


James Garfield Gardiner: Something has been said with regard to marketing of cattle. In this connection I shall give only totals. I could give them for the months of the years, but I shall deal only with the totals and go back several years. This is a record of cattle marketings from 1938 to 1944.


John Horne Blackmore: For the whole of
Canada?


James Garfield Gardiner: Yes.


John Horne Blackmore: Under the government?


James Garfield Gardiner: These numbers are for the years before the time the government took anything as well as during the war. The figures for cattle marketing are as follows:
	Head
1938			 972,000
1939 			 1,061,000
1940				 1,026,000
1941			 1,167,000
1942			 1,097,000
This indicates a drop of about 70,000 head in the fall of 1942, as against the marketings in the preceding year. In 1943 the marketings amounted to 1,024,000.
The only thing I can do to give an indication of what is happening in 1944 is to come down to the month of March. These are the marketings for the month of March in succeedmg years: March- 1938	
1939	
1940	
1941	Head 83.000 71.000 72.000 70.0001942	
1943	80,000 76,0001944	101,000
In other words, our marketings in the spring of 1944, the month of March to be exact, were
very much higher than they were in the same month in preceding years. I could give other figures, but I do not think it is necessary to do so, to indicate what I am suggesting to the committee. It all adds up to this, that whereas under the agreement we had with the United States before the war we were permitted to sell 51,000 head of cattle to that country in the first three months, and 51,000 head in the second three months, in the present year, up until the end of the last month for which we have any record, we have purchased for delivery to Great Britain sufficient meat to cover 107,000 head of cattle. That is more cattle than we were permitted to sell under the special arrangements, with the benefit of a decreased tariff which we had during the period preceding the war. In other words, while there are increased marketings, there are increased sales being made off those marketings. We are selling to Great Britain at the present time, or have sold during the period beginning just before the new year, the period during which we have been buying beef and preparing it for the British market, 107,000 head of beef cattle for that purpose, in the form of beef.
Some suggestion was made a few minutes ago that I ought to say whether or not the American market is going to be open. It has been said that I ought to state my position on that point, in view of the statement I made in the fall of 1942. In that connection all I wish to say is this. The British are pressing us for all the beef we can send them. In answer to a question which was asked a few minutes ago I would say they are suggesting to us that they will provide the shipping to take it away. Up to date they have been
War Appropriation-Agriculture

providing that shipping to take away our pork products, and also to take, as well, this additional beef. We have been attempting to secure beef and to secure pork products, and to have them at the ports to be taken away by the British ships when they arrive. So that in so far as one condition upon which I made my statement in 1942 is concerned, I would say that we have not yet arrived at the position where the British do not want the surplus meat that we have. We have not yet arrived at that point.
Dealing with the other side of the question, as to what the Americans think about it, I would call attention to what I said last night in connection with packing plants. American packing plants are working overtime to approximately the same extent as our packing plants in Canada. They are having difficulty in finding labour to man their plants, and we are having difficulty in getting labour to man our plants. They find themselves with the greatest live stock population, particularly cattle, that they have ever had in their history-just as we find ourselves with the greatest live stock population we have ever had, and particularly cattle, in our history.
So that the problems on their side of the line are the same as those on our side. I have not any doubt that if someone went to an American packing plant on the other side of the line or to an American drover and said, "Are you prepared to come to Canada and buy at lower prices than you have to pay in the United States and then take them on to the American market and sell them there?" he would get the natural answer. But in the United States they have a government, as we have one in Canada. We have spent much time in discussing these problems back and forth, and we think we understand the point of view of the United States. Believing that we understand it from the discussions we have had, we are not asking them to say what we ought to do with our cattle. We are trying to deal with our own problems, by doing something that will not multiply their problems. We are trying at the same time to satisfy the British, who want all the surplus beef that we can send to them. We are trying to do that. We are now entering into an agreement with Britain-and there will not be any great difficulty about it-which will suit their needs and at the same time suit our own necessities; and if we are able to reach an agreement of that kind I am quite sure that the orderly marketing of our beef on the British market will be a possibility from now at least until the war ends. If during that period our production increases to the point where the Americans can take some of our meat, and 
we are extremely desirous of that taking place, I do not think there is anyone on this side of the line who will have any desire to prevent that meat from getting into that market.
In the meantime we are trying to suit the needs of all parties concerned to the best of our ability, and I think we have done a fairly good job despite the fact that the hon. member for Lethbridge thinks we have bungled in relation to our beef and beef cattle policies. We believe that in giving what is obviously a price which compares favourably with any price we have obtained under similar circumstances in the past,-the policy is not something that works to the disadvantage of our farmers. We believe, too, that just as we now have a flat return throughout the whole year for hogs, a flat return for cheese, and a flat return for some other farm products, without prices going up and down at different seasons of the year, if at all possible we should get a flat return on beef. If I had time this afternoon to put the prices on the record it would be found that the policy we are now following is establishing a flat price for beef, and since the demand for beef continues in Britain throughout the whole year there is not the necessity of taking care of great rushes of cattle on to that market at one time and of shortages at another. We can take in beef as it comes just as fast as our plants can handle it, and when it is taken in we can freeze it and ship it out to Britain as the boats are available, and thus market the product orderly throughout the whole twelve months of the year. That is the answer, Mr. Chairman, which I wish to give to the questions.


John Horne Blackmore: I should not be surprised if the minister finds it inconvenient to answer my questions; I may have to answer them myself before we finish this debate. I think the minister will have a hard time answering the answers which I will give. May I deal with the minister's rejoinder?
Even his remarks to-day give indication to the house and the country that there is a very strong demand for beef, that there is a demand for all the beef that Canadian farmers can produce. In the light of that fact, and in the light of the fact that a year ago beef was rationed in Canada and the price of beef was very high to those who wished to buy it to eat, and the great deal of talk there was of the need of beef for Britain-I ask you in the light of those facts how the ordinary farmer, the ordinary feeder, could possibly conceive that in the spring of 1944 he would not be able even to sell his beef. There were thou-

War Appropriation-Agriculture
sands of beef in my constituency that remained on the feeding lots until the feeders sustained a devastating loss because they could not get an offer for the beef, whereas a year before buyers had been scouring the country for that very kind of beef and offering for it prices that were attractively remunerative. That is the disaster which overtook the feeders of beef in my constituency this year. It is all in those simple words, and no amount of speaking will cover the matter up. If there is need for beef, surely the beef producers should be able to sell when they are ready to sell. The minister simply has not taken into account the fearful loss a man sustains in feeding a herd of twenty-five or thirty up to a hundred head of beef cattle after the beef are ready to market, with prices of hay and feed and labour as they are to-day.


James Garfield Gardiner: Beef are not like hogs. You do not have to sell them at a certain weight to make money out of them.


John Horne Blackmore: There is a maximum beyond which they do not readily add weight.


Mr. EVANS:: Do not the two and three-year olds add weight?


John Horne Blackmore: Heavy weight steers do not gain very rapidly, and mature cows which are fed after they are eight years old do not add weight rapidly. Do not let the minister think I know nothing about beef.


Charles Robert Evans: You do not know much about feeding cattle.


John Horne Blackmore: You have no idea what I know. You might be astonished. But I do not undertake to reveal all that I know before the hon. member. I was not always a member of parliament, not by any means. I was raised right up with beef and know beef pretty well.
This is the situation. No man who was feeding cattle could conceive last fall that he would be unable to sell. Not one man in a hundred could have conceived last fall that he would have to sell at lower prices than in 1943. The very figures which the minister gave when he read out the prices for 1942, 1943 and 1944 picture the tragedy. Imagine having to take a lower rate-


James Garfield Gardiner: For a few weeks.


John Horne Blackmore: -for the three succeeding periods which the minister mentioned!


James Garfield Gardiner: All inside a few weeks. Let me give the figures again.


John Horne Blackmore: Yes; give them again. The minister spoke for so long that I may have overlooked something.


James Garfield Gardiner: March 2 is the only one that I gave where there was a considerable decrease.


John Horne Blackmore: But it was a decrease.


James Garfield Gardiner: Let me read the figures: $9.25. 1942; $11 AO, 1943; $10.85, 1944.


John Horne Blackmore: Enough to ruin a man.


James Garfield Gardiner: That is a decrease of sixty-five cents.


John Horne Blackmore: That is enough to ruin a man feeding a herd of 50 cattle.


James Garfield Gardiner: If he bought them at the price my hon. friend suggests he ought to be able to buy them at, one cent or one and a half to two cents under that selling price, he certainly was not going to take any loss. The representative who came from Alberta told me this, and I agree. He said: "I can take cattle on to my range in the spring of the year at ten cents a pound, and I can sell them off the grass in the fall of the year at nine cents a pound and make money on them."


John Horne Blackmore: Certainly, because he is on the grass.


James Garfield Gardiner: Yes, on the grass.


John Horne Blackmore: He is not feeding grain and hay.


James Garfield Gardiner: I can give the hon. member for Lethbridge the answer I gave him "There is another reason; you have cheaper grass from the government."


John Horne Blackmore: And less labour.


James Garfield Gardiner: "You can put your cattle on the grass in the spring, and on the increase in weight you can make money."


John Horne Blackmore: Exactly.


James Garfield Gardiner: But I said, "Why do you come to the government and ask the government to take care of your problem? Why do you not sell the cattle at a cent less to these feed lot men, instead of compelling them to pay from ten to eleven cents for the cattle in the fall and they having to sell them at over eleven and one-half to twelve cents in the spring in order to make a profit?


John Horne Blackmore: The minister is
contending for the very thing I am contending for.


James Garfield Gardiner: I am just telling the hon. member what some of the advisers he is quoting from had to say, and what the reply is to them.
War Appropriation-Agriculture


John Horne Blackmore: I did not quote any advisers.


James Garfield Gardiner: In other words, that is not a problem for the government to deal with or to take money out of the treasury to deal with.


John Horne Blackmore: I did not quote any authority at all.


James Garfield Gardiner: My hon. friend has quoted the president of one of the associations to whom I wrote a letter.


John Horne Blackmore: I quoted no authority.


James Garfield Gardiner: Then, on April 6: 9-75 cents in 1942, 11-65 cents in 1943, and 11-15 cents in 1944.


John Horne Blackmore: All right, another disastrous loss.


James Garfield Gardiner: That is a drop of half a cent a pound.


John Horne Blackmore: Over a whole month. Mr. GARDINER: Over a whole week.


John Horne Blackmore: Over a whole month of marketing.


James Garfield Gardiner: That particular date- yes, that is a month later.


John Horne Blackmore: That is disastrous.


James Garfield Gardiner: My hon. friend knows this, if he knows anything about cattle-


John Horne Blackmore: He knows about cattle.


James Garfield Gardiner: -as he says he does; he knows that anyone who is attempting to feed cattle and market them on a margin of less than half a cent a pound-well, he must have a remarkable judgment in connection with cattle. Anyone who does not bank on there being a difference of half a cent a pound over a month any year in the marketing of cattle is taking very long chances in his feeding. You can take any year for the past twenty years and you will find variations very much greater than that variation in the price of cattle as between different years.
On May 4 there is a difference of five cents.


John Horne Blackmore: Another drop. That is two quotations.


James Garfield Gardiner: 10-25, 11-35, 11-30.


John Horne Blackmore: Well, who would imagine it?


James Garfield Gardiner: Who would imagine a farmer buying cattle and making a great loss because of the difference between 11-35 and 11-30?


John Horne Blackmore: But there are two whole months of marketings there.


James Garfield Gardiner: Yes, even if there are two whole months of marketings.


John Horne Blackmore: The minister does not know what he is talking about.


James Garfield Gardiner: The half cent a pound over that period of time, as compared with another year in which the prices were the highest on record in recent years, does not indicate that the farmers were up against the possibility of an enormous loss, because of that alone. I am speaking now of ninety per cent of the farmers. The man who paid eleven cents in the fall and sold at eleven cents in the spring no doubt lost some money, but I am speaking of the man who had some cattle and grain and fed the cattle on the grain, and that applies to about ninety per cent of cattle in this country.


John Horne Blackmore: Who would imagine that, with a higher ceiling price in 1944 than there was in 1943, the price of stock would be lower than it was in. 1943? You see the situation is just practically absurd to any intelligent man.


James Garfield Gardiner: There is a quarter of a cent on beef, which is about one-eighth of a cent on the cattle, and if my hon. friend can figure any closer than that, he is a good one.


John Horne Blackmore: That is a lot, on fifty steers. I understand the feeding business fairly well; the picture which is delineated by the minister spells disaster for feeders of stock, and there is not a feeder in my constituency who will not support me in that statement. Remember, there was a higher ceiling price in 1944 but a lower price for the stock being sold, and many men were unable to get offerings at all. It is just so terrible that one would hardly think the minister would fail to realize it.
One other thing. The minister even yet has not given the price at which these cattle entered the feed lots. He must bear in mind that, when prices for finished cattle were high, in 1943, naturally those who had feeder cattle to offer demanded higher prices for their feeder cattle, and those who were prospective feeders naturally felt confident in offering higher prices. The result was that feeders were put in a position where they were exceedingly vulnerable. If you want any more evidence to prove that the whole situation was bungled, you are certainly hard to convince.
The minister mentioned cows. The cows which were fed were not cows that were

War Appropriaten-Agriculture
preparing to freshen. It is a settled custom to take cows which have finished their usefulness and feed them as beef. Many, many cows were fed in that way in my constituency.
I think that is enough in a general way. Now I want to read the minister one or two things and see whether he recalls that something like this actually occurred. I asked three questions to start with. Maybe I had better repeat those questions. It is a long list; but you have to get to the facts; you have to get to the basis of this thing to realize how bad it all is.
Is it a fact that the beef producers of Alberta in August, 1942, waived the right to export beef to the United States? The answer is yes.


James Garfield Gardiner: Well, I would say that the answer is no, and I answered that question while I was speaking. A few Alberta ranchers and others met and passed a resolution, but I do not think anyone in Canada waived the right to market cattle in the United States. There was a regulation put out with regard to it which all of us had to live up to, but nobody waived any rights.


John Horne Blackmore: Well, they felt they did. They met on August 25, 1942, in Calgary, and after careful deliberation passed a resolution by which they waived this right, and they laid down the conditions under which they waived the right. The resolution was the beginning of an agreement between themselves and the wartime prices and trade board. The minister may not consider that binding, but out west we do consider a thing like that rather binding.


Charles Robert Evans: Do the Lethbridge feeders govern the feeding of western Canada?
Mr. BLACKMOREu Nothing idiotic like that.


Charles Robert Evans: It sounds like that.


John Horne Blackmore: The hon. member just makes himself foolish in the eyes of intelligent men.	.


Charles Robert Evans: Not half so foolish as some
people make themselves.


John Horne Blackmore: On October 7, 1942,
I am informed there was a press release entitled "Press Release No. 0231," issued according to my information by the chairman, Donald Gordon, in which the following words were reported as being used:
The wartime food corporation will be prepared to buy cattle if there is at any time a surplus supply which threatens to depress cattle prices unduly, and after providing a reasonable supply for domestic consumption, will export any remaining surplus cattle.
These words can mean only one thing, that if a man had a corral full of fat cows, the like of which he had been able to sell at nine cents or nine and a half cents in February and March of 1943, and in 1944 he has to wait for weeks for a bidder, and finally sell between six and one-half and seven and one-half cents-


James Garfield Gardiner: What was the date of
the press release?


John Horne Blackmore: October 7, 1942.


James Garfield Gardiner: That is a long while
back.


John Horne Blackmore: Exactly, but it was
the beginning of this. The minister went back to 1936. I will indulge in a little history too.


James Garfield Gardiner: Yes, but what I am
pointing out is that that condition existed under an order which was passed at that time. That order was changed later, and what he announced would take place did take place down to a certain time.


John Horne Blackmore: Can the minister give the press release which cancelled this one?


James Garfield Gardiner: I do not know whether there was one or not. I did not issue the press release.


John Horne Blackmore: That is just the point. The western feeders did not know either. If there ever was such an order it certainly was not widely publicized among the feeders in the west, and that is an evidence of bungling.


James Garfield Gardiner: No. There was a
standing order all through 1943. There was a standing order from early in the spring of 1943 right down to the present time for the purchase of surplus beef that was in frozen form in store in any of the plants-all the way through. There was no surplus there until the fall of 1943.


John Horne Blackmore: Then how could it be possible that the farmers were told that they were unable to sell beef in February and March, 1944, because the packing plants were full?


James Garfield Gardiner: That is vei-y simple.
You had upwards of 100,000 hogs in a week coming in more than came in before, which of course filled the packing plants, and you had beef at the same time coming in. There were times when you had 30,000, 50,000 and upwards of 100,000, in that period of time, coming in during one week, in addition to the number reached in previous years, and that being the case, the packing plants were filled.
War Appropriation-Agriculture


John Horne Blackmore: If the standing order prevailed at that time, surely the government would have been taking meat out of the packing plants as fast as it was brought in. The whole thing does not fit together to make sense.


James Garfield Gardiner: It does to some people. It makes sense to me.


John Horne Blackmore: To the ordinary person it does not. The minister says that there has been a standing order to take beef, and that this has prevailed since a certain date in the fall of 1943.


James Garfield Gardiner: The hon. member forgets the other part of the statement I made in answer to his question. I said that one of the reasons why there was not a surplus of beef there was the policy proposed at the meeting to which reference was made. Where you have a rising floor beginning at a low level, in September and October, and rising to a higher level in April and May and continuing through to August, while that rising process is taking place the packer does not buy any more on that step than he can sell on that step, and that was one thing that delayed the purchases of cattle, resulting from the fact that beef was not on hand in a surplus to be sold. As to the change of policy, I made a recommendation to the very people the hon. member is talking about, the people in Alberta, the suggestion being that it would help considerably to have it changed. As long as they are insisting on the policy that is being followed there will be trouble if it is maintained, but if they take the position that it should be changed from the plan set out in Calgary in 1942, there will probably be more favourable consideration given to it at this end.


John Horne Blackmore: The minister is not entirely logical. This order, this press release by Donald Gordon, undertakes to purchase any surplus of beef that threatens to depress the price. The very minute that the packers cease to buy, thereby causing a surplus to accumulate, threatening to depress prices, then unquestionably the Wartime Food Corporation should step into the picture to rectify the situation.


James Garfield Gardiner: The order has been there all the time for any surplus of beef, and where there were surpluses they were bought. They were bought to the extent of 107,000 head of cattle, which was more than was bought previously to be sent to the United States market, and this is sent to the British market.


John Horne Blackmore: The important point is this. Why were not these cattle bought which were standing in the way in my con-

stituency, occasioning such a loss? If the standing order was there, and this statement of the wartime prices and trade board has never been revoked, why was it not put into operation?


James Garfield Gardiner: I can tell my hon. friend why they were not bought. I did not sell my cattle in those weeks that were referred to when the price was down. The fact that the price was at a certain level on the market does not mean that every farmer sold his cattle. Many carried their cattle through, which was the proper thing to do under the circumstances. When the market is glutted with stock, stock that you can carry over, you ought to carry over, and many farmers carried cattle to the last week in April or the first week in May or later. In fact, they are coming on to the market now in great numbers, as the figures which I read indicate.


John Horne Blackmore: Exactly so; but the cattle, the presence of which occasioned people concern, were ready for the market in the early days of February. The difficulty arises in the fact that this supporting purchase of live cattle did not come into operation, and when the people who are concerned tried to find out who would buy these cattle in accordance with the statement made by Donald Gordon all they got was a run-around.


James Garfield Gardiner: Oh, no.


John Horne Blackmore: Let me give evidence to show that it is as I say.


James Garfield Gardiner: The farmers all know, and they would explain it to the hon. gentleman if they were here, that the price paid for beef on the last step before they reached the top was within a quarter of a cent of the highest floor. They were all instructed to that effect and the price was paid. It was not half a cent below the high floor during the latter part of the period; it was up to within half a cent of the ceiling, which is a quarter of a cent below the highest -floor; the cattle during that period did sell readily, and beef was taken off the market readily in that period and is still being taken off the market in great quantities.


John Horne Blackmore: The minister's statements are not in accordance with the facts as they exist in my constituency, not by any means.


James Garfield Gardiner: I am talking about
Canada, not the hon. member's constituency,


John Horne Blackmore: Just the same, I
will show that this is not an area that can be jgnored or neglected or kicked around or shoved about, because there was a meeting of 289 persons in Lethbridge on March 15-

War Appropriation-Agriculture


An hon. MEMBER:: Where is Lethbridge?


John Horne Blackmore: I expected that the
hon. member would not know his geography, judging from other things he has said. At this meeting there were 289 people, and they had altogether 26,000 head of cattle -


James Garfield Gardiner: It turned out later that they had between three and four thousand.


John Horne Blackmore: - and 86,200 sheep.


James Garfield Gardiner: It turned out later, on
checking the records at the time that statement was made, that there were three or four thousand head of cattle ready for market.


John Horne Blackmore: The evidence I have
here is not to that effect; I have been in close contact with the people there and I believe they know. This is the point. If a man named, let us say, James Jones, in an area outside Lethbridge has fifty fat cows ready to sell in the third week of February and he has no offer for those cows at remunerative prices, and is running out of feed, whom should he approach to have those cattle taken off his hands, in accordance with the promise implied in Donald Gordon's press release?


James Garfield Gardiner: He should approach
somebody who could turn them into beef and get them frozen in the places where they could be marketed in the sense covered by the statement of Donald Gordon.


John Horne Blackmore: In other words, the
government had no agency for buying the stock.


James Garfield Gardiner: Yes, there were agencies.


John Horne Blackmore: Well, what were the agencies?


James Garfield Gardiner: My hon. friend seems
to know what the agency was. He has been speaking of the different plants at which the product could be marketed. They are the agent of the meat board in connection with the marketing of hogs that .go to Britain; that is, the plants that are able to process hogs and turn them into bacon and ham. The government has considerable authority over them; they have maintained, through all the period since the war began, the prices paid farmers for hogs in order that those prices might bear a proper relationship to the ceiling price of bacon and ham, and everyone who has examined into the matter has agreed that the relationship has been properly maintained. The same will be true in the marketing of beef in the British market. The facilities that are there for the processing of beef will be the agency which is purchasing cattle and
turning it into frozen beef that can be sent to Britain to supply them with food. The facilities that are there will be utilized as the agency to do it.


John Horne Blackmore: Suppose the marketing plants in the area refuse to take the cows, then what?


James Garfield Gardiner: That is supposing something which does not happen.


John Horne Blackmore: But that occurred.


James Garfield Gardiner: Oh, no.


John Horne Blackmore: That occurred.


James Garfield Gardiner: There was a glut on the market for a few days, but within a short time a representative of the government reached Calgary, met the men and settled the whole problem to the satisfaction of those who were out there. My hon. friend is talking about a problem which existed for a few weeks in January and February and which he knows was settled to the satisfaction of those concerned.


John Horne Blackmore: The minister is entirely-overlooking the fact that a man who has fifty or sixty head of stock can be ruined in a few weeks. That is the point the minister is overlooking, and he has not told us yet to whom this man, James Jones, could apply to market his cattle. All he has said is that the nearest packing plant or packing plants would take them. If the packing plants are not prepared to act then the man is simply out of luck.


James Garfield Gardiner: What would the hon. member propose ought to be done?


John Horne Blackmore: Certainly there should be some realistic interpretation and application of this press release. Notice what it says:
The Wartime Food Corporation will be prepared to buy cattle.
That is not the fact, certainly.


James Garfield Gardiner: My hon. friend has read the statement and I now say to him that that particular arrangement was changed.


John Horne Blackmore: When was it changed?


James Garfield Gardiner: It was changed in the spring of 1943.


John Horne Blackmore: From that time
thereafter-


James Garfield Gardiner: From the time the meat board was set up it became responsible for purchasing meat.


John Horne Blackmore: Then, James Jones should apply to the meat board?

War Appropriation-Agriculture


James Garfield Gardiner: No; he should sell his cattle to the plants where the beef can be processed, and then the meat board will purchase the meat from those plants.


John Horne Blackmore: From what the minister is saying this is not designed to be a government agency to buy that surplus meat?


James Garfield Gardiner: At the floor which was established as a result of representations made from Alberta.


John Horne Blackmore: This press release specifically states that the Wartime Food Corporation will buy. The minister now says that the meat board was going to buy.


James Garfield Gardiner: At the floor price, but there was no one in Alberta wTho was prepared to sell cattle at the price fixed as the floor for beef. That is the reason why they were raising difficulties about it. They want to sell at a higher price than that. They want to sell it at the ceiling, not down at the bottom.


John Horne Blackmore: What was the floor price for fat cows on February 10?


James Garfield Gardiner: The ceiling price on beef was 18J cents all through the year, and the floor price from December 18 to February 7 was 1{ cents below that.


John Horne Blackmore: Below what?


James Garfield Gardiner: Below 18J cents. That would be 17 cents a side.


John Horne Blackmore: What would be the price on cows?


James Garfield Gardiner: I have given the price of steers, commercial grade. The price of cow beef would be 161 cents.


John Horne Blackmore: The price of cows would be 14i cents.


James Garfield Gardiner: No, 161 cents. The price of steer beef was 17 cents.


John Horne Blackmore: The minister will be interested in hearing this letter from very responsible feeders.


James Garfield Gardiner: The price I gave was for beef, not cattle.


John Horne Blackmore: Yes, fat cows. Here is a letter from Cardston:
Alberta, February 9, 1914. Mr. L. W. Pearsall,
Meat Board,
Ottawa, Canada.
Dear sir,
We were obliged to sell our fat cows for the best offer we could get. We held them as long as possible on your advice that improvement was expected, but fat cows cannot be held indefinitely as you are fully aware, and we received only 7i cents for these choice cows.


James Garfield Gardiner: That is the floor.


John Horne Blackmore: Cows of no more quality were bringing 91 cents at this time last year. These same cows only grass fat, at the lowest price under your ceiling, brought 8J cents last September. After three months of grain feeding and -with advances allowed under your ceiling regulations, we are able to obtain only 7J cents. The result of your ceiling regulations has been apparent, but so far we have seen no action to maintain a price.


James Garfield Gardiner: That is exactly in
accordance with what I was telling the hon. member in my statement. The ceiling price is a flat ceiling running right through the year, and cows, of course, can be sold near the ceiling while they are buying for a market in Canada. Cows can be sold at a higher price if it is possible to retail the beef right up to the ceiling. During the period when the packer was buying cattle in order to supply his market at that particular price level the farmer who sold them early in that period and got the price which was near to the price made possible were by beef being sold near the ceiling, would get something near the ceiling; but when it came to the time that the packers had all the cattle they wanted for their trade under this policy which was laid down in Calgary and recommended here from Calgary, the situation changed. The packers said: "if we buy any more cattle we have to turn them over to the government at the floor." They said: "All we can pay for cows is 7-| cents." That is the floor. They would then offer 7J cents for any additional cows, the beef from which they were going to put in storage and deliver to the government. That, of course, is what is meant by a floor and ceiling price. What I suggest as the real criticism of the policy is that it was meant to suit the sale of fat steers to commercial feeders in the fall of the year so that they would be able to sell them as red label beef in the spring. That was all right in peace time but in war time it does not necessarily work on all grades of cattle. The reason for that is that you can sell all those steers as butcher steers when they come in. You can sell them as they come in, put them through cold storage, freeze them and ship them to Britain in quantities all during the year. Therefore it is not necessary to send them back to the farm to be re-fed. They are taken right in, and if a man comes on the market and tries to buy them and take them back he will have to pay up to the ceiling price for them because somebody else is prepared to take all these cattle and slaughter them. Under present conditions the old policy just will not work; that is all, and as soon as the few men out in that section view as a

War Appropriation-Agriculture
fact what all the rest of the farmers of Canada realize, that it will not work, and make recommendations in accordance with the experience of the present, I am sure that conditions will be very much better than they have been recently.


John Horne Blackmore: The reason why it will not work is that we destroyed what is called the free market. Is that not so?


James Garfield Gardiner: I would not say that we destroyed it; I would say that Hitler destroyed it. There is no free market in war
time.


John Horne Blackmore: When the government agency established a ceiling price they came rather close to destroying the free market. They established control over the whole market. As I said a few moments ago, control ought to mean control for everybody. It ought to control the prices of the materials that go into the product as it controls the price of the ultimate product. It ought to control everything pertaining to the commodity if it is to work properly.


James Garfield Gardiner: If we undertook to do that we would say definitely to the men who have been feeding butcher cattle for red label beef, "you are not going to be allowed to do that." That is what we ought to say if we are to follow the suggestion made by the hon. member. It would be then the government's duty to tell everyone what he ought to do. The first thing we ought to tell him, in order to make this thing right, is that we do not want him to feed these cattle up from good butchers to red label. When he once brings them on the market they will be sold. We want them butchered and put on the market. On the other hand, if he wishes to go on with his commercial feeding there is one way of doing it. Take those cows. They can be fed for commercial purposes. They can be bought down below the prices that we have been talking about this afternoon. They can be fattened and sold by the same people who were previously building up steers that were already in shape for the market; they can take the unfed cattle. If this year conditions were to develop as my hon. friend's constituents believed a week or two ago they would, into a period in which we would have short grass and very little feed, then of course along toward the fall of the year steers could be bought which would have to be fed before coming on the market. The commercial feeder could feed these to the point where they would make good beef. Up to date the government has not endeavoured to carry regulation that far back, and I am
not proposing that we should do so. If we were to follow the suggestion of the hon. member for Lethbridge, it is there we would have to start.


John Horne Blackmore: It is certain that you cannot control part of a market and leave the rest of it uncontrolled, and have a good condition. That is obvious. That is where the difficulty lies in connection with this matter. The government is quick enough to control all the things that might give the farmer a profit, but it does not control those things which bring him a loss. The element in the whole situation that would make the policy of the government workable is the very element indicated in this press release; in other words, just as soon as there was a surplus of cattle that threatened to depress prices, a government agency would step into the picture and buy. That did not happen; it has not happened, and the fact that it has not happened constitutes a condemnation of the government's beef policy.


James Garfield Gardiner: It is happening right now.


John Horne Blackmore: Is a government
agency buying live cattle to-day?


James Garfield Gardiner: Not live cattle, and our press release does not say that we are going to buy live cattle. It says that we are going to buy beef.


John Horne Blackmore: The point is that
what was promised was not carried out. Men were eager to sell, were losing money every day, were trying frantically to find who would buy the cattle. When they approached a member of the meat board they were told that this board had no power to make policy, *and when they approached a representative of the wartime prices and trade board they were told that it was the business of the Department of Agriculture to buy the beef. Therefore the misery was complete, and the disaster to hundreds of feeders was such that probably a good many of them will never recover from it.


James Garfield Gardiner: We bought 107,000 head.


John Horne Blackmore: Alive or dead?


James Garfield Gardiner: Dead, of course.


John Horne Blackmore: From the packers?


James Garfield Gardiner: From the packers.


John Horne Blackmore: Does anyone conceive for a moment that the farmers would take this press release to mean that the government was going to buy from the packers?


James Garfield Gardiner: Certainly; read it again.
War [DOT] Appropriation-Agriculture


John Horne Blackmore: It reads:
The Wartime Food Corporation will be prepared to buy cattle if there is at any time a surplus supply which threatens to depress cattle prices unduly, and after providing a reserve supply for domestic consumption, will export any remaining surplus cattle.


James Garfield Gardiner: The old cattle order was the one that was put in at the time the corporation was prepared to buy cattle and send them to the United States; but the basis on which we have been working since the spring of 1943, which was announced, was that we would have a floor price for beef as well as a ceiling price. Before that it had always been a ceiling price only. We said that we would have a floor price as well as a ceiling, and that the government agency would always be prepared to buy beef at the floor price. That is the undertaking which was given, and it has been carried out.


John Horne Blackmore: I contend that it has not been carried out in the spirit of the announcement at all. I am now going to read the rest of this letter. The minister sees clearly that if the government is prepared to buy beef only from the packers it leaves the producers at the mercy of the packers.


James Garfield Gardiner: It does not do that
with hogs.


John Horne Blackmore: That is the point; it does not do that with hogs, but it is doing it with cattle and sheep.


James Garfield Gardiner: There is only one reason for that in connection with cattle; that is, as a result of the varying floor price instead of the flat floor price we have in connection with hogs.


John Horne Blackmore: But surely a varying floor could be applied just as well as a flat floor.


James Garfield Gardiner: It cannot.


John Horne Blackmore: The minister might explain why. I go on with this letter:
We fed these cows on the understanding that beef was urgently required, and your guarantee that the price would be maintained. The assumption that this beef was in urgent demand appears erroneous and the assumption that you would maintain a price has also proven erroneous to date. We would like to know what we may expect in the way of bonus or compensation inasmuch as these cows should 'have been sold for not less than 9 cents to be in line with previous prices paid.
That is signed by Smith and Kearl. These gentlemen are reputable stock feeders, reputable ranchers and very conservative men;

this letter must carry a considerable amount of weight. Now here is the letter from Mr. Pearsall:
Mr. J. S. Smith,
Smith & Kearl,
Cardston, Alberta.
Dear Sir,
We have for acknowledgment your letter of February 9 relative to cows which you marketed recently, and which did not return you price anticipated.
We regret that owing to circumstances then prevailing and which we explained previously in our wires, you unfortunately found it necessary to market your cattle at the most difficult time. We further regret that there is no provision to adjust the price to the shipper under such circumstances.


James Garfield Gardiner: Is my hon. friend suggesting that $90 a head is not a good price for old cows? A price of $7.50 a hundred for a 1,200 pound cow, which is not a big cow, would be about $90 for a cow that has been used for breeding purposes for some time and then fattened and sold. Is my hon. friend suggesting that that is not a good1 price?


John Horne Blackmore: Is the minister forgetting the fact that those cows were bought for 8i cents in September?


James Garfield Gardiner: Why did he pay that?


John Horne Blackmore: Because he counted on the government of Canada playing fair with him.


James Garfield Gardiner: He had no reason, under any price levels that were set, to buy those cows at the price stated and think he was going to sell them at higher prices later on. He had no justification whatever for, thinking he would be able to sell them for a higher price in January. If he thought he would' be able to sell them at a higher price in the latter part of April or May there might have been some justification for it, but not for thinking he could sell them at a higher price in February, under any price level that was set, following the floor suggested from the Calgary meeting.


John Horne Blackmore: If the minister will just refer back to the figures he so proudly read a few moments ago, giving prices in the various years, he will see that there was a steady increase commencing with the first year and continuing into 1943. The war is-still going on; we have had international food conferences meet and announce that they are going to need almost limitless supplies of food. What man using average intelligence would conceive that the price of beef in the spring, of 1944 would be lower than in 1943? There just is not any sense in that idea at all..

War Appropriation-Agriculture
The mere fact that the price had been, up in 1943 as compared with 1942 was justification for expecting that while the w'ar continued, Britain would still need meat and the price would be maintained. In addition we had rationing of meat in Canada, and a promise like this had been given, so that- certainly there was justification for anticipating that prices would at least be up to 1943 levels.


Joseph-Arthur Bradette: Shall the item carry?


John Horne Blackmore: No; it is not carried yet. We have only started on this thing.
At six o'clock the committee took recess.
After Recess
The committee resumed at eight o'clock.


John Horne Blackmore: Mr. Chairman, before the committee took recess I was discussing with the minister the question of the marketing of beef in my own constituency. I believe that I used up about as much time as I should at this particular phase of the debate. However, I should like to finish reading the letter I commenced to read, and also read one more. I was reading a letter dated February 21 from Mr. L. W. Pearsall, secretary-manager of the meat board, to Mr. J. S. Smith of Smith and Kearl, Cardston, Alberta. The last paragraph reads:
We believe you will realize that it is quite impossible for us to provide against ocean shipping difficulties over which we have no control. These were primarily responsible for storage congestion and thus depressed the market for your particular class of cattle which was not in current demand on the domestic market.
The committee will be interested also in the letter which Smith and Kearl wrote in reply under date of February 28, and which reads:
We have your regrets contained in your letter of February 21 which are of no value to us. We were amply supplied with regrets before it arrived.
In place of these regrets we should appreciate some information. We have seen the price ceiling operative throughout the west. (Your letter appears to be a frank admission that there is not and never was any attempt to provide a floor price for the producer in spite of the fact information to that effect was widely circulated.) Your last paragraph indicates that demand alone dictated the price on these cattle, yet your control of exports which are prohibited to the United States and price ceilings are responsible for this congestion. We realize that you cannot control shipping difficulties, but if it is not your job to control prices, then -we feel at liberty to ask what is your job?
These cows that went to the packers for seven and one-half cents one week and for which a week or two later they would have paid eight and one-half cents went to the
consumer at the same price as usual. We noted no fluctuation there. We note your regret that there is no provision to adjust the price to the producer. It appears quite clear to us who your present policy is benefiting. We should like to know why no provision was made to adjust the price to the producer if you expect to maintain price control. We should like to know why provision is not made now. We no doubt regret a great deal more than anyone else, other than producers, that it has not been done.
I think I have said all that I care to- say at the present time.
However, in closing I should like to say that in my judgment the government was exceedingly remiss in its duty by failing to protect feeders and producers of beef against possible losses over which they had no control and which they could not possibly have foreseen.
I think the government should be censured further for failing to centre responsibility. If certain adjustments had been made a great deal of loss would have been saved. If the responsibility for the purchase of beef had not been divided between the wartime prices and trade board and the Department- of Agriculture much of this trouble would not have occurred.
I suggest to the minister that he urge upon -the cabinet that his department be allowed to take over complete control of the whole matter of marketing of animals and also to exercise a measure of supervision over prices. Wherever the -minister has -had complete control over any matter pertaining to agriculture he has either found a solution or has put forth a substantial effort to do so. I believe -that if the minister were entirely free to do what he deems to be best, he would do a good job. I should like to see his department have complete control over this matter, and I think I speak for my constitutents when I say that.


Mr. CASTLEDEN:: In the course of his
remarks the minister did not reply to a number of questions which I placed before him when we were dealing with the general item. First, I -asked what steps had been taken to provide for adequate marketing and storage of the increased live stock production which is occurring in certain areas at the present time. I asked also what the policy of -the government was with regard to applications for new storage or packing plants. I asked also what the government, was doing to reimburse farmers whose stock had not been accepted on the Winnipeg market and who had to ship east, with a resulting delay. I inquired about the quantities of meat which had been spoiled in the different years-I understand there has been spoilage-and what steps have been taken to reimburse those who have suffered losses.

War Appropriation-Agriculture
There is another matter in connection with our bacon shipments to Great Britain. The Western Producer of March 23 states:
Associated with Mr. Peterson was Dr. George B. Miller of Ottawa, bacon specialist with the Canadian meat board, who has recently returned from Britain where he inspected handling of Canadian Wiltshire bacon. He explained that all bacon reaching the British housewife was "slightly stale" because supplies were kept on hand three or four weeks. Often, he found, Canadian bacon was kept on British wharfs two or three days before getting to refrigerated storage.
I believe that since that time the government has adopted some policy to overcome this matter, but I submit that this practice deteriorates the quality of our bacon and will possibly affect the demand for Canadian bacon as compared with the demand for Danish bacon when the war is over.
I referred also to labour within the packing plants. At different times labour has been blamed for the stoppages and congestion which have occurred in different plants and I do not think that charge was justified. I should like to know whether the Minister of Agriculture has taken steps to deal with the labour situation. There were one or two things the labourers in these packing plants wanted, and if these were granted I think it would help considerably in relieving this situation. One was equal pay for women.


Joseph-Arthur Bradette: I wonder if we are in order discussing labour matters on the present item?


James Garfield Gardiner: The hon. member is dealing with labour in the packing plants which is necessary to put out the hogs, and I think he is quite in order.


George Hugh Castleden: The other complaint was that a certain amount of income tax was being collected at the source for overtime work, which mitigated against the willingness of the people to work overtime. If these matters were straightened out I think it would do a lot toward easing the situation in regard to labour in these plants. We all know a great number of the skilled workers have been taken by selective service and those people who are now going into the plants are not nearly as efficient. If one visits one of these plants he realizes that the job these men and women are doing is at times at least nauseating, and deserves special consideration.
A report in the Winnipeg Tribune of October 15 last stated that sheep had hit an all-time low of about fifty cents per 100 pounds. Has anything been done to see that this type of thing shall not occur again this fall? Are steps being taken to smooth out the flow so that producers will not suffer from gluts as they have in the past?


James Garfield Gardiner: On the question of shipment of hogs east in order to take care of over-supply in plants in the west, I may say that to December 31 the number shipped east was 46,246, and the subsidy paid by the government was 335,202.50. For January the number shipped east was 57,656. For February the number shipped east was 36,365 and the amount paid. 330,088.99. For March the number shipped east was eighty-five and the amount paid, 359.46. The total number shipped east from last fall until March was 140,352, and the amount paid was $111,253.70. The basis on which these payments were made was the order of the meat board dated February 11, 1944, which reads:
Under authority of meat board regulation* P.C. 4187, the board hereby determines that:
As it is deemed advisable to protect the producer against loss from dead and crippled hogs, payment is hereby approved of the following additional allowances, for this purpose, on such hogs as are eligible for tile regular rebate of 50 cents per hundred pounds:
1.	Shipments originating in Manitoba-20 cents per hog.
2.	Shipments originating in Saskatchewan- 30 cents per hog.
3.	Shipments originating in Alberta-40 cents per hog.
Then on May 1, 1944, the following order was made by the meat board:
Under authority of meat board regulations P.C. 4187 the board hereby determines that in view of the changes in basic prices for hogs which became effective on April 10, 1944, hogs shipped from .the western provinces and slaughtered in Ontario or Quebec plants must on and after that date be settled for on the following basis, in order to be eligible for the rebate of 50 cents per hundred pounds:
The price at which hogs are settled for to the shipper shall ibe $17.75 or better per hundred pounds warm dressed weight, on the basis of B.l grade, or $18.15 basis A grade, delivered at eastern plants.
It will be understood that that change was necessary because of the change in grading and in the method of payment that was made at that time. Those facts give the answer, I think, with regard to hogs shipped east, the payments made and the manner in which they were made.


George Hugh Castleden: Possibly not sufficient account is taken of the fact that these hogs may be on the road for two or three days longer, with a consequent loss in weight and therefore in grade. I do not think less than one dollar would cover that.


James Garfield Gardiner: The basis was decided on after twenty years' experience of shipments east and takes care of all those matters except exceptional cases where damage took place. The fifty cents covers everything, including shrinkage.

War Appropriation-Agriculture
The next question was that of labour supply. I have a statement before me which furnishes some answer to the question as to wha! happened recently in packing plants. I was in the west on the 17th of April and met a number of representatives of producers in Alberta. I was in Calgary and met there most of those who were interested in the problem then developing in the packing plants in Calgary, Edmonton aud Winnipeg. Representations were made to the effect that farmers were being asked to retain their hogs at home until the rush of deliveries at the plants could be taken care of. The difficulty which developed at that time was largely owing to the fact that we have been following certain practices in connection with farm labour. Ever since the spring of 1942 it has been provided in our regulations that those who are essential to agriculture are given postponements in the matter of military service, but the postponements are conditional upon the men remaining on the farm. During the past two winters provision has been made for farm labour leaving the farm in the winter months and going into necessary work such as work in the bush, in the coal mines and in these packing plants, but the definite undertaking was given that these men would be returned to the farms in the spring, leaving whatever activities they had been engaged in during the winter. Accordingly, we had a number of these men in the packing plants during the winter months who, in the month of March, began to move back to the farm in compliance with the regulations.
The hon. member has asked what was done to cope with the problem. All I can say is that immediately those representations were made I wired to the Minister of Labour. He was in Philadelphia at that time, so that the matter was immediately taken up by his deputy and inside of a few hours I had a wire from him which indicated that something was being done to take care of the problem which was developing. The Minister of Labour can explain what was done to better effect than I can. It was to assure those who were working in the packing plants that if they remained there they would have protection against the regulation that they must return to the farm in the spring, provided that they themselves were agreed that they should remain in the plants. That, of course, did not fully take care of the matter because some of them had already gone home and could not return to the plants on account of the labour situation on their own farms. At tha.t time I took the trouble to interview Mr. Robert Gardiner, president of the United Farmers of Alberta, and suggested to him that the surest way of dealing with the problem was for farm labour to be so organized that we could utilize as
much as possible of it in the packing plants whether in the winter or in the summer months so long as it was needed there, the idea being that if w'e are to assure the farmers of a certain amount of labour to produce the live stock which is necessary for the prosecution of the war, the labour necessary to process that live stock is just as essential to the war effort and this indicates that the plants should be considered as part of the farming operations, so far as it was possible to do so. The Department of Labour got to work on the problem immediately, and that is the situation as it exists at present. The farm organizations in western Canada have been appealed to, to co-operate with the government in organizing that labour. Provincial governments have also been appealed to. They all have organizations working on it, and my understanding is that the problem is being dealt with as effectively as possible under the conditions existing.
In order to illustrate what has been happening, let us take the period from April 29 to May 13. At the plants at Vancouver there were seven fewer men working on May 13 than on April 29. In Alberta there were 117 more employees on May 13 than on April 29, 243 having been taking on and 126 having left, making a net gain of 117 employees. That does not cover the whole period with which I am now dealing, but it does cover a very considerable part of it. In Saskatchewan 172 had been hired in that period and 136 had left the plant. The Winnipeg position is that there are eighty-three more employed now than were employed before; and I put figures on the record to show that at about the period of this first date there were more men in these plants, taking them as a whole, than were in them in January. So that there has not been any decline in the amount of labour available at these plants; as a matter of fact there has been more labour put into the plants than has gone out of them, and the plants are operating to the best possible advantage. The total in so far as the position across the country is concerned is that there were 320 more employees in the packing plants on May 13 than there were on April 29. and I assume that an improvement has taken place over the past ten days.


George Hugh Castleden: How many of these are women?


James Garfield Gardiner: I have not the breakdown of that.
Mr. CASTLEDEX':	The packing-house
workers wanted equal pay for women who are doina equal work. I wish to know whether that principle is in effect in Canadian packing plants at the present time.

War Appropriation-Agriculture


James Garfield Gardiner: In view of the fact that the Minister of Labour and his department are dealing with this problem, which was put up to them by the Department of Labour, perhaps the minister would state in a few words what the position is.


Mr. MITCHELL:: My hon. friend knows the situation in the packing industry. He knows there has been a tremendous increase in the production of live stock in this country. Speaking approximately, there are now 4,000 more people engaged in the packing industry than there were at the outbreak of war. I recently returned from the United States, where we had a discussion of problems affecting the agricultural industry, and a similar situation exists there. My hon. friend raises the issue of equal pay for equal work. The national war labour board has laid down certain guiding principles. The organization to which my hon. friend refers has the right to appear before either a regional board or the national board, whichever jurisdiction may cover its particular problem. I do not think the question is one which can be discussed in detail in committee of this house. Whatever case the applicants can make before the board, in conformity with the wage stabilization policy of this country, the board will consider and render a decision upon. If it is a regional board question the parties have the right of appeal to the national board, whose determination is final.
There was some talk, I believe, of a slowdown strike in a plant in Edmonton; I think it was the Bums plant. The matter involved was one of provincial jurisdiction, coming under what I think is called the wages and industry board of Alberta, and my information is that Mr. Clayton Adams, chairman of the board, discussed the issues involved in the slow-down in Edmonton; that the slow-down stopped last Friday; that at the present moment negotiations are taking place between employers and employees in that particular industry, and that it wras expected that a conclusion would be reached to-day or tomorrow.


George Hugh Castleden: I can take it from the minister's reply that the answer to my question is: no, there is not at the present time equal pay for women for equal work.


Humphrey Mitchell: My hon. friend is not going to put words like that in my mouth.


George Hugh Castleden: Then would the minister just answer the question?


Humphrey Mitchell: That is all right; I know that is good campaign material out in the country, but the hon. member is not going to get away with that.


George Hugh Castleden: And probably I shall not get an answer to my question.


Humphrey Mitchell: My hon. friend does not need to worry about that either. I was describing the process of labour negotiation in this country. I do not know neither does my hon. friend or he would not have asked the question what will be the outcome until this particular organization has made its case before the regional board in Alberta. If they feel that an appeal to the national board would be a just exercise of their rights, no doubt they will appeal. I do not think either my hon. friend or myself can answer a question of that description.


Percy Ellis Wright: The Minister of Agriculture stated a moment ago that he thought that some of the responsibility for the securing of this help rested with the farm organizations of western Canada, that they should supply some help from the farms to the packing plants. I cannot agree with him about that.


James Garfield Gardiner: I did not say that some of the responsibility rested upon them. I said that they had been asked for their cooperation and that they had granted it.


Percy Ellis Wright: Absolutely. It seems to me that they might be made available in seasons of the year when they are not needed on the farms. But there are a number of industries in Canada which are less essential than agriculture.


James Garfield Gardiner: Some of the fellows who come out of them would not be of much use, on short notice.


Percy Ellis Wright: They probably would have as much experience in the packing plants as some of the people who are taken from the farms.


James Garfield Gardiner: Not at throwing something around as heavy as a hog.


Percy Ellis Wright: I have been through a great many packing plants, and I have not seen any man having to throw around a hog. Today things are done pretty well by mechanism.


James Garfield Gardiner: He is a lot better man if he can do it.


Percy Ellis Wright: No; strength is not the main factor. That is borne out by the fact that a number of women have been taken into these plants and are displacing men. I strongly suggest to the Minister of Labour that he make a survey to discover if there are not other industries from which men can be drawn instead of asking the farmers of western Canada to supply more labour, especially in the summer time.


Humphrey Mitchell: I am not going to get into a discussion of selective service, which

War Appropriation-Agriculture
has been talked about in this chamber recently for just over a week. But let me tell my hon. friend'that when it comes to the organization of man-power, the Department of Labour does not take a back seat to any country, excepting perhaps Great Britain, among the united nations.


Percy Ellis Wright: What happened with respect to labour for the unloading of grain in western
Canada a year ago?


Humphrey Mitchell: My hon. friend talks about other industries. As I pointed out the other evening, we are just about at the bottom of the barrel. When nearly six out of every eight people between the ages of fourteen and sixty-five are either engaged in the fighting forces or in avocations necessary to the successful prosecution of the war, it gives some indication of the organization that has taken place of the man-power of this country. I do not know of a better organization to go to in western Canada or in Ontario on a question of this description than those with which the department has dealt; it is essentially a farm problem in its broadest sense. The farmers raise the hogs; the packing plants process them, and we have done everything humanly possible to supply sufficient labour for these purposes.
While I have not the figures in front of me, the contribution .made by women in this industry and every other industry in the dominion has been magnificent. I said the other evening that we could not win the war without the contribution which is being made by the women of every one of the united nations.


George Hugh Castleden: Do you give them equal pay for it?


Humphrey Mitchell: Let me say also that that contribution has been made possible by the leadership of this government and the cooperation of the people involved. The records indicate that. We sat in this chamber and listened to Madame Chiang Kai-shek when she said that the per capita production of the Canadian people was the highest in the united nations, which is an indication of the organization which has been taking place.
You could not know in advance the number of pigs that would be born this year. As I intimated when my estimates were before the house, I could put 160,000 people to work to-morrow morning in the higher priority industries of the country, which is an indication of the part that the Canadian people are playing in the present war. My hon. friend can rest assured that everything that is humanly possible will be done by the Department of Labour to support those engaged in agriculture.


James Garfield Gardiner: In further answer to the hon. member for Yorkton, I have now a set of figures covering a little longer period than those I gave a few moments ago. The payroll on May 13, 1944, was 16,728 in these plants; the payroll on April 1, twenty-nine days earlier than the statement I gave, was 16,164. The difference there is an increase of 564 in the period from April 1 to May 13. That gives an indication of the numbers that the policy which is being followed under the efforts of the Department of Labour has produced in that period. With regard to what was said by the hon. member for Melfort, to the effect that we should find this labour somewhere else, I think he will find, if he discusses the matter with leaders of farm organizations in the west, particularly in Saskatchewan and Alberta, where the problem, existed, that they are not inclined to agree, and there is a very good reason why they should not be inclined to agree with the statement that agriculture should not be appealed to on an occasion of this kind to do the best it can to man these plants with labour.


Percy Ellis Wright: I did not say that. I said that during rush seasons on the farm they should not be called upon.


James Garfield Gardiner: My hon. friend said
that the department should have been making appeals to somebody else. That is about as near to what he said as I can put it. The Department of Labour, of course, and this department did make appeals to others as well, but the particular appeal was made to the farmers, and the reason why that appeal was made to them was twofold. In the first place, there is no one who knows better how to handle live stock, apart from persons who have been running butcher shops and working in packing plants, than the farmers themselves, those who have been brought up on farms. Almost ever}7 farmer knows something about butchering, because he has butchered his own hogs and cattle from time to time and he knows something about it.


Mr. GRAYDON:: The farmer has to know something about everything.


James Garfield Gardiner: Yes. Most of them
have some knowledge of most things, and there is one thing they must have that some others have not. They must, if they are to make their way in life on a farm, have a little muscle, and that is necessary, too, around a packing plant. But there is another reason why they are not only prepared to take part in this activity but extremely desirous of doing so, and every farm organization, as a matter of fact, is desirous of helping them to this end. No industry has been more criticized by farmers than the packing industry and
War Appropriation-Agriculture

there is some reason behind the criticisms; but I venture to say that if one boy from every farm had an opportunity at some time to work in a packing plant for a while he would know more about the preparation of live stock, how to feed it and put it on the market than he does now. He would know more about the handling of it in connection with slaughtering for his own use and otherwise. Not only is every farm organization familiar with the fact that it would be of assistance to the farm home in western Canada to have someone who has had that experience, but farmers are also anxious that there should be a closer association between farm organizations, farmers in general, and the packing industry as it affects themselves than there has been up to the present time.
We hear a great deal of discussion from my hon. friends over in the group across the floor to the effect that all these plants ought to be run by the state.


An hon. MEMBER:: Cooperatively.


James Garfield Gardiner: Yes. Well, the best kind of cooperation I know of is the kind we are getting at the present time, where the farm boys are going into the plants and assisting in the running of them, getting to understand the running of them; and if at any time in the future they do take the notion that they would like to have cooperative plants run by their own people there will be at least some of them who will have had the necessary education to run such plants. Personally I am of the opinion that cooperatively run plants, whether so run as among farmers, or run as between the businessman and the farmers, are superior to any system of state ownership and control that could be set up either in western Canada or in eastern Canada to handle the problem. I am therefore a little surprised to find that two of the leading advocates of state ownership, control and operation of packing plants object to the fact that farmers are cooperating now in running them in western Canada, and no doubt intend to do so.


Percy Ellis Wright: As usual, the minister has set up a straw man and knocked it down. This group has never advocated state ownership of packing plants in western Canada; he knows that, We suggest that they should be run cooperatively for the people who are raising the stock and those w'ho are consuming it.


James Garfield Gardiner: The straw man always
goes down hard enough to knock you straight up.


Percy Ellis Wright: What is more, I did not
suggest that farm organizations in Canada should not cooperate in seeing that labour from the farms was made available to these plants in the season when it was not needed
on the farms. That was the wise thing. But I do not think it is a wise thing that the people of western Canada, those engaged in agriculture, should be asked to supply men when they are needed on the farms, when there are other industries which are less essential from which this labour could be drawn. That is all I wish to say.
Mr. MITCHELL. It is all very well to say that; it looks nice when Hansard gets back home. But I would be glad if my hon. friend would tell me where we should get these people. That is the question I want to have answered. Do not pose the question; give me the answer.


An hon. MEMBER:: No answer.


George Hugh Castleden: There were three other questions which I wanted the minister to answer. One was with regard to the quantities of meat spoiled that had to be destroyed, another was with regard to sheep, and the third was with regard to the bacon market in Great Britain.


James Garfield Gardiner: The quantity of beef
that had to be destroyed?


George Hugh Castleden: Beef and pork.


James Garfield Gardiner: 
James Garfield Gardiner: Yes, and will require to be continued so long as we are not able to get properly fitted boats. The storage accommodation on the boats is not as good as it is in peace time, and in so far as the United Kingdom is concerned it is not our responsibility. Under the agreements ever since the war started the British take over the product from Saint John or Montreal. Immediately it goes on the boats it is out of our hands. That is a part of the agreement that probably is not sufficiently emphasized at times. The British take full responsibility for getting the meat across the ocean and for all storage and care of it after it arrives in Britain. We can only get reports on that; we have no responsibility for it.


George Hugh Castleden: We have men carrying on inspection in the United Kingdom?


James Garfield Gardiner: Yes, we have half a dozen men there.


George Hugh Castleden: It does affect our
market..
Mr. PER.LEY: At page 3102 of Hansard of yesterday there is an answer to a question asked by the hon. member for Lake Centre. This answer gives information with regard to the grading of hogs. In reading that answer I find that there are many different grades. I have stated before that I do not think the grading system is satisfactory. While it may suit some parts of Canada, possibly the east, I think a lot of improvements could be made. Who grades the hogs and how are the graders selected to do this work? Are there any qualifications, or how do they get the position of grader? Then on the next page of Hansard a reference is made to the differentials that arc paid after the bonus system was discontinued. It mentions a differential of forty cents per 100 pounds between A grade and B1 grade carcasses being paid after the discontinuation of the packers' premium. This is how the answer reads:
Following the discontinuation of the packers premium of $1 per head on A grade carcasses as at April 10, 1944, a differential of 40 cents per 100 pounds between A grade and B1 grade carcasses was agreed to, with prices paid for other grades to be determined by, and based on, actual value.
Who sets the differential on the grades under the B1 grade? I should like the minister to
War Appropriation-Agriculture

catch this last question: Is there a uniform differential paid by the packers throughout Canada? With respect to the question of its being based on actual value of certain grades and that bonuses are paid, who determines the actual value of a graded carcass? Who does the grading?


James Garfield Gardiner: The answer to the first
question is that the government inspectors do the grading. There is at least one government inspector in each plant and they do the grading.


Mr. PERLEY:: What is the qualification?


James Garfield Gardiner: The qualification is a
lot of experience, knowledge of the product. Practically all the inspectors are graduates in animal husbandry of some of our agricultural colleges. They get their qualifications by that method. The question of grades as submitted in the answer to the question asked by the hon. member for Lake Centre, which was placed on Hansard yesterday, is referred to. I call attention to the fact that under the old system of grading there was Cl, C2, C3, Dl, D2 and D3. Under the present system there is A, Bl, B2 and B3, as there was under the old grading system, but there is one classification of C and one classification of D. The other descriptions of grades are much the same as they were before. They have to do with specialities such as lights, heavies, injured, ridglings, stags and sows. There is not much you can do about the classification of grades there, but there has been a cutting down on the number of grades by making one C and one D as against these C's and three D's as before.
On the question of the establishment of values it will be remembered that the old system was established not by the government but at a meeting held in 1922 between the producers and the representatives of these packing plants. At that time a conference was held, and after discussion a plan was agreed upon. They set up what was known as a swine committee, which acted in connection with the grades over a long period of years. At that time they decided that in order to promote the production of high-grade hogs it would be a good thing to have a premium of $1 paid on select hogs, and this premium was continued on the same basis after rail grading came into effect. That premium of $1 was in addition to what was known as the basic price; and the basic price was the same for Bl hogs as for A hogs. There was no premium on Bl hogs; there was a premium of SI on A hogs, so that the producer of A hogs got $1 more for his hogs than the producer of Bl hogs.

In January we announced a change in the system of grading, and it took us until April to get the new system into operation. At the same time we announced that there would be a change in the payment of premiums, which in future would be paid by the government. Previously the premiums were paid by the packing plants, but the premiums were obtained out of the transactions in connection with hogs throughout the range of the different grades, by taking from those who brought in undesirable hogs a certain amount of money by means of discounts and paying a similar amount of money to those who brought in selects. In other words, the man who brought in both heavies and selects probably would be discounted on the heavies and paid a premium, from the same money, on his selects. However, if one individual brought in all selects while another brought in all heavies, the money taken from the latter individual would go to make up a fund from which the premiums would be paid to the other. We changed that system; we decided that the government would pay the premiums, just as we have been doing with cheese, and that in future these premiums would be $3 on grade A hogs and $2 on grade Bl hogs.
In our contracts with Britain there is a real differential in the payment for the different grades of bacon coming from these different grades of hogs, so that it was thought a real value should be established in connection with both grade A hogs and grade Bl hogs. Therefore we asked the representatives of the producers on our advisory meat committee to give consideration to the question; we also asked the packing plants to consider it, and as a result of the discussions that took place between the two groups and the representatives of the government the present plan was decided upon. Under this plan we take the $1 which was originally paid as a premium, which was found somewhere in the marketing of all the hogs, and distribute it over both the Bl's and the A's, on the basis of an actual value of about fifty cents per 100 pounds of slaughtered hog. We decided that this should be divided in the ratio of ten cents on the Bl's and 40 cents on the A's; so that the new price basis is the old basic price plus 10 cents for Bl's and 40 cents for A's. In addition the government pays a premium of $3 on the A hog and a premium of $2 on the Bl hog. It was further decided that the $2 and $3 premium should go out in the form of a warrant attached to the settlement the farmer gets from the packing plant. Now he obtains his payment for the hog and the premium at the same time, and it is clearly indicated on the statement that the premium is paid by the government and is in addition to the actual market value of the hogs upon which it is paid.

War Appropriation-Agriculture


Ernest Edward Perley: Is there then a uniform
system of differentials throughout all the packing plants?


James Garfield Gardiner: Yes, there will be, at a given point. The price will be different in Winnipeg from the price in Toronto, but at each point the price is uniform. The differentials are the same throughout.


Ernest Edward Perley: How has it worked out
since the change was made on April 10? Is at working to the satisfaction of the producers and those marketing hogs?


James Garfield Gardiner: Of course the system has not been in operation very long, but up to date there have been no complaints with regard to it.


Ernest Edward Perley: Then would the minister say that the system of grading is generally satisfactory throughout Canada?


James Garfield Gardiner: Yes, I would think so.


Mr. HLYNKA:: I raise no particular objection to the way things have been handled or the way they have been going on during the war period. I believe most of us will agree that in times such as at present it is not so easy to handle everything to the satisfaction of everyone. At tlae same time we should seek to eliminate all the irregularities and irritations which may be found in the present system in regard to the production and sale of meats. As most hon. members of this committee are aware. I am not an advocate of the nationalization of industry. At the same time I would point out that prior to the war the profits which accrued from the sale of bacon and beef, in particular, went perhaps more to the plants and less to the producers themselves. I have in my hand a pamphlet entitled, "Price Spreads and Profits in the Pork Packing Industry". At page 6 I find this interesting paragraph. This pamphlet was published in 1941-


Humphrey Mitchell: By whom?


Anthony Hlynka: By John Proskie, B.Sc. (Agr.), M.A., agricultural economist; it was published in Edmonton. I believe that the figures quoted were taken from those issued by the minister's own department and the bureau of statistics. This is what Mr. Proskie has to say:
During the period 1923 to 1939 inclusive, a seventeen-year period, the packing plants in Canada fulfilled the function of slaughtering and processing in their plants, 84,411,009 animals, which were valued at $1,663,251,100. The average fixed and working capital used by the packers to carry on this colossal business was approximately $58,000,000, of which approximately $30,000,000 was fixed in the form of land, buildings and equipment, and the balance in workable capital. The gross return on capital realized by the packers during the seventeen-year period, afterv labour, management and cost of animals and materials was paid for, was $272,085,154, or an average of $16,005,009 per year. Taking into account the total number of animals killed and taking the gross profits into account, it averaged at $3.22 per animal, a fairly substantial spread, after iabour, management and cost of materials used were paid for.
It seems to me that prior to the war something should have been done to see that the farmer and not the packing plant was the beneficiary. It is all very well to speak about the marketing situation and the production of meats during a war period, and the minister has painted a fairly rosy picture of the situation which some people may take at its face value. But on looking through the Financial Post of May 20 I find an article by Kenneth Wilson, Ottawa correspondent, who went to Great Britain to see for himself how things were going on in connection with marketing. He makes this statement:
One authority with whom I talked expects that two months after the European war Denmark will be ready to negotiate with Britain on post-war bacon sales. The same authority thought the Danes would be in the British market in a ibig way within two years of war's end.
Farther down he says:
They emphasize one important point, seldom discussed in this country: namely that Denmark will always have the edge on Canada, so long as the bulk of Canadian export bacon comes from grain-fed 'hogs and has to compete with Danish bacon which is complementary to a dairy industry.
And he makes this statement:
The important point is that Canadian bacon, as now delivered in Britain, does not, in the view' of the trade, rank as high as that of Denmark, even in spite of the strides made in the Canadian industry in recent years.
He gives the figures of our exports down to the end of 1943 and goes on to say that we may be able until the end of the war to sell about 400,000,000 pounds annually. He then says:
Some of the big distributors with whom I talked remarked on the deterioration in quality of Canadian bacon.
On more than one occasion the members of this committee have heard the minister express the view that the Canadian farmer was holding his own in this particular field. As a matter of fact many Canadian farmers are being docked for overweight in order that a better grade of bacon may be produced. When that happens it is rather discouraging to read statements of this sort.


Humphrey Mitchell: Is Mr. Kenneth Wilson an expert on agriculture?


Anthony Hlynka: I do not know Mr. Kenneth Wilson personally, but the way in which he sets out his information in this article-


Humphrey Mitchell: What paper?

War Appropriation-Agriculture


Anthony Hlynka: The Financial Post of May 20, 1944.


An hon. MEMBER:: You cannot disagree with that.


Anthony Hlynka: The reason why I attach the value I do to this article is that it seems to be compiled fairly well, and the statistical data he gives checks with what I have read in other publications.


Mr. BLAIR:: Who publishes the Financial Post?


Anthony Hlynka: I am sure that the publisher of the Financial Post is not a. Social Crediter; he may be a Liberal. The fact is that when our farmers produced bacon which was too fat they were docked for overweight. With the experience gained in this war the farmers of this country should be assured a post-war market. This article states that prior to the war Denmark filled about sixty per cent of the needs of the British bacon market, Canada filling only from eighteen to twenty per cent. Great Britain should be Canada's best bacon market. But unless we are able to produce the quality of bacon that the British people want to buy, our farmers will find themselves in the position in which they were prior to this war. Every hon. member from western Canada knows that the situation was desperate at that time, and statements have been made on the floor of this chamber that we will never go back to pre-war days. Yet the situation seems to be heading that way. I suggest to the minister that he and his experts should see to it that matters are worked out in such a way as to guarantee a fair share of the national income after the war to our farmers.
I do not want to raise any particular objections to the present state of affairs at this time because I think we must all recognize that to run any department during war time is not an easy task. The Social Credit party is not endeavouring to fight a Saskatchewan election in this chamber, although other gentlemen may seem to be concerned with that particular issue at this time. We are merely placing our views on this subject before the committee because we believe that this matter is of importance to the farmers of Canada.
I should like to say a word about beef marketing and the embargo placed upon the movement of beef to the United States. Not long ago I had an opportunity of visiting our good neighbours to the south, and not once during my four days' stay there did I see beef on the menus of the restaurants. Yet this afternoon the hon. member for Lethbridge and the minister were matching arguments as to the tme situation concerning beef. When the minister and his department found that they were unable to market all the beef produced, surely they could have made arrangements within
[Mr. Mitchell.1
twenty-four hours to sell to the United States what beef they could not otherwise dispose of.
The farmers of Ontario were calling mass meetings and getting together from one end of the province to the other, sending resolutions to this government to lift this particular restriction so that they could sell their beef to the people in the United States who needed it at that time. But no action was taken. Our people were told to take their cattle back home when they brought them to the market. That sort of situation cannot possibly be justified. Surely we should have taken advantage of every opportunity to sell what we had to sell, and the people of this country are in a position to produce more if more is required.
The Minister of Agriculture said that he was unable to forecast what was going to happen in the future, that everything depended on the law of supply and demand. That is an old story, Mr. Chairman, and it will not stand the test now. In the first place our people must have all the food that they require, and our farmers are ready to produce all the food that our people can consume. But in order that the farmers may buy the commodities which they need in order to get along, they must be able to sell some of their surplus products to other countries. That subject has been discussed by members of this group on many occasions. The government has always maintained that unless we are able to export our surplus products to other countries, then our own people in Canada must go hungry because we shall have no money. After this war we must get down to brass tacks and assure the people of Canada that they will never, never go hungry again because we can produce all the foodstuffs that we need and still have a surplus to export to other nations. That is the first thing we must ensure. Second, we must be ready to exchange our surpluses with other nations. This talk that goes on from time to time to the effect that everything must be based on gold or some other fictitious basis will not hold water after this war. Mr. Wilson, when he was speaking to one of these gentlemen, was given a plain indication of what might be expected. He was told: "We will boy all the bacon and cheese and wheat you want to sell us, provided that you buy a like amount of British products in return.'' We must recognize the fact that exchange of goods is the basis of all trade. To repeat, we must first of all produce to satisfy the needs of our own people. Second, we must export our surpluses in exchange for the goods we need. If the minister can assure our people of those two things, this committee and the people of Canada will not blame him for the difficulties that may arise.


Mr. BURTON:: It is quite apparent from the remarks of the Minister of Agriculture

War Appropriation-Agriculture
that his idea of cooperation does not agree with that of some of the rest of us. I am quite certain that we farmers and all our farm organizations are prepared to give the packing plants all the cooperation the minister speaks of under the present circumstances, but we regret we did not have leadership coming from him in trying to bring about cooperation when the packing plants were making the greatest profits in their history while the farmers were receiving almost nothing for the things they produced.


James Garfield Gardiner: When was that?


Joseph William Burton: To go back to that; it was when the Minister of Agriculture was premier of Saskatchewan.


James Garfield Gardiner: No; in 1932 I was leader of the opposition. Your party was in power in Saskatchewan at that time.


Joseph William Burton: We hear this talk about cooperation now when we farmers are already overburdened and have little to cooperate with. But when there is talk of cooperation to ensure that the farmers may share in the wealth they produce, too often the talk of cooperation is missing. However, that is not what I rose to say.
The hon. member for Vegreville might think I am making a pre-election speech because I really rose to express my appreciation to the Minister of Agriculture for the information which he has given us under this item. He has given us much clearer information than did the Minister of Labour, who left me up in the air; I could not tell, after he got through, whether or not women in the packing plants are getting equal pay with the men for equal work. The Minister of Agriculture did a better job because I at least understood some of the things he told us.
I am going to make another statement to which some hon. members may take exception. If the prices we farmers are receiving for our beef cattle to-day had been received during the years gone by, there would have been little if any complaint. Only twice in the forty j'ears that I have been on the farm in the district from which I come have there been such handsome returns from the production of beef cattle as there are to-day.


Charles Robert Evans: Perhaps you did not raise the right kind.


Joseph William Burton: Both of those times were times when we as individuals and as a nation had to pay a tremendous price. Why is it only in war time that we can get a decent return for the products we produce on the farm? That is what strikes us farmers. In between these two wars there were times when you could produce cattle and keep your head above water. But it was only in these two wars
that, taking all costs into consideration, the farmers could get a good price for their cattle.
In the discussion which took place this afternoon between the minister and the hon. member for Lethbridge, one thing which I did not think the minister entirely cleared up was the position of those people who have been feeding cattle. Everyone remembers that only a few years ago farmers and feeders were called upon to exert themselves to the limit to increase production of beef and pork. Feeders were called upon as well as the rest of us farmers to do what they could. I submit that when these people were prepared not only to carry on their usual operations but to expand them, provision should have been made to enable them to "take the bumps," so that they could operate properly and efficiently. We were told that meat was needed. Meat was raised. We were told that it was of the greatest importance that we farmers produce as much as possible, and feeders were included in that class. I might point out that when the Minister of Munitions and Supply needs something for the war effort, he sees to it that those who are called upon to produce for the good of the nation are protected against loss. Why was a similar arrangement not made on behalf of feeders of beef cattle?
There is another point in this connection which seems strange to me. We had a publicity campaign the object of which was to have us produce more and more, but apparently the increased volume which resulted caught the department entirely unawares. They seemed to know nothing about it until the glut was so heavy that they could not move any more; then they realized that something was going on.
If I have a criticism to make of the department it is in that connection. I believe that they should have had their ear to the ground and that their eyesight should have been a little keener to know what was going on and make a certain amount of provision for it.
In connection with beef, the minister mentioned the different grades-blue label, red label and so on-which go into the meathandling establishments. It seems strange to me, however, since I have come to the city, that the beef which has been served to me almost invariably reminds me of the kind of beef which came from cows that were in the condition to which the minister referred this afternoon. It is a long way from the kind of beef to which I was accustomed out west.


Mr. JACKMAN:: You aristocrats!


Joseph William Burton: If you go to the meathandling establishments you can call for certain grades of beef. When we come to pork, the minister's department seems to have a fairly effective inspection of the plants which we supply. I can assure him that it is not a
War Appropriation-Agriculture

very good feeling when, upon delivering your hogs, you find that some of them are three pounds overweight and you are docked three dollars, or at the rate of a dollar a pound.


James Garfield Gardiner: That is all gone.


Joseph William Burton: That is all gone, but it is something we had to contend with, and some of us farmers do not forget these things so easily.


George Hugh Castleden: The grading is tougher now.


James Garfield Gardiner: The government did
not do that.


Joseph William Burton: We were docked at that
rate, and not so long ago. I could still hunt up the old slips to show you.


James Garfield Gardiner: That was under an
arrangement entered into between the producers and the packers; it was not a government arrangement.


Joseph William Burton: Yes. But here is the point. We have to operate under these arrangements as they vary from time to time. There is still quite a loss to the farmer if he cannot get his hogs off at the right time. They are graded as they go through the packing plants. I quite agree that grading should take place and I am content that this inspection should go on, but the point I would bring to the minister's attention is that we are graded so fine when we produce our hogs and deliver them to the plant. A railway man told me at one time that if it continued the way it is now we farmers would soon be sending our hogs to market by parcel post, because it was almost impossible to get them fine enough for the grade line, and consequently we would be shoving them off individually instead of in lots. But when consumers of meat go to the butcher shops or the meat-handling establishments, where can they ask for the thick smooths, the extra heavies, the B-l's, the AA's, and so on? We take our cut when we deliver a hog which weighs a few pounds overweight, but neither I nor any other consumer has the privilege of stepping into a butcher shop and saying, "I want a slice of bacon or a cut of ham from an extra heavy hog". That is a condition of things to which we object, and object most strenuously. We accept our cut in an endeavour to get the standard of bacon up to what the department says it must be so as to carry on our export trade.


James Garfield Gardiner: I am sure the hon. member does not want to misrepresent the matter. There are different grades of bacon in the butcher shop. I believe there is a difference of $3 or so between top grades and seconds.


Joseph William Burton: Quite true. You have side bacon, different kinds of bacon, and different
[Mr. Burton.1
kinds of pork that you can buy. In the case of beef, which is finished up to a certain degree, you have red label beef and blue label beef, and again you have the ordinary butcher variety, as one may say; but as regards pork there is no such choice, and the consumer has not that benefit. That is one of the points I wish to bring to the minister's attention.


Mr. CARDIFF:: With reference to the minister's statement yesterday, who sets the difference in price between the different grades
of hogs? At page 3103 of yesterday's Hansard the minister made the following statement:
Following the discontinuation of the packers premium of $1 per head on A grade carcasses as at April 10, 1944, a differential of 40 cents per 100 pounds between A grade and B1 grade carcasses was agreed to, with prices paid for other grades to be determined by, and based on, actual value.
Who sets that actual value?


James Garfield Gardiner: There is really no established price on all the different grades of hogs. The price of heavies may be a little higher at one time than another because there is a scarcity of them and a demand for that type of pork. They may vary, but there is no definite set price that must be paid for heavies in any particular market. If there are too many heavies the price will be lower, and if there are not enough heavies it will go up somewhat. The variation takes place, but there is no hard and fast rule. As a matter of fact, competition on the market retains the position pretty well. People buying for a particular market bid against one another, and the tendency is for prices to be much the same as a result of the experience they have on the market. But there is no one who says that such and such has to be the price.


Lewis Elston Cardiff: I do not think the minister has answered the question. I am still at a loss to know how the price is set. That is what I am trying to get at.


James Garfield Gardiner: The basic price of hogs since the war started has been pretty well set by the agreement with Britain which takes from seventy to eighty per cent of the product, and that has set the floor price ever since we entered into these contracts. Early in the war, when there was a scarcity of pork on this market, because we were taking great quantities off and sending them to Great Britain, the price of pork sold in Canada was much higher than the price obtained for the pork that went overseas, and the price on this market therefore averaged somewhere between those two prices. Since we have had price control we have set a ceiling for pork, not for hogs but for pork, and we have gradually raised the price of the British contract until to-day there is not a very wide margin

War Appropriation-Agriculture
between the price that can be obtained on this market when you are at the ceiling and the price that is obtained for the pork which goes into bacon and ham that go overseas. So that there is little variation in the price. It varies a little up and down, probably above five cents, but that is as much leeway as they can take between the ceiling and what is now the floor constituted by the agreement. Therefore the price stays almost at one level. But that is the method by which it is set. It is the relationship between the ceiling price and the price we are obtaining for the seventy or eighty per cent of the hog products sent to Britain.


Ernest Edward Perley: What is the basis used for arriving at the penalties on the lower grades, and where does the packer come in in assessing the penalty or arriving at it? Does the packer have a say?


James Garfield Gardiner: There are no penalties now. They were done away with in the present system of grading. There is a price established in the manner I have indicated, a basic price so far as BPs are concerned. There is a higher valuation placed upon A's and there is a lower valuation upon the grades that run down from Bl. When you get into the heavies and lights the price that is established there is governed by the supply of them into the market as related to the Bl price. Most people prefer what comes from cuts of Bl hogs, but there are people who want the heavier hog. It depends on the number of people who want the heavy hog as compared with those who want Bl as to what the price will be for heavy hogs.


Percy Ellis Wright: Is it not a fact that most of the pork consumed in Canada is from the light and heavy grades? Most of the export, the seventy per cent of exports, is usually from A and Bl grades, and the packers I believe receive probably more money from lights and heavies sold on the domestic market than they do for what is exported. Is the money made on lights and heavies on the domestic market used to subsidize the export, or is it clear profit to the packers?- I ask that question because they do sell these grades at a higher price on the domestic market than they get for the export.


James Garfield Gardiner: Not very much higher now. They did earlier in the war. The ceiling price based on the actual price that did exist in the fall of 1941 has been established under the prices board. Since that time there has been very little upward movement. At the same time, there has been every year an increase in the contract price of the pork that is going to Britain, which has resulted in the floor established by that agreement
gradually drawing closer to the ceiling. Today it is so close to the ceiling that there is not very much room for variation, and while lights may be bought at a slightly lower price than Bl, which would leave a wider margin as between the ceiling and the price purchased at, and heavies may be bought at a lower price, still my understanding is that under the ceiling prices set, there is a lower price set for heavies, but there is no lower ceiling price for lights, so that there is a possibility of a person purchasing lights and making a bigger profit than he would if he purchased A's and B's. Of course, we are anxious to get A's and B's into the plants where they will be processed and sent overseas. That is one of the reasons for paying a $3 premium on A's and a $2 premium on B's. They must be inspected by our inspectors before that premium is paid, and that means that most of it must come into the plants where it can be processed and sent overseas. But the other product sold on this market is ruled by competition in buying and selling.


Ernest Edward Perley: Is it not a fact t/hat the packers get a certain quantity of high-class bacon out of C and D grade hogs?


James Garfield Gardiner: The statistics show that they do not. The bacon and ham that come out of A's and B's are practically all covered by high standards of bacon.


Ernest Edward Perley: Is there any particular way of checking the packers?


James Garfield Gardiner: It is all inspected at seaboard and checked as to grade.


Ernest Edward Perley: The inspectors must be pretty good, because I happened to be on the train with some of the representatives of the packers coming to Ottawa on one occasion and they had samples of bacon that had been taken from five or six different weights of hogs. You could not tell the difference. In fact they admitted to me that they could take so much of A or a higher grade of bacon out of a hog weighing from 250 pounds down. They did not make any bones about it. That was'not last year or this year, but a year or so ago.	[DOT]


James Garfield Gardiner: I think that is the old story, but you have to trim a lot of that hog before you get the bacon out of it, and it may be sold at a very much lower price than the other.


Ernest Edward Perley: They could sell a lot of that right at home. As one hon. member stated a while ago, I think the Canadian people are eating a lot of that stuff and paying more for it.


James Garfield Gardiner: Somebody is eating it.
War Appropriation-Agriculture


Mark Cecil Senn: There is one more point I should like to bring up before this item passes. The minister referred to it a moment ago. Since the new regulations came into effect and a $3 premium is being paid for grade A bacon and $2 for grade B the local butchers have been practically put out of business. I know the minister has had representations made to him by the local butchers because they find themselves unable to buy their hogs and pay the premium owing to the hogs not being graded. Representation was made to me from one particular county asking that a local grader be provided if a hundred hogs or more could be found in that locality for grading purposes. If that were done the farmers could sell their hogs to the local butchers who in turn could sell to the local trade in the smaller towns and villages, and the farmer would enjoy the premium. In nine cases out of ten if the farmer does not get the premium he will not sell to the local butcher. Has the minister given any thought to any scheme which would help out the local butcher in this way? As conditions are now it means that they are being practically put out of business. The trade is all being driven into the hands of the packing houses. It is all very well to say that we need the hogs for bacon for Britain. It seems too bad that the Canadian people have to eat the lower grades of pork all the time, either lights or heavies or other classes which can be purchased and which would not get any premium in any event.


James Garfield Gardiner: We did give consideration to that matter when the present plan was set up. The provision we made was that wherever an average of fifty hogs are being slaughtered each week-


Mark Cecil Senn: In one plant?


James Garfield Gardiner: In one plant at any one place. If two or three butchers could make arrangements to have their hogs slaughtered at one place the government would provide an inspector who would check the hogs. There must be some limitation somewhere. It is not possible to have government inspectors for half a dozen a week or ten a week, and the point at which we made the division was fifty. We say that where there is an average of fifty hogs a week being slaughtered we make provision for inspection. There are some places where it is most difficult even to carry out that arrangement, and that is because of the nature of the plant that is provided in which the killing is done. It is impossible to have killing done just in any place, out in a shed that is put up on some farm or in some small place where the facilities are not such as would take care of the sanitary conditions. These
rMr. Gardiner.1
hogs must be properly inspected and proper care taken with regard to disease before they are turned into the packing plants where food is being provided for so many people. Some care has to be taken with regard to that. Apart from that I think the matter has been, dealt with fairly satisfactorily. In the last few months I have found some complaint in Ontario. I have had butchers come to me, half a dozen at a point, and discuss the matter, but most of the difficulties that have arisen have been corrected, to a degree at least.
After having said that I will say that I think most butchers in most parts of Canada are getting their supplies in the same way that they always got them, and that under the ceiling prices which are arranged in the different parts of Canada they can buy possibly mostly off-grade hogs, and can pay a sufficiently high price for them under the ceilings to be able to carry on their butcher business and cater to the kind of trade which they have in their district. I quite agree that in places where there is a packing plant and where there is a number of people who kill in a small way roundabout it is more difficult for those men to carry on than it is in some other sections; but again it is easier for those men to make arrangements to have their hogs killed in the packing plant if there is one in their vicinity. Therefore the matter is taken care of in that way. One difficulty that I have run into, and where it has been almost impossible to make satisfactory arrangements, is where persons desire to kill in plants whose facilities are such that the packing plants would not allow those hogs to come in for processing because of what might happen in connection with their whole food products.


Mark Cecil Senn: I was not making a plea for hogs that are going into the packing plants after having been slaughtered. I fully realize the difficulties that are in the way. It is very difficult to get government graders to go out to all these small places, but I had a proposition put up to me the other day. I do not know how the minister would consider it, but this is what it was. Some local man who is a fairly good judge of hog carcasses or the agricultural representative in the county could go a-round one day a week to eight or ten of those houses that are slaughtering for local consumption, and if he grades those hogs and shows that they are entitled to a premium as A's or B's that could be accomplished without very much difficulty. There are usually men in each of those places who are perhaps just as good judges of hog carcasses as the government graders. They could be hired very easily as part-time inspectors, say one day a week, to go around and grade the hogs. If that were done it would be very much to the benefit of the local butcher who

War Appropriation-Aqnculi arc
has been carrying on a butcher business for years and who now finds himself in difficulty because the only type of hogs that he can get is, as the minister says, the off-grade hogs.


Mr. QUELCH:: Last year I received a complaint about the grading of hog carcasses. This year I received a number of complaints about grading dockage. It has become very severe. I received one letter which said that a 740 pound hog had been paid for at the rate of three cents a pound. Could the minister explain what a hog like that is used for? I should have thought if it were used for anything it would be worth more than three cents a pound. Is it rendered down or used as sausage meat?


James Garfield Gardiner: It would be rendered down. I am afraid I had more trouble myself with a hog of that kind recently than the gentleman who wrote the letter. I had one that I estimated weighed 800 pounds. I sent him in to the cooperative at Winnipeg and lost him altogether.


Victor Quelch: What happens to the hog?


James Garfield Gardiner: I have not been able to find out what happened to that one.


George James Tustin: I should like to ask a question with regard to the deductions that are made on hogs below grade B. As the minister said a few moments ago the S3 that used to be deducted has been wiped out under the new system. Is that in reality a fact?
I am given to understand that in many cases where hogs are graded below B the deductions are greater than they were before. I am not certain as to whether there are as many grades now as there were before the present system came in. Apparently the government has set a basic price for grades A and B. What reductions are made for grades below B? If the regulations are not set by the government, who sets them, and are those reductions left entirely in the hands of the packing plants?


James Garfield Gardiner: I am afraid I would not be in a position to give the prices for the . different grades as they are established on the different markets, other than that the Bl's on the Toronto market are, I think, about $17.25 at the present time, while the B2's and B3's are about twenty-five cents under that figure and the C's are about $16.60. I have the .average prices for last week, as follows:
\	
$17	60B1	
17	20B2	
16	95B3	
16	95C	
15	95P "	
15	70Light	
15	70


Harry Rutherford Jackman: Would the minister	amplify the statement he made yesterday to the effect that to-day we are sending Britain as
much bacon and ham as she got from all the other countries of the world before the war. What was the total consumption of Britain in normal pre-war years? Then may I ask a further question. If Canada should be fortunate enough to send 900,000,000 pounds of bacon this year, would that have any effect on the four-year contract, which extends to 1947? Would that lessen the amount we might send under the present contract during the next three years?


James Garfield Gardiner: The quantity consumed by Britain the year before the war began was about 1,400,000,000 pounds. Of course she is not consuming that much now; her people are rationed. I have not the exact figures before me as to the British consumption at present, and what part of that consumption we supply, though I could obtain them. The Americans are sending some, but the greater part is sent from this country. I understand that about sixty-two or sixty-three per cent of their hog products comes from Canada, but about eighty per cent of the bacon and ham is sent from Canada. The Americans are sending more of the fat type of hog in the form of pork than we are sending from this country.
On the other question, the answer is that it would not make any difference in succeeding years if we should send over 900,000,000 pounds this year. Under the new agreement which is being negotiated we would still supply 500,000,000 pounds next year, as a minimum; and if they required as much next year as this year we could send over another 900,000,000 pounds next year if we had it. I do not know whether the hon. member was in the house this afternoon when I corrected the statement I made last evening. I said I had been wrong in stating that final agreement had been reached with regard to the years 1946 and 1947. I discovered this morning that those negotiations are not complete, and that we are not sure of the quantities and prices for those years. As far as 1944 and 1945 are concerned, however, while I doubt if we shall send over 900,000,000 pounds this year, though we may come fairly close to it, even if we do we shall still have 500,000,000 pounds to send over next year, and anything more Britain requires in addition.


Mr. STIRLING:: But still this is to be a four-year contract?


James Garfield Gardiner: We are hoping it will be. We may have to make some adjustments; discussions are going on, but we are hoping that it will be a four-year contract.


Harry Rutherford Jackman: Could the minister amplify at all what may happen in 1946 and 1947? If he cannot say definitely that 500,000,000 pounds will be the objective, could he say whether it will be more or less than that amount?
War Appropriation-Agriculture


James Garfield Gardiner: In spite of what was read by the hon. member for Vegreville, I am quite satisfied in my ,own mind that Britain will still want at least 500,'000,000 pounds in 1946. I should be sufficiently satisfied on that point that if we could not make a satisfactory agreement now covering the four years, we should not be in too much of a hurry. Conditions that may exist three or four years from now are uncertain so far as the British are concerned, as they are uncertain so far as we are concerned1, and I would not be in favour of agreeing to an arrangement now which in two years we might find not in the interests of our people. If it gets too far over in one direction I do not think it would be good policy on our part to enter into an agreement now for the longer period of time. If it gets to the point where we think it will be to the advantage of everyone concerned to have the agreement made now for the longer period, of course we shall sign the agreement.


George Hugh Castleden: Then do I understand that there is not a four-year contract at the present time?


James Garfield Gardiner: At the moment there
is not a four-year contract signed; I corrected that statement to-day, and said that the final negotiations had not been completed.


George Hugh Castleden: Then what are we
operating under at the present time?


James Garfield Gardiner: We are operating under the two-year contract for 900,000,000 pounds.


George Hugh Castleden: Signed when?


James Garfield Gardiner: Some time about February, I think.


Victor Quelch: Yesterday the minister expressed great surprise that hon. members did not know that an assurance had been given for the next four years, saying that it had been advertised all across the country. Now we are told that the contract is for only two years. Has he been advertising all across the country that it is a four-year contract?


James Garfield Gardiner: I said that it had been advertised across the country that a four-year contract was under negotiation. Last night I thought I would be able to say to-day that it had been completed, but I find it has not.


Victor Quelch: Then is the minister in a
position to give an absolute assurance that there will be a market and that we shall be able to maintain the price, despite the fact that the contract is for only two years? Certainly he was very much surprised yesterday that hon. members did not know of the four-year contract. To-day we are told that the contract is not in existence, so that appar-

ently the hon. members who spoke yesterday were right.


James Garfield Gardiner: Of course yesterday hon. members were not talking about a four-year contract; they were talking in general terms about assurances having been given the farmers that there would be a market. I dealt with more than hogs yesterday; I said that there was a two-year contract on eggs, a two-year contract on cheese, a four-year contract under negotiation in connection with hogs, which I thought was nearer conclusion than it is, and also a contract under discussion with regard to beef. All these matters are being considered by the government. It is not a question of losing sight of any of these things.


Victor Quelch: But we were arguing that
the assurance should be for a longer period than two years, because a two-year period does not guarantee a farmer against the costs involved. We were urging that a four-year guarantee should be given. Now, even though a four-year contract has not been consummated, the minister does feel in a position to give the farmers the assurance that there will be a good market for the next four years?


James Garfield Gardiner: I will give the same
assurance I gave last evening, upon which I based the argument to which reference is now being made. I said that the Prime Minister had announced by radio, and other ministers had announced, that we were to have floor prices under farm products. That is the real assurance. That does not mean necessarily that we shall be able to sell the product at that price; it may mean that we shall have to take money out of the treasury after the war in order to give the farmer the floor return, whether or not the market can provide that price.
" Mr. QUELCH: And I suppose it may mean that the guaranteed price will apply only to a certain quota. It may not mean that you will take an unlimited quantity at that price.


James Garfield Gardiner: At the moment I should not like to say whether or not it may mean quotas; that is a matter which will have to be dealt with later. The main guarantee is that there will be floor prices under farm products.


[Stage Direction]
Item agreed to.
Dairy products board-administration, $21,690.
Victor Quelch: Will the winter rates be continued during the summer months?


James Garfield Gardiner: The rates were announced some months ago. The rate on whole milk, fluid milk, for the- summer months will be thirty-five cents in the areas in which it was fifty cents in the winter time and twenty-five cents in those areas where it was twenty-five

War Appropriation-Agriculture
cents in the winter time. So far as canned milk is concerned, the rate will be fifteen cents as against thirty cents which was paid in the winter months. The rate on cheese is twenty cents all ymar as against the thirty cent rate in the winter last year and nothing at all in the summer. The rate on butterfat is ten cents all the year through this year, and it was ten cents in the winter last year. It is correct to say that the rates are not as high on fluid milk, cheese and canned milk as they were in the winter last year, but they are higher on all these commodities than they were in the summer last year.


Victor Quelch: There will be the same rate on butterfat all the year?


[Stage Direction]
Item agreed to.
Special products hoard - administration, $50,190.
Percy Ellis Wright: Some time ago I was inquiring with regard to participation certificates which were issued on purchases of alfalfa seed for export. When were these participation certificates authorized and what are the conditions governing them?


James Garfield Gardiner: If my memory serves me aright, I placed on Hansard, either by way of an answer to a question or at the time the estimates were up, a list of those who were purchasing alfalfa seed.


Percy Ellis Wright: There was nothing placed on the record with respect to the regulations under which participation certificates were issued. Were they issued to all growers from whom the seed was purchased, or were they issued only to growers from whom seed was purchased for export? There was considerable difficulty about the matter in certain sections of the country, and it was stated that participation certificates had not been issued to all growers.


James Garfield Gardiner: My understanding is that participation certificates were issued to all farmers who sold seed to the persons contained in the list placed on the record. '


Percy Ellis Wright: Was it compulsory to issue participation certificates for all seed purchased after the date the order came into effect?


James Garfield Gardiner: There seems to be some doubt as to whether it wras compulsory. I imagine a man could sell his product outright if he wished to do so. I can sell my wheat outside the ordinary elevators at any price I like; I can dispose of it completely without getting any participation certificate. The same principle prevails here. If a man sells to a concern which is licensed by the government, he may get a participation certificate, but there is nothing to prevent his selling to anyone else.


Percy Ellis Wright: I do not know whether my information is correct, but I am told that some of these firms were purchasing seed outright and not issuing certificates. I was wondering whether they could do that.


James Garfield Gardiner: I think they can if the farmer is satisfied to sell it. It is just the same as it was when we were pooling in the west. But the farmer has a right to get a participation certificate in advance if he desires.


Percy Ellis Wright: It seems to me that it should have been compulsory upon these people to issue participation certificates for the alfalfa they purchased after the date of the order. A number of farmers did not understand the situation thoroughly, and the information I have is that they sold their grain and then found out afterwards they could have obtained participation certificates which would have been worth considerable to-day. I am pointing this out to the minister in order that he may make an investigation. If the facts are as I have stated, in another year he should see that certificates are issued to all farmers from whom seed is purchased by the firms authorized to purchase. That would be the fair way to do it.


Mark Cecil Senn: I suppose if a farmer did not want to take a participation certificate there was no reason why he should take it. Most of the farmers in my district did take participation certificates after the new regulations came out. The special products board quite early in the season, although not early enough, took over the export of seeds from Canada. They also set the price at which they would buy seed for export. Unfortunately that price was considerably below the retail ceiling price set by the wartime prices and trade board. The result was that the primary dealer, who bought the seed from the farmer, gave it a * preliminary cleaning and then passed it on to the next dealer, usually a wholesaler, had to buy on the basis of the export prices which had been set by the special products board and which, as I have said, were less than the ceiling prices.
It is true that they set prices at the seaboard for different classes of seed such as alsike, red clover and alfalfa, and the primary dealers were forced to buy in accordance with those prices. They had no idea how much of the seed they purchased would go into the domestic trade and how much into export. There was a good deal of dissatisfaction among the farmers because they realized that the prices being paid were lower than retail ceiling prices.
It is true that participation certificates were issued and the farmers expect to get something from these, but I believe there was little
3198	COMMONS
War Appropriation-Agriculture
if any red clover seed exported, so that those participation certificates will be valueless. It is equally true that there was very little alfalfa exported, so that those participation certificates will not have much value. I suppose it is a little too early in the season to ask the minister what those participation certificates will bring to those who received them. I understand that a certain amount of alsike seed has been exported or will be exported before the season is over, and there will be a return to the farmers in that event. Perhaps the minister could give us an estimate as to what these participation certificates will be worth.
I think it is unfair to lay the blame upon the primary dealer for the lower prices that were paid. He had to buy in accordance with the export prices, and if any profit was made it did not accrue to him. It accrued to the larger houses who recleaned the seed and then sold it to the retail trade. I think it is only fair to the primary dealers to say this. I believe the minister will agree with me that if any blame was to be attached to anyone, it was owing to the fact that the special products board made more or less of a mistake in not placing a high enough price upon export seed.


James Garfield Gardiner: All I can say is that
there is an established price as has been suggested, and the dealer can pay any price at all up to that price. He gives an undertaking to give a participation certificate in any case where the farmer desires to have it, although he is not compelled to do so.


Mark Cecil Senn: They did so in my district.


James Garfield Gardiner: In some cases he pays
a price somewhat below the top price that might be paid. My understanding is that he gets one-eighth of a cent a pound by way of commission for issuing the certificate. I would point out that grass seed is a thing that farmers buy as well as sell and I hope that they are not being billed any more for it than I have been billed if they want to plant it to make a pasture.


Mark Cecil Senn: There is a price ceiling.


James Garfield Gardiner: It is a pretty high
ceiling.


Percy Ellis Wright: How does that price ceiling compare with the price received last year for alfalfa seed by the cooperatives in western Canada ?


James Garfield Gardiner: I was billed thirty-seven cents a pound for alfalfa.


Percy Ellis Wright: The ceiling this year was
thirty-seven cents.


Mark Cecil Senn: The retail price as set by the prices board in lots of thirty-one pounds was thirty-seven cents for alfalfa, twenty-nine cents for alsike, thirty-four cents for red clover, early double cut; single cut, thirty-five cents.


James Garfield Gardiner: That is commercial grass.


Mark Cecil Senn: Of course, if the minister were using fancy grades it would make a difference, but the average farmer is not using that kind of grade. As long as it is clear of weed seeds, that is all he desires, provided that the seed is vital. The only point I wish to make is this.
I think somebody did make a pretty handsome profit on the seed that went into domestic use in the country because the price ceiling is high enough to allow that. I know that in some cases the seed was not sold as high as the ceiling. In my own village it was not, but they made a handsome profit just the same.
I should not like to see the primary dealers, who are performing a useful service to the farmer in collecting, cleaning and marketing the seed, blamed for paying a price that was too low.


[Stage Direction]
Item agreed to.
Subsidies to producers of food products, $47,600,000.
Mr. NOSEWORTHY:: Can the minister give any more definite information than was given yesterday in reply to a question by the hon. member for York-Sunbury as to the subsidy paid on potatoes?


James Garfield Gardiner: No. I think it was agreed yesterday that that was a question which would have to be asked when the prices board estimates are before the committee.


Percy Ellis Wright: Is there a detailed breakdown of these subsidies? I am not asking the minister to read it, but perhaps it might be placed on the record.


James Garfield Gardiner: The break-down is as follows:
Payment of subsidies by agricultural food board on products delivered to distributors and manufacturers during fiscal year ending March 31, 1944.
(Refund made in April for March deliveries)
To April 30,
Fluid milk at 25 cents	 $ 2.632,908 82	.
at 55 cents	 6,289,085 60
Total fluid milk	 $ 8.921,994 42,
Butterfat at 8 cents	 15.954.297 21
at 10 cents	 3,050,353 30
Total butterfat

War Appropriation-Agriculture
Concentrated milk at 30 cents... $	638,675 61
Concentrated milk, March and
April, 1943, at 25 cents...	234,065 52
Total concentrated milk	$	872,741	13Cheddar cheese milk at	30 cents. $	1,171,557	64
Total milk and milk products.. $29,970,943 70
Canning crops	
$	945,441	06Berries for jam	
$	261,025	06
Grand total


Grote Stirling: How is the difference between that $31,000,000 odd and the $47,000,000 made up?


James Garfield Gardiner: The $31,000,000 was for last year. The $47,000,000 odd is the estimate for the coming year. The subsidy payments estimated for 1944-45 are as follows:
Subsidy payments estimated for 1944-45
Subsidy .
Butterfat used for creamery butter
Fluid milk	
Cheese	
Concentrated milk	
Rate
10 cents per pound butterfat.. 25 cents and 35 cents (summer) 25 cents and 55 cents (winter) . 20 cents per hundred pounds...
(15 cents (summer)	
(30 cents (winter)	
Subsidy on fruit for jams	
To producers of tomatoes, corn, peas and beans
Estimated
cost

Total


Ernest Edward Perley: Would the minister give not totalled. But			the total amount paid in	
us a break-down by	provinces of the fluid subsidies	on milk	for fluid use in	all Canadamilk subsidies paid?	in 1943 -	was $4,968,477. The other figures of


James Garfield Gardiner: I have not the figures subsidies for this year except by the months, which are	paid are	as follows:	Milk for	Milk for	Milk for manu-	Butterfatfluid use	cheese	factured use	subsidy1943	1943	1943	1943CANADA 	
$4,968,477	$800,270	$464,955	$15,724,915Prince Edward Island	
22,250	4,484	231,166
188,775	1,751	359,649
136,304	2,747	371,487
1,314,072	301,261	128,965	4,825,545
2,219,833	470,201	268,935	3,810,740
261,709	11,707	1,721,330
137,188	1,881	231	2,286,856
211,341	5,371	16,254	1,902,125British Columbia ....	
477,005	2,616	48,818	216,017
It will 'be noted that, in respect of milk for fluid -use, Prince Edward Island and Saskatchewan are the provinces with the lowest subsidy.


Grote Stirling: I do not follow the
figures of the' break-down that the minister gave, because there seem to be so many omissions; for instance, all the subsidies on imported goods, tea, molasses, oranges and all those sorts of things.


James Garfield Gardiner: Those are paid under the prices board in connection with consumers subsidies. These are only producers subsidies.


Grote Stirling: In the subsidies on
domestic goods, besides those to which the minister has referred, there are eggs, groceries and things of that sort. Do they not come into this item of $47,600,000?


James Garfield Gardiner: No; we do not pay any subsidies on eggs, that I recall. There is the milk subsidy, again paid to consumers by the prices board. That does not come into this.


Grote Stirling: Maple products, rye,
vegetables?


James Garfield Gardiner: Of course the vegetables are in this, $2,000,000.


Grote Stirling: Vegetables come in.
Berries and jams and canning of produce, under canning?


James Garfield Gardiner: Yes; canned vegetables, like peas, corn and so on.


Grote Stirling: The remainder of this return to the house comes under other items?


James Garfield Gardiner: Yes.



War Appropriation-Agriculture


Grote Stirling: What would the minister describe this forty-seven millions as?


James Garfield Gardiner: It is producers subsidies, given for the purpose of getting greater production.


Ernest Edward Perley: How much of a staff does it take to carry this on?


James Garfield Gardiner: I understand that this is about the staff, sitting at this table, with two or three more, that handles this particular thing.


Ernest Edward Perley: Well, if all the boards were correspondingly small I would be "tickled to death". I think it is a compliment to these men, and an achievement for other boards to work up to.


James Garfield Gardiner: We sometimes get a little criticism for not having outsiders. Practically all of the work during the war has been done with our own staff.


Joseph William Burton: Would the minister explain this item under the heading, "agricultural food board, administration, $68,175"? I was comparing it with the corresponding item under the special products board, of $50,190. In respect of the disbursement of $47,600 the cost of administration is about the same as under the very small item of the special products board.


James Garfield Gardiner: The special products board handles, of course, quite a number of different products. It deals with everything except meat, which is handled under the meat board. Dairy products are handled under the dairy products board. Everything else is handled under the special products board.


Mark Cecil Senn: I think what the hon. member means is that, if there are only three or four people administering this particular item, $68,175 is quite a lot of money to pay.


James Garfield Gardiner: In explanation of that I may say that there are the travelling expenses of our inspectors, a few of them, and also the travelling expenses of the advisory board that most members are very anxious we should have. That amounts to a considerable sum of money. We bring in people from all over Canada as an advisory committee for the food board, and they are brought in on a number of occasions.


Mark Cecil Senn: Then you must have a larger staff than you indicated.


James Garfield Gardiner: That is not staff. They are people who are brought in from around the country as representatives of provincial government and farm organizations.


Ernest Edward Perley: The amount stated by the minister as expendable in Saskatchewan and

Manitoba is so small that he will not require a large staff of inspectors to carry on in those provinces.


Mr. NEILL:: Did I understand the minister to say that this is the item which covers the subsidy to milk producers?


James Garfield Gardiner: Yes.


Alan Webster Neill: Perhaps he can explain this situation. I am asking for information. Somebody moved for a return the other day, and it was brought down. What was asked for was a statement of the various market areas, I think they are called, and I see there is a large number of them throughout Canada, including several in British Columbia, but there is not any reference to Vancouver island. I know there are some payments made on Vancouver island; there must be one or more areas. Why was Vancouver island omitted from this return which was brought down?


James Garfield Gardiner: The return is for the twenty-five cent market only; and I understand that all of Vancouver island is fifty-five cents in the winter and thirty-five cents in the summer. The reason why the island was not reported in the twenty-five cents return is that it receives more than the areas which are contained in that return.


Alan Webster Neill: How would we find out about the fifty-five cent areas? Ask for a separate return? It would not have hurt the department to have covered both payments in the return.


James Garfield Gardiner: There are 525 areas which are getting fifty-five cents; among them is the area of Vancouver island. Those can be listed, but it would be quite a list. I do not know whether anyone has an interest in getting them, but I think the best way to get this is to ask a question or ask for a return and have them all brought down in the return.


[Stage Direction]
Item agreed to.

[Stage Direction]
Mines and geology branch-development of tar-sands of Alberta. Remodelling and expansion of plant of Abasand Oils, Limited, $500,000.
Hon. T. A. CRERAR (Minister of Mines and Resources):: The hon. member for Davenport (Mr. MacNicol) had some discussion on this matter when the estimates of the Minister of Munitions and Supply were before the committee. The hon. member for Davenport is absent to-day, and he indicated that he would like this particular item to stand until he is here. That is quite agreeable to me, and I suggest that we might take the next item.


Ernest Edward Perley: That is all right. I was
going to ask the minister one question with

War Appropriation-Mines and Resources
respect to certain reports that I think are available and that he might have ready to bring down when this item is taken up. To preface what I was going to ask, I received a sample of the tar sands about the middle of March, and a certain person on his way to Chicago called and picked this parcel up, about a foot square, and took it to Chicago and had it analysed by an outstanding chemist there. He said that the extraction of oil was quite easy, that there was no difficulty about it, and he showed also that in the white sand there was a trace of gold, which was something npw, something that had not been heard of so far in connection with tar sands. This person said that the government here in Canada had employed a Doctor Egloff in Chicago to do research work in connection with this tar sands development. My question is this. Is there a report from Doctor Egloff and, if so, will the minister give it to the committee when the item comes up next.


Thomas Alexander Crerar: I do not know whether we have such a report. There was a concern in Chicago, Universal Oil Products, that specialized in this sort of work. That is the only concern there that I know of that had anything to do with it. What was the name of the gentleman?


Ernest Edward Perley: Doctor Egloff of Chicago.
The person to whom I have referred says that this professor had been employed by this government to do certain research work and that there was a report available on the subject which would be interesting. I have never heard of it, and I would ask the minister to look into this matter and, if such a report exists, to let us have it.


Thomas Alexander Crerar: I am advised that the
gentleman in question is with Universal Oil Products of Chicago, which company is doing research work on bitumen. Perhaps we might let the item stand.


Mr. JOHNSTON (Bow River):: I understood that the minister would make a statement on tar sands. I would suggest that he give that statement now and let the item stand, and in the meantime we could examine his statement so that we might be prepared to discuss the question when the time comes around. I should like to have his statement and have a chance to examine it, and then we could have the debate later on. I am very much interested in this subject, having spoken on it on a number of occasions. I was in the minister's office and I went through a large file in connection with it. I understood that he would make a full statement on this subject, and if he would make this statement now and then let the item stand until such time as he desires to bring it up again, I think that would meet the convenience of hon. members.
Item stands.
Investigations of petroliferous deposits and of potential petroliferous areas in Canada, $145,000.


George Hugh Castleden: This has to do with
the investigation of petroliferous deposits in various areas in Canada. I suggest that we might have spent a little more and done a lot of the work, in the Northwest Territories and the Yukon, which is apparently being handed over lock, stock and barrel to other authorities. On May 5 of this year the minister tabled an order in council, P.C. 2904, having to do with the handing over of all rights for the exploration of oil fields of the Yukon and the Northwest Territories and practically all the oil-bearing territory of that area. At that time he gave a very full report in explanation of the first part of the order in council. It is interesting to note that in this agreement with the United States it is arranged that the United States government is, under this order in council, entering into a contract with a Canadian company for further exploration and development of the oil industry in that territory. Apparently there has been quite a bit of prepartion going on with regard to organizing and getting that order in council ready, because I find that order in council P.C. 742, which was passed on January 28, 1943, states that the governor in council:
... on the recommendation of the Minister of Mines and Resources and pursuant to the powers conferred by the Dominion Lands Act and the War Measures Act, is pleased, hereby, to make the annexed regulations for the disposal under permit of petroleum and natural gas rights, the property of the crown, not disposed of under lease or permit specifically reserved by the crown by P.C. 4140, dated 18th May, 1942. to be effective immediately, notwithstanding the provisions of section 75 of the Dominion Lands Act.
On February 12, 1943, P.C. 1138 was passed whereby:
The regulations for the disposal of petroleum and natural gas rights, the property of the crown in the Yukon territory, shall no longer apply to the area defined as follows.
And they take in the Yukon-a portion of it at any rate-and a portion of the Northwest Territories. Later, on March 26, 1943, there is an interesting order in council whereby:
The regulations for the issue of oil and gas permits and leases in the Northwest Territories shall no longer apply to the area defined as follows:
1.	The whole of the Yukon Territory.
2.	Then follows the description in regard to the Northwest Territories, which takes in a part of the mainland of the district of Mackenzie, west of a line commencing at a point on the shore of Beaufort sea on the east side of Mackenzie river, distant seventy-five miles from the centre of the main channel of the east channel of Mackenzie river at the south point of Richards island, and a line following that down.
3202	COMMONS
War Appropriation-Mines and Resources
I submit that the Canadian people should be completely informed on the development of this area and upon the contents of this order in council. In the first place, we find that the agreement is entered into in this case between the United States government and the Imperial Oil Company of Canada. They are to do the exploring, but the Imperial Oil Company is controlled entirely by the Standard Oil Company of New lersey which is a part of a world-wide combine in oil. So that it means that the United States are entering into an agreement with their own company and are given practically all the rights- of development of the field in the Northwest Territories and the Yukon, and what the government gets out of it, so far as Canada is concerned, is extremely little in return for the great resources which are being handed over.
On page three of the order in council the area to be developed is:
... a unit operation by the company, the oil produced therefrom to be disposed of by the company in the ordinary course of its business, the government's share therein to be sold at prices satisfactory to the government.
(b)	The government's share of the oil to be one-third and the company to be paid the actual direct costs of producing it, plus a fee of ten per cent.
It does not say in here how the actual costs are to be arrived at. Then the order in council goes on:
(c)	Subject to the prior and preferred supplying of all local requirements for crude petroleum and petroleum products, the company to have the right of giving an option to the United States government to purchase for its own use, but not for resale, an amount up to one-half of the oil recovered from the proven area, not exceeding thirty million barrels, the price therefor to be the cost of production, plus twenty cents per barrel. From its share the Canadian government will supply one-third.
I think P.C. 2904 is of sufficient interest to the people of Canada, since it has to do with one of their great natural resources, to warrant its being tabled and put into the records of this house. I therefore ask the permission of the committee to have P.C. 742, 1138, 2447 and 2904 placed on Hansard.


Thomas Alexander Crerar: I do not wish to interrupt my hon. friend, but what he is talking about has nothing whatever to do with the vote we have under consideration. There is not a single penny in this vote that is in any way associated with the matter that he is discussing. There was a statement made in the house on May 5. I gave a very full statement to the house and at the same time tabled the order in council that had been passed a few days previously dealing with the development of the oil resources in the Mackenzie river area. The orders in council to which he refers were tabled from time to time previously in the house, and I do not see

any reason why they should now be reprinted in Hansard.
I have not the slightest objection at the appropriate time to discussing the policy of the government and what it has done in association with the United States authorities in the development of the oil resources of the Mackenzie river valley. But, Mr. Chairman, it has nothing to do with this present vote because, as I said a moment ago, there is not a penny in this vote that is associated with the development.


George Hugh Castleden: 
Thomas Alexander Crerar: I still repeat what I said a moment ago, that the vote we are considering now, this item of S145.000, has nothing whatever to do with the development that is taking place in the Mackenzie river valley. There is not the slightest objection on the part of the government to discussing at the appropriate time all the development that has taken place in the Mackenzie river valley country and the part the government has taken in it, not the slightest. I know that the questions brought up by my hon. friend may make some headlines in the papers and perhaps in certain places have some useful results, but it is-


George Hugh Castleden: All we are asking for
is the facts.


Thomas Alexander Crerar: No. My hon. friend has got the matter all wrong.to begin with. And in the second place, as I have said now for the third time, it has nothing whatever to do with what took place in the Mackenzie river valley.


Mr. GREEN:: Which is the appropriate
vote?


Thomas Alexander Crerar: There is another vote here for it.	*

War Appropriation-
-Mines and Resources


Thomas Miller Bell: The minister says that this can be discussed at the appropriate time. This item reads:
Investigations of petroliferous deposits and of potential petroliferous areas in Canada.
My hon. friend is discussing petroliferous areas in Canada when he is discussing the Yukon territory and the Mackenzie basin.


Thomas Alexander Crerar: Quite true.


Thomas Miller Bell: Will the minister tell the committee what would foe the appropriate item under which this project could be discussed? Whether it makes good headlines or bad headlines is not the question. The question is whether it is a good or a bad deal for Canada; whether we are giving away, as I think we are, one of our great resources to the Standard Oil Company of New Jersey and not getting adequate compensation for it; whether we are, as we have done in the past, alienating one of our great resources to a great corporation again and leaving the people of Canada without control of that resource. Obviously any ordinary member of this committee, not having a break-down of this particular item, in looking at it and seeing that it was for the investigation of petroliferous deposits and of potential petroliferous areas in Canada would conclude, and intelligently, that it took in the Yukon and the Mackenzie basin and that, therefore, was the item under which this could foe discussed Could the minister tell the committee, first, where it can be discussed and, second, what this item of $145,000 really is.


Thomas Alexander Crerar: Yes, I can tell what the item of $145,000 is. But if the hon. member for Rosetown^Biggar will look further down the estimates under "Lands, parks and forests branch" he will find there an item of $10,000 for "expenses of liaison officers in connection with the Alaska highway and Canol projects". I think it would be quite proper to discuss the Canol project under that item, if it is desired to discuss it.


Thomas Miller Bell: I understood the minister to say a few moments ago that there was nothing in this war appropriation which dealt with the Canol project.


Thomas Alexander Crerar: If I did, I did not intend to say so. I said that there was a time when it could be discussed.


Thomas Miller Bell: After all, the $10,000 item seems such a small one under which to discuss such a huge project. If the only interest we have in the Canol project is the $10,000 item in these estimates, then our interest is very very small.


Thomas Alexander Crerar: My hon. friend is not right at all.


Thomas Miller Bell: The minister invited that sort of comment.


Thomas Alexander Crerar: May I tell the committee that up to the present the federal government has not spent a single dollar-


Thomas Miller Bell: It -has given away one of our resources.


Thomas Alexander Crerar: No. That is rather extreme too. We are not in the habit of giving away our resources.


Thomas Miller Bell: Governments have.


Thomas Alexander Crerar: We can discuss the whole
Canol project, as far as it relates to the government under the item I mentioned a moment ago, and I would suggest that we leave it until we come to that item, and deal with this $145,000. The $145,000 is to cover explorations, or surveys, if you like, by seismograph and in other ways of other possible oil structures within the provinces of Canada, mainly in Saskatchewan and Alberta. Last year there was an item of $500,000 in the war appropriation vote for this purpose. A good deal of work was done, some of it in the Wainwright park area of Alberta. There was some aerial photography in Entrance and Wapiti areas in Alberta, and also certain surveys made for oil exploration in New Brunswick. Surveys also were made near Fort-McMurray, Alberta. There is one other item which I should mention, namely that covering the work done by the Consolidated Mining and Smelting company in drilling the tar sands in the Fort McMurray area. That work was done under an agreement made with the company. This $145,000 is to continue similar investigations this year.


Charles Edward Johnston: Would that include further work in the tar sands area?


Thomas Alexander Crerar: Yes; it has to do with the drilling of the tar sands. Briefly that is the purpose of this vote. I do not know exactly where the surveys will be conducted this year. One of the difficulties we are running into in this connection is getting the personnel to head up the geological parties and to service them while they are in the field.


Thomas Miller Bell: Did we spend the
$500,000 last year?


Thomas Alexander Crerar: The vote was $500,000, but we did not spend that much.


Thomas Miller Bell: What did you spend?


Thomas Alexander Crerar: We spent $154,000 last year.


Thomas Miller Bell: And what happened to the balance?


Thomas Alexander Crerar: It was not spent.


Thomas Miller Bell: It has not been transferred to some other item?


Thomas Alexander Crerar: No.


Thomas Miller Bell: It is possible under this resolution, is it not, to transfer any unexpended balance to some other project?
3204	COMMONS
War Appropriation-Mines and Resources


Thomas Alexander Crerar: It can be done only with
the approval of treasury board, and treasury board does not give its approval very readily in these matters.


Thomas Miller Bell: But it is not under the control of this house once the item is passed. It is not like the regular estimates, in which the expenditure is definitely limited.


Thomas Alexander Crerar: If we had $500,000 for investigations or explorations for petroliferous deposits and did not spend that amount; then if under the next item, which deals with the search for strategic minerals, we wanted to spend more money, with the approval of treasury board we could transfer the balance from one vote to the other, but it has to be done with the approval of treasury board.


Thomas Miller Bell: That is different from our ordinary budget resolutions and estimates: However, I was gping to ask the minister what were the results achieved by spending $154,000 on this project. If we are to spend another $145,000 this year I think we should know what results were obtained by the expenditure last year of $154,000.


Thomas Alexander Crerar: In the Wainwright park area, for instance, the investigations were very encouraging; so much so that presently the area is to be put up for competition for companies to go in and drill. Part of the structure is within the park and part is without the park, and we have arranged with the government of Alberta that the areas will be put up at the same time. All the data we have gathered in these surveys and explorations are available to any company that wants to go in and bid for these claims.


Thomas Miller Bell: Supposing a company goes in, drills wells and finds valuable deposits of oil. What do we get out of it?


Thomas Alexander Crerar: In Alberta they will be subject to the royalties of that province.


Thomas Miller Bell: I was not thinking of Alberta. This is a dominion expenditure.


Thomas Alexander Crerar: If they are discovered in the park they will be subject to any royalties we may impose.


Thomas Miller Bell: And as a rule what royalties do we impose?	[DOT]


Thomas Alexander Crerar: We have never fixed royalties in the parks before, but I believe the royalties in Alberta are from five to fifteen per cent.


Thomas Miller Bell: But this is a dominion expenditure, and I am wondering what benefit accrues to the dominion by way of royalty as a result of this expenditure.


Thomas Alexander Crerar: The only royalties we shall get will be those on any oil which may be
found in the park. Those royalties will be determined, probably, on the same basis as those of the province of Alberta.


Thomas Miller Bell: And will the province of Alberta collect royalties as well?


Thomas Alexander Crerar: They will collect royalties in the area outside the park; that is their property.


Thomas Miller Bell: The minister said that the area would be put up for competition by the government, so that companies could compete for the opportunity of drilling. How is that done; is it advertised?


Thomas Alexander Crerar: Yes, it is advertised.


Thomas Miller Bell: How does the competition work? If we get nothing but royalties and those royalties have not yet been determined, what competition is there?


Thomas Alexander Crerar: A person or company
applying for a licence will offer a bonus, and the competition really is on the bonus. No matter what company gets the privilege, it has to pay a royalty in addition to the bonus offered.


Thomas Miller Bell: I did not quite hear what the minister said.


Thomas Alexander Crerar: We lay down certain regulations for drilling in particular areas. Certain royalties have to be paid. The areas are put up for competition and it may be that one, two, three, four or five companies will bid for the right to explore. The highest bidder gets the right to go in and do the drilling. If he finds oil he carries on in a commercial way and pays a royalty to the proper government authority.


Thomas Miller Bell: Then practically it
means that this is a competition among certain companies; and the company that can offer to pay the highest bonus will get the right to drill. Is that the idea?


Thomas Alexander Crerar: Yes.


Thomas Miller Bell: Naturally this squeezes out any small man who may want to go in and try to find oil.


Thomas Alexander Crerar: I do not think either the hon. member for Rosetown-Biggar or myself would have sufficient capital to go in and bid on one of these leases.


Gordon Graydon: Perhaps we could cease drilling operations now; it is eleven o'clock.


Thomas Miller Bell: Apparently there are certain limits to free enterprise.
Item stands.
Progress reported.


[Stage Direction]
At eleven o'clock the house adjourned until Thursday at three o'clock p.m., pursuant to special order made Monday, February 21,1944.