1945-10-23

[Stage Direction]
Mr. J. A. BRADETTE (Cochrane) presented the first report of the standing committee on external affairs, and moved that the report be concurred in.
Motion agreed to.

[Stage Direction]
Hon. IAN A. MACKENZIE (Minister of Veterans Affairs) moved:
That the name of Mr. Sinclair (Vancouver North) be substituted for that of Mr. Reid on the standing committee on external affairs.
Motion agreed to.

Mr. RALPH MAYBANK (Winnipeg South Centre):: Mr. Speaker, I rise to a question of privilege. My question of privilege arises out of what purports to be a report of the proceedings of this house. I should say that this report does not emanate from the parliamentary press gallery. This report is not an accurate report; it is a complete misreport of supposed proceedings in this house. I do not know whether the error is an error on the part of the newspaper or whether the fault lies with the hon. member who represents Winnipeg North. The facts which I find necessary to lay before the house are as follows:
The Winnipeg Free Press under date of October IS, 1945, has a fairly lengthy report of a meeting of the Winnipeg district trades and labour council.	After reporting on
numerous matters that took place at the council meeting the Free Press publishes the following:
Replies were read from Prime Minister King, Hon. C. D. Howe, L. A. Mutch, M.P.,
S.	Knowles, M.P., Ralph Maybank, M.P., and
Alistair Stewart, regarding the council's resolution passed at a mass meeting in the Playhouse theatre on the question of reconversion, unemployment in the aircraft industry, and the post-war programme prepared by the Trades and Labour Congress of Canada.
The report goes on to indicate the nature of these replies which were received from various hon. members, and then continues:
A letter from Alistair Stewart said that he had brought the matter up in the house but
that Ralph Maybank talked the resolution out, so that no vote could be taken on it. "Afterwards Maybank received the congratulations from government members for his sabotage," said Stewart's letter.


Mr. SPEAKER:: Order. The hon. gentleman knows that any hon. member may rise to a question of privilege in connection with any matter in respect of which his integrity or honesty are put in doubt, and I would ask the hon. member to state his question of privilege.


Ralph Maybank: Precisely, Mr. Speaker; that is the point. Moreover, there is also the question of the privileges of the house itself, as you will observe from the remainder of that which I desire to present to you. That which I have read as being the report of a letter by the hon. member for Winnipeg North (Mr. Stewart) is not merely an inaccuracy, nor can it even be called a distorted report of anything that occurred in this house. It might be termed a perversion of the truth, but a better way of describing it would be to say that it is pure fiction and has no relation whatsoever to truth. It is a complete make-up.
The newspaper story states that Alistair Stewart, who is the representative of Winnipeg North in this House of Commons, brought up in this chamber the question of a resolution of the Winnipeg and district trades and labour council which had been passed at a mass meeting, dealing with the question of reconversion, unemployment in the aircraft industry and the post-war programme prepared by the Trades and Labour Congress of Canada. The said Alistair Stewart, the member referred to in the news story, never did bring up this question in this chamber. In fact the said gentleman never initiated anything in this chamber at any time. The said gentleman is reported to have stated that I talked out the resolution which he had brought up and that therefore no vote could be taken on it. That statement, of course, is utterly without foundation. Not content with an excursion into the realm of fancy to the extent already indicated, he goes on to say that government members in this chamber congratulated me for the imaginary sabotage of a mythical proposal.
If the hon. gentleman is correctly reported it is probably incumbent upon us to offer him our congratulations upon his flair for publicity, but at the same time this is a mere fairy tale as far as being a report of the proceeding in this chamber is concerned. I submit therefore that it is not merely my privilege but my duty to bring to the atten-
Veterans Affairs

tion of the house this misreport, which, like all libels, will find its way far abroad as a result of the manner in which it is put out.


Mr. STEWART:: May I suggest that the
hon. member for Winnipeg South Centre (Mr. Maybank) should know much better than to accept the Free Press as being accurate. What I said in my letter was correct. I am not responsible for what the Free Press says.


Ralph Maybank: I said in the beginning that I did not know whose fault it was, but someone is at fault.



REPORTS AND PAPERS

Hon. J. L. ILSLEY (Acting Prime Minister):: I should like to table copy of order in council passed to-day appointing Mr. A. Davidson Dunton of Montreal, a governor of the Canadian Boardcasting Corporation and chairman of the board. Mr. Dunton will be the first full-time chairman of the board appointed in pursuance to the legislation of 1944. He will take up his duties on November 15. The appointment is for a period of three years.
I should like also to table copies of two orders in council dated October 18, 1945, passed pursuant to the provisions of the Public Service Rearrangement and Transfer of Duties Act. One of these orders in council transfers the powers, duties and functions of the Minister of National War Sendees with respect to film activities under the National Film Act of 1939 to the Hon. Brooke Claxton, a minister of the crown. The other order, effective as of October 15, 1945, transfers the powers, duties and functions vested in the Minister of National War Services under the Canadian Broadcasting Act, 1936, with respect to broadcasting, to the Hon. J. J. McCann, a minister of the crown.



BUSINESS OF THE HOUSE


[Stage Direction]
Hon. IAN A. MACKENZIE (Minister of Veterans Affairs) moved:
That after Wednesday, October twenty-fourth and every day thereafter until the end of the session, government notices of motions and government orders shall be considered during all the sittings of the house notwithstanding anything in standing order 15 or any resolution passed by the house during the present session, provided always that this order shall not affect introduction of bills, questions and notices of motions for the production of papers which shall be taken up under the provisions of standing order 15.
Motion agreed to.
tMr. Maybank.)


[Stage Direction]
On the orders of the day:
Mr. STANLEY KNOWLES (Winnipeg North Centre):: Before the orders of the day are proceeded with I should like to direct a question to the Minister of Munitions and Supply, of which I have sent him notice, together with a copy of a telegram in relation thereto, so I need not read the telegram now. Has the minister been advised of the fact that progress in connection with the Bannatyne avenue water project in Brook-lands, Manitoba, is being held up by a government order freezing six-inch cast iron water pipe? In view of the seriousness of this situation, will the minister give consideration to releasing a sufficient quantity of this water pipe to enable the contractor to proceed with this work before freeze-up?


Hon. C. D. HOWE (Minister of Munitions and Supply):: The answer to the first part of the question is, no. I shall be very glad to explore the situation and take whatever action is possible to remedy the condition reported to me.


Stanley Howard Knowles: Thank you.



VETERANS AFFAIRS


[Stage Direction]
On the orders of the day:
Mr. J. L. DOUGLAS (Queens):: I should like, to ask the Minister of Veterans Affairs what provision has been made for the hospitalization of veterans in Prince Edward Island.
Hon. IAN A. MACKENZIE (Minister of Veterans Affairs): I had notice of this question from my hon. friend this morning. I have long realized that Prince Edward Island, as a province whose contribution to the cause of freedom in this war has been magnificent, is entitled to hospital facilities for veterans, so that Prince Edward Island men may be treated on the island where their dependents may visit them. We have already made a grant of $75,000 to the tubercular sanatorium to provide accommodation for veterans on the island. It is now proposed to make a grant of $75,000 to the two Charlottetown hospitals, the Prince Edward Island hospital and the Charlottetown hospital. There is a stipulation that, as part of a construction programme in the case of the two hospitals, fifty beds

Trans-Canada Air Lines
must be set aside in each hospital for Veterans Affairs' patients. These beds are reserved for veterans so long as the department may require them, after which they revert to and become the property of the hospital concerned.


Mr. FRASER:: May I ask the minister if he can tell the house when the Peterborough veterans hospital will be opened?


Mr. MACKENZIE:: I could not give the exact date, but I shall be glad to give it to my hon. friend to-morrow. I think it will be very soon now.



TRANS-CANADA AIR LINES INCREASE OF CAPITAL-CREATION OF CORPORATION TO OPERATE SERVICES UNDER CONTRACT

[Stage Direction]
The house resumed from Monday, October 22. consideration in committee of the following resolution-Mr. Howe'-Mr. Macdonald (Brantford City) in the chair:
That it is expedient to introduce a measure to amend the Trans-Canada Air Lines Act 1937, to increase the capital from five to twenty-five million dollars and to authorize the Canadian National Railways to issue securities to twenty-five million dollars for acquiring the stock of the corporation; to provide authority in the governor in council to create corporations to operate and maintain air services under contract with Trans-Canada Air Lines such corporations to be controlled by Trans-Canada Air Lines; also to make provision for the payment of subsidies to such corporations payable out of moneys to be apporpriated by parliament and with provision for the termination of the present contract for the transport of mails and for a new contract for mail transport.
Stanley Howard Knowles: Mr. Chairman, it is not
often I find myself in a position to give warm and wholehearted support to government measures, especially proposals introduced by the Minister of Reconstruction (Mr. Howe).


Mr. REID:: I suspect it, right now.


Stanley Howard Knowles: I hear the suggestion that the legislation is suspect, already, because of my support; but I do rise to express my wholehearted approval of the proposals made yesterday by the minister, so far as they go-In other words, after I have made my favourable comments I shall have something to say about further steps which in my view the minister should take.
My opening comment with reference to the Minister of Reconstruction relates to the fact that, rightly or wrongly, we regard him as a strong devotee of private enterprise. In that field the minister has an enviable record of efficiency and success- I am glad to say he has carried that same record of efficiency and success into such phases of public enterprise
as have come under his jurisdiction. I have no hesitation whatsoever in paying to him a well deserved tribute for the work he has done in organizing Trans-Canada Air Lines, and I also wish to pay tribute to him for the further steps he has proposed from time to time by way of extending the principle of public ownership, in so far as civil aviation is concerned. Yesterday I listened with keen interest to the minister's speech, and I was particularly pleased when at the. close of his remarks he referred to the advantages, in terms of Canadian unity, achieved by the building up of an organization such as Trans-Canada Air Lines. I feel that the more we can think in terms of material improvements having a bearing on other phases of our life as well, the better it will be for us. I suggest that we should not look upon public ventures of this kind only in terms of their material value, but rather in terms of what they do to improve life in Canada in every way.
To refer specifically to the proposals outlined yesterday, may I say that hon. members of this group are whole-heartedly in support of the extension now proposed in connection with Trans-Canada Air Lines services. The . minister indicated that it was the intention to increase the service within the country, both by opening new and more direct routes in some areas, and by adding new aircraft to the routes now in service. Secondly he dealt with new lines to be established for service outside Canada. These he dealt with under the headings of new lines to the United States across the Atlantic, to the West Indies and to the Pacific.
I felt that hon. members in the Progressive Conservative party gasped when they listened to these proposals for the very wide extension of the principle of public ownership, which was so well underlined when the minister pointed out that the extensions would increase five or six times over, the route mileage of Trans-Canada Air Lines.
Hon. members in this group feel that there are certain fields of endeavour which are natural monopolies, and that aviation is one of them. When a field of endeavour is a natural monopoly we take very strongly the position that that monopoly should be in the hands, not of private individuals, but rather in those of the people as a whole. May I repeat our whole-hearted support of the minister's proposal to enlarge the capital set-up of Trans-Canada Air Lines to establish these subsidiary corporations, and to establish government control of these additional services
Trans-Canada Air Lines

Incidentally we are pleased to learn about the opening of services to additional points in the United States, the United Kingdom, the West Indies and in the Pacific area. The really significant thing, however, is that at the outset we are not going to make the mistake of turning this venture over to private enterprise, and then going through all the difficulties involved in trying to get it back at a later time. We are starting out on the right foot, and I congratulate my hon. friend the minister, who is sometimes my en?my, upon the stand he has taken in this instance.
Another reason why I was pleased to note the establishment of the principle of government ownership in our international air operations lies in the none-too-bright picture which presents itself in respect of international civil aviation. I feel deep concern in this matter, and do not wish to say anything which would complicate international relations. But the fact is that the provisional organization we now- have in the field of international civil aviation does not go as far as some of us feel it should go. 'In fact, it does not go as far as the Canadian government sought.
This brings to mind the warm support given by hon. members of this group to the proposal made by the minister on March 17, 1944, for an international air authority. Without reservation I congratulate the minister and the government of Canada upon the part they played at the Chicago civil aviation conference, where they advanced the proposal to which I have just referred. I was pleased with the stand they took, and with their diplomacy in the face of a difficult situation. There could be no denying the fact that by the way they performed at the Chicago conference they helped to strengthen Canada's position in world affairs. If that conference did not develop as some* of us would1 have liked, nevertheless a provisional arrangement was achieved. We are glad to note that the headquarters of that organization is in the city of Montreal, within the boundaries of our own country. In the world of to-day we cannot but be grateful for any step in the right direction, even though that step may be only a beginning.
In terms of civil aviation, the international situation is one which calls for a strong stand and for a definite contribution. I am glad1 to know that Canada's voice in the provisional body which will deal with international civil aviation will be the voice of a government which has already gone on record as favouring an international air authority-with power

and a government that has established its own postion in Canada as favouring government

ownership and control of our own main-line routes, and also our connections with other countries. I hope that in the deliberations that are carried on in connection with the provisional set-up the minister and the government will continue to press as far as they can along the lines of the draft proposal for an international air authority which was presented to us last year.
Lest hon. members on the government side or to my right think that I am simply taking up the time of the committee to pat the government on the back, I shall now say something about the other side of the picture. The minister will have a pretty good idea of what I am going to talk about. It seems to me that the principle of a natural monopoly being best handled by the people as a whole through their government applies not only to our main line routes and our international air connections, but also to the smaller lines, to the feeder routes that play such an important ' part in aviation in Canada.
There still seems to be some uncertainty as to what the government intentions are in this connection. We have had a statement of government policy, and we have had an act which incorporates that policy to the extent that it is proposed1 that within a certain period after the war the railway companies shall divest themselves of the ownership of air lines. I dared to hope when I saw this resolution on the order paper yesterday that it foreshadowed the setting up, not only of crown companies to operate subsidiary lines into other countries, but of crown companies to take over feeder lines in western Canada. I am still hoping that when the bill comes before us its provisions will show that it will be possible to set up a crown corporation capable of operating within Canada lines subsidiary to the main line of the T.C.A. If it is not in the bill, I hope in due course another bill will be brought down to give that authority to subsidiary corporations of the T.C.A.
When the minister made his statement on March 17, 1944, with reference to compelling the railways to divest themselves of the ownership of air lines, he did not go on to the position I am now taking, namely, that the feeder lines should be government-owned. He said that it was the desire of the government to leave that field open to returning airmen who might like to go into that phase of activity. We contended at tKe time, and I think results have borne out our contention, that the chance of a returned airman to break into civil aviation on his own is very slim. We reminded the government of what had

Trans-Canada Air Lines
happened in the early days of bush flying. Those men made all kinds of sacrifices to get civil aviation started, but most of them have since been swallowed up by the larger companies. The larger companies now handle most of the civil commercial flying in this country. This type of flying is now virtually the monopoly of one firm, namely, Canadian Pacific Air Lines.
Yesterday the minister tabled sessional paper 129A, in answer to a series of questions that I placed on the order paper some time ago. One of my questions had to do with the number of aviation firms operating in Canada and what routes they were licensed to fly. The return is much too long for me to read into the record, but I find it divides the companies operating in Canada into four groups. First, there are the companies licensed by the air transport board. These total nine, and they are licensed only for charter service. They do not operate fixed routes; they are merely small taxi-ing air firms. The second group of aviation firms is licensed by the board of transport commissioners. There are about ten or eleven of these Canadian companies operating small feeder lines, of which there is now a great network across this country. The third group of companies is licensed by the Department of Transport, and there is just one Canadian firm under this heading, Maritime Central Airways Limited. The fourth group is a list of United States air transport companies which operate into Canada.
As I say, there is a considerable network of feeder lines in Canada. At the present time the only group of companies operating services of any significance is the group licensed by the board of transport commissioners. I have checked the return and I find that these ten or eleven firms operate a total of sixty-eight routes, of which only eleven are operated by companies other than the Canadian Pacific Air Lines or its subsidiaries. In other words, fifty-seven of the sixty-eight charter routes being operated in Canada at the present time are operated by Canadian Pacific Air Lines or its subsidiaries. The fact that a number of these companies are subsidiaries of Canadian Pacific Air Lines is not obvious from the sessional paper to which I am referring, which simply lists the various companies under their own names. But by making a cross reference to " sessional paper 155, tabed in the house on February 11, 1944, in answer to a question of mine as to what firms in Canada were subsidiaries of Canadian Pacific Air Lines one
finds that Arrow Airways Limited, Canadian Airways Limited, Mackenzie Air Service Limited, Quebec Airways Limited, Starratt Airways and Transportation Limited, Wings Limited, and Yukon Southern Air Transport Limited, are all subsidiaries of Canadian Pacific Airlines Limited. These are the firms, all C.P.A., that operate fifty-seven routes, as I have already indicated. The only three outside of C.PA. that are operating charter routes are M. and C. Aviation Company Limited, Northern Airways Limited and Maritime Central Airways Limited.
The fact that this one firm has such monopolistic control of this important phase of our life makes it obvious that-it is next to impossible for returning airmen or for any so-called small person to get into this field. In order that returning airmen may not waste their lives, their capital and their energy in a cutthroat proposition; in order that we may have the best service for Canada, it seems to me that the course to follow would be to incorporate these feeder lines under a subsidiary company, such as the minister is proposing under the terms of the bill he is about to bring before the house.


Mr. JACKMAN:: Will that give the returned man a chance?


Stanley Howard Knowles: It will give him more of a chance than he has under the other system. My hon. friends say that they want private enterprise, but here we have a monopolistic firm, Canadian Pacific Air Lines, stepping in and gobbling up the whole show.


Harry Rutherford Jackman: What about the returned men?


Stanley Howard Knowles: My hon. friend should remember that there is far more opportunity for the returned men under government corporations set up under government control than by trying to get into a field completely held by these private corporations. Canadian Pacific Air Lines did not pioneer in this field at all. The pioneering was done by individual men whose cause the hon. member is now pleading, by the bush pilots who got these small companies organized.


An hon. MEMBER:: May I ask a question?


The CHAIRMAN:: Order. An hon. member is entitled to ask questions only with the permission of the hon. member who has the floor.


Stanley Howard Knowles: The interjections only underline the point I am making, that these individuals whose cause my hon. friend was
Trans-Canada Air Lines

so anxious to plead tried to do that very thing in the initial stages of civil aviation, but one by one they were swallowed up by the larger corporations. In the early days, C.P.A. were doing no pioneering at all, but later in the. day they came in and bought up ten of the smaller companies who were doing the pioneering and now they have a monopoly in that field.
There are two questions I would like to put to the minister. I should like to know what progress the government is making in implementing its decision that the railway companies must divest themselve^ of the ownership of air lines within one year after the end of the war. I asked that question of the minister a few days ago by placing it on the order paper. My question was this:
Have any steps been taken by the government to form a crown air lines corporation for the operation of feeder air lines in central and western Canada? If so, is the acquisition of the ownership of Canadian Pacific Air Lines by said corporation under consideration?
The answer given by the minister was simply "no". On the other hand when I asked this question:
Has the Canadian Pacific Railway divested itself of the ownership of Canadian Pacific Air Lines? If not, has the government taken any steps designed to achieve this end?
The minister's answer was:
It is proposed to carry out the intent of the declared policy of the government under date of March 17, 1944; namely, to cause the Canadian Pacific Railway to divest itself of the ownership of Canadian Pacific Air Lines within the time specified in the Act to Amend the Aeronautics Act. 8 George VI. chapter 28, effective September 11, 1944. Discussions to this end are under way.
Both of those questions and answers will be found in sessional paper No. 129A, tabled yesterday. I left the latter question until I had given the other, because I liked that answer much better. I am glad that discussions are now under way, and I hope that during this debate the minister will give a report on the progress of discussions to that end.


Mr. MacNICOL:: To what end.


Stanley Howard Knowles: To the end of compelling the C.P.R. to divest itself of ownership of C.P.A.
I have another question to ask, because in my view it is not enough just to advocate that the Canadian Pacific Railway company divest itself of ownership of the Canadian Pacific Air Lines. That can be accomplished by the setting up of another holding corporation separate from the C.P.R. taking over the C.PAe. and continuing to operate it as a

private monopoly. This leads to my question: Are any discussions under way with a view to setting up a corporation subsidiary to T.C.A., which might take over these feeder lines and incorporate them into a well worked out rational programme of civil aviation in this country? I feel strongly about these things, and one of the reasons I am taking the time of the committee is that I hope that the government will move in this direction, and there is no time like the beginning of a venture such as aviation to get started off on the right foot. The government has done the right thing in terms of the main line across Canada, and its record with regard to the T.C.A. is exceptionally good; I do not hesitate to give all kinds of credit to the minister and the government for that. I am wholly in support of the proposal now made to maintain as a government monopoly flying from this country to Britain, the United States, the West Indies and across the Pacific. I use the word " monopoly," because if I do not my hon. friends to my right are going to use it in an unfavourable connotation. I am using it in a desirable sense, and I urge that this natural monopoly should not get into private hands, but should remain with the people as a whole through government ownership.
Having gone as far as it has, I hope the government will do two thing: first that it will continue its efforts, and I know it will, to secure the establishment of an international air authority along the lines of the proposal made last year by the minister, and that it will also look into the domestic picture in this country and apply to it the same principle of government ownership of a natural monopoly that it has already applied to the main line routes and to our international connections.


Mr. GREEN:: Mr. Chairman, the members of the official opposition are very much interested in this resolution, because it opens up for discussion the air policy of the nation. There are several members of the opposition who wish to ask questions on the resolution in order to get the situation clarified. I myself have several questions to ask. But first I should like to point out to the supporters of the government that those of them who groaned when the hon. member for Winnipeg North Centre began his remarks were quite right. They were wise to look at his support of this measure with a good deal of suspicion, because the reason that the C.C.F. are endorsing the government on this resolution is that they aim at socialization of all the means of transport within Canada, not only airways but railways and shipping. They are aiming at the socialization of our whole transportation

Trans-Canada Air Lines
system. They are advocating that already in my own province of British Columbia. That is the reason they speak as the hon. member for Winnipeg North Centre has done to-day. It is all very well for them to talk about helping the small airman to get an air route, but the members of the committee will notice that this was a very secondary consideration; we want to help returning airmen just as much as anybody else; in this case the C.C.F. support is designed to further socialization of transportation in Canada.


Stanley Howard Knowles: Hear, hear. You are
absolutely right.


Thomas Reid: The airmen would not get it under their system.


Howard Charles Green: I think the minister would be wise to make a statement of government policy on that question. The government might as well decide now whether it is going in the direction of socializing transportation in Canada. So far as the members of the official opposition are concerned we do not believe in it; we do not believe it is in the best interests of the Canadian people.
Also I would ask the minister to give the committee a picture of the domestic air situation at this time. On March 17 of last year he gave a very full review of the domestic air situation. He said there were three types of air lines. First, there were the main lines, which were being flown by Trans-Canada Air Lines. Then there were the feeder lines, being the lines flown north and south, as, for example, from Vancouver into the Yukon, from Edmonton into the Yukon, from Edmonton into the Mackenzie river basin, and down the north shore of the St. Lawrence river. 1 cite those as examples of what were known as feeder lines. The third group were known as the bush or pioneer lines, most of which, I presume, fly on charter or do not have a definitely fixed route. In his remarks last year the minister stated the government policy with regard to those three types of air fines. We would ask him to do that to-day, so that the confusion which has been brought into this debate may be eliminated'.
We think that the committee should be told what lines are to be designated as main lines. It is my understanding that the governor in council has power to say that a line shall be considered a main line, and if that is done the line so designated will be flown by Trans-Canada Air Lines. The minister will correct me if I am wrong. We should like to know what lines not now main lines are to be designated as main lines. We see no reason why that information should not be given to the committee.
We should also like to have the policy on the feeder fines. The hon. member for Winnipeg North Centre has brought them intc the discussion; in fact we should like a full statement with regard to both the feeder lines and the bush lines. We understood last year that the government policy in domestic aviation was that there should be government monopoly of all routes in Canada except small operations. Perhaps the policy did not go that far; at any rate we should like to have it enunciated to-day.
Turning to the question of subsidizing other companies, or making loans to other companies, or buying shares in them-all of which the minister mentioned yesterday-this, of course, is a new departure. No provision is made for it in the Trans-Canada Air Lines Act; it is something entirely new; and we should like the minister to give definite information concerning the companies which it is proposed to buy into or to subsidize. Also we should like to know whether this is to apply only to the international lines, those flying beyond the borders of Canada, or is power to be taken to subsidize and to buy shares in companies concerned wholly with domestic aviation?
Further, we ask the minister to give some details with regard to the three international routes he mentioned yesterday. He referred to the route across the North Atlantic; the route from Canada to the West Indies, which I suppose in due course will be extended to South America; and the route from Canada across the Pacific. We should like to know whether the transpacific route is to be by the north Pacific, that is up through the Yukon and Alaska, or whether it is to be to Australia. It may be that the plan is to fly both routes. Personally I should be very much interested in finding out whether the terminus of that line is to be in British Columbia. There was some talk a few months ago that it might be in San Francisco or one of the other United States cities. Also, whether the route across the north Atlantic to Great Britain is to be flown under a bilateral agreement with Great Britain, just as we have a bilateral agreement with the United States covering the various routes across the American boundary, or whether it is to come under the jurisdiction of the new aviation authority.
There may be other questions arising out of the minister's answers to these questions which I have placed before him.


Clarence Decatur Howe: In reply to the first question asked by the hon. member for Winnipeg North Centre, the government policy with regard to the railways and their association with aviation
Trans-Canada Air Lines

was announced in this house at the last session. That policy remains unchanged. Part of the policy was in the form of a time limit. The time limit was one year after the termination of war in Europe, in other words one year after V-E day. That year has not expired. We expect before the year has expired to carry out the policy which was announced in this house. Naturally in advance of determination of the details I should not care to go further at this time; in fact I am unable to do so. I may say that discussions are proceeding as to the best method of divorcing land transportation from air transportation, applied to both the C.N.R. and the C.P.R., and when definite plans have been determined I shall be very glad to advise hon. members of the terms. In the meantime anything I might say on the subject would not be helpful to the discussion.
The other question asked by the same hon. member was, does the government intend to nationalize flying into the north, so-called bush flying? The answer is that the government does not intend to do so. Bush flying was inaugurated as a private service. It is a peculiar type of service. There are whole towns in the north which depend on air for everything they use, for tranporting the persons who visit the town or leave the town, for the supplies which come into the town and for the activities of the town. In addition to that there are much smaller services of equal importance. There is the small mining development where the mining machinery and personnel are brought in by air. Such developments also are served by an air service. Then there is the trapper who goes into his trapline in the autumn, and iepends upon that air line to pick him up n the spring. There is the fisherman in the small lakes who goes in at one season of the year and is dependent upon the air line to move out his catch and to pick up him and his equipment at the end of the season.


John Ritchie MacNicol: Almost daily.


Clarence Decatur Howe: It is a highly personal service. It was developed by private flyers operating in definite territory. At the beginning of the war those services were consolidated into one large system. In my opinion that consolidation was not helpful to the service, and I should like to see the service returned to private companies.
My belief is that the interests of the north country would be best served if it could be divided into perhaps seven or eight zones and one operator placed in each zone who would be charged with the duty of seeing that the public and the public interests in that zone is served. I believe that if the public interest

in that zone is to be properly served it is the duty of the government to see that that air line can operate at a reasonable profit. The difficulties of the air lines arose in earlier years owing to the fact that unlimited competition was permitted. A private operator might establish a very good service in a zone and begin to make some money, The history was that a second operator moved in and cut the business in two so that neither made a profit. The territory might develop so that they both began to make a little money and a third operator moved in. That was the history of flying in the north prior to the war. All those air lines were taken over by one of the railway companies at the outbreak of the war, because unlimited competition in that area had weakened the financial position of those air lines, with the result that the closing of mines and cutting back of business in that territory made it impossible for them to operate.
In discussing the Canadian Pacific Air Lines let us remember that if the Canadian Pacific Railway company had not adopted the policy of taking over those air lines, many of them would have been bankrupt. I do not know what the position of the government would have been, had any of them ceased to operate. Perhaps the government would have had to come to the rescue. In any event before any decision of the kind was required the Canadian Pacific Railway company bought up the shares of the air lines. C.P.R. has maintained the operation and they have kept the service going into those areas.


Harry Rutherford Jackman: And the personnel.


Clarence Decatur Howe: The personnel has been kept flying. Anyone who could fly a plane has been busy during the war, either in air line operation or in training schools.


Harry Rutherford Jackman: Senior administrative
officers have all been busy?


Clarence Decatur Howe: Yes.


Harry Rutherford Jackman: Some of them have been busy in this service, but others have had to go to the states because there was no opportunity here.


Clarence Decatur Howe: It was a pity that all the great political parties take a stand for or against socialization of transportation and industry. I think there is a happy medium and suggest a look into any particular industry before deciding whether it would operate better under private or public ownership. Perhaps I have had as much experience on both sides as has any member of this house. In private practice I used to be the servant of the government and the servant of private

Trans-Canada Air Lines
industry, perhaps in the proportion of one to the government and three to private industry. During the war I suppose I have operated more government industries than any man who ever lived in this country. I think I know the strength and the weaknesses of each type of operation. I can tell hon. members this: there is only one test of the strength and weakness of either private operation or government operation, namely, which can best serve the need of the public of Canada.
In the war years the government could operate many industries and do the job sometimes better than private enterprise. Some may question that, but I believe it to be a true statement. The position changes when the matter of selling the product becomes predominant. During the war the government is the buyer of everything produced by a good many industries, and in those circumstances it can operate industries very efficiently. When it is necessary to sell the product in competition with private industry, in my opinion government operation is entirely out of its field; it is entering a field that private enterprise can handle very much better.
When we look at the air lines I believe that a good portion of the operation of air lines can be better done by the government. I do not think anyone would argue that the post office cannot be better operated by the government than by private enterprise. I think most hon. members would say that the telephone is a natural monopoly. Some would say it can be better operated by the government than by private enterprise; some would say that private enterprise would do it better; but I think we can all agree that it is better operated on a non-competitive basis than otherwise.


Mr. FLEMING:: What stand does the government take on it?


Clarence Decatur Howe: We have government telephones and private telephones. They are both doing well in their field, and we have no desire to change the situation in that regard. In other words, in my opinion it is not important which does it, so long as it is well done.


Mr. KUHL:: What is involved in the word
"better"?


Clarence Decatur Howe: Better service to the public.
That is the only criterion. After all, it is the customer we have to worry about. It is up to the man who is operating an enterpise to make his place. The person who buys the service is the one who must be served, and the one who can best serve the man who buys the service is the man who should provide it, whether it be government or private industry.
Let us discuss the air lines from that point of view. I should like to discuss them as one neither prejudiced in favour of private enterprise nor prejudiced in favour of public enterprise. I think I can stand in that position on my record, because I have served both and I have been responsible for creating both types of enterprise. We will first consider the mainline services of Trans-Canada. Canada is a country of twelve million people sitting beside a country of a hundred and forty million people. We have to have the same type of service that the country to the south of us enjoys if we are to be equally well served. Our area is just as great as the area of the United States, in fact a bit larger, and we require air service more than does the United States because our population is more scattered. In order to give that efficient service I believe that the main lines should be operated as a monopoly.
At the inception of the project I was not very much worried about who should run the monopoly. My first stand in the House of Commons was that it ought to be run by a group made up of the two railway companies and the government forming a partnership. That did not work out, and it was decided-


John Ritchie MacNicol: Why?


Clarence Decatur Howe: -we would place it in the
hands of the government-owned railway. In any event, it was treated as a natural monopoly. It has prospered under that direction. I think we have to-day an air line that is as well operated as any air line in the world. I have been interested, in attending the international discussions, to hear the comment;, about Canada's air lines. I have been interested in the requests we have had from other air lines to send men to serve with Trans-Canada in order to obtain the Trans-Canada technique. We are told that our technique of operating an air line is equal to the best in the world.
It is the intention of the government to maintain the service on the main air routes as a government service. It was started that way. The government made the investment, and the original investment has been added to by earnings accruing from the operation of the system. This service has not cost the taxpayers of this country one cent; in fact the taxpayers have profited financially from the operation. We intend to continue that operation and expand it to meet the needs of the Canadian people' for interurban flying.
Then there is a second class of service, which I have referred to as bush service. I have said already that I believed that was better served by private enterprise. In interurban service we are able to maintain very close control. The air line is paralleled by
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telegraph services, teletype services and a communication service which allow those operating the line to be in touch with every plane in the air for every minute of its flight. A bush service is quite different; it depends upon the operator of the plane,'his knowledge of the territory and his ability to take care of himself in case of sudden emergency. As I say, the bush services were developed by private operators. They know their territory, and in my opinion are better able to serve that territory efficiently than the government would be through operating the service as part of a great enterprise. This type of service calls for individual attention, and I believe if we give an operator enough territory so that he can make a living in that territory and can prosper with its growth, provided that he looks after his customers, that is the ideal service for the north.
Then there is the third type of service in Canada, the charter flights. We are licensing quite a number of charter operations. The charter flyer has no scheduled service and no regular route. He is stationed in a city or other centre prepared to take parties who may charter his plane to any point in or near his territory.


John Ritchie MacNicol: If I may ask a question there, when a chartered plane sets out from a field does it have to get a permit from some operator to take that trip, say from Fort McMurray to Yellowknife?


Clarence Decatur Howe: If it is a licensed field the operator is required to check out with the local air authority; the operator of the field is required to make sure that the plane is in condition to fly, but there is no great restriction about it. He must, simply comply with the air rules before his plane leaves a licensed air port.


John Ritchie MacNicol: What I had in mind was that when one plane is in the air flying north, another plane might be flying south. How do the two planes keep in contact with one another, or how do the fields from which they fly keep in contact with them?


Clarence Decatur Howe: Before he leaves the field the operator of the plane must file a route plan, and an effort is made through the available services to inform other planes that this plane is in the air flying a certain route on a certain schedule. The charter plane of course is definitely a private operation. A flyer takes out a licence to do charter work; he performs a necessary service, and is restricted from interfering with those who are licensed to operate routes.
I think I have covered all the points down to subsidized flying in Canada. As I say, I believe if we can restore the individual oper-

ator in the north it will be the duty of the government to see that he can live, provided that his work is satisfactory. When the Air Transport Act was passed by this house it contained a provision that the air transport board might recommend to the government subsidies on northern routes payable out of money appropriated by parliament for that purpose. That provision has not been invoked, but it will be used if necessary to establish proper services in the north country. Starting a new route is expensive; business builds up gradually, and if it is necessary to subsidize a new and desirable route in order to get it into operation, the government will use the powers it now has under the Air Transport Act. The subsidy provision of this amendment to the Trans-Canada act refers entirely to foreign services. In starting a line, we will say from Vancouver to Australia and New Zealand-


Howard Charles Green: Before the minister goes on to the international field, are we to understand from what he has said already that the policy will be to have seven zones with seven different operators flying those zones?


Clarence Decatur Howe: I could not answer that
question. I have given hon. members my idea of a proper arrangement for the north country. Whether that can or will be worked out I cannot say at this time, but I believe it js the best system for the north as I have observed the operation of air transport in the north country over the past ten years.


Mr. BENIDICKSON:: When the minister
was referring to bush sendees I take it he was not describing what the hon. member for Vancouver South calls bush services but to what the hon. member calls feeder lines; is-that right?


Clarence Decatur Howe: I think in this country the
two are practically the same.


Some hon. MEMBERS:: No.


Stanley Howard Knowles: That is a distinction I
was going to ask the minister to make.


Clarence Decatur Howe: Between bush services and
feeder lines? If a bush service flies from Aklavik to Edmonton and delivers passengers to the Trans-Canada service there, it is a feeder service to Trans-Canada and it is also a bush operation. I suppose a feeder service need not necessarily be a bush operation. A bush operation could be described as a service off the main airway. It can also be a feeder service operating on the main airway, picking up the intermediate stops.

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Mr. GRAYDOX:: You would not call a
line operating from Fort William and Port Arthur to the main line a bush sendee?


Clarence Decatur Howe: Fort William is in the happy position of not being involved in this dispute; it has no such service.


Gordon Graydon: I am serious about that, for there is a distinction which I believe the minister should clear up. In the minds of some hon. members there is some differentiation between a feeder line and a bush line. "Bush line" would not seem to me to be the term properly applicable, for instance, to that great section of Canada represented by the Minister and his friend from Fort William. I am sure his constituents would not think a line connecting Fort William and Port Arthur with the main Trans-Canada line should be called a bush operation. Perhaps that might be used as an illustration of what we mean and what we think should be cleared up.


Clarence Decatur Howe: We are answering the question my hon. friend raises by moving the main line of Trans-Canada to go through Fort William and Port Arthur, so they will be a main line stop.


Gordon Graydon: That is perhaps solving
a number of problems at the same time.


Mr. PEARKES:: Might I suggest another
example of a feeder line which could not be considered a bush line. I believe applications have been sent in for a service to some of the gulf islands which lie between Vancouver island and Vancouver, so that business men of Vancouver may spend week ends on those islands. I am sure the gulf islands would not like to be considered bush.


Clarence Decatur Howe: Well, I would not want to
interfere with the pleasure of those taking such trips, but I would call that a bush line in the ordinary parlance of the trade. All bush lines are feeder lines, but I suppose all feeder lines are not bush lines.


Gordon Graydon: Perhaps you might call ,hem branch lines.


Clarence Decatur Howe: Yes, branch lines.


Mr. LENNARD:: Does the minister propose o subsidize bush lines or feeder lines? He mentioned subsidizing bush lines. Does he mean bush lines or feeder lines?


Clarence Decatur Howe: So far I think that the government has not subsidized any lines. My position would be that if a service is needed in an area and cannot be performed without a loss, provided that the operation is efficient I 47696-89
should be prepared to subsidize that service. But if it is not a necessary service, I would not be prepared to subsidize it.


Stanley Howard Knowles: While the minister is making his statement to the effect that the government is not subsidizing lines, would he not also complete the picture' by referring to the amount of money the government has spent in developing routes, beams and meteorological and other services? I have before me a document tabled by the minister in August of last year in which is listed an item for S29 million spent by the Canadian government directly on the development of routes to the north. It also refers to the fact that the Canadian government has agreed to pay to the United States government $76 million for installations of a permanent value. I have had these things in my mind during the discussion which has been going on for the last half hour. Hon. members, particularly those to my right, have spoken as though these private firms flying to the north were doing it entirely on their own. But they have been able to do it only because of the immense amount of help made available to them through government expenditures.
While I am on my feet perhaps I should make a further comment. The minister said that with the folding up of these small air lines, if the Canadian Pacific had not come into the field we should have been denied that service. May I point out that if it had not been for the expenditure of public money on developing these routes, even the Canadian Pacific would not have been able to carry on the service. I am only suggesting that the-minister should complete the pioture. In fact I was going to ask him if he could give the committee the up-to-date figures as to what it has cost the government to develop these northern lines.


Clarence Decatur Howe: May I point out to the hon. member that all the airports which have been built in the north during the last five years have been built for war purposes. For the defence of Canada and the United States it was necessary to have a chain of airports extending from Edmonton to Alaska. Large expenditures were made on that route, and tremendous quantities of freight were shipped over it to serve the war in the east and1 to assist Russia in her war effort in Europe. Those are matters quite separate from the discussion here to-day.
May I tell the hon. member that the services of which he speaks were in operation before those expenditures were made. While the aircraft use facilities of that type for present day service, I doubt very much if airports have added to the earning power of

Trans-Canada Air Lines

those planes, through the fact that they now operate on wheels where formerly they operated on floats. The expenditures in the north for war purposes are scarcely pertinent to this discussion. However, I feel I should finish my statement, and then let someone else have the floor.
The reference to subsidizing the flying of transocean aircraft, to which reference was made in my statement concerning the amendments, refers to the pioneering of new services outside Canada. So far as the Canada-United Kingdom service goes, may I say that that service has already been pioneered. I believe it can be a profitable service, right from the start. In fact we hope to inaugurate a fare paying service before the end of this year. In the meantime we have practically covered .the cost of the line through the very heavy movement of mail handled, as a result of our troops being in England and on the continent. I think we'need not worry about subsidizing the Canada-United Kingdom service. Nevertheless when we pioneer from Canada south, through the West Indies and into South America, that will be an expensive operation, and in its initial stages it must be subsidized either by Trans-Canada Air Lines, if its funds permit, or, if not, by a government appropriation. The same is true of the Pacific. That is a very thin traffic route, extending some six thousand or seven thousand miles, and it is scarcely conceivable that in its initial stages it can operate without a subsidy.
But I can say this, that the three routes I have mentioned are routes which we believe will ultimately represent a profitable operation. And I can also add that Canada is in " the air in a practical way, and that we do not intend to operate indefinitely any route which will not pay its operating costs. That has been our policy in the past. We have abandoned certain routes because we became convinced that they were not profitable, and our policy in international aviation will be the same as it has been in domestic aviation in that respect.
Mention was made of selling shares of certain companies, or of subsidizing certain operations.


Howard Charles Green: Buying shares.


Clarence Decatur Howe: Buying or selling, yes. That arose from the fact that several South American countries have a proviso in their laws to the effeet that any air lines operating into their territory must be owned, in certain proportions, by the nationals of those countries. For instance, the law in Brazil requires that any service operating into that country must be owned to the extent of forty per cent by

residents of Brazil, and must carry a certain proportion of pilots who are nationals of that country.


Mr. BLACKMORE:: Will the minister
permit a question?


Clarence Decatur Howe: Just let me finish my statement. The purpose is to give Trans-Oanada Air Lines the same freedom in the development of civilian services that any privately owmed competitor would have in carrying out the same operation. I believe I have covered the questions asked by my hon. friend.


Howard Charles Green: Would the minister say
something further about the transpacific route?


Clarence Decatur Howe: The proposal is to operate in cooperation with a partnership made up of the government of Australia, the government of New Zealand and British Overseas Airways. The combination of these three will form one company, and Trans-Canada Air Lines will be their partner in the operation. The intention is that the Australian-New Zealand-British Overseas Airways group will operate one flight, and that Trans-Oanada will operate the second flight.


Howard Charles Green: Right through?


Clarence Decatur Howe: Yes. I Would not say,
however, that that will be the final solution. Australia and New Zealand have rights both in the United States and in Canada. Canada has rights in Australia and New Zealand, but it has no rights in connection with that particular flight in the United States. If Canada flies across the Pacific on that route, it will fly from Vancouver. The Australian air lines may fly to San Francisco and then to Vancouver.
The hon. member asked about the route north from Edmonton. That, of course, is the short route to the orient, through Siberia, China and Japan. Whether that route can be used will depend on negatiations with the government of Soviet Russia; therefore I cannot speak definitely about the future of the route. In time it may be our best route to Australia >and New Zealand, as well as to the orient, but that of course is a matter for future development.


Howard Charles Green: I asked that question because on September 24 Mr. Symington is reported to have said that it was expected to fly the northern route to China and Russia.


Clarence Decatur Howe: Negotiations are pending.


Mr. BOUCHER:: Yesterday the minister
said this:
The bill also empowers Trans-Oanada Air Lines to acquire and dispose of shares in companies established to operate air services. In

Trans-Canada Air Lines
order to protect the position of any companies incorporated under this act, and ensure that they may always remain under government control, it is also provided that Trans-Canada Air Lines must always retain fifty-one per cent of the shares of any such company.
Does the minister mean by that statement that Trans-Canada Air Lines will own fifty-one per cent of the shares of all companies operating air lines, whether they be domestic, national or international? Do I take it that before licensing any company to operate any air service in Canada the government will require that it be fifty-one per cent government owned?


Clarence Decatur Howe: This explains what I said
yesterday, that it is difficult to discuss a bill without seeing it. That provision applies only to external air lines and transoceanic air lines; that provision does not apply to domestic air lines in Canada. It means that if we decide to operate in Brazil, through a separate company, Trans-Canada Air Lines would own fifty-one per cent of that company, but it may dispose of any part of the shares in order to meet the laws of Brazil.


Mr. CHURCH:: The minister has made a
statement about this matter, first in connection with the domestic side and then, second, in connection with the international side. I raised some questions about this last year on March 28, at a time that was vital in the history of our empire. One international branch of this matter deals with the Pacific; another has reference to the north Atlantic and the third deals with lines operating to the West Indies and South America. I raised certain questions last year and the year before because I felt that Canada was away behind the times, that if we did not change our policy we would soon be in a precarious position.
I would call the attention of the committee to to-day's order paper. Item No. 6 is in connection with the carrying out of the provisions of an interim agreement which was signed in Chicago. The next matter of business to which I would direct attention was dealt with a week ago to-day when a motion to appoint a committee was agreed to. A year ago when the minister made what I considered was a leap in the dark in connection with this whole matter I proposed that it should be sent to the committee on railways and shipping in order that all sides of the matter might be considered. We should know now what the policy of this country is going to be in view of the rapid progress that has been made in civil aviation.
I wish also to call attention to the resolution that was placed on the order paper on October 47696-891
22, the matter which is now before the Chair. Why is it necessary for Canada to take part in all these secret conferences when parliament is in session? The Prime Minister is in the old country at the present time and he is supposed to be dealing with matters relating to the defence of the empire, civil aviation, trade, migration and other matters of interest to the empire. Why is it necessary to have all these secret arrangements that have been made? As I said last year on March 28, continuing again on March 31:
Why did Canada not seek first a conference with the other dominions in order to formulate an empire policy as a unit? What was the need for all this secrecy in regard to a public matter such as this which is of the utmost importance to the future of the world and the future of our empire? Why were all these star chamber proposals made, when we had the minister and his staff in London at a time when there were also in that city representatives of nearly all the countries of the world trying to devise some definite plan for the progress of civil aviation and the progress of the world in general.
Mr. Curtin and Mr. Fraser appealed to Canada to formulate a policy for the Pacific. Those two prime ministers pointed out that the United States had grabbed all the air routes in the Pacific. In this connection I would refer to the report of the British shipping board. The Americans have a tremendous hold over the Pacific, and they did not get it by accident but by enterprise at a time when Canada was asleep. They have made great concessions to travellers. The United States air service over the Pacific is free, every military pr civilian traveller having the benefit of that route at no cost to himself.
The prime ministers of Australia and New Zealand had a conference on January 17 of last year at which they agreed on a plan for the Pacific. They made an appeal for an empire air policy. Canada has ignored it all and has done nothing about it. As I said last year, Canada now announces an international air policy as though she were a first-class power. The United States will have nothing to do with internationalism; neither will Russia. Russia has made an agreement good for ten years-with whom? With Great Britain. The United States have made several agreements, as I pointed out the other night. These are with whom? They are with the Latin republics in South America and with other countries.
We have had in the C.N.R. some most unfortunate experiences with branch lines, American subsidies and merchant marine. We want to link this up with Canadian National Railways. The Canadian National Railways is public ownership in some ways, but not in others. What is the railway system going to do? The time has come when that system needs more rolling stock for passengers and
Trans-Canada Air Lines

freight. A great need at the present time is more housing, but yet you are going to create some more civil aviation subsidiaries for our railway system, a system which was supposed to be bankrupt a few years ago. That railway system has done splendid work, and I have referred before to the wonderful work done during this war by the employees of the system. We have had an unfortunate experience with the subsidiaries of the Canadian National in the United States. They have received most of the benefits in equipment and rolling stock during the war, before the war and between the two wars. We have had a most unfortunate experience with our merchant marine. Ships that cost a million and a half were sold for $15,000 to $30,000. We have had a most unfortunate experience with the useless duplication and waste in the branch lines of the Canadian National system across Canada. We have had reports by royal commissions on these things, but we have ignored all of their recommendations to avoid errors in transportation.
I have the report of the British shipping board. The British merchant marine has been on the seas for over two hundred years. Under their policy they allowed ships of all nations to enter their harbours under user, but retained sovereignty over them, and I suggest that the same principle should be applied in the matter of civil aviation.
We have a British navigation policy, under which any ship can enter our harbours and land its cargo. They cannot enter our coastwise trade on the Atlantic or Pacific, but they can land their goods at our ports. That policy has proven in navigation a success for two hundred years, and has made Great Britain the great ocean-going country she is. The same principle should be applied to civil aviation, which should be free the world over, with user given, but not sovereignty.
The old country, with New Zealand and Australia, appealed to Canada to act as a link in an all-red empire air route, but in January and March 1944 we rejected that appeal. We should never forget what the other privately-owned railway company, the CJP.R., has done to build up this country, by the building of the air branch lines and the development of ocean traffic, as well as what it has done in~civil aviation. I repeat that government monopoly of transportation in the air will not be a success if we now branch out into an international world effort over the head of the mother country, and other dominions.
I say further that we need a constitutional change. Why should one minister of the crown be able to walk all over the world and

make agreements respecting the Pacific, the Atlantic and South America and any place else over the head of parliament in session, or political pledges given to foreign countries? What kind of constitution is that? A pledge which in time will take the form of a treaty, no doubt. It could not be done in the old country, and I would recommend a change in our constitution so that the minister would first have to report to the cabinet.
Is this the time to embark on a separatist scheme like this over the head of the other dominions? I say no. I say further that no individual politician, and we are all politicians, should obligate the government of this country in any matter which has not first been submitted to parliament. We have seen what happened in military matters by not following that policy, and we have seen what happened at Locarno, for instance. We have seen how some agreements made over the head of parliament have led to a second war. The first duty of yes-men in Germany was to find out what the dictator wanted and then to do that very thing. Are we going to be a lot of yes-men? If so the authority of parliament is gone. Yes-men are not all astrologers. Perhaps if they were, we would be better off. Germany, Italy and Japan all depended on yes-men to keep their authoritarian governments in office. Are we going to be yes-men? Are we going to act aver the heads of the other dominions to pass this separatist agreement? If so, we are headed for disaster. As I said, there should be a constitutional change. No minister of the crown should be able to act over the head of parliament. It cannot be done in the old country.
I asked the minister the other day a question about the interim agreement made at Chicago. I asked if the report had been tabled and he said that he did not know. I do not know whether it has been tabled since or not, but we are to be tied by this resolution to everything that was done at Chicago.
There is another side of this picture. We have an international defence board. As I said before, it is all board and no defence. It seems that the minister has ignored that board altogether when laying down his policy. We have also to consider the Atlantic. Has Britain ever been consulted for cooperation in such a policy as this? During the war Britain made an agreement with the United States by which it got fifty-six of her old destroyers and in return she gave the United States a ninety-nine year lease of her naval bases, practically freehold, from Newfoundland right down to British Guiana, and according to the congressional debates the United States is not

Trans-Canada Air Lines
going to give up those bases. We had better stay in the pond before we wander out into the lake. Internationalism is all right, but it presages a perfect world which we never will have. We must never forget that Canada is a country of only eleven million people. None of the dominions are able to go it alone, and if we and the other nations of the commonwealth do not hang together we shall hang separately.
We need not think that we are a first-class power in the Pacific. The mother country was in such straits in the war with Germany that she had to leave the Pacific to the United States, and I do not criticize that at all. But one of the mistakes Canada made during all this war has been that we have surrendered to Washington. too much political, military, financial, and economic initiative. The people of the, United States, our great ally, would respect us much more if we told them what our views are not only in regard to this question but in regard to other questions.
The most important feature of all, the defence feature for the future, the minister has apparently not considered at all. Let me read a few paragraphs'from Sir Edward Grigg's book on "The British Commonwealth" which has been recently published. He says:
Until the present century it was only naval power that this island had to fear; but the advent of the aeroplane has established a new menace which commits it still more deeply to a vital interest in European affairs.
The role (which used to be hers) of semidetachment combined with a vital interest in certain aspects of European affairs now passes to Canada. She must suffer the reluctance to be involved which Britain has always herself felt and shown; with this from her own experience Britain can fully sympathize. But facts will compel the Atlantic democracies as they have always compelled her. An accumulation of potentially hostile naval and air-power upon the western seaboard of Europe and northern Africa would menace Canada and the United States, not merely with destruction of their sea communications and trade, but With attack upon their peoples at home; and they are furthermore exposed to a danger which has not troubled Britain for at least a century past-namely, that if their foreign relations were unwisely handled or their defensive preparations in arrear, they might be threatened -with simultaneous war upon their Atlantic and Pacific coasts.
He goes on to say:
So far as the United States are concerned, the issue rests with the American people; but their decision, whatever form it takes, cannot affect the need for the closest possible understanding between Britain and Canada. The latter's position is of vital importance for the development of air communications, and this should be planned in concert by the British and Candian governments. It is also of consequence that British and'Canadian measures for the welfare of sea transport and the protection
of sea communications should be complementary. Canada is now too great a country to be regarded as a British or American or Anglo-American protectorate. Her resources are vast; and if her population increases suitably and proportionately, she may well be the equal of any but the greatest powers before the end of the present century. It is of moment to the whole commomvealth that British institutions should prove their strength in her. the greatest oi the younger nations of the British family. She is the first example of what nationhood within that wide brotherhood can achieve as it passes from semi-dependence to the full stature of national maturity; and the destines of the empire now lie as much within her lands as in those of the British people.
These are wise, true words. At this time we should have plain speaking and clear thinking on this question.
I contended last year that there should be a chair of aviation in every large university in Canada. One of the hopes we had last year when this matter was under discussion was, that, next to agriculture, aviation would prove to be one of the main sources of employment for the boys returning from the front. But if we have this kind of international policy our place will be taken by competitors whose resources and experience exceed our own. The minister has spoken of the planes which have been selected. I predict that they will be obsolete by the time that the extensions,' which will require a year or two years, are carried out. Nor do I favour the policy of handing over empire bases for international purposes; they should not be retained subject to user by other countries. Where would we have been in this war had we surrendered all those bases to international control? Where will we be in the next war if their ownership passes into other hands?
The policy which the government is adopting over the head of parliament will not, I predict, be a success. I was about to refer to this the other day in connection with the motion for the setting up of the committee on railways and shipping. We are adding today to our obligations in connection with this department, and more subsidiaries to be, and I can say this, that the Canadian public, with the experience of the vast expenditures on the C.N.R. in the branch line days of Sir Henry Thornton, are long-suffering, but there is a limit to their patience regarding this particular problem, and in my opinion the limit has been reached. Thoughtful men are concerned at the number of government subsidiaries and outside boards that are spending money like water. There seems no hope of parliament regaining control.
I suggest to the administration that one of the most important things to be done is completely to reorganize Trans-Canada Air
Trans-Canada Air Lines

Lines. Look over the board of directors. Millions upon millions of dollars are to be expended. Has our finance minister, whom I am glad to see back with us to-day, been' consulted about this? If you had the responsibility for a private railway or a steamship company, would you entrust that great public ownership venture to Mr. Symington and Mr. Henry and the other gentlemen, some of whom were mentioned a few years ago in this house in connection with a light and power scheme, the Beauharnois of blessed memory? These are the men who are to head this whole world extended system, branching out all over the world into the Pacific and Atlantic oceans and international transportation generally, over the head of the mother country, and the other dominions, without any consideration of the effects on all allred empire air scheme of this policy. I do not doubt that they are good men, I have nothing against them personally; they are splendid citizens, but they have too much to do now in -other lines, and no time for this as another venture. If we are to have a publicly owned monopolistic system, at least give it a chance with public ownership men. I repeat that I believe the whole Trans-Canada Air Lines should be reorganized. In this connection it is of the utmost importance that we have an agreement and an understanding with our great ally the United States and with the mother country. What has been done in this direction? We have not heard one word about the results of the empire conference in London in January, 1944, when Canada was represented and did not aid in it. At the present time the Prime Minister is over there: we do not know what he may have done regarding this matter.
I have recently expressed myself on the policy of adopting this big programme and going extensively into this business over the heads of the other dominions: Hansard, March 31, 1944, page 2046:
Reference has been made to the selection of the Douglas DC-4 by the Trans-Canada Air Lines. It is obsolete. They say that the Lancaster is unsuited for civilian purposes, but it has been shown by Handley Page and others in the old land that some of the bombers can be readily adapted in a few days for use as transports, and also Lancasters by simple changes in design by research at Malton.
I do not believe that in connection with this aviation problem we have given sufficient attention either in this war or the last to scientific' research. ... I believe that the government will waste a lot of money by utilizing the Douglas DC-4 for its civilian air service. A much better plan could be worked out along the lines I have indicated. Canada should try to take the lead in the field of design and should prepare a definite policy for the next twenty-five years. Fundamental changes will occur in the future. Aviation in Canada is yet only in
IMr. Church.]
its infancy. Research, design and experimentation will be more important than ever. In Canada and in the empire we are on the threshold of a grand new age which will revolutionize aeroplane construction and the development of aeroplane engines. In this field high speed is essential to supremacy. Problems of all sorts arise; science and research will provide even lighter alloys and nerv types of wings, engines and parts which will withstand various climatic conditions the world over.
I do not think Canada should have a monopoly in connection with civil aviation, any more than she should have a monopoly in connection with design. No doubt immediately after the war improved aircraft for the transportation of passengers, emergency foods and many other articles will be absolutely necessary, because when the war is over the railways and, other forms of transportation will be choked. So it will be of the utmost importance that there be close cooperation and mutual understanding between Great Britain, the United States and the dominions.
I believe this question, instead of being a secret with the minister and the government, should be considered by the committee on railways and shipping, which dealt with one aspect of this question the other day. It should hear all sides of the question. Trans-Canada. Ait-Lines, Canadian Pacific Air Lines and private lines in this country, which carried on the work of civil aviation between the two wars, should be heard and a proper policy should be adopted. We are now embarking upon a policy of complete isolation from the mother country; we are going over the heads of Australia and New Zealand, and I say we are at the parting of the ways. I warn hon. members of the danger; I say we should stop, look and listen to the advice of those who have seriously considered this matter. When the young people come back from the war and look for employment, where will they find it?
For these reasons I oppose the international feature of this project. I am in favour of a red all-around-the-empire scheme. Indeed it is necessary to have such a programme to solve our own problems and to enable the mother country to recover. She is suffering as hardly any other nation has done; unless we stand behind her in this aviation programme she will simply revert to being a small island and become a second-class power like Denmark, and the British empire will pass into liquidation. The time has come for clear thinking and wise and plain speaking on these empire matters in this house.


Mr. McIVOR:: Those of us who live in
western Ontario or in northern Ontario are intensely interested in Trans-Canada Air Lines, Of course we know that T.C.A. is a baby of the minister, and it is not surprising to know he is extremely proud of his boy-because there is nothing feminine about the T.C-A. After this baby has been half starved during the war we find that the minister wakes up this House of Commons and the country to the fact that this baby must be fed. He

Trans-Canada Air Lines
realizes, as a wise father would realize, that there are two sources from which this baby can get the food it needs. One is the House of Commons and the other is the natural resources of the northland. He is calling for support from both. We at the head of the lakes-and that includes the two progressive cities of Fort William and Port Arthur-believe that the minister is wise in calling for additional expenditures to feed this lusty baby, and I am sure that he will get it.
He then initiates those feeder lines. We have thousands of young airmen who risked their lives over Germany. They have initiative left; they do not want to be tied down too much. They have been accustomed to running their own show in the air pretty well, and now many of them are beginning to organize feeder lines all over Canada. I hope that the minister will continue to give them the encouragement they need and thus feed the lusty baby from -those feeder lines.
I should like to say that before the war I was in room 16 with the minister and three specialists who wanted to get an order for a plane or planes to serve on the T.C.A. The minister said, "What is the name of your plane?" Well, of course, it was not known; it had never been tried out. I can see the minister with his smile set, striking from the shoulder. He said, "No plane will be tested out on the Trans-Canada Air Lines." You can imagine me just sitting back and saying, "thanks", to the Great Aviator that we have a man like that at the helm so that no young man's life will be risked.
We at the head of the lakes are very much interested in the Trans-Canada Air Lines. We have had pictures of Fort William, Port Arthur and the Thunder Bay district, of course, feeding it on the Trans-Canada Air Lines. We have been told that we would be on the direct route, and that is natural. The minister himself sees that that is the natural route for the Trans-Canada Air Lines. Look at the distributing point. Fort William and Port Arthur are the very centre of Canada, the breadbasket of the world, as I said the other day. Why should not we be on the main route of the Trans-Canada Air Lines? I speak as the mouthpiece of the Thunder Bay district and say to the minister: "Success to you; look after your baby; feed him well. Feed him well from the feeder lines all over Canada and you will have an air parent that will live long after you have closed your eyes in sleep."


John Ritchie MacNicol: I am going to ask only a few questions, because to make a speech on this matter at the moment seems to me to
be entirely out of place. We can do that on the second reading of the bill. However, I should like to get a little clarification on a matter over which I am concerned. Yesterday I asked the minister a question on the orders of the day. My question arose from a rumour that appeared in La Presse of Montreal to the effect that negotiations were under iway to expropriate the Canadian Pacific Air Lines. The minister replied to my question as follows:
The government has not given consideration to expropriating the shares of Canadian Pacific Air Lines, and is not doing so at present.
In a return tabled in reply to a question asked by the hon. member for Winnipeg North Centre, some information is given, and I would gather that negotiations must be under way because of a quotation which appeared in this morning's Gazette. The quotation is as follows:
Mr. Howe said discussions were under way with a view to carrying out the announced government policy of compelling the Canadian Pacific Railway to divest itself of ownership of the Canadian Pacific Air Lines.
These two replies do not jibe, and I should like further explanation, because, as the minister said to-day, it is the announced policy of the government to compel the Canadian Pacific Railway Company to divorce itself from the operation of airlines.
The minister outlined the policy of the government in a speech he made on March 17, 1944. In that speech he was not a bit friendly toward the good work which the Canadian Pacific had done. I am not here to defend the Canadian Pacific Railway any more than I would get up and speak in defence of any other company that had done good work. I myself am not interested in any company, but I am interested in defending any company that does a good job.
I had determined to make a trip to inquire into air service over the far north country, and I received a good deal for joy from it. I had to go by the Canadian Pacific Air Lines because there was no other way for me to go. I presume this line from Edmonton to Fort McMurray, from Fort McMurray to Fort Smith, and from Fort Smith to Yellowknife is what the minister would call a feeder line. The same thing applies if one goes the other way, from Fort Smith to Fort Resolution, from Fort Resolution to Fort Providence, from Fort Providence to Fort Norman and from Fort Norman to Norman Wells. I found the service excellent. I made up my mind that when I had an opportunity I would suggest to the minister that the airfields could be improved. The airfields on the eastern route are just the ordinary gravei runway airfields and there is a great deal of
Trans-Canada Air Lines

traffic over them. I do not know whether or not it is a paying traffic, but there is a lot of traffic over that route. The airfields should be improved with the object of opening up the country more rapidly. When I was there I do not believe there was an 'airfield at Yellowknife. My trip on the last occasion did not take nie over to Yellowknife. When I went to Yellowknife I went in a pontoon plane that rose and alighted on the water, but I am told there is a wheel plane field now at Yellowknife.
I ask the minister to consider in his programme having plane fields much farther north. I met quite a number of prospectors representing very large companies that are up in the Coppermine area. Of course they had to go into that country by pontoon planes. All of them suggested the advisability of having somewhere up in the Coppermine area a field that wheel planes can alight on, because once the frost comes down there is no way of getting out of that country, since the pontoon planes cannot alight on ice until it has formed in sufficient strength to support them.
I suggest to the minister that a field to accommodate wheel planes be constructed at Aklavik. There is quite an area there on which a field could be constructed. I made it my business to make a thorough examination both north and south of Aklavik, and Doctor Livingstone, the government representative at that point, pointed out a very good position which on examination looked to me to be all right too. There is quite a community there, and as it is the outpost of this country on the Arctic I would imagine that it would be good business to construct a field in that area on which wheel planes could land. I want a further explanation from the minister as to what he means by feeder lines in relation to the position of C.P.A. in that country, and I only mention C.P.A. because ;hey have no other feeder lines there. I do lot know why Trans-Canada has not decided to go into that country unless, as the minister has suggested, it is because the department would not allow a line to be started that could not be operated at a profit. Somebody has to* operate these lines which do not make profits. I do not suppose C.P.A. makes any profit, and all the more credit to it for opening up that country. I found them very satisfactory and the airfields on the west line from Edmonton to Whitehorse are 100 per cent. They are the best I have seen anywhere; large, well-lighted and with fine buildings.
In his speech yesterday the minister spoke of starting a line to fly from Whitehorse to
rMr. MacNicol.]
Fairbanks. Is the same line going to carry traffic from Edmonton to Whitehorse? If so, it washes out C.P.A. as far as that route is concerned; if not, then that line will be away off by itself. I feel that in the course of his remarks the minister at least should have paid a compliment to that great railway which operates those air lines in that far north country at its own expense. The Canadian Pacific has been a pioneer railway, and I often contemplate the great men who built it; Mount Stephen, Van Horne, Beatty, and the other great men who pioneered throughout the west and I presume did more than any equal number of individuals to open up that whole country for the benefit of Canada. They are worthy of a bit of praise, but not one word was said by the minister on behalf of the C.P.R. or the C.P.A. I am not here to defend them. They need no defence on my part. They are quite able to take care of themselves, but the C.P.R. and the C.P.A. do deserve some praise in this house for what they have done. Now they are again pioneering in that country in the matter of air transportation, and personally I am not in favour of wiping them out. I believe in supporting the T.C.A. to the limit, but I am a believer in competition, and I can speak very highly of the service I got from C.P.A.
Perhaps I might tell the committee one instance the like of which I do not think could be found anywhere else. When the plane I was on arrived at Fort Good Hope everyone got out to see the little old church built by the fathers who were in that country many years ago. It is quite an ornate structure and I took many pictures. Soon I exhausted the film in my camera and went back to the plane to get more. To my surprise I did not see my suitcase anywhere, so I asked the pilot if he would mind getting into the plane and handing me my suitcase, because I wanted a film. The pilot got in and turned over all the suitcases but could not find mine. When he came out he said, "I guess I must have left it on the dock at Norman Wells." I said, "Well, you might as well have left me there. There is no use in my going to Aklavik and all through that country unless I have my camera and films." So he said, "Just wait [DOT] a minute." Then he hopped in the plane and went back over a hundred miles to Norman Wells to get my suitcase which had been left on the dock. That is service.


Clarence Decatur Howe: Does the line make much money?


John Ritchie MacNicol: The C.P.R. or any other company in the service of the public is not interested only in making money. Of course

Trans-Canada Air Lines
they have to make money, but they also have to give service. I thought that was the finest example of service it had been my privilege to enjoy.


Clarence Decatur Howe: I would think it was an example of negligent operation.


John Ritchie MacNicol: If the T.C.A. was operating that line and would not do as much for its passengers I would not call it a very good service. It was not my fault the suitcase was left on the dock; I had paid a handsome sum for that ride, which I enjoyed very much.
I should like to ask the minister, too, if consideration has been given to the establishment of airfields in the Arctic. As the minister knows, United States lines are planning to fly over our far northern country. Since it is only 7,700 miles from New York to Chungking flying over northern Canada over the west end of Baffin Land, that is likely to be one of the routes, and I should like to know if this legislation contemplates the construction of airfields in our far north so that it may become the main line from the great American cities to the Great Asiatic and European cities. I should like to know further whether the proposal mentioned by the minister yesterday, or the record tabled yesterday by the minister in reply to the hon. member for Winnipeg North Centre in reference to the taking over of C J.A. means that this really is to be done. I can tell the minister that I heard much condemnation of that proposal in the north country. I went there to ascertain what the feeling was. Everywhere I stopped, at Fort McMurray, Fort Smith, Fort Resolution. Fort Norman, Norman Wells, right down to the Arctic ocean and also at Dawson and Whitehorse in the Yukon, as soon as the plane stopped I got off and asked everyone what they thought about C.P.A. service. 1 can tell the minister I found 100 per cent approval of that service and general regret that there was a possibility of its being wiped out. So many said, "Well, if C.P.A. is wiped out and we have no competition we will just get what everybody gets where there is no competition, and that is not very good service."
I was glad to hear the minister say it is not the intention to wipe out what are called the-bush planes. I found prospectors in the far north greatly worried over the possibility of the bush service being wiped out. I asked one man why he was worried, and he replied that the big planes, that is C.P.A. or T.C.A., have to fly on beams, and I think there is only one beam in the whole north country, at Norman Wells, although there may be one at Whitehorse. He also said that the big planes would stay on the ground perhaps for two or three days, until they got the order to go. Of 47696-90
course you could not blame them for that. I had to wait for two days at Fort McMurray before going north on the C.P.A. plane, but a judge who went north with me to Fort McMurray got on a bush plane at Fort McMurray. I inquired about that, having in mind what I had been told, and I was informed that the bush planes will follow the rivers and fly if it is at all possible. They will follow the Athabaska river and the Slave river; then they will cross Great Slave lake to Yellowknife; and if they are going further north they will go on to the Coppermine river, and so on. They keep right down where they can see the water, and since they are all float planes they can come down on the water if that becomes necessary. So that I am glad to hear there is no intention whatever of wiping out that service.
Let me just conclude with this. I am going to suggest to the minister that when he speaks again he be big enough, and I know he is, and fair enough, as I believe he is if he thinks of ' it at all, to give some credit to that great pioneer railway and its aviation service, both of which have done so much for this country. The. minister ought not to confine his remarks to what has been described as his baby. Trans-Canada Air Lines is a pretty big baby and, anyway, the minister ought to be big enough to have a couple of babies.


Clarence Decatur Howe: I should like to make it clear that there is no overlapping in the two replies my hon. friend quoted. The policy of the government is to divest air lines from surface transportation. That does not mean that the method will be by the government buying the air transportation system.


Harry Rutherford Jackman: Who will take over?


Clarence Decatur Howe: Divesting orders have been
made many times. It is only four or five years ago that a divesting order of exactly the same kind was issued in the United States. Railroads like the Pennsylvania and the Boston and Maine disposed of air lines. As a matter of fact the Canadian National Railways had a small interest in an air line in the. United States which it had to dispose of. My financial friend must have heard of orders of that kind in connection with investments, about which he knows a great deal. It is a divesting order now contemplated in connection with our Canadian railroads. It does not apply to one railroad; it applies to both. If my hon. friend would think more deeply he would know what a divesting order is.


Harry Rutherford Jackman: I was not questioning
that. The minister suggests that I do not know what it is, but I did not raise any question about a divesting order. I asked him

/
1408	[DOT]	COMMONS
Trans-Canada Air Lines
who would likely take over these branch lines, of which Canadian Pacific Air Lines would divest themselves? Who is to take over?
And while I am on my feet I would also ask what compensation the government intends to give to the owners of private air lines where they will be compelled to divest themselves of those air lines. I remember that once in committee I asked the minister what compensation at all, that they had built the line Pacific Air Lines in connection with the route from New Westminster to Vancouver. At that time he said that there was no compensation at all, that they had built the line up and that that was their worry. Is that the way he is to treat enterprise and capital which is giving a service to our people?


Clarence Decatur Howe: We are going to give the
same kind of compensation that the government of the United States gave the great utilities corporations when they were asked to divest themselves of certain of the utility enterprises.


Mr. ROWE:: Why do you copy the United States?


Clarence Decatur Howe: Would my hon. friend keep quiet? I have been asked a guestion, and I will answer it. Our capitalists like to tell us how things are done; but we read the newspapers too, and probably more carefully than our capitalists in the house. Perhaps they can tell us how the Great Lakes Paper company is operated-


William Earl Rowe: Keep from getting personal.


Clarence Decatur Howe: I was interrupted when I was trying to make a statement.


William Earl Rowe: But if you wish to get
personal-


Mr.   CHAIRMAN@: May I remind the committee that when an hon. member wishes to ask a question he should rise in his place and ask permission of the hon. member who has the floor. No question can be asked unless a member rises in his place and obtains permission to ask it.


William Earl Rowe: We were just exchanging
information.


Clarence Decatur Howe: I was trying to answer a
question, but I have been interrupted a few times. Perhaps I might be permitted to carry on.


William Earl Rowe: You got a little off the
question.


Clarence Decatur Howe: In answering the question I
think I have made the distinction as to whether the policy of the government, which

is to issue a divesting order, is to be carried out. It is. Whether the government will take over has never been raised. The government has never announced any policy that it intended to acquire any services to the north. That is a question which has been raised by others, rather than by the government. The government has never raised the issue, and does not intend to do so now.
As for air lines in the north, we are gradually building airfields to serve important settlements. We are building airfields where there are communities. For example, we are building airfields at Yellowknife, where a large mining operation is in progress, an operation which will require twelve months service. We are proposing to build an airfield at Red Lake, which is also a mining centre largely dependent upon aircraft. We are planning to build landing strips at other points in the north.
My hon. friend suggests an airfield at Aklavik. Aircraft which operate into Aklavik must serve other points which must be served by hydroplanes. If we had an airfield at Aklavik no aircraft could travel to it on wheels.
I would expect my hon. friend would get the best of service. I should think that any air lines which gave any other kind of service to Mr. John R. MacNicol, M.P., world traveller, would not only cease to prosper but would not expect to survive. I am rather shocked, though, that they forgot his baggage. It seems to me that he did not get the service to which his experience and standing in the community would entitle him. Perhaps I have answered the questions.


Mr. BRYCE:: I do not wish to go into this matter on a national or on a provincial basis. I am concerned about my own constituency.


An hon. MEMBER:: Perhaps it is as big as some countries.


William Scottie Bryce: Yes, perhaps it is. The minister will know that Canadian Pacific Air Lines hold the franchise to Norway House. While they hold the franchise, they do not give a service. Bush pilots who are willing to give that service are deprived from doing so.


Mr. COLD  WELL@: By whom?


William Scottie Bryce: That is what I want to know. It is impossible to have any communication with Grand Rapids and Norway House. If one sends a wire to have a plane come in, he has to pay for every seat on the plane

Trans-Canada Air Lines
both coming in and going out. This would be an extortionate figure for the ordinary man or woman to pay.
However, the other fellow-I do not know whether you would call him a bush pilot- is willing to give this service. He may come under the chartered plane service to which the minister refers. Under the new policy which has been discussed this afternoon will such chartered planes be permitted to come in to pick up a sick person, for instance, or a doctor, and bring him back? When one has to pay for every seat on a plane the cost is prohibitive, and people, are left to die. Someone may say that we never had this service before. My answer is that we are living in a modern world, and that the people in my constituency want the same service that is given in other parts of the country.
Hon. members to my right give credit to Canadian Pacific Air Lines. I would give the credit to my buddies of the last war who pioneered these routes, thus making it possible for Canadian Pacific Air Lines to buy them up and make more money out of them.


Mr. BLACK (Yukon):: I should like to ask two or three questions, the replies to which will be of interest to my constituency. Yesterday the minister said:
Trans-Canada Air Lines will establish additional services from Halifax to Boston, from Toronto to Cleveland, from Toronto to Chicago, from the lake head to Duluth, from Victoria to Seattle and from Whitehorse to Fairbanks.
Is that to be the end of that flight? It is a short flight and from a financial point of view would not be very attractive. Is that flight from Whitehorse to Fairbanks to be extended further south or further north?


Clarence Decatur Howe: The policy of the government is to operate all international routes under Trans-Canada. Obviously the physical operation of the route from Whitehorse to Fairbanks by Trans-Canada is impossible, so that a sensible arrangement has been made. The licence has been issued in the name of Trans-Canada, with Trans-Canada subleasing the operation to Canadian Pacific Air Lines.


George Black: Does the minister intend to supplant Canadian Pacific Air Lines with Trans-Canada Air Lines on the flight from Vancouver to Whitehorse and from Edmonton to Whitehorse, which is a daily flight? Canadian Pacific Air Lines now operate a semi-weekly flight between Whitehorse and Dawson and certain mining camps. Will those flights be taken over by Trans-Canada?


Clarence Decatur Howe: No consideration has been
given to Trans-Canada entering into those operations.
47696-90J


Mr. COCKERAM:: The camps will be without service?


Clarence Decatur Howe: What do you think?


Alan Cockeram: If you are not going to let Canadian Pacific Air Lines have this business, they will be without service.


Clarence Decatur Howe: I can assure hon. members that services no\y in existence will be continued. There is a lot of nonsense being talked here, if I may suggest it. Everyone knows what a change of ownership means. It does not mean that you close down the service.


Mr. JAQUES:: What is the real purpose behind this bill? Is it being introduced merely for business and commercial reasons or are there questions of high politics and high policy involved?


Clarence Decatur Howe: I suggest it' is a little of both. The requirements for air transportation in Canada have expanded greatly and are at present not being met by Trans-Canada Air Lines. The purpose is to increase the capital of Trans-Canada Air Lines so that sufficient equipment can be provided to develop fully transport within Canada. It is also the policy of Canada to establish certain transoceanic routes. Whether we are doing it for prestige or for profit, the fact is we are doing it in the national interest. We are doing it for the same reason that a country establishes a shipping route or any other kind of route outside the country. For whatever reasons, we have decided to do it and the purpose of this bill is to provide the funds to enable us to do it.


Norman Jaques: We have always relied on private enterprise to pioneer routes of all kinds, such as our railways and shipping. Why should there be a departure with regard to air?


Clarence Decatur Howe: I cannot see why there should be. The interurban routes of Canada were pioneered by public enterprise. Because we have a capable public enterprise, that public enterprise seems to the government to be in the best position to pioneer the transatlantic route. Therefore we are going to use that instrument for that purpose.


Mr. MACDONNELL:: Whatever our views may be about private or public enterprise, we all would like to have an understanding of the facts. I should like the minister to explain one statement he made. As I understood him, he said that T.C.A. has never cost the taxpayers one cent. I should like to have him explain that a little further. I would call the minister's attention to what he said yesterday. He referred to the fact that the statute
Trans-Canada Air Lines

originally provided that the payment by the post office for the carriage of mail in Canada should be on a sliding scale calculated annually on the basis of the revenue and costs of operations of Trans-Canada Air Lines during the preceding year.
I observe that in furtherance of that policy, from 1943 to 1944 the revenue from the carriage of the mail rose from S3,o15,000 to $3,800,000, an increase of some $500,000. That revenue was needed because there appeared to be a surplus of only S7,000 with that additional revenue. The minister explained later on in his remarks that a change was being made because more flexible provisions were required in connection with the payments for the carriage of air mail.
Would the minister be good enough to tell us whether there are any incidental services which are provided for Trans-Canada Air Lines and which are not paid for. I take it that there are radar and weather services and what not, as well as emergency landing fields that are provided. I would ask the minister to explain that statement. We should be able to understand exactly whether all costs, direct and indirect, of operating T.C.A. are in fact borne by T.C.A. I say this quite seriously. Those who believe in public ownership should be more anxious than anyone else to have the true picture, because we do not want to fool ourselves about it.


Clarence Decatur Howe: The committee on railways
and shipping examined the officers of the air line on the very question my hon. friend /has raised here. A great deal is said about mail payments, but let me remind my hon. friend that anyone who wishes to send anything by air must pay a premium for that service. For example, at the present time if my hon. friend wishes to send an airmail letter he puts a seven cent stamp on it- That seven cents is made up of one cent war tax, three cents for first-class mail and three cents for a surtax for airmail. I regard the three cent surtax for airmail as just payment by the post office for the service rendered by T.C.A.
This question undoubtedly will be discussed in the committee. My information is that the payments made by the post office for the carriage of air mail by T.C.A. do not exceed the surtax on the letters. I should like to make that clear because it is often referred to' as a subsidy. As a matter of fact it is paid for as a service. It was provided that the rate of payment by the post office would decrease as the earnings of the line increased. As a matter of fact the post office originally paid sixty cents a mile. Last year I think it
iMr. Macdonnell.l
paid about forty-one or forty-two cents a mile. If the present arrangement had been continued, the rate would be lowered still more for next year.
The reason the change is being made is that the carriage of mail is no longer the principal business of Trans-Canada Air Lines. It is an important business, but there is a great demand for air accommodation in excess of the needs of the post office. The result is that when it became necessary/ to put on four, five or 'six schedules a day the post office said, "we need only two or three schedules; we object to carrying the whole line." By mutual agreement it has been decided to drop the automatic reduction feature of the mail rate and work out an arrangement perhaps on a ton mile basis.
When my hon. friend speaks of landing fields and radio beams he must remember that these were used by others than Trans-Canada Air Lines. The R.C.A.F. could not have operated in this country without the radio beams that also served Trans-Canada. In fact, perhaps two-thirds of the radio beams in the country were built during the war to serve war purposes. Just as shipping has its harbours and lighthouses, the air service has its airports and radio beams provided as government services. Certain fees are paid for using them, but they are not enough to carry the service, although we hope that in time they will.


Mr. ROSS (St. Paul's):: I was interested in a remark made by the hon. member for Winnipeg North Centre a little while ago in connection with the C.P.R. and CJP.A. To my way of thinking he made that remark because he thinks it is popular among the people generally, but instead of condemning the C.P.R. on the ground of its being private enterprise I think he should take into consideration what it has done in building up this country. It is all very well for people to make political capital out of remarks of that kind, but everybody knows that the C.P.R. has done much to build up this country, and the country can get a little too much of the kind of talk my hon. friend indulged in.
The hon. member said something else that I did not like, and the Minister of Reconstruction also said something a little like it. He said that this party would be aghast at the thought of public ownership, but I would point out that the Conservative party was the first party in Canada to bring into being public ownership when it instituted the great hydro electric system in Ontario, which has been remarkably successful. There is a place for public ownership and there is a place for

Trans-Canada Air Lines
private ownership. We in this'party do not want to be controlled body and soul by seme individual at Ottawa. As my hon. friend the member for Davenport has said, the C.P.R. at one time was almost synonymous with Canada. It has built up this whole country. Of course it has made mistakes, and so has the C.N.R. and the C.P.A.; there is no question about that.
The one thing that concerns me more than anything else in connection wtih this bill and government policy is this: Are we to get under the government's policy the service that I think this country requires? At the present time we are not getting that service. How long will it take us to get it? We have a good transcontinental service serving the large cities like Toronto, Montreal, Vancouver and Victoria, but there are many cities in Ontario that do not get a service, such as Hamilton, Niagara Falls, Fort Erie, Owen Sound, Sault Ste. Marie, Moosonee, Temagami and all that tourist playground in the north. The government's policy is to wait until someone else provides the service and then take it over. But who will form a company to provide a kind of circuit service in the province of Ontario to serve all these different towns I have mentioned that are now without a service? I think we need such a service, with jumps of from seventy-five to one hundred miles. That would serve various towns in Ontario that are now without service. But who are you going to get to do it unless some guarantee is given that the company that starts it will be able to carry on and not have the business it has developed taken away from it by being absorbed into Trans-Canada Air Lines?


Clarence Decatur Howe: Will my hon. friend tell me what line we have taken away from anyone or propose to take away?


Douglas Gooderham Ross: You propose to take away the C.P.A. lines after they have developed a great service.


Clarence Decatur Howe: I said that we did not intend to take them over.


Douglas Gooderham Ross: But the precedent is there. What kind of guarantee are you going to give these people?


Gordon Knapman Fraser: Is it intended to keep on the airfield at Gander, Newfoundland, as a base for ocean air traffic? ,


Clarence Decatur Howe: That is a difficult question to answer at the moment. We would like to continue it, but we are subject to an agreement between the United Kingdom, Newfoundland and Canada so far as the use of
this field for civil aviation is concerned. There will be conversations within the next month to determine this question, but at the moment I cannot answer my hon. friend's question positively.


Gordon Knapman Fraser: Will Goose bay come into the conversations?


Clarence Decatur Howe: It is in the same position. These airfields are in Newfoundland and are subject to the laws of Newfoundland. We have not worked out an agreement required to determine the future use of these bases. Gander does not belong to Canada but is being operated by Canada during the war years.


Gordon Knapman Fraser: But the T.C.A. are now using Gander?


Clarence Decatur Howe: Yes, we operate a service there. The field itself is not operated by T.C.A., but by the R.C.A.F. We have a small building there to handle passengers, and that is all. We operate there, just as we operate into three other airports in Newfoundland.


Gordon Knapman Fraser: I suggest that if you put in equipment there it would certainly be more comfortable for the passengers who have to stay overnight and sometimes for three or four days. I have another question. The air'force operates a meteorological service through the north country. Does T:C.A. pay for any of that work?


Clarence Decatur Howe: No; the meteorological service antedates flying. It is a service for all Canada, which we have had for many years. It forecasts the weather for farmers and gives weather forecasts for the cities, and we have used the service for flying purposes. But the meteorological service is a service for all our citizens.


Alan Cockeram: Who owns the Gander airport?


Clarence Decatur Howe: It was built by the United Kingdom at their expense. The ownership was later transferred to the government of Newfoundland. Goose airport was built and paid for by Canada, on lend-lease from the government of Newfoundland for ninety-nine years. It is the property of Canada but, being located in another country, it is subject to the laws of that country, in so far as its use for civil aviation is concerned. We are in the position that we own it, but if the government of Newfoundland says that we cannot use it, we cannot use it.
Trans-Canada Air Lines


Mrs. STRUM:: There is a very important point involved here which we are losing sight of. Regardless of whether these transportation services are privately or publicly owned they are primarily designed to give service to the Canadian people. I think we shall all agree that in the past we have been extremely wasteful in the construction of railway lines. Windthorst, the town where I live, is serviced by the C.P.R., and two miles north is the Kipling-Regina or Brandon-Regina line of the C.N.R. These lines run parallel two miles apart, sometimes widening to a space of three or four 'miles. Then there is a strip of territory to the south where people have to travel more than twenty miles to get to town, a great area wherein there are no railways, buses or air lines. I believe that so long as you have competing private firms servicing transportation in this country you will have that sort of thing. The constituency of Qu'Appelle, which I represent, has a very good train service, and there are also two buses travelling in each direction every day alongside of the main line of the C.P.R. So that the people have four choices every day, two buses and two fast trains, while there are great stretches of territory where nobody has any transportation at all. I believe the only way for the country to have a rational kind of transportation is to have it socially owned, and plan to cover this country to serve the needs of the Canadian people.
When we say that only the C.P.R. gives service, that is a terminological inexactitude; it is not correct. Last year I came to Ottawa three times, and I have come here twice since the session opened. Sometimes I go by Canadian National and sometimes by Canadian Pacific, depending on who has a reservation for sale. The service is equally good. The line of the Canadian National is not quite so rough, and a little shorter. That is the only difference. We can allow our prejudices to blind us to the thing we are trying to do, but if it is transportation in which we are interested let us plan to cover this country with transportation instead of allowing competing lines to run along the same tracks and leave other large areas without service.
As for the devotion of employees, I am surprised that the hon. member for Davenport in his search for efficiency would tolerate having a suitcase forgotten and then a duplication of services, someone running back for the suitcase. That would not be tolerated on a socially owned line.


Ian Alistair Mackenzie: You would not have the suitcase.


Gladys Grace Mae Strum: One must be sensible about this. The incident may be flattering to the dignity of the hon. member for Davenport, but it is not efficiency, and I do not think anybody should be asked to pay for that sort of sloppiness in transportation. The only way to achieve a rational system of transportation is for all forms of it to be owned by the government, I care not whether it be Liberal or Conservative or C.C.F., and then have the buses feed the railways and have the air lines cover those territories where railways have not yet been built.


Clarence Decatur Howe: May I point out to hon. members that there are two ways of accomplishing the same result; one is by government ownership and the other is by government regulation. In the air we have government ownership and government regulation. We have government ownership of the T.C.A., and we have government regulation of all private operations. No one can start an air line without the consent of the government, duly obtained through the air transport board, and all flying operations must come up to the standards of the board. I believe that the government has assigned flying to the proper fields, in operating the main line services as a government operation, and depending on regulation for control of the feeder services.
We have spent a good deal of time on this. I wonder if we can put this resolution through before six o'clock, and give the war estimates a chance.


Some hon. MEMBERS:: No.


Harry Rutherford Jackman: 
Clarence Decatur Howe: My hon. friend's question is a good one, but I think it requires a little modification. During the war. years the Department of Transport on behalf of the government of Canada and for the use of the armed services spent S200 million on airports, and not a single one had anything to do with civil flying; they were all built for military purposes. They are there, and some of them may be used in future. Surely my hon. friend will have to find some way of disposing of them, if he contends that if we use them at all we must charge them to civil transport. The expenditure, apart from the expenses of war, has been very small. In other words, this is what one might call a trick question.


Harry Rutherford Jackman: The minister has not answered my question. I did not ask him what the Department of Transport had spent on facilities which are not used by Trans-Canada Air Lines, but I do want to know, and I think the committee is entitled to know, how much was spent by the Department of Transport and how much is required in each year to service the various fields in which service is given by the Department of Transport where those services are being used almost exclusively by Trans-Canada Air Lines? For instance, all the directional towers are required and a great deal of the staff around any of these airports is Department of Transport staff and paid by it. What I want to point out, and what has already been pointed out by those who know, is what a very small ratio of the money is invested in Trans-Canada Air Lines, four and three-quarter millions, now asking for twenty-five millions, against the tremendous amount of government money which was used in providing the facilities necessary to carry on any kind of air service.
At six o'clock the Speaker resumed the chair and the house took recess.
After Recess
The house resumed at eight o'clock.



CANADIAN WHEAT BOARD ACT


[Stage Direction]
Mr. ROBERT FAIR (Battle River) moved the second reading of bill No. 6, to amend the Canadian Wheat Board Act, 1935.
He said: I am very glad indeed we have an occupant in the chair; it looked for a few moments as if we were without a parliament. I am veiy glad also to find that we have an opportunity at last to discuss this measure which, to my mind, is one of great importance to all of the people of Canada.
The Canadian Wheat Board Act was passed in 1935, and the wheat board has been operating under that legislation ever since. To my mind, and I believe in the opinion of many of our farmers, both organized and unorganized, this legislation has acted to the detriment of the wheat board and the farmers of Canada as a whole. It is my intention to-night to bring about, if possible, a change in that legislation which will free the officials of the wheat board from some of the restrictions that have been imposed upon them by the original act of 1935.
Section 8, paragraphs (h), (i) and (j) read as follows:
(h)	to give effect to any order in council that may be passed with respect to its operations;
(i)	in selling and disposing of wheat as by this act provided, to utilize and employ without discrimination such marketing agencies, including commission merchants, brokers, elevator men, exporters and other persons engaged in or operating facilities for the selling and handling of wheat, as the board in its discretion may determine;
(j)	to offer wheat for sale in the markets of the world through the established channels: Provided that the board may, if in its opinion any existing agencies are not operating satisfactorily, take such steps as it deems expedient to establish, utilize and employ its own or other marketing agencies or channels.
Under these handicaps I feel that the Canadian wheat board has been compelled, perhaps against its will, to make use of the facilities which are already in operation and which I hope to show have been working to the detriment of Candian farmers and the Canadian people as a whole. In order to correct this, my amendment reads as follows. This would replace paragraphs (h), (i) and (j) which I have already read:
(h) subject to the provisions of paragraph (i) of this section, to give effect to any order in council that may be passed with respect to its operations;
Wheat Board Act
[Stage Direction]
(i) in selling and disposing of wheat as by this act provided, to employ such methods, consistent with the provisions of paragraph (b) of this section, as will not involve the payment, directly or indirectly, of any commission or other remuneration to commission merchants, brokers or other marketing agencies.
Mr. CASE:: I do not know what the hon. member is saying; I cannot hear what is going on.


Mr. FAIR:: If hon. gentlemen opposite wish to carry this amendment it is quite all right with me, because the time is very short. We have only one hour. Perhaps this is the last hour we shall have to discuss this bill. May I continue with my argument in favour of this change? I might state that under the old grain exchange methods seventy to seventy-five per cent of the grain grown was sold during the first three or four months of the crop year, which would begin the 1st of August. In the following three or four months many farmers sold a very large percentage of their grain simply because they were compelled to do so owing to existing conditions. Some of this grain was bought in by legitimate channels. Much of it was bought by speculators and held for higher prices. The effect of this was that a large number of farmers., having in many cases grown large crops, had those large crops used as a penalty against them. By this I mean that while they had the expense of planting and harvesting those crops, the marketing conditions that obtained during the grain exchange time worked against them. The futures system provides protection for banks, elevator companies and millers. In my opinion the interests of the farmers were not protected, and that is one of the things with which we as members of parliament should be concerned.
Again, the grain exchange does not find markets for any of our grain. It is a place where buyers do business, but as far as finding markets is concerned no such business is performed-by the exchange. One of the greatest objections we have to the exchange is that it cannot operate without speculators. In case anyone should question this statement I am going to read from the report of the Turgeon commission of 1938. At page 183 of that report the commissioner had this to say:
I have mentioned the "imperfections" of the futures trading system, and I know that in the eyes of many, the greatest of these is its dependence upon the speculator. And the fact must be faced that this dependence, while not absolute, is substantial not only in Winnipeg but in Liverpool, as the evidence shows. It has well been said that there are only three classes of buyers in the wheat market: (1) those who have immediate need of the wheat, (2) hedgers who buy to insure their transactions,

and (3) speculators who buy and hold in the hope of making profits but also at the risk of making losses. When buyers of this last class are absent, or are present only in small numbers, the market becomes weak and prices fall. This was the situation. which existed in 1931, when the government was urged to send somebody into the market to take the speculator's, place, and the situation was met by the' institution of stabilization measures.
I said at the outset that I was opposed to the grain exchange and that in making this statement I felt I was voicing the opinion of many farmers in western Canada, including organized agriculture. The organized pools of Saskatchewan, Alberta and Manitoba presented briefs to the grain inquiry commission, and I quote from those briefs as they are referred to at page 39 of the report. This is the opinion of the three pools:
We are satisfied that the futures market does cause fluctuations not justified by the supply and demand for wheat, and this fluctuating price does not necessarily reflect world value. Indeed, it would appear to be true to say that the futures market is not a system of intelligent merchandising; it is merely an example of irresponsible mob blundering. This tendency toward instability in price, which many farmers are convinced is aggravated by speculation, is one of the most serious indictments numerous farmers level against the futures market.
Since I have been farming in Canada, for the last number of years, I have seen the price of grain fluctuate close to thirty cents a bushel in a day, without any apparent change in the quantity of grain available, and I think it will be readily recognized that farmers who had sold or delivered wheat, who had stored wheat and taken a certain advance on it, were closed out when that fluctuation was downward. This meant that somebody else took possession of the wheat, someone who was in there for the definite purpose of gambling. We may be told to-night, and I expect we shall, that farmers have gained an advantage of quite a number of cents a bushel because of the operations of the exchange. I do not know where anyone can get figures to prove that statement. On the contrary, I would say that if it had been stated that farmers lost a number of cents a bushel through the operation of the grain exchange, that would be much closer to the truth.
According to the last report I have, in 1942 there were 109 brokers, eighty-five of whom were dealing in futures and twenty-four in cash wheat. Under the grain exchange system we find that millions of bushels of wheat which do not exist are traded, and that this trading brings to the brokers a commission on every sale made, regardless of the fact that the wheat does not exist and that it is merely a paper transaction. Of course these trades

Wheat Board Act
* are detrimental to the farmers. At the present time on the Winnipeg grain exchange-and I believe the same is true of the Liverpool exchange-brokers are being paid large amounts of money for which they render no service whatever. A certain commission is paid on all grain sold or bought, and those commissions are distributed among the brokers as an organization. In my opinion that should not be permitted. These men should be given an opportunity to get out and do something worth while for a living.
In the past the wheat board has served and is still serving a useful purpose, and in my view we should do everything possible to see that all our grain is handled by that board; To-day wheat is a national problem, and we -and by that I mean all Canadians-cannot afford to have it handled by the grain exchange. This affects Canada as a whole, not only the farmers. It is realized that a large percentage of our wheat is exported and that we cannot carry on successfully while wheat , and other grains are traded and sold on the exchange. In my opinion the wheat board should set up its own selling organization. In that way it would save the farmers of this country quite a little money and at the same time keep in operation the programme which is in effect at the present time, with the government taking over the handling of all our grain.
I think lion, members will realize that under present conditions we must have purchasing power in the hands of the people if we are to carry on successfully. We are told that a depression is coming. One of the best ways to avoid a depression is to keep purchasing power in the hands of all our people. The greatest potential market in Canada for industrial goods, as in the world at large, is to be found in rural areas. Some thirty-three per cent of our population are engaged in farming. These farmers represent the one undeveloped reservoir of demand for manufactured products. These people are short of everything from farm tractors to kitchen stoves, hats, shoes, paint and nails. If their purchasing power can be maintained the greatest industrial expansion of the twentieth century can be initiated. If the farm people are impoverished and farm prices are low, industry loses its market and labour loses jobs. These are facts which every Canadian knows and appreciates.
In my opinion, to-night we should depart from that practice which has been adopted since private members' days have been restored to us this session, of talking out bills.
Let us discuss this matter intelligently, without going all through the woods; let us give this matter the consideration it deserves, and let us decide it here to-night.
Mr. RALPH MAYBANK (Winnipeg South Centre); Mr. Speaker, if I caught the hon. member aright he said that something in the neighbourhood of thirty-three per cent of our people were engaged in agriculture, and offered that as a particular reason for giving special consideration to this measure, and, I presume, he would have said, to any measure relating to agriculture. As a matter of fact I believe the figure is quite a bit larger than that. I recall reading some years ago a publication issued by the international institute having to do with world agriculture, in which it was said that all countries in the world except four had more than fifty per cent of their population dependent upon agriculture; and Canada was not one of the four.


Robert Fair: Dependent on the land.


Ralph Maybank: I appreciate that. I have no objection to the hon. member's interrupting me in that way, except that I was not saying anything-


Some hon. MEMBERS:: Hear, hear.


Ralph Maybank: -controversial.


Stanley Howard Knowles: The same old story.


Ralph Maybank: Well, I led with my chin by my "pause" for that one. I was not saying anything controversial about what the hon. member had said, and for that reason I felt it wras hardly necessary for him to interrupt me. I think the percentage is much more than thirty-two per cent who are dependent upon agriculture. Therefore one is bound to agree with him as to the importance of any such subject, and likewise as to the fact that a large number of the population of necessity would be intimately connected with a problem of this kind. So that we start out in complete agreement as to the importance of the matter.
But I am opposed to this bill, and substantially for the same type of reasons for which the hon. member would support it. The hon. member, and other protagonists of this and similar types of legislation, believe that it would either permanently close the Winnipeg grain exchange or tend in that direction, and that it is part of a series of steps which would have that effect. And so do I. For that reason the hon. member and others associated with him favour this measure, and for the same reason I oppose it.
Wheat Board Act

I believe the sooner we get back to the open market system of merchandising our grain and other products, the better it will be for us. I say to hon. members on the government side of the house, as well as to other hon. members, that if this were a government bill, to be followed by other similar bills, I would vote against it, and I would hope that my adverse vote would defeat the government.


Some hon. MEMBERS:: Oh, oh.


Ralph Maybank: If we take over permanently this business of merchandising one important product, then it is only a short step to the establishment of Boards for the handling of other products, and to move on from one product to another. When you have taken over several, it is only a short step until you take over all. All must be handled this way if we take over several.
That is the socialist method of commercial activity. Of course, if one believes in socialism, there is no objection to this. After all, any person has a perfect right to be a devotee of Karl Marx, just as any other person has a right to be opposed. But I think hon. members in the C.C.F. group will agree with me wholeheartedly when I say that if we are to have socialism it will be better that it should be brought into force and administered by men who believe in it-excuse me, and by men and women who believe in it. I do not think there can be no doubt about that, on any side of the house.


Mr. JOHNSTON:: Your side ought to be pretty good at that. You are pretty socialistic.


Ralph Maybank: Well, sometimes I think the trend is too far in that direction on the part of some on this side of the house. It is for that reason I state now that I desire to see . it stopped. However, this can be said, that much has been done during the war which, if done in peace time, would be considered totalitarian. That might be the influence of people on what we term the right, or the influence of those who are said to be on the left. But the mere fact that in a time of war we adopt certain policies does not mean that the same sort of policies should be continued indefinitely. So that whenever one is critical of totalitarian schemes which have been in operation-


Mr. COLD  WELL@: Do they need to be totalitarian to be socialistic?


Ralph Maybank: They are totalitarian.


Mr. COLDWELL:: Does the hon. member mean to say that democratic socialist parties are totalitarian, the British Labour party, for example ?


Ralph Maybank: That, of course, is one of the-


Major James William Coldwell: Just stick to sound facts.


Ralph Maybank: That, of course, is one of the questions which it is extremely difficult to settle in advance. For instance, when the hon. member gets to heaven I do not know whether he. will wear his halo on the right or the left side, no matter what his ideas are now.


Gordon Knapman Fraser: Are you sure he is going there.


Major James William Coldwell: Is the hon. member sure he will see me there, you mean?


Ralph Maybank: No, I do not expect to be there to see him. You see, the hon. member feels to-day quite certain that if, as and when he. has a socialistic government he will be able to keep it democratic. But I am quite sure that -will not be so. That is one of the things we have not yet been able to settle, any more than we can settle the halo problem.


Major James William Coldwell: Then why foe so sure of it?


Ralph Maybank: I also think there is a complete unlikelihood of our ever being able to settle the point, so far as hon. members on this side of the house are concerned anyway, because all virtues reside over there apparently.


Major James William Coldwell: Thank you.


Ralph Maybank: It may be almost impossible for us to learn about how the hon. member will carry his halo, and it would be just as impossible for us to determine the other question because of the extreme unlikelihood of his ever introducing socialism. He will never get the chance.
Mr.. KNOWLES: Back to the bill.


Ralph Maybank: That is the general nature of my reasons for being against this bill.
The hon. member for Battle River has suggested that to keep the grain exchange closed would be a help to the farmers. While he did not speak at great length, he did not give any indication as to the manner in which he thought they would foe helped. There is nothing in the past to indicate that the closing of the grain exchange would be an aid to the farmers. When the government of Sir Robert Borden closed the exchange, it certainly did not do so with the intention of helping the farmers, nor have I ever heard any suggestion that it was closed for that purpose.

Wheat Board Act
As a matter of fact during the last war the exchange was closed on a rising market. Any person who has observed the graph line showing the price trend of that time would see that prices rose steadily, and when they reached a certain high point the grain exchange was closed. Surely, just looking at those signs, one would not say that the action was taken to help the farmers, nor is there any probability whatsoever that it did in fact help them at that time.
I am not criticizing the legislation of that day; I have no doubt that the over-all picture of the war at the 'time made it necessary. I fancy the truth of the matter is that prices under the open market system had become so high that Great Britain could not continue to pay, if those prices were allowed to continue ro increase.
I remember hearing Mr. Motherwell, when he was in the house, asserting very often that by closing the grain exchange at that time the farmers lost a great deal of money, and he used to have some impressive figures to support his view. I do not 'believe it is necessary lo give statistics, because opinion on the point must foe speculative in large part anyway. However, it would not appear that at that time the grain exchange was closed for the purpose of helping the farmers, nor would it appear that its closing had such an effect.
So far as the closing of the grain exchange a few years ago is concerned, the case is the same. The grain exchange certainly was not closed at that time to help the farmers. The grain exchange being closed a few years ago, if we take that act just by itself, did not help the farmers. I do not think any person who had anything to do with the closing of the grain exchange-with effecting its close- would say, in the first place, that he was motivated by a desire to help the farmers by that act or, second, that he ever believed it would have that effect.
The grain exchange was closed at that time on a rising market. I do not remember the date when wheat was seventy cents a bushel, but hon. members will remember that at a certain time that was its price, Hon. members will remember ,also that the price rose a cent or two, then a little more, and finally it got up to a fairly high price. My recollection is that the price went along fairly slowly from seventy cents to about ninety-five cents, but that after it passed ninety-five cents it rose more quickly. It is said that the wheat board was casting many bushels on the market to stem the upward rise in prices. I do not know whether that is the fact, but that was freely asserted and the picture in those days certainly did look that way.


Mr. WRIGHT:: If the grain exchange is such a fine thing for the farmers, why is it that every farm organization in western Canada is asking that it remain closed? Can the hon. member explain that phenomenon?


Ralph Maybank: I do not know that I can answer why certain people hold certain opinions. I cannot say why the hon. member holds certain opinions heaven knows.


Percy Ellis Wright: They are the people who are affected.


Ralph Maybank: The people of this country are all affected because the money of the people of the country must be behind any board handling a product of this sort. Hon. members know that by reason of its getting behind a certain wheat policy the country got fairly deeply into the red at one stage. It is not just a producers' question.


Percy Ellis Wright: They came out all right in the end.


Ralph Maybank: I suppose we shall all come out all right in the end, no matter what happens. The hon. member says that certain organizations assert that they would like to see the grain exchange remain closed. He has never given aty reasons, nor have they, to show how they are to be benefited. As a matter of fact, the grain exchange does not have to be used by anybody. As the name "exchange" implies, it is not anything more than a convenience. The wheat pools did use it, and I think the Scottish cooperatives have always used it, but they did not have to. I would imagine that at times the wheat pools and the Scottish cooperatives did not use it; at times they did and at times they did not.
As a matter of fact all these exchanges were created in the past because merchants met together at some place to do business together. Eventually an organization developed. Of course that is well known; that would not be controverted by anyone. All these exchanges developed in about that way. The fact that a convenience is held open to its members does not obligate any person to use it. Grain exchanges do not raise the price of wheat; they do not lower the price of wheat. They reflect only what the price of wheat is. It is conceivable that the operators on the exchange can lower the price, and it is conceivable that the operators can raise the pfice; that must be admitted and that brings one to say this: There never can be any objection to regulating any organization in case there be abuses.
But it is an entirely different matter to say that men may not establish a convenience for the purpose of trading as long as no person is
Wheat Board Act

compelled to use it. In other words, there is nothing inherently wrong in trading in grain or any other commodity, either on an exchange that may be formed for the purpose of convenience or in any other way. It might be objectionable if farmers, or other individuals wanting to make a sale, had to use the grain exchange because there was no other agency, but such is not the case. There is the wheat board ready to take grain from everybody at whatever the contract price happens to be.
There can be two means open. There can be the grain exchange, the ordinary channel, and there can be the other method whereby the board itself would take the product from the farmer. This policy was in force for a long time. The two of them ran side by side. I do not profess to know all about the matter, but it would seem to me that that might be a good way to continue for a time; that the one could be alongside the other for the future. Very often we find that a combination of methods of that sort is good as a means of balance and checking of one policy against another policy.
I have said that I believe that the approach being developed toward the closing of an organization of this sort is. bad because it introduces more .boards of the .same sort. It will be only a matter of time before we have a board for every commodity in the country, numerous boards set up with the aim of destroying the profit motive, which in my opinion is not anything like the objectionable devil that those who would exorcise it claim it to be.
The bill does not actually say that the grain exchange should be kept closed for ever and a day, but the hon. member has admitted that it is in that direction that he aims, that it was substantially for that reason that he asks the support of this house for his measure. I think we are in agreement there. The bill really aims at the removal of some of the restraints upon the wheat board while it imposes certain other restraints upon the board. For example, at the present time the wheat board is under instructions to act in all respects according to declared government policy. The wheat board is subject to the continuing direction of the government by order in council. The bill would cut that down to a certain extent and leave the board wider discretions than it has at the present time. Surely that is a move in the wrong direction. If the government is to take responsibility, for policies, surely it ought to have the right to dictate those policies. Surely the hon. gentleman would not desire to have a board with untrammeled powers, with unlimited discretion. If that sort of thing is done it will be not merely inviting irresponsibility but actually putting

a premium upon it. It seems to me that if the government is to stand with the money of the people of Canada behind any proposition, it must keep control at all times and be responsible for that money. That is not to say that the policy of the government in these respects cannot be criticized just as it can be now, but if you have it that all the policymaking is left in the hands of a board with practically untrammeled discretion, then you have no means of influencing policy at all.
The sponsor of the bill also complains about payments that are made in the way of brokerage fees. I believe that the brokerage fees they have been paying arose by reason of the quick closing of the exchange. There is something to be said on behalf of . the brokers Whether the hon. member thinks they lead a useful life or not, the fact of the matter is that agents of one kind and another have not been able over the past several hundreds of years to receive fees without doing some service for them. Organizations such as were operating on the grain exchange were not paying, over all the years in which they traded in grain, small brokerage fees to brokers and getting nothing in return. It is not the nature of man to do that sort of thing.
May I say this with reference to brokers and agents generally, and referring to the suggestion that brokers do nothing for their money? I know we do not need to employ a real estate agent when we want to sell a house, but when we do not employ an agent we have to put' ourselves to some inconvenience ; perhaps we have to wait longer to effect a sale, and a number of other features very often make it desirable to go ahead and employ an agent. We feel we get a value. A value, too, is obtained from grain brokers or brokers of any commodity, it does not matter whether it is grain or anything else. If you take away the business of brokering some person will have to be brought in for the purposes of doing their work, and in the long run there will probably be no saving whatever to anybody. At any rate, when it was decided to pay a number of brokers in connection with this work, it came about in this way. The grain exchange was closed without warning. That was the first step. These brokers had a vested interest in their business. Many of them had paid a great deal of money for the seats on the grain exchange, which immediately became worthless. It was in these circumstances that the grain board decided that there was work which some of these men could do. The board continued to employ them to carry out cash grain sales. The cash grain brokers are the

Wheat Board Act
only ones, of course, who have been employed by the grain board. All the others who are called futures brokers were not so employed, but the cash grain brokers were.
There is one feature which is worth while considering in connection with this sort of thing. If a government suddenly takes away the means of livelihood of anybody it is no more than fair that sympathetic consideration should be given to him, not to the point of keeping him in idleness or anything of that sort, but to see whether there is not some useful purpose he may serve. It was found by the grain board that there was a useful purpose that this particular type of person could perform, and it'was for that-season they were employed.
The hon. gentleman has said that the matter of the payments to these brokers was a handicap upon the wheat board and against its will, but that was a mere gratuitous statement made by him and he did not offer anything in support of it. This is'the first time it has been suggested in my hearing that that which was done was against the will of the grain board and that it imposed a handicap upon them.
There is this one further point I would make with reference . to something said by the hon. member. A great deal of talk is offered about speculators. There have been a number of boards investigating these exchanges, and it has been found without exception that the amount of speculation is not large. In the second place, supposing that there is speculation, surely it must be well known to every man and woman in this house that speculators are nearly always bulls. The act of a speculator would tend as far as his act would tend at all, not to depress prices but to raise them, because how many speculators do you know, if you know any, who customarily offer to sell something which they do not have, believing that the price will drop and that they will be able to buy it in in time to make delivery? It is nearly always the other way- Have you ever heard people say:	I think I had better sell fifty shares [DOT]
of such-and-such a company because I think they are going to drop?


An hon. MEMBER:: Plenty of them.


Ralph Maybank: Yes, I have heard of
them, but that was a rhetorical question and I was going to answer it myself. Have you heard any people say:	I am going to sell a
thousand of wheat?


An hon. MEMBER:: Yes, lots.


Ralph Maybank: I think my hon. friend
said, "I have heard lots." But I call anybody
to witness who has h-eard these people talk to any extent, and I am sure h.e will agree that what he usually hears them say is this:
I am going to take a flyer in wheat; or, I ' am going to buy a little wheat or a little stock in such-and-such a company. All actions of speculators tend to raise prices rather than to lower them. Other forces result in prices being lowered. A study of the history of speculation establishes that.
Mr. TOWNLEY-SMITH:	May I ask a
question?


Ralph Maybank: If it is a question.
Mr. TOWNLEY-SMITH: Every time anybody buys does not somebody else sell?


Ralph Maybank: Yes, certainly. When
you have anybody buying somebody is selling, and when you have anybody selling, somebody is buying. But that does not mean that they are both speculators. This is not, after all, like a crap game.


Percy Ellis Wright: I think it is.


Mr. ROSS (Souris):: Certainly, right now.


Ralph Maybank: I do not want to say
too much about that, or some of these hon. gentlemen will be wanting to get me into a game.


An hon. MEMBER:: You do not know
much about it.


Ralph Maybank: Surely hon. gentlemen
will see that both parties to the transaction are not speculators. A farmer undertakes to go in and sell one thousand bushels of grain. The man who buys it is not a farmer just because the seller is a farmer. I ask the hon. members to consider carefully whether it is not a fact that most speculators are bulls instead of bears. However, if hon. members do not wish to accept that aspect they do not need to, but I am quite sure that if they are willing to think about it-and that of course is a large assumption on my part because they may not be willing to think about it-I am convinced they will agree that what. I have said is true.
I come back to my original proposition with reference to this. I believe we are only inviting disaster to go in for all these boards of this kind, and I would indicate in half a dozen sentences the sort of thing that we have had to do and from which we have to get away:	exchange control, price fixing,
rationing, elevation of the government to the position of being the one dominating influence in every phase of economy. These are the direct opposites of the normal marketing
Wheat Board Act

system to which we have been accustomed; they are, I submit, totalitarian controls, and we have had enough of them. The sooner we get away from such policies, the better. We should not bind ourselves now to future trouble of that sort.


Some hon. MEMBERS:: Question.


Wilfrid Garfield Case: Mr. Speaker, I should like to' preface my remarks-


Some hon. MEMBERS:: Louder.


Wilfrid Garfield Case: I thank hon. members for the compliment; I know they are anxious to hear what I have to say. I should like to preface my remarks by saying that I feel I am coming to the assistance of the hon. member for Winnipeg South Centre.


Ralph Maybank: Thank you very much.


Wilfrid Garfield Case: I listened to-day when he rose to give an explanation of an extract from a certain newspaper which attributed to him something he denied, namely, that he talked out the last motion. I realize that my time is very short, but I am willing to risk the tribute which was paid to the speaker who has just concluded his remarks.
When I look at this bill I cannot but feel that it involves consideration of one of the great factors in our whole economy, namely the grain market. It is not long since when we were willing to accept, as a tribute to the productiveness of our great country, the fact that we were the bread-basket of the world. Indeed, we produce in the agricultural sphere a volume of products which compares favourably with that of any other part of the world.
I had a very great friend, the late Hon, James Malcolm, who at one time was the dominion minister of trade and commerce. If I refer to some of the thoughts he conveyed to me, I wish it understood that I do not seek in any sense to quote him, because it would not be fair for me to do so at this time. But I remember one thought he left with me, that the moment you seek to defeat the law of supply and demand you are indeed rowing upstream; you are pulling a heavy oar. Therefore I say that when you seek to interfere with these natural laws you invite the risks which are run by those who try to regulate in an artificial way one of the great principles of human existence and human activity.
As I think back over the days that have passed I recall an experience we had- following the first great war, indeed as late as the early thirties when it was generally considered that the millers of the world required Cana-

dian wheat for mixing purposes, and we decided that they could not get along without our own natural product, Canadian No. 1 hard wheat. But one of our largest purchasers, the British buyer, was not satisfied to pay the price we then demanded, and turned to Argentina. I am led to believe that up to that time Argentina was a grazing country, but with the British purchasers seeking to buy its wheat Argentina realized that it had a market for another product, and much of its grazing land was turned to wheat production. Rather than help ourselves we created another competitor. So I say that we should approach very carefully anything which would have the effect of regulating the -marketing of wheat. I come from an agricultural constituency, and I am indeed much concerned about the prices which our farmers may receive for their basic products. But I have been told by members of the grain trade, men -who -are willing to risk iheir financial future on their success in this enterprise-and I myself, sir, am not a technician in any sense of the word-that a grain exchange is necessary to the-ir success, that as they purchase they sell against futures; and if I accept that as reasonably correct-and I have no reason to doubt it-I must concede that the grain exchange is a necessary part of our economy. Therefore may I suggest that we approach with much caution anything which has to do with the arbitrary regulation of the price of grain.
I realize, sir, that the time has arrived when I should say to you that I cannot conclude the re-marks I had intended to make, and remind you that the hour is nine o'clock.


Some hon. MEMBERS:: Question.
Mr. -SPEAKER: The hour reserved for private and public bills having expired, the house will revert to the order of business under consideration at six o'clock.



TRANS-CANADA AIR LINES INCREASE OF CAPITAL-CREATION OF CORPORATION TO OPERATE SERVICES UNDER CONTRACT

[Stage Direction]
The house resumed consideration in committee of -the following resolution-Mr. Howe -Mr, Macdonald (Brantford City) in the chair:.
That it- is expedient to introduce a measure to amend the Trans-Canada Air Lines Act 1937, -to increase the capital from five to twenty-five million dollars and to authorize the Canadian National Railways to issue securities to twenty-five million dollars for acquiring the stock of the corporation; to provide -authority in the governor in council to create corporations to operate and maintain air services under contract with Trans-Canada Air Lines such corporations to be controlled by Trans-Canada Air Lines; also to make provision for the payment of

Trans-Canada Air Lines
subsidies to such corporations payable out of moneys to be appropriated by parliament, and with provision for the termination of the present contract for the transport of mails and for a new contract for mail transport.
Stanley Howard Knowles: There are two or three questions I wish to ask the minister further to our discussion of this afternoon.. First, on a point of information, I thought I heard him say that no subsidies are being paid by the government to any of the private civil aviation companies in Canada, apart from payments made for airmail, which, the minister pointed out, are not in fact subsidies.


Clarence Decatur Howe: I was thinking about that , after I left the house. I believe a small subsidy is paid to the air line operating in northern Saskatchewan, pending the time they can get proper equipment to carry on profitable operation.


Stanley Howard Knowles: As a matter of fact I thought at the time that the minister was correct, but shortly after he made that statement my attention was drawn to P.C. 185/2662 which authorizes a subsidy not exceeding $12,000 a year to be paid,to M. & C. Aviation Company Limited. I hasten to add that this is one of the companies not yet swallowed up by the Canadian Pacific Air Lines.
Another question I should like to ask the minister has to do with Nthe whole question of what is to happen to these Canadian Pacific Air Lines after the Canadian Pacific Railway company has divested itself of their ownership? I think the minister cleared up the confusion that was in the mind of the hon. member for Davenport this afternoon as to the distinction between a divesting order and expropriation; but the question still stands as to who is to operate these companies after the Canadian Pacific Railway company no longer owns them. One of the reasons why I have dared to hope that a subsidiary corporation of the Trans-Canada Air Lines might take them over was a special story that appeared in the Winnipeg Free Press on September 27. It was under the signature of Chester Bloom, whose articles from Ottawa are frequently on the beam. He said:
There is a well defined rumour, circulating in government and parliamentary circles here-
The dispatch was dated from Ottawa.
-that the government is planning to form a crown air lines corporation, separate and apart from Trans-Canada Air Lines, to take over and operate all so-called feeder air lines in central and western Canada.
That is only a rumour. I take it from what the minister has said to-day that he denies
it, and that no such plan is on foot at the present time; but the question still remains, who is to operate these lines?
Another dispatch from Ottawa, also by Chester Bloom, under the same date, September 27-the minister may say those rumours cancel each other-was to the effect that big United States air line companies have approached the Canadian Pacific Railway company to acquire ownership of its feeder air lines which blanket air routes in central, western and northwestern Canada. I questioned the minister about that by placing certain questions on the order paper, One of which was as follows:
Has any United States air line sought to purchase Canadian Pacific Air Lines from the Canadian Pacific railway?
The answer in sessional paper 129A is: "No official knowledge." This is not quite as definite a setting aside of the rumour as the other answer was. Quite frankly, one of my reasons for pressing this question is this: It seems to me-and I am glad this is the case- that after these lines have been separated from the Canadian Pacific Railway company it is just a matter of time until the government will have to take them over. I think the hon. member for Rosedale, with whom I do not agree on this point at all, hit the nail on the head when he asked a question as to who would take them over. When you take them away from a big corporation like the Canadian Pacific Railway company it seems to me it is only a matter of time, unless you intend to permit a large United States corporation to come in and take them over, until the government will have to do so under some such plan as has been put forth in the present measure. I hope that the minister will discuss the matter further. I am asking the same question that the hon. member for Rosedale asked, although with an entirely different motive. It does seem to me that the minister might give us a little glimpse into the future as to what is in prospect with respect to those feeder lines. '


Clarence Decatur Howe: My hon. friend is dealing
with rumours and speculation as to what is to happen in the future. I am afraid I cannot give him any information on that, because I have none. I can give him a solid fact, though. In the Nova Scotia election the Liberals have been elected in twenty-three seats and are leading in five seats. The C.C.F. have been elected in two seats, which seems to cdver all the provincial seats,


Wilfrid Garfield Case: How many seats are there?


Clarence Decatur Howe: Thirty.
Trans-Canada Air Lines


William Ross Macdonald: If we are discussing the motion before the committee the hon. member for Winnipeg North Centre has the floor.


Ian Alistair Mackenzie: We are dealing with futures.


Stanley Howard Knowles: I have just one other
question. If the leader of the opposition is anxious to state that this was a great day for democracy I, of course, would give way to him. In one sense it certainly has been, with the end of the Tories in Nova Scotia.
The other question I should like to ask the minister is this. We shall not be able to ask him questions in committee on the bill after it has had second reading and before it goes to the special committee on railways and shipping, and that is the reason I ask the question now.


Clarence Decatur Howe: I should like to make it clear that the hon. member will have an opportunity of asking questions when the bill comes back from the committee. I expect to be at the committee and he will have an opportunity of asking questions there. It seems to me that there is no hurry about these questions, unless my hon. friend is terribly anxious to get the information.


Stanley Howard Knowles: I should like to get this information. Perhaps we might deal with it specifically rather than hypothetically. Are the terms of the bill, in so far as it sets up subsidiary corporations, such that one of those corporations can be set up to operate subsidiary lines within Canada?


Clarence Decatur Howe: I am afraid I would have to consult my lawyer about that. That certainly was not the intention. I believe that that applies only to lines outside Canada.


Mr. BRACKEN:: With all deference to the hon. member who wishes to move this out of committee and go on with some other work, I should like to ask one other question before we leave-


Mr. CRUICKSHANK:: About Nova Scotia?


John Bracken: The question has to do with the relationship of the Canadian National Railways to the Trans-Canada Air Lines organization. The resolution before the committee reads:
Resolved, that it is expedient to introduce a measure to amend the Trans-Canada Air Lines Act 1937, to increase the capital from five to twenty-live ^million dollars and to authorize the Canadian National Railways to issue securities to twenty-five million dollars for acquiring the stock of the corporation . . .

For the information of the committee will the minister outline what exactly is the relationship now between the Canadian National Railways and the Trans-Canada- Air Lines organization; and what will be the relationship if and when this measure passes? I ask that the minister answer that question as far as he can in layman's language, because I think the committee and the country want to know.


Clarence Decatur Howe: The present position is that Trans-Canada Air Lines is owned by the Canadian National Railways. The passing of this measure will not change the ownership in any respect. The shares are fully owned by the Canadian National Railways. If the order to divest should issue there is a clause in the present Trans-Canada act which provides that the government can take back the property at any time at its book value.


John Bracken: I have but one other question to ask. The resolution goes on to say:
[DOT]-to provide authority in the governor in council to create corporations to operate and maintain air services under contract with Trans-Canada Air Lines such corporations to be controlled by Trans-Canada Air Lines-
And then in particular:
-also to make provision for the payment of subsidies to such corporations payable out of moneys to be appropriated by parliament. . . .
My question is, who will determine the amount of these subsidies? Will they be determined by some board to be set up, subject to approval by the governor in council, or will they have to be approved by parliament before they are given?


Clarence Decatur Howe: In my remarks I covered the subsidiary companies and explained that for several reasons trans-ocean operations must be separated from domestic operations. The operating statements of trans-ocean air lines must be filed with the international authority, and there are other reasons why each transocean operation should be a separate corporation. The bill makes provision for the governor in council to incorporate these as wholly owned subsidiary companies of Trans-Canada Air Lines. I have explained this evening that in starting a new route, such as the route to South America, or the route to Australia, probably it will be necessary to subsidize the operation in its initial stages. In pioneering a new route, we can hardly hope to have traffic immediately available in the early stages. The usual method of handling appropriations of this kind is to have them included in the budget of Trans-Canada Air Lines, which is presented to the house, examined by

Trans-Canada Air Lines
the committee on railways and shipping and referred back to the house, where it is discussed and passed as part of the appropriation bill.


Wilfrid Garfield Case: May I say at the outset that I have been impressed with the willingness of the minister - to seek to convey to hon. members generally the information they desire. At one time this afternoon a personal note was interjected, but I assure the minister he is really at his best when answering questions asked by the opposition. I was impressed with the statement of the minister yesterday in support of the resolution, but because of the enthusiasm1 of my C.C.F. socialist friends to the left I felt we should seek to examine the resolution and the provisions of the bill when it is brought down.


Stanley Howard Knowles: Anything more about
Nova Scotia?


Wilfrid Garfield Case: Well, my hon. friend wants to know about Nova Scotia. I do not know a great deal about Nova Scotia, but I certainly hope to be privileged to visit that splendid maritime province next year. From the intimation given us by the Minister of Reconstruction I think many people there showed very good judgment, and I say that advisedly. After all is said and done, I am not a socialist and never will be one. I stand for private ownership and the right of the individual to his own opportunities, his ambitions and his desires. I do not pull my punches on that score. It may be that at times those who are wise in their judgment' are overpowered by those who have not given the. subject at hand the same thought and consideration, but in my riding particularly they did not guess at anything; they used their own good judgment and voted accordingly. After all, this is a great country, a marvellous country, rich in its opportunities, challenging to all classes of Canadian citizens who have red blood in their veins. If there is anyone in this chamber or in this dominion who wants to lean on the other fellow, I do not and neither do the people of my riding.
One is cautious about criticizing the charming hon. member for Qu'Appelle. I always feel that she provides some degree of restraint in this chamber; but when this afternoon the hon. member said that a socialist government would not tolerate a plane flying back for the baggage of the hon. member for Daven-' port I thought how well she had endorsed and underscored the story I told my friends in my own riding, that the C.C.F. socialists would not stand for anything except that which they endorsed.


Stanley Howard Knowles: On a point of order-


Some hon. MEMBERS:: Sit. down.


Stanley Howard Knowles: The hon. member has all the right in the world to disagree with us, to argue with us or to condemn the position we take, but he has no right to misquote us. I distinctly heard the hon. member for Qu'Appelle say that we would not, all of us, tolerate such a procedure on the part of a socially-owned enterprise. There was no statement about what a socialist government would do; and in fairness to the lady member who is not present I suggest that the hon. member should not quote her unless he is sure he is using the words she used.


Wilfrid Garfield Case: Well, ours is in no sense a
totalitarian party, and we do not express the same thoughts in the same language. I only repeated what I understood the hon. member for Qu'Appelle to say, and I shall have it verified when Hansard is available. I do not want to detract in any sense from her very fine contribution when I refer to what I believe she sincerely thought.


Stanley Howard Knowles: Is this the restraint the
hon. gentleman spoke about?


Wilfrid Garfield Case: I am sure we are not going to exchange punches all evening, because I am a short-winded fellow.
There is in this bill something fundamental with which I think I should deal more particularly. This afternoon I was pleased to hear* the hon. member for Davenport and the hon. member for St. Paul's make reference to the Canadian Pacific Railway company. As one from a rural constituency who has never experienced the set-backs and heart-aches of the stock market hon. members will understand that I have no brief for any transportation system, but as a student of history I believe I can say the Canadian Pacific Railway company has played a prominent part in the development of this great nation. They have indeed pioneered, and I do not like to hear their names slurred or slighted. Because, after all, while some may say they reaped a great reward, believe me, in the early days the capital entrusted to their care was venture capital, and no one knew what the reward might be. In the sense of the great national unity which to-day we profess to admire, they played their part in binding this great nation with bonds of steel into one great unit. It is our responsibility to develop that unit.
Therefore I say that the Canadian Pacific Air Lines is, likewise, a pioneer in the air field. We have it from the Minister of Reconstruction himself, that had they not taken over those lines which were in danger of going into receivership, there would have been no service there to-day. So that, as one who believes in the rights of people, I subscribe to the theory
Trans-Canada Air Lines

that the future transport development of Canada must take into consideration railroads and governments combined.
Certainly we have lost nothing by having the Canadian Pacific railway as a competitor with the publicly-owned Canadian National railways system. I am sure I shall not be misunderstood if, as a traveller and as one who has enjoyed the services of both systems, I make the statement that in my experience I have not found any service to equal that of the Canadian Pacific Railway company. I do not say that in any unkindly spirit, because there are no people on earth more hospitable than the personnel employed by the Canadian National system. My experience has been that they have gone out of their way to look after the comfort of passengers. But the nearer one gets to a monopoly, the more difficult it becomes to make a comparison.
The Minister of Reconstruction said yesterday afternoon that we have established one of the greatest air lines in the world, and I am proud of that fact. May I say to hon. members to my left that all of us have a big stake in the future transportation problems of Canada. I have no reason to object to provision being made for the development of Trans-Canada Air Lines. They have rendered a service, and I wish to be perfectly fair to that ^organization.
I am not a private ownership man, in the sense that I am opposed to public ownership; nor, conversely am I a public ownership man opposed to private ownership. But I do believe, sir, in the theory of efficiency. At present I happen to be charged with the responsibility connected with the chairmanship of the public utilities board in my home city of Owen Sound. We are faced with a problem which I believe private enterprise or private ownership would solve. It is not an easy problem; rather it is a difficult one. I find myself at odds to know how to deal with it.
While the Minister of Reconstruction has admitted that Canadiin Pacific Air Lines assumed the responsibility for certain transportation facilities in the dominion, I do not believe those air lines have ever paid one cent of dividend. As a matter of fact I believe they have shown a deficit, a fact which I suggest indicates a desire to risk capital in the possible future development of the air lines for which they have accepted responsibility.
This brings me to the important point first discussed by the hon. member for Rose-dale (Mr. Jackman). Unless we are prepared to give the green light to private enterprise, we cannot expect venture capital to take a chance in the future development of our

country. I say that to hon. members of the C.C.F. and, particularly to the hon. member for Qu'Ap.pelle (Mrs. Strum), who spoke this afternoon about a Canadian Pacific line running to a certain station in an almost parallel line with the Canadian National. Does the hon. member think for one moment that the Canadian Pacific Railway company, or any other private enterprise, would dare to develop the line she suggested was so necessary, if it did not feel there was some security in that development?
I offer this to hon. members as food for thought. The fact remains that unless we have some organization through which we can make comparisons, it is difficult to determine the efficiency and economy of the operation. I believe that is a fair axiom.
When estimates have been under discussion in the house I have heard my leader and other hon. members ask for comparative estimates, and for information as to the amounts spent last year or the year before. A mass of figures means very little to the average person. Therefore I repeat that the nearer one gets to monopoly, the more difficult it becomes to make a comparison as to efficiency or economy of operation.
There is another factor which I suggest has been overlooked. I know that in Owen Sound public utilities such as hydro, water works and gas pay no taxes. I wonder how much the Canadian Pacific Railway company, which admittedly is the largest taxpayer in Canada, and which has risked its capital in saving air lines which otherwise would have gone by the board, has paid in taxes to the treasuries of the respective municipalities in which it operates, and to the dominion treasury. By the same token, if we are to compare efficiency in operation, I think it is only fair to ask if Trans-Canada Air Lines pay taxes to the municipalities in which they operate, and how much the dominion treasury receives in taxes from that organization. I might ask the same question in connection with the Canadian National Railways, were they up for discussion this evening.
During the days we are inclined to describe as the hungry thirties, when our transportation systems were showing huge deficits running into upwards of hundreds of millions of dollars, the Canadian Pacific Railway company, the largest individual taxpayer in Canada, was required to pay its share of the deficit on the business of its chief competitor. So that I do not hesitate to rise as a champion of individual ownership, while at the same time being prepared-


An hon. MEMBER:: C.P.R.

Trans-Canada Air Lines


Wilfrid Garfield Case: JsTo; do not say C.P.R. That is not a fair comparison.
This afternoon the Minister of Reconstruction referred1 to friends of mine on this side of the house as capitalists and1 monopolists. We are not; we are Canadians. I want to tell him that I love my country. I have no selfish interest or any selfish axe to grind. I am prepared to devote my time and talents to the future of Canada. If her future is great again, I shall be proud. I do not want anyone to say, "CP.R.", or anything else, because after all I am only trying to make a fair comparison. I think I will leave that to hon..members.
I am one who believes in private ownership and the right of the individual to develop his own initiative, his own enthusiasm and his own hope to reap a reward and profit in playing some part in the future development of this country. At the same time I do not want to appear as an enemy or opponent of public ownership of certain utilities. This war has certainly taught us that there is back of this government, back of this House of Commons, a great body of public opinion, a wealth of resource, initiative, ambition and intellect which will play a great part in the future development of Canada.
I only hope-I know my hon. friend has given some evidence of this this afternoon and this evening-that this government, in which the Canadian people have indicated some faith and preference, will give the green light and say, we invite you to use your initiative, your ambition and your hopes in order that you may play your part in the future development of Canada.
There is one question I should like to pose to the Minister of Reconstruction, but I do not know whether it is entirely correct. Has the C.P.R. made any money on their aeroplane transport operations? I will leave it to the minister whether he cares to answer that, and I shall think none the less of him if he does not, because it is outside of this parliament. Then I want to know how much in taxes the C.P.R. pays on their development, and whether the C.N.R. or the T.C.A. pay any taxes on their developments.


Clarence Decatur Howe: I would not care to say anything that might check the eloquence we are hearing here, but I suggest that there is nothing in this resolution about private ownership or public ownership. We are discussing an amendment that will affect a property owned by Canadian National Railways. After this bill goes through it will continue to be owned by Canadian National Railways; it will always be a public enterprise.
There is no mention in the resolution of Canadian Pacific Air Lines or the Canadian Pacific Railway Company. As far as I know, they have no interest in this bill one way or the other. I wish we could get back to the subject of the resolution. I have heard only two questions asked that had any relation to the resolution, and they were both asked by the official leader of the opposition. If we could confine the discussion to the subject matter of the resolution, it might speed u; the business of the house.


Douglas Gooderham Ross: The minister says that the discussion which has been going on has nothing whatever to do with the resolution, but I do not quite think that is so. First of all, the minister has said that the railways of Canada were to divest themselves of their air lines. We now find that the Canadian National Railways are to issue the debentures for Trans-Canada Air Lines. That is not divesting themselves of that interest.
I think a great deal of .this discussion has been very helpful. As far as that is concerned, it gives the minister something of what the members of the House of Commons are thinking. Just in passing, I should like to refer to the remarks of the hon. member for Qu'Appelle. She said that the two railways run through the west within twenty miles or so of each other. I have been out there and I have seen them running side by side for a long time. The fact is that private enterprise in the form of the C.P.R. went in there and developed the country. Then these C.C.F.-mindied people who are in control and who advocate public ownership and so on come along and they want to take away from the C.P.R. what they already have. That is all there is to it. When you get something there is always somebody who wants to take it away from you.
It is time we got down to brass tacks and found out what the facts are. Just in passing, I notice the minister has gone out of the chamber for the moment, but there is something I wanted to say to him about the election in Nova Scotia. Sometimes the Scotch can be wrong, but this time not many are right. There are just one or two. other things I wish to say. We are going to have competition between the air lines and the railways such as we never had before. We are still in the horse-and-buggy days as far as air service is concerned. You cannot get a seat on a plane when you want it; you have to sit up all night in the day coach.


Alan Cockeram: What about priorities?


Douglas Gooderham Ross: We should be able to get air transportation when we want it.
Trans-Canada Air Lines

You are going to have that competition all the way through. I imagine like all other hon. members, I stood at the window and looked at the plane that was flying over the building to-day. It is just like that, now you see it and now you don't. That is about what it is.
Think of the future of transportation by air. Are you to kill all private initiative as far as air transportation is concerned? That is exactly what the government is trying to do. This afternoon the minister told us something that I found quite interesting. He said that we had to do it in this way. There are three ways of doing it: one by confiscation, another by legislation and the third by taxation. What chance has private enterprise when that is the attitude on the part of the government. That is not the attitude of the people of Canada.
This great service we have at the present time must develop Canada, and it will be called into use more and more as time goes on. There are only 12,000,000 people in this country and we shall have many more, before we get through, many more of the right kind of people. We shall have to service these people. We have this great big Canada of ours with all its opportunities for young people, provided that they have the nerve and initiative to go on and make something of themselves. We shall have to supply them with the needed transportation. No country is any good without transportation. We do not want people to have to travel as they did in the olden days in Toronto. In those days they had to draw all their stuff in with oxen. We must have something better for these people. We cannot just put them down in the centre of the forest and ask them to carve a way out. We must do something to help them. We must provide transportation.
We must give the young fellows coming back from overseas an opportunity to go into this aviation business. They must know that when they get going everything will not be taken away from them by way of confiscation, legislation or taxation.


William Ross Macdonald: During the afternoon and evening the discussion in the committee has developed into a discussion of the merits of private ownership as against public ownership. A great deal of latitude has been allowed. I do not want to suggest that the debate be closed off, but I would ask hon. members to confine their remarks as much as possible to the resolution.


Harry Rutherford Jackman: Mr. Chairman, the hon. minister has suggested that the only intelligent questions put in this discussion this afternoon and evening were those put by my honoured leader, and I trust that he may get answers

in due time. Nevertheless I should like an answer to a question that I have propounded twice already just before the dinner recess. I wonder if the minister would answer that question now.


Clarence Decatur Howe: I can assure my hon. friend that not one cent of the funds asked for in this resolution will be spent on airports. The hon. member is a member of the committee on "railways and shipping, and the officers of the department will be there to answer his questions. He asks them every year, and I assume that he will again this year. He makes the same speech every year, and I assume that he will make it again in committee this year. I should like to run all around Ottawa getting that information if I had time, but I had to eat dinner since I last saw my hon. friend and I have not had time. Therefore I say to him in all good will that the information he desires to get, which is not related in any way to the resolution before the committee, can easily be got in the committee on railways and shipping, where the officers come to give just that kind of information.


Harry Rutherford Jackman: I am not at all satisfied with the answer which the minister has just given.	.


Clarence Decatur Howe: I did not think the hon. member would be.	'


Harry Rutherford Jackman: There is no more irritable minister in the house than the minister before me. He is a fine business man, but as a parliamentarian we all have our respective opinions of him. I did not raise the question whether any of this $25,000,000 is to be spent on the airports. Quite the reverse, and I am quite sure the minister understood the' import of my question before dinner. What I said was that the Department of Transport spends a great deal of money, running into hundreds of millions of dollars, on capital account, and millions of dollars on operating account, just in order to keep these airports and various auxiliary services available, and to whom are they available? We see by the divesting order that the government is going to make these fields which are provided by the department available only to Trans-Canada Air Lines and to certain United-States lines and a few private people who may charter a plane occasionally. I asked how much has been spent by the Department of Transport on the development of airfields and auxiliary facilities which are used almost exclusively by Trans-Canada Air Lines. The minister says that he is not able to get that information; he says that I can ask elsewhere for it. It is not just for myself

Trans-Canada Air Lines
that I want the information. I want it because I think it may be useful to other members of this committee.
May I just point out at this moment that in the estimates for the Department of Transport, the items for civil aviation alone amount to $5,257,000 for the current year, and there is an additional $412,000 for meteorological services which are perhaps used chiefly for other purposes but which make up part of the estimates for the Department of Transport. Radio aviation service, construction and improvements, amounts to $1,152,000 and lighting and field services, construction and improvements, amount to $1,065,000. Yet on a superficial glance at the statement of T.C.A. it looks as if it was paying its way and earning its operating expenses, five per cent on the $4,600,000 of capital investment, which is a mere bagatelle as compared with the amount of money spent by the Department of Transport to provide the necessary services, the docks and harbours, if you like to call them that, for T.C.A. They earned, after the five per cent, $7,409. Yet we find in the estimates that for these two items alone, radio aviation service and lighting and field services $1,152,000 and $1,065,000 respectively is to be spent, and for whom? For T.C.A.


Clarence Decatur Howe: May I correct my hon. friend in the matter of operating expenses of Trans-Canada Air Lines. They pay fo,r every field and service they use. There is a regular scale of fees for any plane that lands at an airport, and that runs into a good many thousands of dollars. My hon. friend may have before him the expenditures, but he has not the revenue items. It is not just as simple as picking up a book and picking out figures here and there and saying:	That is
that. Trans-Canada Air Lines have paid for its services at every airport just as any other user of the airport does. It is not peculiar to Trans-Canada that an attempt is made to put the service on a commercial basis. Per-[DOT] haps my hon. friend had better get the information before he m^kes his speech.


Harry Rutherford Jackman: We are so used to statements like that from the minister that they just do not mean a thing. The revenue on Trans-Canada Air Lines for 1944 was $10,000,000, and out of that they had to pay all their expenses. It is quite obvious that the amount it paid out for landing services, a few dollars, does not begin to return to the country any income comparable with the great expense entailed. I am not suggesting that these services provided by the Department of Transport should yield a big return,
but I would point out in connection with all this aviation expense that Trans-Canada Air Lines pays for but the smallest part of it, and we are now asked to provide $25,000,000 for Trans-Canada Air Lines, so that they can go into ventures farther afield. How do we know that they will not construct landing stages in mid-ocean, perhaps two or three hops across? Trans-Canada Air Lines will not spend hundreds of millions of dollars for that type of aircraft facilities; it will come out of the Department of Transport, and I am suggesting to * the committee that one can not fairly judge the operations of Trans-Canada Air Lines, enjoying the monopoly position which this government is endeavouring to put it into, without assessing the charges against these facilities which are used by Trans-Canada almost exclusively, and by United States planes when they come over here. So far as Canadians are concerned, the only people who can use the facilities at the airports in Canada are the government-owned T.C.A.
May I suggest, before resuming my seat, that if a young man to-day is interested in air development-and surely that is one of the expanding fields particularly in transportation which might entice any venturesome young man wishing to carve out a career for himself-he has to become virtually a government employee in T.C.A., or go across the border and join one of the United States companies. Only in this way can he fly into his own country and have a future in the air lines. Already there has been great discouragement to our young men entering the flying service in Canada, and already some of our brightest young men have gone across the line where there is not just one government-owned monopoly operating in that field.
This reminds me that the minister brought up a point about the United States government having issued a divesting order to various railways and shipping companies to get rid of their air lines, and, if I recall correctly, the United States, rightly or wrongly, took the attitude1-I think perhaps wrongly-that railroads having a paramount interest in railway transportation would not develop air transport as fast as would an independent air company. I suggest that in Canada there was no such reason as that. Canadian Pacific Air Lines had gone ahead at great expense to itself, never having shown a profit and having taken over these various small lines which the minister suggested might easily have gone bankrupt had the Canadian Pacific not stepped in and provided the service. So that we have there a spirit of enterprise; Canadian Pacific Air Lines was willing to develop

Trans-Canada Air Lines


Donald Methuen Fleming: We are being asked to
approve a proposal to authorize the Canadian National Railways to extend its present investment of $5,000,000 in civil aviation to $25,000,000. At the same time the government, through the minister, has reiterated its policy of forcing companies now engaged in rail transportation out of the field of air transportation. Would the minister tell the committee, first, if he thinks these two policies are to be reconciled with one another; second, when the divesting orders may be expected, and, third, will the Canadian Pacific and the Canadian National be treated alike when the time comes, if it does come, for a divesting order to be issued? In other words, will the divesting orders be issued for the two companies at the same time, or is it contemplated that one shall be issued to one of the companies ahead of the other, forcing one out of the airways business while the other may continue?


Clarence Decatur Howe: I have every reason to believe that the divesting order will be an order which applies to both railways; that there will not be two separate orders.


Harry Rutherford Jackman: Why are they putting
up the $25 million then?


Clarence Decatur Howe: They are putting up the $25 million under the provision of the Trans-Canada Air Lines Act that the government can acquire the stock at any time by paying its book value. It is not difficult to understand. We could have put through both transactions at the same time. We could have taken over the operation of Trans-Canada Air Lines first and had the government supply the money direct. But since the ownership is in Canadian National Railways, and since the machinery for working out the divestment is not completed, we decided to do it in this way. I assume that it does not matter very much in which way it is done.


Donald Methuen Fleming: Just to clear up that point, does the minister expect, then, that one divesting order will be issued direct to both companies at the same time?


Clarence Decatur Howe: Yes.


Donald Methuen Fleming: It will not be a case of
separate orders directed individually to the two companies, the Canadian Pacific and the Canadian National?


Clarence Decatur Howe: I would not think so.


Alan Cockeram: When the minister
made his statement on March 17 last he did a great injustice to those remote mining areas which are served by airways other than Trans-Canada. It amuses me to hear the minister say to-night that we are discussing something which has nothing to do with the resolution, because in my opinion it has something to do with it. On March 17 the minister stated that the railway transportation companies were to be put out of the flying transportation business in Canada. What was the result? If anybody has been in the Yellowknife area this summer he will know what I say is true, that the service in that mining area has deteriorated, for the simple reason that Canadian- Pacific Air Lines have no knowledge when this divesting order, as the minister chooses to call it, will come into effect.


Clarence Decatur Howe: May I say to my hon. friend
that there has been far more service to the Yellowknife district since that announcement was made than before; I venture to say, in the proportion of six to one.


Alan Cockeram: I disagree with the
minister, and I think I know something about the mining area, that there has been more activity in that area.


Clarence Decatur Howe: I think I know a good deal
about it. I have the records.

Trans-Canada Air Lines


Alan Cockeram: I do not care whether the minister has the records or not.
The hon. member for Davenport paid a great tribute to Canadian Pacific Air Lines; and, as one who has been vitally interested in the development of the north country and the remote areas of this country, I say that the minister is doing a disservice to those areas when he tries to put that great air transportation system out of business, because it was not until Canadian Pacific Air Lines came into being that those who were connected with the mining industry in remote areas felt a certain amount of security in their transportation problems.
The minister must know that not an air transportation system, other than Trans-Canada Air Lines, when you take them from the auditors' point of view, shows a profit; there is not a bush transportation system which has made money in Canada. If there is one, I shall be very glad if the minister will contradict me and give me the name of the company. When we can get a company like Canadian Pacific Air Lines to give us good service and take the loss we are indeed lucky. I think the minister must agree with me that C.P.A. are- supplying a service to the remote areas which is very necessary. Nobody in the house has a greater knowledge of air transportation, to remote areas than the minister himself unless it be the hon. member for Rainy River; they both come from areas where there has been great activity in mining because of air transportation, and it seems to me that the minister should think ofthose districts which are so closely connected wuth his own riding, when he tries to force out of business a company which has given and is giving good service. I suggest to the minister, the hon. member for Rainy River and any other hon. member who is interested in the question of air travel that they go into the mining areas and find out, from the people actually living there, -what the conditions are in districts which can be reached only by plane, and for several months in the year cannot be reached at all; let them ask these people, whether or not they are dissatisfied with the services which the Canadian Pacific Air Lines supplied to them.
It seems to me that if this 'bill is passed, and if all the things which the minister desires come to pass, we shall have a dictator of air control in this country, and that will be the minister or his successor. Whatever happens in the future, nobody will be able to go into the air transport business without the permission of the Minister of Transport or the minister for air, or whoever he will be in days to come. I think we should consider definitely
whether we should vote money for this bill because on a straight dollars and cents basis we will not get a return for the money we put up.
What I should like to ask the members of this committee and the people of Canada is, are we prepared at this stage to enter again into a system of transportation that will bring about deficits of many millions of dollars a year in the years to come? It is true that the Canadian National Railways are possibly paying their way, but the heyday of'war will soon be over and we shall go back to the day. of deficits of a million dollars a week. If we give the minister the power that he is asking for I can foresee the day when we shall have deficits on Trans^Canada Air Lines of a like amount. I think a great deal of consideration must be given to the whole business of return on the capital to be put into it.


Mr. ADAMSON:: There are one or two matters I should like to clear up and suggest to the committee before the question is put. This afternoon there was much talk about the bush pilots and the small operators servicing the mining industry, particularly the small and isolated mines, the prospecting industry and the prospect mines. I have said this before in this house, but apparently I have to say it again. The reason why the small operators went out of business was that the prospecting industry was reduced to such a low level by the taxes imposed upon the mining companies that there was no incentive for the prospector, the young mining company or venture capital to go into these new territories, in the outlying parts of what we now like to consider older Canada, and develop them before the war.
I speak of northern Quebec and northern Ontario because it is an amazing thing that when we thought of the north country we used to think of it as around Noranda, Kirkland Lake, Timmins., Red Lake and so on, that gold-bearing break which runs through that country. But when one thinks of the new area like the Yellowknife, which is nearly fifteen hundred miles farther north than that again, it will be seen what a tremendous job air traffic has 'to do in the development of mining in the future.
This brings me to one more point which I should like to bring to the attention of the committee. I mention this because I am not a member of the special railway committee. I shall not have the opportunity to appear before that committee and ask questions. I am sorry that is so.
The minister has said that we have three types of operation in Canada, namely, the large transcontinental main line, Trans-Canada Air Lines feeder lines and the bus-h operators.
Trans-Canada Air Lines

There is, however, another type of operation, and that is the type of service which is now being furnished by Canadian Pacific Air Lines, which I shall call the major pioneer. This is an operator operating over very great distances, operating services on which it is unlikely to receive any net profit for some years, but on which it hopes, as the area builds up, to receive a very considerable return. It is hoped that the Yellowknife, the Great BeaT area, and all the new territory, and possibly some of the territory farther west than that, will be found to have minerals in such volume as to pay for the opening up of the area. That area probably will not be serviced by surface transportation for some time to come. Probably there will be major fields which will depend almost entirely on aircraft for their very life. Before those communities can be built up to a size that will give a return to the aircraft company, whatever its name, under whatever guise it is, -to make it profitable, it may be a period of years. Therefore I suggest to the committee that the position of a large pioneer, with sufficient financial reserves behind it to be able to stand the gaff for the unprofitable or building years, ought to be taken into consideration ; furthermore, that such operators should be encouraged.
That has been the history of most of our enterprises in Canada. We do not find things easy. As the years ahead are going to be difficult we must look for deficits. I suggest to the minister that if a large company adequately supported with sufficient capital is not operating these air lines we shall find that whoever does operate them will either decrease the services or ask the government for a subsidy.
If the government takes over the air lines serving the Yellowknife, for example, or if the government owns some major north and south air lines what will happen? For years the minister charged with the responsibility of running this air line will have to come into this house and report deficits, and the deficits will be growing. What will happen is this: The minister will be faced with the treasury board. The treasury board will be on his neck all the time saying: "Can you not cut down that service to the Yellowknife? Can you not cut down the deficit here? Look at what we shall have to face in the house when we report those deficits." That is why I suggest to you, sir, that the government should not operate air lines in these pioneer areas. When I speak of "pioneer" I speak of large pioneers; I am not speaking about

bush pilots now. These large pioneer fields must not and should -not be a government function.
I have never been satisfied that, because the United States divested air transport from surface transport, we should automatically do the same thing, or that it is wise. Our conditions are quite different. In the United States there certainly was a. doubt as to whether the railways, if they owned the air lines, would develop them. Only recently I was reading the history of commercial air transport in the United States, and in particular the history of T.W.A., which went through many vicissitudes. In the beginning they found1 it very difficult to get money, and the only way they could get it was by means of a very large mail subsidy. I do not know if the committee will remember the scandal that was disclosed in connection with putting money into these pioneer air lines, and the log-rolling and political skull-duggery, if you like, that went on until, in either the first or second Roosevelt administration, they had to take over the mail contracts entirely and give them to the army. Then it will be remembered that immediately after the contract to deliver mail was given to the army there was a series of serious crashes, with many pilots killed, and the whole system of airmail in the United1 States very nearly broke down.
At one time T.W.A., when it was T.A.T., had a certain amount of capital invested in it ' by the Pennsylvania railroad. Following that, General Motors Corporation put a good deal of capital into it. Then it went through many difficulties, reorganizations and mergers, and after a great deal of violent manoeuvring I believe General Motors .sold out control to Lehman- Brothers, one of the greatest investment trusts in the world, and the Atlas Corporation, another great investment trust. Eventually they in turn sold out to Howard Hughes, who made such a success of T.W.A. in conjunction with the two pioneers, Frye and Richter.
I need not go on, but that has been the history of nearly all air lines in that country. They have been up against it to get money; they have been held as corporations and monopolies, at various times, but eventually they began to pay. It was not until they began to pay and became big business that they began to stand on their, own feet. Our air lines -began to operate in 1937, just when the air lines in the United States were beginning to pay. I should like to give the committee a few simple figures to show exactly what happened. In- the years 1935 to 1938

Trans-Canada Air Lines
there was an average annual increase of nineteen per cent in air miles travelled. In 1939, however, that increase jumped to 42-2 per cent, and in 1940 to 64-2 per cent. In 1935 the major air lines in the United States travelled 314,000,000 passenger miles; in 1940 they stepped it up to 1,145,000,000 passenger miles. There is no question that Trans-Canada Air Lines have done a good job, but I would point out that they came into the air picture just when every line on the north American continent was coming into its period of profitable operation. T.C.A. came into the air picture at the psychologically correct time, and they could not avoid making a success of it. Because they did make a success, all power to them. Because they have established a magnificent record) for safety, all power to them. Because they have done such a good job, I repeat, all power to them.
Before this resolution is reported, I believe the question of making our major pioneer divest itself from the pioneer long distance air lines, simply because it is a surface carrier, should be considered very seriously. I believe that point should be considered also in regard to the Canadian National Railways. Both the Canadian National and Canadian Pacific are transportation systems. I believe fears are bootless that because an air line is owned or controlled by a railway it will not give air service. I believe that because they are both in the transportation business an air line can become a very helpful co-partner of its parent railway. I believe there are places in Canada where an air line and a railway can and should cooperate in the handling of passenger and freight traffic; and I am not yet convinced that because the Americans have divorced the air line from the railway it is advisable for us to do the same thing.
I should now like to say just a word with regard to bush pilots, the men who put Canada on the air map. The bush pilot was responsible for bringing Canada into the lead over all countries in the world in regard to the amount of air freight carried. Our record in connection with air freight, passenger miles and the development of- bush pilots is unique in the world. We cannot, as the minister has suggested, go into the dog-eat-dog, cutthroat competition of the past. I offered the suggestion that in the country north of the main transcontinental airway there should be some sort of zoning. The suggestion was that the zones should be perhaps 300 miles wide east and west and that in each zone a bush company should be licensed and given a virtual monopoly. This would permit adequate 47696-91
air service in that zone, and if a company made a success oh its operations it would be protected from other companies coming in and taking its business away from it or cutting rates. I pass that suggestion on to the committee, because it has received somewhat favourable comment in the aeronautical magazines of this country.
Therefore I should like this committee to consider very seriously whether the government is the proper agency for the operation of transatlantic and transpacific air lines, and, second, whether it is in the best interests of Canada to have the railways divorce themselves entirely from air transport.


Mr. FULTON:: There is one question I should like to bring to the attention of the Minister of Reconstruction. It is in connection with the request made by the hon. member for Vancouver South that the minister provide further information as to the policy of the government in connection with branch and feeder lines.
As I recall it-and I submit this with deference-the minister did not give a satisfactory answer. He made some reference to bush lines; in fact he almost had us bushed, because he went on to say that he did not know the difference between feeder and bush lines, and left the matter there. I think he should bring us in from the bush, and make a definite statement of policy, or give some consideration to the matter and make his statement later.
I say that because this question of feeder lines is one of some importance to anyone considering the establishment of a commercial air line. For instance, I think it is fair to say, although the minister apparently does not like us to say it, that private interests were to a great extent discouraged by government policy wrhen the announcement was made that the railways should divest themselves of their air lines. If that is done to the railways, then who is to know when it will be done to the next private corporation which wishes to operate an air line.
However, the government has stated its policy, and it is that they regard Trans-Canada Air Lines as the agent which will be given exclusive operation rights over main lines. This creates the inference that anyone else, within certain limitations, will be free to start a branch or feeder line. When I say that I do not mean a bush line; I mean a feeder line.
For instance, in my own province, in my own constituency, there might be the desire to establish a line from Vancouver to Calgary,

Trans-Canada Air Lines

which was not served by Trans-Canada Air Lines. That organization provides no service between those two points. A centrally located city, such as Kamloops, might be a stop-over point. There is an airport there capable of accommodating large aircraft.
We are interested in the development of a feeder system throughout central and southern British Columbia, and we foresee that that might be tied in with a north-south line, tying in with the main Trans-Canada Air Line, say at Nelson or some such city.
The point is that nobody is likely to start that sort of undertaking when, all the time, there is hanging over his head the fear that the government may step in and say that that is an area reserved to Trans-Canada Air Lines. That is why I say it is important that the minister should define his policy in respect of feeder and branch lines. Yesterday he said:
Other main lines services are to be added, including for example a service from Winnipeg through Saskatoon to Edmonton.
Without that statement on the record it might be taken by someone, looking at the map, that a line between Edmonton and Winnipeg would be a branch line or a feeder to the main Trans-Canada Air Lines. Therefore he might be prepared to go ahead with that and, after he has his arrangements made, the government comes along suddenly with the statement that that is to be a main line.
I suggest that if the government intends to go ahead with this policy of giving Trans-Canada Air Lines a monopoly control of all main-line operations, then it should lay down immediately a definite policy as to what will be taken to constitute a main line, and, what will constitute a branch or feeder line; because, unless we are to take it that the government policy is one to the effect that there is to be no civil or privately owned commercial organization, then in order to give private individuals the go-ahead sign it must define clearly those areas in which the individual will be free to operate.


Clarence Decatur Howe: I believe I can relieve my hon. friend's mind. He is afraid that no one, under private enterprise, would wish to tackle the Vancouver-Calgary service. Let me assure him that we have several responsible firms who are only too anxious to start that service. They have made application to the air transport board, and from those applications the board will select the firm best able to give the service.
I think there are many fears in -the minds of hon. members opposite which are not shared by those who are actively at work on air transportation in this country.
	: I'nTH


Edmund Davie Fulton: Well, Mr. Chairman-


Clarence Decatur Howe: Now, just a minute, I am replying. The policy in respect of new routes in this country is well established. It has nothing to do with this resolution, because there is nothing in the resolution respecting feeder services or new routes. However, there will be a resolution which will have to do with amendments to the Air Transport Act. That will be the proper place for a discussion of this kind, because the air transport board performs the function of allocating new routes and regulating the operation of existing routes.
So far as Trans-Canada Air Lines crowding other lines off the routes is concerned, to my knowledge that has not yet happened. The hon. member spoke about the route from Winnipeg to Edmonton. It has never been operated as a route either privately or publicly. But the policy was announced two or three years ago that Trans-Canada Air Lines would operate it as part of the Trans-Canada Air Lines system.


Harry Rutherford Jackman: How about the Vaneouver-Victoria route? Was there not crowding there?
Mr. HOWEx No; there are two separate services there. One is a definite local service, and the other is a main-line service, the extension having been made at the urgent request of the people of Victoria for the extension of that service to Victoria.


Harry Rutherford Jackman: I am not sure what
happened. The administration was taken from the Department of Transport, and the aeronautical board was set up. If I recall correctly, the Department of Transport has ruled that the Trans-Canada Air Lines would have the right over transcontinental or through traffic from Victoria, and that so far as local jitney traffic between Victoria and Vancouver was concerned it would remain with Canadian Pacific Air Lines. Then when the government did away with the jurisdiction of the board of transport commissioners and put the jurisdiction under the aeronautical board, was any change made in connection with the jitney service between Vancouver and Victoria?


Clarence Decatur Howe: Yes, and for a reason which seems to me important, although I am not sure how it will appear to my hon. friend. There was a shortage of seats for that service. We have been short of aircraft in this country; and there was an objection, which seemed to me reasonable, that one line was operating between Vancouver and Victoria with empty seats, while the other line was unable to

Trans-Canada Air Lines
handle the traffic. The order was issued by the air transport board to give Trans-Canada Air Lines permission to carry passengers on its regular transcontinental operation. I have heard no protests from the competing lines, because it was well understood that all the seats available between those two cities would be needed.


Agar Rodney Adamson: Did the minister say
there was one line operating between Vancouver amd Victoria?


Clarence Decatur Howe: Yes. By a ruling of the air transport board, Trans-Canada Air Lines operated from Vancouver to Victoria, to carry passengers boarding the plane east of Calgary, but could not take local passengers. The result was that they flew across with empty seats, which did not seem to make sense when there was a shortage of seats to handle the traffic.


Agar Rodney Adamson: I had great difficulty in getting a seat. [DOT]


Clarence Decatur Howe: And1 you would have more difficulty if that difficulty had not been met.


Edmund Davie Fulton: 1 am glad to hear the minister make the .public statement that consideration is being given to the operation of air lines between Vancouver and Calgary. However, I can assure him that in this matter the government has not been omniscient, because I kmiew there was that development, but it was rather felt that sufficiently rapid progress was not being made.
But it goes further than that. People are considering developing air transport throughout central British Columbia, and many of these people do not know whether they will be given permission to start up such air lines, because it may be said that these routes are reserved for Trans-Canada. I am glad to hear the minister make this public statememit, but I think he should go a bit farther and outline as far as possible what areas are to be reserved for private air lines and what assistance will be given to those private air lines.


Howard Charles Green: I think the minister should clear up the situation more than he has done. This afternoon he said something to the effect that Trans-Canada Air Lines would do all interurban flying.


Clarence Decatur Howe: I did not say that.


Howard Charles Green: I did not know just what the minister meant. There are many cities in Canada which are not on the present Trans-Canada Air Lines route and which would like to have service to adjoining cities. Those would be interurban routes. The proposed service from Vancouver to Calgary, which would stop at different places on the way, would be one 47696-91J
of those lines. Could the minister make it clear just how the field is to be divided, whether private lines are supposed to fly these city-to-city routes, or will they all be flown by Trans-Canada?


Clarence Decatur Howe: The Trans-Canada route
extends from Vancouver to Lethbridge to Winnipeg to Toronto to Montreal and to Halifax. There is a branch from Montreal to Sydney and then on to Newfoundland. There is a secondary service north from Lethbridge to serve Edmonton. It is intended to furnish direct service from Edmonton to Winnipeg, and it is quite possible that at some'time in the future there will be a service from Edmonton to the west coast. This has been announced as a possible future development, and it will serve an area not at present served by aircraft.


Howard Charles Green: Would that be from Edmonton to Prince Rupert?


Clarence Decatur Howe: Direct from Edmonton to Vancouver. In addition, Trans-Canada Air Lines serves all routes crossing the border and extending into other countries. All other routes are open to the public. If anyone can show the air transport board that he has selected a route which he believes will be profitable, if the air transport board believes it has a reasonable chance of success and if the applicant shows that he has the necessary finances and aircraft available to operate the route, in the ordinary course of events a licence to operate would issue.


Howard Charles Green: There has been some talk this evening of a divesting order under which Canadian Pacific and Canadian National would be forced out of the aviation field. If Canadian National is forced out of that business, would the shares in Trans-Canada Air Lines now held by the Canadian National be taken over and vested in the name of the minister?


Clarence Decatur Howe: They would be vested in His Majesty the King.


Howard Charles Green: Section 11 of the Trans-Canada Air Lines Act, which I presume is the section to which the minister refers, reads:
11. (1) The minister shall, with the approval of the governor in council, be entitled at any time to acquire from the shareholders all of the shares of the capital stock of the corporation on payment to the shareholders of the book value thereof, and the governor in council may by order vest the said shares in the minister.
Subsection 4 of that section reads:
The shares shall, upon acquisition by the minister, be held in trust for His Majesty.
In effect the shares would be held in the name of the minister.


Clarence Decatur Howe: It might be, yes.
Trans-Canada Air Lines


Howard Charles Green: The section I have read is the one to which the minister referred earlier this evening.


Clarence Decatur Howe: The minister in trust for the crown.


Frank Exton Lennard: I have just one observation to make in connection with the proposed service to the West Indies, the Caribbean and Latin America. In my opinion this service is long overdue. Canada has lost considerable prestige because we have not instituted this service. Can the minister tell me how far the plan has been developed and when it will be possible to institute the service?


Clarence Decatur Howe: Discussions are under way in connection with the use of the necessary airports and we are building the equipment as rapidly as we can. I could not give any exact date. No. new air line could possibly have been started into that area before this, because during the war years flying was prohibited except by the existing services.


Mr. KNIGHT:: I notice that most of the criticism during the last hour or two has been hostile and has come from hon. gentlemen to my right. I have heard more to-night about shares, dividends, venture capital, capitalization and things like that than I have for many a day. I must express sympathy with the hon. member for Qu'Appelle when she says that not much has been said for the people in the territories which are to be served, and particularly by the group to my right.
I wish to commend the minister for the steps he has taken. As far as I am concerned, he can go a good deal farther. I represent the constituency of Saskatoon, and I am glad that we are to occupy a central position in what is to be a main-line T.C.A. route from Winnipeg to Edmonton. There is to be another main-line route from Winnipeg to Calgary, and Regina will again be in a half-way position. I shall be pleased if the route between the two cities is to be under T.C.A.
Resolution reported, read the second time and concurred in. Mr. Howe thereupon moved for leave to introduce bill No. 21, to amend the Trans-Canada Air Lines Act, 1937.
Motion agreed to and bill read the first time.



WAR AND DEMOBILIZATION


[Stage Direction]
The house resumed from Monday, October 22, consideration in committee of a resolution to grant to His Majesty certain sums of money for the carrying out of measures deemed necessary or advisable in consequence of the war-Mr. Ilsley-Mr. Macdonald (Brantford City) in the chair.

Mr. ABBOTT:: I must be one of those rare flowers, the night-blooming cereus, as I seem to come out with my estimates late every evening, but I suppose we can carry on with this resolution for the next fifteen or twenty minutes.


Mr. McMASTER:: I wish to refer to one phase of the naval service in which I think a great improvement could be made. The navy is not being demobilized as rapidly as possible, and the pay and allowances for the navy for the present year are almost equal to the expenditure last year and even more than two years ago. This I believe is not because naval personnel cannot be demobilized, nor is it from any lack of shipping, but for some reason best known to the government these men are kept in Nova Scotia', the maritimes and elsewhere, and are not alloived to leave the service as fast as they would like to do. It may be that the election which took place in Nova Scotia to-day had something to do with the matter, and perhaps now the demobilization of naval personnel will proceed a little more rapidly.
I wish to refer particularly to the bandsmen in the navy. They are performing no particularly useful service at the present time and they are very much dissatisfied at being kept in the service. All the other artificers are being kept on in the same manner and it is causing a great deal of dissatisfaction. It means increased cost to the people and it might also interfere with future recruiting. It may be that the minister thinks that by keeping these men in 'the service a certain number of them will join up in the interim period and eventually become members of the permanent navy, but that is not altogether likely to happen, because if they do not join the permanent navy they will go out among the people a bunch of dissatisfied men who will impede rather than help

Demobilization-Naval Services
recruiting for the permanent force. I respect-folly suggest that these men should be allowed to.be discharged and to rehabilitate themselves in private life as they desire to do, because they are serving no useful service at the present moment so far as I can find out. They are not doing any essential work such as the clerks are doing whom it is necessary to retain to assist in the demobilization of the other men. If the government would discharge the bandsmen not oniy would it be in the best interests of the people of Canada and in the best interests of the minister, who is I am sure anxious to recruit the navy up to strength, but it would also be acceding to the wishes of the bandsmen themselves.
Our party has definitely stated its stand on defence. We believe in a strong, efficient army; we believe in a strong, efficient air force; we believe in a strong, efficient navy, and the remarks I have made this evening are made with the pdrpose of helping the government rather than impeding them in their recruiting campaign for the permanent navy.


Douglas Charles Abbott: I am not sure that I caught my hon. friend's question, but I think he complained that we were not demobilizing the navy fast enough. I said yesterday that we were demobilizing at the rate of ten thousand a month, which in my judgment, for what it may be worth, is about as rapidly as we can possibly turn men out without turning them out too quickly. I do not think we should turn them out too fast. The rate of demobilization compares favourably with that of the other services. It is only six or seven weeks since V-J day, and we have already demobilized fifty-three per cent of the total strength of the navy.


William Alexander McMaster: I had particular reference to the bandsmen; they are serving no useful purpose at the present time.


Douglas Charles Abbott: I am not prepared to concede that bandsmen do not serve a useful purpose in any service. At the outset of the war we had complaints that we did not have enough bands. It was a complaint that I made myself. I thought we wanted a lot of bands to give colour and arouse enthusiasm. I think the navy as well as the other services should have bands. I do not know whether my hon. friend was on Confederation square the other day at the opening of the victory loan campaign when we had an air force band and a navy band from Toronto, and a Royal Mounted Police band, I think, all playing rousing music. I am not prepared to say,
until we are actually down to rock bottom, that we should not have a band in the navy as well as in the other services.


William Alexander McMaster: I heartily agree with the minister as to bands when the war and a recruiting campaign are on. I think we made a mistake at the beginning of the war in not having enough bands. A band plays an effective part in arousing enthusiasm, but for some reason or another-it was not the fault of the present minister-the government .decided not to have bands. At the present time, if bands are not necessary for the army,
I do not see how they can be of any service to the navy, because the navy will not be recruited just from the maritimes or other ports where they may now be stationed, but will likely be recruited from all over Canada. So that I cannot see why it is necessary to retain the bandsmen at the present time. The bands that we have in Toronto are gathered together by the different armed forces, and they practice for a certain number of hours each week and receive a certain amount of pay. They do perform as effective work in providing martial music as any band that spends its whole time at that work. If the minister or any of the departments desire a band they can always get a good band from Toronto. The trouble has been that the military bands attached to the reserve forces cannot get work enough to do, and we have made a special effort to have their services used on special occasions when they will receive a certain amount of remuneration to compensate them for the time they have spent in practising.
As I have said. I think these other men who have special qualifications in private life and want to get away should not be held there any longer. I wish the minister would take that into consideration, because I am astonished that pay and allowances of the naval forces have not gone down in the present year to the extent that we should have expected, or to anything like the extent that they have in the other forces.


Douglas Charles Abbott: Pay and allowances are
down- The bandsmen take their turn for demobilization the same as anybody else, and the basic principle in the navy, as in the other services, is that the men with the longest service get out first.
Pay and allowances are down substantially from last year. Last year the estimates were $114,698,835. The estimates for this year are $68,351,247. The actual expenditures last year for pay and allowances were I think, about $123,000,000. I am speaking from memory.

Demobilization-Naval Services
as I have not the figures here. This year they are estimated to be about $98,000,000. So that pay and allowances are down substantially. My hon. friend will recall, if he thinks it over, that on a straight basis of mathematics the average number of men employed during the year will be rather higher than the number who were discharged to date, because you have to include in the figures the thirty days leave granted on discharge, and other items of that kind, so, that in effect a man is on the strength for thirty or forty days after he actually ceases to be a serving rating. The figure for pay and allowances necessarily reflects that amount, but the pay and allowances will not exceed the average number of men on strength during the year. They are being demobilized at the rate of about ten thousand a month; fifty-three per cent have already been demobilized, and by the end of the year we shall be down to the minimum below which we do not want to go.


Mr. POULIOT:: In the first place I must
congratulate the hon. member for High Park upon his interest in the fine arts and his musical disposition. No doubt upon such a subject the discussion will be carried on in perfect harmony. I am interested in bands- military bands.


John Ritchie MacNicol: Don't you like the bagpipes?


Jean-François Pouliot: Well, not in the house;
outside in the valley when we are on the top of a high mountain. They are very fine, but each thing in its place. Speaking of military bands, there is a matter which I have at heart; it is to knowif the air force bands are the only ones of the three branches of the armed forces that were instructed two or three years ago not to play "O Canada" as the national anthem; and I want to know if the same instructions have been given to the bands of the navy and the army militia.


Douglas Charles Abbott: I cannot, of course, speak
for the air force, but I can assure my hon. friend that no such instructions have been given to the navy or the army bands.


John Ritchie MacNicol: And "O Canada" is not the national anthem.


William Ross Macdonald: Later in the proceedings in committee it was decided that we should have a general discussion of the estimates of the various services and then oonsider item by item the statement which has been prepared. Is it now agreed that we will start 
consideration of the estimates of the Department of Naval Services, beginning with the first item, civil salaries?


Douglas Charles Abbott: I think, Mr. Chairman, we had a discussion of this yesterday evening, and it was more or less understood that we would follow the practice as in the past, and on the first item, civil salaries, we would have the general discussion, speeches or remarks of a general nature, but where information of a specific nature was requested it would be deferred until we were considering the special items one by one.


Howard Charles Green: We have had quite a long general discussion on the first item, and perhaps we could carry it.


Douglas Charles Abbott: I am in the hands of the committee.	[DOT]


Mr. NICHOLSON:: Has the minister an answer to the question I asked last night about the ratio of medical *officers?


Douglas Charles Abbott: I think I can give that information. Incidentally, any information which may have been asked for by any member of the committee and which I have not to-day, I give an assurance that I will put it on the record- under some other item. That has been the usual practice. My hon. friend, I think, asked how many medical officers are on the strength as compared with navy personnel. The number is 287, and the personnel not yet processed for demobilization is 48,000, which would give a ratio of something around six per thousand. But my hon. friend will appreciate that, although the number on' the strength is constantly decreasing by reason of demobilization, we cannot decrease the number of medical men quite as rapidly, because if anything we need more medical men during the process of demobilization than we do during normal operations, since we have to conduct a medical examination of each man as he goes out.


Alexander Malcolm Nicholson: Can the minister give the figures relative to the army and the air force?


Douglas Charles Abbott: I will give them, if I may, when we are considering the estimates of those services.	.


Alan Cockeram: 
Douglas Charles Abbott: Yes; I can give that explanation. One explanation, a very short one, is that the navy operates two industrial establishments in the shape of dockyards on the east and west coast. We have a very large number of civilian employees in those dockyards. Neither the army nor the air force operates any comparable establishment. We still have on the east and west coast large dockyards which employ a very considerable number of civilian employees. As I say, these in effect are industrial establishments. For that reason the ratio of the navy's civilian employees to its service employees is probably higher than in either of the -other services. In addition, we contemplate during the course of this year replacing as many service employees as we can with civilian employees, particularly in clerical work such as is now being carried out by W.-R.C.N.S. and other service personnel.
Mr. COCKERA-M: How do the- figures compare this year with last year? How many civil employees have you now, and how many did you have when the estimates for last year came out?


Douglas Charles Abbott: I can give the figures now for those employed at the present time. I have not the figures here for last year, but I have them for the beginning of September this year and they are as follows: For headquarters, Ottawa, 1,677; Atlantic coast-
Mr. COCIvERAM:	Civilians?


Douglas Charles Abbott: Yes. Atlantic coast, 1,318; Pacific coast, 729; Newfoundland, 211

that will go down rapidly-Toronto, Montreal, Quebec, St. Hyacinthe, et cetera, 305, total, 4,240. I would point out that there will be, of course, a substantial reduction in some of those figures before the end of the current fiscal year, but in the meantime the estimates include provision sufficient to cover temporary civilian help which will be needed in order to carry out the closing up process.


Alan Cockeram: The minister should be
more explicit on this, in that there is a large increase, I think, over $700,000, as between this year and last year.


Douglas Charles Abbott: It is $526,000.


Alan Cockeram: Over half a million
dollars?


Douglas Charles Abbott: That is right.


Alan Cockeram: 
Douglas Charles Abbott: Some only. I'think I explained this on another item. We were under the necessity during the war of putting into
uniform a number of men who would ordinarily be engaged as civilians. The reasons for that are obvious, namely, in order that they could be subject to discipline and in order that we could keep them under control. It should not be necessary to put-I do not want to cast any reflection upon plumbers-a plumber into uniform. We have had to do that on some occasions during the war.


Alan Cockeram: I am told you are doing it now.


Douglas Charles Abbott: We may still have to have some, because we have the work to do. As soon as we can. replace what is in effect a civilian worker now in uniform with a civilian we propose to do so.


Alan Cockeram: The estimates should take that into account.


Major James William Coldwell: Eleven o'clock.


Alan Cockeram: I suggest that we do not pass this item now.


Douglas Charles Abbott: I did not ask that the item be passed now; I am in the hands of the committee.
Progress reported.



ADJOURNMENT

Ian Alistair Mackenzie: I should like to quote the remark made by a great Canadian two weeks ago, on the night of the Manitoba election. At that time the leader of the opposition said: "This is a great day for democracy." I should like to say the same thing this evening with regard to the Nova Scotia election.


Douglas Gooderham Ross: In answer to the remark of my .hon. friend, the Scots are said to be always right, but this time one class of Scotsmen is just a bit wrong.


[Stage Direction]
It being five minutes after eleven o'clock the house adjourned, without question put, pursuant to standing order.
Wednesday, October 24, 1945.