1946-06-25

[Stage Direction]
On the orders of the day:
Hon. GROTE STIRLING (Yale):: May I ask the Minister of Labour whether it is true, as is alleged, that only seamen carrying a 
Canadian seamen's union card are being allowed aboard the ships now controlled by the government?


Hon. HUMPHREY MITCHELL (Minister of Labour):: I have no knowledge of that, but I shall be glad to look into it. I may say that they are moving through the national employment service offices on to the ships. That is the machinery which is being used.



NEGOTIATIONS FOR CONTRACT WITH THE UNITED KINGDOM

[Stage Direction]
On the orders of the day:
Mr. J. G. DIEFENBAKER (Lake Centre):: Is the Minister of Trade and Commerce in a position to give a report to the house with regard to the wheat negotiations between the government of the United Kingdom and the government of Canada?


Hon. J. A. MacKINNON (Minister of Trade and Commerce):: I rather expected that I would be asked such a question to-day, and I came prepared to make a brief statement to the house with regard to the progress being made in negotiations looking towards a wheat contract between Canada and the United Kingdom.
For the past ten days negotiations have been carried on between experts representing this country and the United Kingdom. Substantial progress has been made in regard to the terms of such an agreement, in spite of the difficulties involved in placing the sale of a large volume of wheat on a contract basis for an extended period. A number of important considerations have now arisen which must become a matter of reference to the Canadian government and the United Kingdom government. As soon as these matters have been dealt with by the respective governments, negotiations will be resumed on the terms of the proposed contract.



CANADIAN PACIFIC RAILWAY


[Stage Direction]
On the orders of the day:
Mr. STANLEY KNOWLES (Winnipeg North Centre):: I should like to direct a question to the Minister of Labour. Is the minister yet in a position to make a statement to the house with respect to the conciliation officer's report on the Canadian Pacific pension dispute?


Humphrey Mitchell: I have received, a reply from the company, and I also received their permission to table it, which I shall be glad to do tomorrow.

Interim Siipply Bill


Stanley Howard Knowles: Would it be possible to table a copy of the conciliation officer's report at the same time?


Humphrey Mitchell: It is not customary to table the report of a conciliation officer. It is a report made to the minister. May I give an example of how careful one has to be in these things? We had two commissioners looking into the printers' strike in Winnipeg. I have received representations from the union not to table one of the reports. This thing cuts both ways. If my hon. friend would like to read the other report himself, I shall be glad to show it to him.


Stanley Howard Knowles: Thank you.



MOTOR VEHICLES


[Stage Direction]
On the orders of the day:
Mr. NORMAN J. M. LOCKHART (Lincoln): I should like to ask a question arising out of information which has been sent to me about the importation of small jeep cars from the United States. Some of the automobile employees have objected to the importation of these cars. Has the minister any knowledge of it, and if so will he give the house some information in respect to it? I have just received a telegram which states that the jeeps are coming in duty free.
Right Hon. J. L. ILSLEY (Minister of Finance):: I do not know that I am the minister to deal with the inquiry-it may be the Minister of National Revenue. If the hon. gentleman will send me any information which he has-it would need to be fuller than that which he has given to the house to-day-I shall see if it can be checked.


Mr. LOCKHART:: I shall be glad to do that.

Right Hon. J. L. ILSLEY (Minister of Finance) moved that the house go into committee of supply.
Motion agreed to and the house went into committee of supply, Mr. Golding in the chair.



INTERIM SUPPLY BILL

James Lorimer Ilsley: Resolved, that a sum not exceeding $136,598,972.86, being one-twelfth of the amount of each of the several items to be voted, as set forth in the estimates for the fiscal year ending 31st March, 1947, laid before the House of Commons at the present session of parliament, be granted to His Majesty on account for the fiscal year ending 31st March, 1947.


Mr. R. W. MAYHEW (Parliamentary Assistant to the Minister of Finance):: I should like to inform the committee that I have made arrangements with the leader of the opposition and the leaders of the other parties to allow interim supply to go through at this time. In doing so I wish to say that the passage of this interim supply will not prejudice in any way the rights and privileges of the members of the house to criticize and oppose any item in the estimates, and I have pleasure in giving the usual assurance in that regard on behalf of the Minister of Finance.
Resolution reported.
Mr. JEAN-FRANCOIS POULIOT (Temis-couata): Before the resolution is concurred in, Mr. Speaker, I have just a few observations to make about some answers which have been placed on Hansard. On May 12, 1943, I gave a warning that millions of dollars had not been accounted for in 1943, and I asked why it was impossible to render an account for $17 million for the year 1942 and $41 million for the fiscal year 1942-43. The Minister of Finance submitted that the observation was out of order, and the chairman ruled me out of order.
To know what Canada has spent during the war we must consider first the revenue from taxation, and second the increase of the dominion debt during the war through victory loans, et cetera. In Hansard of May 27, 1946, at page 1881, the answers were given as follows:
Total revenue of the dominion from September 1, 1939, to February 28. 1946, was $12,681,719,279.
The net debt up to March 31, 1945 was $15,712,181,527.


Mr. SPEAKER:: Order. I am sorry to interrupt the hon. gentleman, but if he will look at standing order 38, debatable motions, he will see that the second reading of this resolution is not debatable.


Mr. POULIOT:: I did not understand a word you said, Mr. Speaker.


James Horace King: I asked the hon. gentleman to refer to standing order 38, debatable motions. If he does that he will see that as we are on second reading of a resolution, thi motion is not debatable.
Resolution read the second time and con curred in.



Ways and Means-Interim Supply



WAYS AND MEANS


[Stage Direction]
Right Hon. J. L. ILSLEY (Minister of Finance) moved that the house go into committee of ways and means.
Motion agreed to and the house went into committee, Mr. Golding in the chair.
amounted to $17,366 million, making a total of $22,068 million. If we recapitulate these figures we get the following result:
million
Total revenue from September 1, 1939 to February 28, 1946, and war debt
to March 31, 1945	 24,626
Non-war expenditure and war expenditure from September 1, 1939", to February 28, 1946	 22,068
Mr. ILS'LEY moved:
Resolved, that towards making good the supply granted to His Majesty on account of certain expenses of the public service for the fiscal year ending March 31, 1947, the sum of $136,598,972.86, being one-twelfth of the main estimates, be granted out of the consolidated revenue fund of Canada.
Jean-François Pouliot: In my humble view the revenue and the increase of the debt during war time, the increase of the debt through borrowing on the one hand, and on the other hand the non-war and war expenditures during that period, should balance. As a foreword may I say that the country spends the revenue which comes from taxes, and when there is not enough revenue to meet the expenditures, then there is some borrowing. During the war the borrowing was done through victory loans. The money which has been received from taxation and from victory loans should balance with the non-war and the war expenditures of the same period. This statement seems clear, and everyone may agree with it in principle.
According to the figures given by the Department of Finance on May 27, 1946, at page 1881 of Hansard, the total revenue from September 1, 1930, to February 28, 1946, was $12,681 million. The debt at March 31, 1945, which is the latest figure I have, was $15,712 million. If I subtract from that the debt when the country went to war on September 1, 1939, which was $3,767 million, the balance of the war debt proper up to March 31, 1945, was $11,945 million. If I add the total amount of revenue from September 1, 1939, to February 28, 1946, to the increase in the debt up to March 31, 1945, I get a total war expenditure of $24,626 million. No information was given for the fiscal year ended March 31, 1946. The figure for the total debt at April 30, 1946, was "not yet available" on May 27 of this year.
The official figures given for non-war expenditure and war expenditure from September 1, 1939, to February 28, 1946, do not balance with the total increase in the debt during the above mentioned period, and the total amount of revenue. From September 1, 1939, to February 28,	1946, our non-war expenditure
totalled $4,702 million. War expenditures

Not accounted for

The $2,500 million not accounted for was not a surplus. I quote from Hansard of June 12, 1946, at page 2419:
War Expenditures and Revenue
Mr. Pouliot:	Referring to the statement of
the parliamentary assistant to the Minister of Finance at page 1881 of Hansard, May 27, 1946, was the difference of $2,557,559,903 between the war debt until March 31, 1945, and the total war revenue until February 28, 1946, on one hand, and the non-war expenditures and war appropriation from September 1, 1939, to February 28, 1946, on the other, a surplus?
The answer by the parliamentary assistant to the Minister of Finance was:
Mr. Mayhew:	No, a surplus is an excess of
revenues over expenditures. In the period September 1, 1939, to February 28, 1946. total expenditures of the government were $22,069,226,313, and total revenues were $12,681,719,279, resulting in a deficit of $9,387,507,034.
I have a note here that this item does not balance with the increase in the war debt, according to the figures given on May 27. Then the hon. gentleman continued:
The figure of $2,557,559,903, which is the difference between the increase in total debt from September 1, 1939, to March 31, 1945, together with revenues in the period September 1, 1939 to February 28, 1946, on the one hand, and total expenditures in the period September 1, 1939, to February 28, 1946, on the other, represents an excess of receipts (including borrowings) over expenditures. This excess would be reflected in the books of the government by increases under various accounts classified as active assets (cash, loans, investments, etc.)
This leaves $7,500 million unaccounted for. The figure of $24,626 million for war expenditure was incomplete, because victory loans and extra-parliamentary expenditure during the fiscal year ending March 31, 1946, were an additional part of the debt and should have been added to this figure. That amount would be approximately $5,000 million. Therefore the total war expenditure, including war revenue up to February 28, 1946, and war debt up to March 31, 1946, should amount to about $29,626 million. A recapitulation of the above figures would give this result:
million
Total revenue from September 1, 1939, to February 28, 1946, and war debt to
March 31, 1946	
War expenditure	
Not accounted for


[Stage Direction]
Ways and Means-Interim Supply
This amount of $7,558 million which has not been accounted for represents $2,000 million more than all the deposits in the ten Canadian chartered banks. It is one-fourth the total expenditure of $30,000 million during the war. It is a very serious matter.
I was the only member to complain against the Bank of Canada when it was established. Now the books of the Bank of Canada apparently balance, but there is a secret; there is a mystery behind the doors of the Bank of Canada, and it is impossible to get any information about that. When the banking committee studied the Bank of Canada Act a couple of years ago the attention of hon. members was ably directed elsewhere by a discussion of the supposed hidden reserves of the banks. Much noise was made about it, but no member of parliament took advantage of that unique opportunity to get information about the Bank of Canada itself. I warned some members that a trick was being played; I warned the house and country that it was dangerous to have amounts unaccounted for when we debated the gift made in 1943. But that was a trivial matter; it was a casual matter of no importance!
Now there is an amount of $7,500 million which apparently is unaccounted for. In May I asked for information about the amount of the debt to the end of the fiscal year ended March 31, 1946. The only information I got was to the end of the fiscal year preceding. Every business man has accounts showing the operation of his business each morning when he comes to his office. He finds that information on his desk each day. I wonder if the Minister of Finance is not informed day after day as to the amounts of the debt of Canada. If we are to be the bankers of the world, then business should be done otherwise, because that figure of $7,500 million represents the amounts collected in several of the victory loan campaigns.
I do not cast any doubt upon the honesty and integrity of the Minister of Finance or his parliamentary assistant. I do not cast any aspersions of dishonesty on anyone in the Bank of Canada. But the day of mystery should be ended. The time has come when the House of Commons should scrutinize the business of the Bank of Canada; and the Minister of Finance should be responsible to the people, just as in the days of Fielding, White and Jim Robb.
Parliament is in the impossible position of being unable to get information about the business of the country. Money is spread everywhere, but when we ask for an accounting it is hard to get. Probably it will be made later. I wonder if that is the reason 63260-177J
the budget has been delayed so long. Perhaps it may be made. As this document states:
This excess would be reflected in the books of the government by increases under various accounts classified as active assets (cash, loans, investments, etc.)
When Mr. Dunning was Minister of Finance I asked him for information about the personnel of the Bank of Canada. But his reply was, "No, that is a secret". When Mr. Bennett, upon my advice to one of his secretaries, left for the Antipodes, he took with him a doorman from the Bank of Canada named Brooks. Upon his return I asked the government of that day if Brooks' salary had been paid by Mr. Bennett or by the Bank of Canada while he was travelling with Mr. Bennett. The answers by the Prime Minister and by Mr. Bennett were that I had been very bold in asking such a question, and that no member of parliament should inquire about the Bank of Canada. They said' it was very bad manners to ask if Brooks had been paid by the Bank of Canada or by R. B. Bennett.
We are responsible to the people of Canada for the money that is spent outside and inside the country. We must be in a position to inform our constituents when they ask us for information in these matters. It is our duty; are we neglectful of it?
We live in strange times. On one occasion I complained about a man who, it was supposed, had sold the same coal three times; but no one was scandalized. Everyone considered him smart. These are the signs of the times. We are neglectful; we are careless; we pay no attention to these matters. Then, afterwards, some people will complain about taxation. They are ready to throw away their money outside, anywhere. We help the world, but we cannot look after our own business.
Sir, you will remember how many times I have insisted that the Minister of Finance bring in some reform in the matter of public accounts. The help I got was from two hon. members opposite, the hon. member for Broadview, and the hon. member for Davenport, who is now in his seat. Now when members of parliament complain about high taxation, they will remember that they made no move to reform public accounts. They voted for the loans which we had not the means to make. Having done that, they cannot complain about high taxation; it would seem that they want it. They are responsible before the people of Canada for that high taxation. I wonder if they will not realize the time has come to make a check
[Stage Direction]
Ways and Means-Interim Supply
on public business, to scrutinize the operations of the Bank of Canada and to make the Minister of Finance responsible again to the House of Commons in conformity with the old principle of ministerial responsibility.
I have asked information about government agencies, the chief of which is the Bank of Canada, including its subsidiaries, such as the foreign exchange control board. That board, it will be recalled, is operated by a man trained by Montagu Norman, and another man, who were doing so much at the Bank of International Settlements in Switzerland, and who during the war were shaking hands with Germans under the table. Those people are here. They are supposed to be internationally minded; I am not. I am nationally minded, although I am not a nationalist. I consider that the Canadians who are here should be considered first, and before any other peoples in the world. It is in their defence I speak to-day. As usual, perhaps I shall have the support of one member-or two. If there are two, there will be a crowd in support of my contentions.
I wonder what the people of Canada think about it. These figures are available; they can be collected by the Bank of Canada. It is very easy; anyone could do it. It is only a matter of bringing together the various increases under different accounts classified as active assets, cash loans and investments. Let it be done; let us place responsibility where it should be. Let us say that it has gone somewhere-to the Atlantic, the Pacific, the north pole, or the south pole; we do not know where. But the money has gone.
Let us suppose that one has an estate of 1100,000, and that it is to be administered by someone who, while honest, may be incompetent. When the time comes for the rendition of accounts, they are rendered for only $75,000. Where has the other quarter gone? Where is the $25,000? No one knows. It is unaccounted for. That is the situation here.
I have simply given in miniature the true picture, which I believe to be my duty. I have informed the house. I wonder if the budget debate will simply be a matter of patting on the back, saying that everyone has done wonderful work, and that we must not disturb those gentlemen in the Bank of Canada who are so very competent and who are under such heavy strain because they work so hard!
One time I asked Mr. Dunning how much Graham Towers received. When I asked if it was $35,000 the minister was indignant, and replied, "Not at all; it is only $30,000." In spite of all this incompetence, which has scandalized me, I see a further notice in the

papers that these fellows in the Department of Finance are to have a boost in salary because. they have done so magnificently. Yet they cannot render accounts for $7,500 million out of expenditures of $30,000 million.
Mr. MacNICOL:: A salary of $30,000 is a more pittance.


Jean-François Pouliot: It is a small thing. I
hope I have awakened the. house to its responsibilities, and I hope that every hon. member, no matter to what party he belongs, realizes that he has a responsibility to protect the Canadian people against the incompetency of men who perhaps wdth the best motives in the world have ruled rich concerns in the state.
Then a word about university degrees. Oh, that is a bad thing. I remember that one of these men came to Mr. Bennett and said, "Mr. Bennett, you are not acknowledged as you should be on the North American continent. You should be made a doctor of laws in all the universities of this country." Mr. Bennett said, "Well, you are fair to me; you are a decent chap, and I appreciate what you say." Then Mr. Bennett was made doctor of laws in universities where he had never placed his foot. This is just a form of flattery. These people wear their mortarboards and they begin to think that they are held in higher esteem by the Canadian people. It is still done, and perhaps it is something that should be done more generously.
Members of parliament show a lack of courage and are unfaithful to their duty when they do not denounce those who consider themselves to be high above us and who really govern this country. If I had the proper words at my command I would tell the Minister of Finance and his assistant that I am sorry that they have not the nerve to follow what was done for this country by the pioneers and builders of the past, by men like Fielding, White and Robb. Those men were ready to defend the rights of the people within the precincts of parliament, and that is where it should be done.
At first the Bank of Canada was a private concern with individuals subscribing to some of the capital stock. Then it was taken over by the government and became a public institution. I do not know why the Bank of Canada is not abolished. I do not know why the foreign exchange control board is not abolished. I do not know why ministerial responsibility is not exercised again by the Minister of Finance, why there is not responsibility to the members of parliament who in turn are responsible to the people of Canada.

Ways and Means-Interim Supply
I have said this many times and I am repeating it to-day. It is pretty hard to follow figures when they are being read, but hon. members can read them to-morrow in Hansard. They will then see that there is something behind them. When I am not satisfied with an answer that is given to me I check the figures, and I felt that the discrepancy in the figures that have been given to me was so great that the matter should be brought to the notice of my colleagues in the house, which I have done.


John George Diefenbaker: Mr. Chairman, we in the opposition agree with the hon. member for Temiscouata when he says that parliament should have the fullest information and be able to make the strictest examination of the country's accounts. May I add that we are happy to know that the hon. member has disavowed his vow of silence and is once more giving us the benefit of his wisdom.
There is a matter I should like to bring up which has to do with the wartime prices and trade board. For some time the press has reported various small rackets in coupon distribution in different parts of the *. ountry. Ouly to-day La Banque Provinciate du Canada were notified by the wartime prices and trade board that, after July 31 next they will not be permitted to participate in the arrangement for ration coupon banking. The announcement was in the form of a release made outside of parliament while parliament is sitting. The officials of the board explain that this bank has been warned of its method of handling coupon accounts. They say that safeguards recommended by the board to protect the public have not been lived up to by this bank; therefore in the public interest, the board has no alternative but to terminate the arrangements with them. This is the first opportunity we have had in the house to ask what irregularities have been ascertained-because they must have been widespread-how long they have been going oh, and what safeguards recommended by the board were not lived up to. Recently the press reported the investigation had indicated that about a million fake or false butter coupons had found their way into the chartered banks. Apparently the bank in question was warned that its activities were illegal. What measures are being taken to ensure that in common with ordinary wrongdoers they will be prosecuted according to law? I am sure the government would wish to acquaint, the country at the earliest possible opportunity with all the circumstances of this investigation and to indicate what action the government intends to take in order to prevent a repetition of any such practice. If the situation was sufficiently serious to warrant cancellation of the- right of a bank to operate ration coupon banking for the wartime prices and trade board, why is the right not cancelled immediately instead of being continued for over a month?


Mr. CHURCH:: Mr. Chairman, this is a resolution to vote interim supply of one-twelfth, amounting to 8136,000,000. Fifty years ago last Sunday, on June 23, 1896, the Liberal administration of Sir Wilfrid Laurier came into power pledged to retrenchment. The whole year's budget of the first year they were in power amounted to $36,000,000, which is S102.000,000 less than the one-twelfth that is being asked for now. We are spending billions to-day compared with millions then. There are many good business men in this house, but certainly this house does not conduct its business in a businesslike way. We are now being asked to vote one-twelfth of the whole year's supply from March 31, 1946, when hardly any estimates have been passed at all. In a few weeks another one-twelfth will be asked for, and on the 12th of July, no doubt, another one-twelfth. What we are really doing is making post mortem examinations of expenditures. We might just as well go home. John Hampden stood for an important principle wThen he refused ship money to the king. The hon. member for Temiscouata made a good stand last session and the session before; he was contending for a principle, and that is what we should do in this house. We should see that there is a proper examination of the estimates before they are voted.
The House of Commons has gone down in public estimation. The press came into being because of a lack of real parliamentary representation, and the press to-day represents public opinion more than do the members of the House of Commons, because our rights and privileges are continually being taken away from us, with the result that we have this way of doing business. I contend it is all wrong. The principle is entirely wrong. This is the sixty-seventh day of the session, and the budget has not yet been brought down. We shall be considering it in July and the session will go on until August, and probably September before we get through. That will mean that for six months of the year the money will have been spent, voted one-twelfth at a time, but, with very few estimates having been passed, and some of the departments have not yet been called in supply. There was some reason for proceeding in this
2S04

Ways and Means-Interim Supply
way during the war, but the war has been over for a year, and no budget has been brought down yet.
They do things differently at Washington. There they have applied the axe to expenditures. We are a country of only eleven millions of people, with nine provincial governments and all the municipal governments. Over-government and over-taxation is the curse of this country. Expenditures are being made without public control. We used to have an auditor general. He used to have certain powers, but they have been taken away. He is picking up quite a bit after the criticism of his reports and is doing a bit of checking, but it does not amount to anything because there is an official over him called the comptroller of the treasury. You have a war appropriation bill, A, B, C, D, E, and once the accounts go through within the terms of the appropriation bill, the account is stamped and paid over the head of parliament without any control at all. The country will face bankruptcy if we continue to conduct business in that way. A number of small business men have already been driven out of business by the controllers that have been appointed. Only the other day the owner of a house in Toronto was evicted from his own home and taken to Pape Avenue police station in my constituency. Under an absurd housing regulation issued by the housing controller this man could not get into his own home. I have examined these various controllers and boards and it is time they were all wound up.
Take an institution like the Canadian Broadcasting Corporation. It collects a licence fee of $2.50 and spends public money on capital accounts and yet it is contended that it is a private corporation, not a public corporation. Is it any wonder that the tax rate is as high as it is, and that people cannot pay their income tax? Is it any wonder that the small business man cannot continue in business? There has to be a change for the benefit of the people. Under the comptroller of the treasury we mostly have no control at all of expenditures and no control of the chiselers. There were some real Liberals in 1896. Alexander Mackenzie, it used to be said, slept on the strong-box. He has no counterpart in liberalism to-day. They have even moved his monument into the back yard. Every Tom, Dick and Harry who wants to come to Ottawa and raid the treasury finds no one guarding the nation's strong-box. The people are looking to parliament to do something, and we are doing nothing. If the municipal governments conducted their business the way we conduct ours in this House of Commons, they would be prosecuted under the Municipal 
Act for not having done their duty and would be dismissed at the next municipal election. We have no check on our business or on our expenditure. I do not suppose there is much use in protesting, but this is the place where the protests should be made. We cannot go on indefinitely in this way under this new 1946 type of liberalism, where we are spending money like water over the head of parliament, over the heads of the responsible ministers and without any public check at all. If this is the way we are going to conduct our business it is no wonder that parliamentary institutions are going down and down and down in public estimation.


Robert Wellington Mayhew: The hon. member for Temiscouata evidently believes that it is better to give than to receive, because he left the chamber after making his remarks. The only criticism I have to make is of his statement that the information was hard to obtain. He was hasty in making that statement. I do not think he had any right to make it. When he asked for information from the department it was immediately supplied to him, and the suggestion was made that if he could not then reconcile the figures given to him, we would have someone from the department visit him and try to show him exactly what was meant by the statement. As to the rest of his statement, it will be brought to the attention of the minister and of the governor of the bank.
As to the statement made by the hon. member for Lake Centre, I am not familiar with the- matter, but it will also be given attention, and as soon as the information can be obtained it will be brought down. I exipeet that in a very short time there will he an opportunity to discuss this if it is necessary. The estimates for the mounted police will come on just as soon as the estimates for health and welfare have been dealt with, and any information we have can be given at that time. I hope that will meet the hon. member's request.


John George Diefenbaker: I would not wish to put the parliamentary secretary in an embarrassing position. But there was a press release on this matter to-day, and I cannot see why parliament should have to wait three or four or five weeks for the estimates of the wartime prices and trade board in order to get the information. I ask the parliamentary assistant to have the information furnished to-day. Parliament is entitled to any information given in press releases and more. I do not want to be unfair to the parliamentary assistant, but I do insist on the information being given now, to-day, before this resolution is passed; otherwise it is just one more instance of parliament

Ways and Means-Interim Supply
being ignored. The hon. member indicated that if it was necessary to give any information, possibly it could be given later. I am sure what he meant was that after the matter had been checked with the wartime prices and trade board the information would be forthcoming. I ask for it to-day.


Robert Wellington Mayhew: I think the hon. member for Lake Centre misunderstood what I said.
I said the information would be supplied to him just as soon as possible, possibly when the estimates for the mounted police are brought down, which will be immediately following the National Health and Welfare estimates, probably later to-day, certainly not later than to-morrow. The matter can then be gone into in detail and we can furnish him with all the information in connection with it-not on the estimates of the wartime prices and trade board.


John George Diefenbaker: No one knows
whether the matter has been brought to the attention of the Department of Justice. All we know is that the wartime prices and trade board did certain things. The wartime prices and trade board is under the Minister of Finance, who has introduced the resolution now before us. If we wait until later in the afternoon the Minister of Justice may say; of course the matter has never been brought to my attention; you had better get in touch with Finance; and we shall be back again on the regular old performance. We are entitled to the information now. The press release issued to-day says that certain wrongs have been ascertained on the part of La Banque Provinciale du Canada, that apparently it has been neglectful of its duties and responsibilities, to such an extent that, after warning, the board has found it necessary to cancel this bank's right to handle the distribution, allocation, or cashing of coupons. If the matter is as serious as that, surely parliament is entitled to have the information when we are being asked to vote interim supply, part of which will certainly be used for the commodity prices stabilization fund and other activities of the wartime prices and trade board.


Robert Wellington Mayhew: I do not disagree at all with what the hon. member has to say. I think he is entitled to the information, and I promise to get it to him as soon as I possibly can. Evidently the Minister of Justice did not have the information when he was in the chamber a few moments ago. I have not had an opportunity of seeing the Minister of Finance to discuss with him whether he has it or not, but as soon as we are through here
I shall endeavour to get the information, and if it is possible to do so it will be given to the hon. member to-day; if not, just as soon as we can get it, and there will be full opportunity to discuss it.


Mr. COLDWELL:: Can we get a copy of the press release? Some of us have not seen it. The case made out by the hon. member would indicate that we should get this information at the earliest possible moment, and it strikes me that the hon. member is asking for it at the right time. Apparently even the Department of Justice and the Minister of Finance have not had time to prepare a statement for the house. I think we should have an understanding that we can go into the matter without delay.


Norman James Macdonald Lockhart: Who prepared the press release?


Mr. MACKENZIE:: I do not know. I never saw it.


Robert Wellington Mayhew: I have promised the hon. member that I will give it to the committee just as soon as I can get it. I hope I shall be able to get it at six o'clock.


Norman James Macdonald Lockhart: Then the matter stands.


Mr. ROSS (St. Paul's):: A little while ago a return was brought down at my request showing the number of people in the employ of the government of Canada, including boards and commissions. I can understand the necessity of increases from time to time during the recent past in the number of employees in the dominion service, but the war has now been over for more than a year, and the time has come for a little economy. On March 1, 1945, we had 149,698 civil servants, including officials of boards and commissions and so on, in the employ of the government of Canada: at that time they were paid $19,158,059 per month. As I say, the war has been over for a year, and it seems to me we should have had some economy practised in that time, something should have been done; but now what do we find? The reduction in personnel is about 900; that is, on March 1 of this year there were 148.711 people in the employ of the government of Canada, and we paid them $19,949,329 per month-roughly $20 millions. There must be something wrong. The people of Canada demand economy, and we on this side of the house want to see economy practised. There is no economy in a reduction of only 900 in the number of federal employees in one year; and this return is inclusive of all the people in the employ of Canada. Not only that, but the increase in the monthly pay has been roughly $800,000. I can understand that, because there have been increases

Ways and Means-Interim Supply
in civil servants' salaries. The government ought to get busy and start to count the pence and see if we cannot have a little real economy so that there shall be a reduction in what the Canadian people have to pay in taxes.


Mr. MACDONNELL (Muskoka-Ontario):: I am wondering whether we might reverse things and have those of us on this side of the house find out what has been happening, and tell the government. But speaking more seriously, it does seem to me, as the hon. member for Lake Centre has said, that this is just one of those cases which bear out what we feel very strongly, that these independent bodies are indeed independent and do all kinds of things without even bothering to take responsible ministers into their confidence. That is not certain, but it would look as if it may be so; therefore these things should be brought to notice and seriously considered; I do not think the matter under discussion should be regarded as a mere affair of routine on which we will get information. I have no doubt that the parliamentary assistant wdll get the information as soon as he can. But is this matter not more significant in that it indicates the degree of seriousness with which these things are dealt when they are brought before the house?


John Ritchie MacNicol: I should like to make a brief comment on the remarks of the parliamentary assistant in reply to what the hon. member for Temiscouata said. I warn the parliamentary assistant that the hon. member for Temiscouata is one of the greatest diggers for information in the House of Commons, and when he makes a statement he usually has the facts under his hand. If the parliamentary assistant does not remember what the hon. member for Temiscouata said-he made some startling statements which have not been answered, and my experience has been that he has always been a stickler for full information being placed before the House of Commons-my suggestion to him is that he read the statement of the hon. member for Temiscouata carefully and give us the reply at the first opportunity.


Ian Alistair Mackenzie: May I say humbly that general assent was given by the house to the granting of interim supply. As I announced last night, we intend to go into supply later to-day, when all these grievances may more properly be ventilated. May I suggest that we make progress with interim supply?


Grote Stirling: Do I understand from that remark that opportunity will be given to the parliamentary assistant to give the information?
rMr. D. G. Rost.1


Ian Alistair Mackenzie: Yes.


Grote Stirling: Is it the government's intention that there will be that opportunity?


Ian Alistair Mackenzie: Yes.


Grote Stirling: Otherwise I w-as going to ask whether it would not be fitting to ask the committee to rise, report progress and ask leave to sit again to-day so that we might have that opportunity.


Ian Alistair Mackenzie: An opportunity will be given to criticize whatever information is furnished by the parliamentary assistant later to-day, of we should again get into supply, and I hope we shall.


Grote Stirling: My point is that when the motion is presented the Speaker will be in the chair and there will be no opportunity for questions and answers. When the motion is carried and we get into the Department of Justice or some other department, have we assurance that this matter can be again discussed?


Ian Alistair Mackenzie: Yes.


Grote Stirling: With the consent of the committee.


Ian Alistair Mackenzie: If that is the decision of the committee, it certainly will be. I can assure the committee now that later wThen we reach committee of supply, every opportunity will be given to ask questions in regard to this matter.


John George Diefenbaker: Do I understand that when we get into the Department of Health and Welfare or the Department of Justice, any hon. member will have the right to bring up this question?


Ian Alistair Mackenzie: Yes.


John George Diefenbaker: To ask questions on it; we shall not be cut off from asking questions or getting the information because of the fact that this matter does not peculiarly come under the department under discussion?


Ian Alistair Mackenzie: Definitely, yes.


John George Diefenbaker: It is not a matter of just a grievance, as the minister said; it is more than a grievance; it is a serious charge against a bank in this country for malfeasance or misfeasance in connection with coupons used. Apparently the wartime prices and trade board must have acted without the minister or the government knowing anything about it, because when they read the press release which I sent over to them, they all showed

Railway Act
that surprise which we on this side often have to show when we have not seen the matter until it comes before the house.


Ian Alistair Mackenzie: Neither did they.


Mr. PROBE:: I presume the assurance given by the Minister of Veterans Affairs covers merely the matter with reference to La Banque Provinciate, which was under discussion. I should like to ask one or two questions with respect to the policy of the wartime prices and trade board. When a price is set by the board on agricultural implements, for example-because that is the thing I have in mind-is it the ceiling price at which the machinery may be sold? Must that machinery be sold at that price, or may it be sold at less than the ceiling price? If it must be sold at that price, how are the instructions sent out?


Robert Wellington Mayhew: The 12J per cent increase on farm machinery was the maximum price that could be charged for machinery. They may sell as low as they wish. It is not a directive that they must sell at that price. They must not sell above it.


John Oliver Probe: A ceiling price exists, but not a floor price?


Robert Wellington Mayhew: That is right.


John Oliver Probe: Is that true generally of the commodity market?


Robert Wellington Mayhew: That is true of all.
Resolution reported, read the second time and concurred in. Mr. Mayhew (for Mr. Usley) thereupon moved for leave to introduce bill No. 198, for granting to His Majesty certain sums of money for the public service of the financial year ending the 31st March, 1947.


[Stage Direction]
Motion agreed to, bill read the first and second times, and the house went into committee thereon, Mr. Golding in the chair.
Section 1 agreed to.
On section 2.
Grote Stirling: Referring to the matter which was brought up by the hon. member for Lake Centre, would the minister leading the government be good enough to go one step further and say that the house will go into committee of supply this evening? It is conceivable that the bills which stand between us and committee of supply may drag on, and we might not reach supply.


Ian Alistair Mackenzie: Yes; if it is the desire of the house we shall go into supply, and before adjournment of the house this evening
we shall give ample time for discussion of the matter brought up by the hon. member for Lake Centre.


Mr. CASE:: We have not a copy of the bill.


Robert Wellington Mayhew: An interim supply bill is never printed.


[Stage Direction]
Section agreed to.
Preamble agreed to.
Bill reported, read the third time and passed.


[Stage Direction]
Hon. LIONEL CHEVRIER (Minister of Transport) moved the second reading of bill No. 138, to amend the Railway Act.
Motion agreed to, bill read the second time and the house went into committee thereon, Mr. Golding in the chair.
On section 1-Trains moving in reverse.
Grote Stirling: May I endeavour to persuade the minister to make a statement?


Mr. CHEVRIER:: The amendment sought in this bill is simple, and I think will commend itself to the house. It has to do with the movement of a locomotive and its tender operating in reverse. It happens from time to time that locomotives must move in reverse, and the section has always aimed at protecting the public when the locomotive is moving over unprotected crossings, by posting a man on the front of the tender. This amendment seeks to eliminate the placing of that man on the tender.
Perhaps I should give a brief history of the legislation having to do with this section.
The origin of section 310 was section 276 of the Railway Act, which was passed in 1901. The language of that section was very clear. It stipulated that in any city, town or village, on any train passing over or along a highway at rail level not headed by an engine moving forward in the ordinary manner, the company should station on that part of the train or of the tender, if that is in front, a person who should warn persons standing on or crossing or about to cross the track of such railway. The railway brotherhoods objected strenuously to the posting of that man. They did so for many reasons, one of them being that when the locomotive completed its run the engineman often was required to leave the engine, after being in a very wTarm temperature for hours, and come down on the tender in

Railway Act

order to ride the tender back to the roundhouse. Over the years they objected strenuously to that. The various railway companies admitted that there was some foundation for the objections raised by the brotherhood and attempted to rectify the difficulty by having an amendment passed in 1910, which was chapter 50 of the statutes of Canada for that year. But that amendment gave a discretion to the board of railway commissioners, and that did not work out satisfactorily. It was not until 1917 that satisfaction apparently was obtained by eliminating the words, "or of the tender if that is in front" so that by chapter 37 of the statutes of 1917 it apparently became no longer necessary for a man to be posted on a tender when a train was moving backward. Perhaps here I should just read that section, because it is pertinent. Section 276 as enacted by chapter 37 of 1917 reads as follows:
Whenever in any city, town or village, any train not headed by an engine is passing over or along a highway at rail level which is not adequately protected by gates or otherwise, the company shall station on that part of the train, which is then foremost, a person who shall warn persons standing on, or crossing, or about to cross the track of such railway.
The words "or of the tender, if that is in the front" were eliminated, so that it became no longer necessary to post a man on the tender. But following an accident which took place in the city of Hull the privy council placed an interpretation on this section which decided that a locomotive and a tender is a train, So by virtue of this interpretation it became necessary again to place a man on the tender. I say this because the intention of parliament in 1917 was quite clear. It was the intention then to do away with the posting of that man, but parliament's intention was interpreted in a different way by the privy council.
In order to meet the intention of parliament as enacted in 1917; in order to meet the wishes of the brotherhoods, of the railway association of Canada, this amendment is now sought; and it is framed in such a way that the words "or its tender" have now been added after the word "engine", the effect of this being that the legal interpretation of the word "engine" is now overcome, so that in the opinion of the law officers of the Department of Transport it will become no longer necessary to post a man on the front of a tender when the locomotive and its tender are moving in reverse.


Grote Stirling: What is the position if the locomotive and tender are shunting a train of three cars behind them? Does the man go on the end car?
[Mr. Chevrier.l


Lionel Chevrier: Yes. It is necessary for a man to be posted on the end of a number of cars if they are being pushed backwards by a locomotive and its tender. I said a moment ago that this legislation was requested by the joint legislative committee of the railway transportation brotherhoods. It has been endorsed by the railway association of Canada and approved by the Board of Transport Commissioners for Canada. I should like to read an opinion of Sir Henry Drayton in which he covers the point fully. This was an opinion he gave prior to the enactment of the statute of 1917, when he said:
In the opinion of the operating department-
That is of the board of railway commissioners.
-a man on the tender when the engine leads the movement, although backing, serves no useful purpose. In the ease of almost every engine, as a matter of fact, the engineer has at least as good if not a better view of the track in front of him as in the case of a front movement, a tender nearly always being shorter than the boiler and other engine works in front of the cab; and, in the case of a reverse movement, as a usual thing, there is no possibility of the view being obscured either by smoke or steam.
In other words, it would appear that, if a man on the tender is necessary, a man is also necessary in the front of every locomotive operating over crossings.


Grote Stirling: What has become of the objection raised by the railway brotherhoods, that they did not desire their members to get out on the back in cold weather?


Lionel Chevrier: This meets the objection. This amendment to the Railway Act is being enacted to meet their objection.


Grote Stirling: How does it meet it?


Lionel Chevrier: By doing away with the necessity of posting a man on the tender of the train moving in reverse. That is what the amendment does.


Major James William Coldwell: What protection is the public given in this regard?


Lionel Chevrier: The public does not need protection in this matter. The opinion given by Sir Henry Drayton, and that of the board of transport commissioners, is that locomotives are so long to-day that the engine man or the fireman who is in the cab of a locomotive has a much better view of objects crossing the highway than would a man posted down below at the foot of the tender.


Major James William Coldwell: That is probably correct.


John Ritchie MacNicol: WThat happens when a train is backing up, with the engine and tender probably a quarter of a mile away? Does the brakeman not have to be on the end of the car going forward?

Railway Act


Lionel Chevrier: Yes; it is necessary to post a man on the rear of the train. The law remains the same in that respect as it was before. This has to do only with the tender, not with trains which might be in the front of the tender.


John Ritchie MacNicol: In the circumstances set out in the act, the engine and tender if backing up would really be at the wrong end of the train.


Lionel Chevrier: Yes.


John Ritchie MacNicol: The engineer might be able to see just as well; however it was always my understanding that the forward brakeman was the one who stood on the front of the tender when it was backing up. I did not think the engineer or fireman did that.


Lionel Chevrier: That is what brought about the discussion in the matter. When the act was passed in 1917 the brakeman did not do it. Either the fireman or the engine man had to go down from the cab, and go out in front. Because of the protests of the brotherhoods, for a time the companies used yardmen who were doing work at the stations. They would jump on the front end of the tender. There was difficulty about that, and finally the decision was made to amend the section by doing away with the man altogether. It was not done by the brakeman.


John Ritchie MacNicol: It was done by the forward brakeman.


Lionel Chevrier: No, by the engine man or fireman.


Grote Stirling: It was done by the brake-man on the train, but not on the tender.


John Ritchie MacNicol: It is my memory that the forward brakeman, who frequently rides in the engine, would get down and go to what would then be the front of the train, and warn' the people to stand back. I am afraid if we eliminate the necessity of someone being on the so-called front of the train when it is backing up, with the long engines and long tenders now in use-some of the cylindrical water tanks are mammoth in size- the public will not have all the necessary protection required. Is the minister satisfied that there will be ample protection?


Lionel Chevrier: Yes, and for more than one reason. In connection with an amendment of this nature it is customary to submit the suggestion to the board of transport commissioners. They have an operating branch which goes into these matters thoroughly, and I am informed they have approved this amendment. As far back at 1942, as a result 63260-1781
of the demands of all parties concerned-the men and the railway association-an order in council was passed under the War Measures Act doing this very thing. It has been in effect now for at least three years.


John Ritchie MacNicol: They are compelled to give ample warning with whistles and bells.


Lionel Chevrier: Yes.


Mr. FRASER:: Is there any limit to the speed at which a train is allowed to back up?


Lionel Chevrier: Yes, there is a limit under the Railway Act. I do not know what it is, offhand, but I can find out.


Major James William Coldwell: I hope every consideration will be given by the board of transport commissioners and by the government to the elimination of level crossings. I have been a passenger on two trains which hit automobiles, and have seen something of the destruction caused. In one instance a priest and his driver were killed, and in the other a family were pitched out and had to be taken to the hospital. I do not know what happened to them' afterwards. We have too many level crossings in Canada, particularly along the main lines of the railways. No matter how much protection we may give in circumstances such as are envisaged in the bill, we do not get to the root of the problem of level crossings. Most countries have endeavoured to get- rid of them. During the period of unemployment before the war we were told that one of the projects which would receive consideration by the government elected in 1935 was the elimination of level crossings. I know of only two or three which were eliminated. Far too many of them are still in existence, for the safety of the public. These are different from the days when we had horses and buggies. Traffic moves quickly along the highways, and I take this opportunity to urge upon the government the necessity of making plans to eliminate as soon as possible the level crossing menace. I have in mind highways very close to Regina, where one drives down beside the railway and then makes a sudden turn to cross. One night while driving I saw what I thought was an automobile coming in the opposite direction. It turned out to be a train, and it was only by accelerating very quickly that I managed to get across. The train happened to be a flier, although I had thought it was an automobile on the other side of the track. I just managed to get across; otherwise I would not have been here to-day- and some people might have been thankful for it.
Railway Act


Thomas Langton Church: Who is asking for this legislation, anyway? Last Thursday evening I made reference to the large number of people who are killed on level crossings. A man should be on the engine tender, and I see no reason for making the change. Surely there is such a thing as public rights and safety. The people have just as much right on the highways as the railway companies, especially when the highways were built before the railways came along.
An application has been made before the board of transport commissioners for the building of a subway to eliminate the danger at the Jones avenue and Woodbine avenue crossings in the constituency I represent. That subway should be built, because there is ten times the amount of traffic at that point that there is farther down the line where there is a subway at Victoria park avenue. There is enough loss of life as it is without adding any further to the number of accidents that will happen if this amendment to relieve the railway companies of responsibility is passed. At present they are under the obligation to station a man to warn persons that an engine is moving. There is considerable traffic along the waterfront in Toronto and there is always danger in the moving of coal and other cars. The same thing applies to other parts of the city. Surely some consideration should be given to the public in an effort to prevent the terrible loss of life that occurs at level crossings. Only last week-end twenty-nine people were killed in eastern Canada from various causes, and it is horrible to see the way human life is being sacrificed at level crossings without considering the economic wastage, loss of employment and earnings which run into hundreds of millions. All this is quite apart from the human suffering that occurs.
This bill ought to go to the railway committee in order that the public may be protected. What is the use of having a committee when they never or seldom meet?


Lionel Chevrier: They are meeting now.


Thomas Langton Church: I am not opposed to the railways because I believe they have certain rights and they do a great deal of good. In congested cities and towns and in many of the villages along the Lake Shore road there are many danger spots and we should not be relieving the railway companies of providing reasonable and proper methods of protection. In Toronto millions and millions of dollars were spent to build the viaduct. The waterfront roads were there long before the railways came, but the city paid one-third of the cost, something which they had no right to

do, in order to provide the necessary protection. The cost to the taxpayers was between S13,000.000 and $14,000,000.
What has become of the policy of the government in connection with level crossings? A return was brought down this session showing that hardly any money is being spent on grade crossings. They used to spend from two to three millions a year on grade separation account, but this was permitted to become a dead letter during the war. This bill ought to go to the railway committee in order that a report may be made and municipalities and others who are aggrieved heard. They have had no notice of this bill. It may have been advertised in the Canada Gazette, but we should go slow in a matter like this when human life is involved. We are far behind Great Britain and the United States in connection with grade separation and the protection of the public. The time is coming when the public will stand for this no longer because so many of them are being killed.


Mr. BRYCE:: I do not disagree with the matter because I believe he has given quite a lot of consideration to this matter, but I am a little reluctant to vote for a thing like this. I am not going to speak as a parliamentarian; I am going to speak as one who has built locomotives. A locomotive is built to go forward; it is streamlined for that purpose and the engineer can see only ahead with ease. It was expected that when the locomotive had to reverse there would be a lookout on the tender to guide the engineer.
The minister says that the brotherhoods have appealed for this. I know from my locomotive experience that there have been many men killed or maimed for life when a proper lookout was not maintained when the locomotive was just going to the roundhouse. As I understand the bill, when a train is reversing there will be the usual lookout, but this amendment applies only to an engine and tender.


Lionel Chevrier: An engine and a tender is a train.


William Scottie Bryce: But when there is a train attached there will be a proper lookout?


Lionel Chevrier: Oh, yes.


William Scottie Bryce: I think this is a mistake in the interests of safety.


Lionel Chevrier: The railway brotherhoods do not think so.


William Scottie Bryce: That may be so, but I would put the safety of the people before what the brotherhoods want. A lot of men have had to be out in the cold in order to protect the safety of this nation.

Transport Stores


Lionel Chevrier: The hon. member for Peterborough West asked about the speed of trains moving in reverse. It is ten miles an hour across highways.
With reference to what was said by the hon. member for Rosetown-Biggar and the hon. member for Broadview, I would point out that I made a lengthy statement on the elimination of level crossings on the second reading of another bill to amend the Railway Act which was brought down by the hon. member for York West. At that time I dealt with the question of safety at these crossings.
I pointed out that a committee composed of certain members of the board of transport commissioners had been set up to go across this country to study grade crossings deemed to be dangerous, in order that they might be eliminated as a post-war project. That work is being done. While a report has not been made, the investigation is being carried on.
It has been said that no notice of this bill was given. It has been the law now for three years and there have been no accidents. It seems to have met with the general approval of all persons concerned.


John Ritchie MacNicol: You are just defining the word "engine"?


Lionel Chevrier: Yes. With reference to the point raised that this might take away certain rights from the public, I would point out that it is the other way around if anything. The danger is to the man on the tender. Experience has shown that it is the man on the tender who finds himself in the more difficult position. He is there without any protection. Should a train moving in reverse strike a motorcar, he is more likely to be injured than the man at the wheel of the motorcar. I am not saying that there is no danger to the man in the motorcar, but that is the case.
I want to draw the attention of the committee to the fact that this whole matter was thoroughly debated in 1917 and the house took from the then section 276 the words, "or of the tender if that is in front," because parliament then thought that the elimination of those words were necessary. Had it not been for the decision of the privy council which held otherwise in the case in 1922 to which I referred, there would be no necessity for this amendment. It is just to circumvent and do away with the interpretation by the privy council of section 310 as it stood that this amendment is thought necessary.


William Scottie Bryce: Perhaps I did not get my point across to the minister. When an engineer wants to move his engine in reverse
he must put his head out in order to look back. He cannot sit in the position in which he usually sits to drive the engine and look back at the same time.


Norman James Macdonald Lockhart: The engineer has a tremendous responsibility if he is to be the lookout man when approaching a level crossing. I would remind the minister that both engines and tenders of to-day are much greater in length than they were fifteen or twenty years ago. Even in that short period there has been a great change in the construction of locomotives and tenders. There is increased danger of course in storms, fog and night driving when the view is obstructed to some extent. Does this relieve the railway of any responsibility for accidents at level crossings under those conditions?


Lionel Chevrier: The railway is relieved of the necessity of posting a man on the tender, but it is not relieved of legal liability if negligence can be shown. The common law right and the statute right still remain.


Norman James Macdonald Lockhart: The minister is of the opinion that the public is as fully protected without the man being posted there?


Lionel Chevrier: I do not think there is the slightest doubt about that.


Norman James Macdonald Lockhart: The minister thinks the engineer can handle the situation just as well from a greater distance away?


Lionel Chevrier: I do.


Gordon Knapman Fraser: The only protection the public has is the rate of speed of backing up?


Lionel Chevrier: There is the ringing of the bell and the blowing of the whistle.


Gordon Knapman Fraser: You never hear them if it is raining and the windows are closed.


[Stage Direction]
Section agreed to.
Section 2 agreed to.
Bill reported, read the third time and passed.


[Stage Direction]
Hon. LIONEL CHEVRIER (Minister of Transport) moved the second reading of bill 139, to amend the Department of Transport Stores Act.
Motion agreed to, bill read the second time, and the house went into committee thereon, Mr. Golding in the chair.
On section 1-Inventory.
Transport Stores
[Stage Direction]
Mr. MaoNICOL: Would the minister give an explanation of the amendment? Just what are the advantages and the reasons for increasing the inventory from $1,250,000?
Lionel Chevrier: I was just about to do that. The amendment is a simple one, to increase the inventory of stores at the end of each fiscal year from $1,250,000 to $1,600,000. When the Transport .Stores Act was passed in 1937, section 6 provided:
The inventory of stores at the end of each fiscal year after 1936-37 shall not exceed the amount of the stores inventory established as of April first, 1937, under section three of this act.
The amount of the stores inventory established on April 1, 1937, was $957,368. It was found that this section did not meet the situation, and in 1939 an amendment was sought from the house raising the amount to $1,250,000. The amendment now before the - committee seeks to place the inventory at the end of each fiscal year at an amount not to exceed $1,600,000. The hon. gentleman asks the reasons for that. The reason chiefly is the expansion in the Department of Transport. The amount of inventory when the act was passed in 1937 was $950,000, and when one compares that with the inventory to-day, namely, $1,500,000, one gets an idea of the tremendous expansion in the stores from 1937 to date. The expansion in fact has been 45 per cent. It is due particularly to the expansion of the air service branch of the Department of Transport, radio and the like. It is due also, I must admit, to prices which, as the committee knows, have increased considerably since 1937. Unless the amendment is passed the Department of Transport will not be able to abide by the terms of the section.
Mr. MaoNICOL: Just one question there. The minister said that the inventory to-day was approximately $1,500,000.


Lionel Chevrier: I was in error. I wonder if I might change that. The inventory to-day is $1,374,000.
Mr. MaoNICOL: That will do for the purposes of what I have to say. I can easily understand why it might be up from $1,250,000 to $1,375,000 approximately. But is there no control to prevent those in charge of purchasing from exceeding the amount of $1,250,000 until it is now $1,375,000? I can appreciate the reasons for the increase, and that makes me ask this question. The inventory at the moment is $1,375,000 and the amendment asks for an expansion of another $225,000. It is quite conceivable that even
TMr. Chevrier.]
this amount will be passed shortly and that another amendment will be necessary providing for a further increase.


Lionel Chevrier: The only reason I can give for the increase is one of expansion. In 1939 there were not the number of divisions that there are now. Civil aviation in 1939 did not have the stores it has to-day. There is a difference between purchases and stores. The stores which we have in the Department of Transport at the end of each fiscal year are in the canal division, marine division, civil aviation, meteorological and printing and stationery divisions of the Department of Transport. Each of these divisions has increased, but none of them has increased with the celerity that civil aviation and radio have, and it is because of the expansions in these divisions that it is thought necessary to increase the inventory at the end of each fiscal year.


Gordon Knapman Fraser: It is mostly price that has accounted for the increase?


Lionel Chevrier: No. That is just one factor. It is mostly expansion.


Mr. FLEMING:: Would the minister give the committee a statement as to the inventory of stores at the conclusion of the last fiscal year, so that we may have some basis of actual comparison with the figure now sought?


Lionel Chevrier: Yes. In order that the hon. gentleman may get the figures as I have them, on April 1, 1937, the inventory of stores was $957,000-I am not giving odd dollars and cents. To-day, by which I mean April 1, 1946, the inventory was $1,374,000 or an increase of 45 per cent.


Donald Methuen Fleming: Has that increase been a steady ascent in the years between 1937 and 1946?


Lionel Chevrier: Fairly.


Donald Methuen Fleming: Perhaps the minister will say if it was higher at any time than $1,374,000, or does that represent the peak at the conclusion of the fiscal year?


Lionel Chevrier: That represents the peak at the conclusion of the fiscal year 1946.


Donald Methuen Fleming: I did not make my
question clear. Does this represent the peak among these years for the inventory at the conclusion of a fiscal year?


Lionel Chevrier: My recollection is no, that it does not, that at one time it was higher than the $1,374,000, but still under the $1,600,000 which w'e require here.

Transport Stores


Donald Methuen Fleming: Would the minister say something further with reference to this expansion? He has said in general terms there has been an expansion, particularly in connection with civil aviation. Would he be a little more specific and indicate what this expansion of stores consisted of? What relation has it, for instance, to Trans-Canada Air Lines? Is any portion of this inventory related to expansion in operation of Trans-Canada Air Lines?


Lionel Chevrier: Yes. During the past few years the increases, as I told the hon. member for Davenport, have been confined chiefly to air services, and in air services particularly to radio and aviation materials. The table I have before me shows that the increase has been far more rapid in the meteorological and aviation divisions than in the others. The other divisions of transport have remained pretty much static. There has been a small increase but nothing to worry about. In the others the increase has been more rapid. Future civil aviation requirements are difficult to forecast. From what we know of the value of stores in aviation to-day it is felt, that all this increase will ultimately be required.


Thomas Langton Church: Would the minister say
what was the inventory value one year before the war? As he knows, a whole lot of dilapidated stuff and junk is kept; I have seen it in yards throughout the system. Did the minister in drafting this bill have the appraisals; and what was the book value, the market value, the par value? There will be an inventory value on the books of approximately 81,600,000. Has the minister a par value and a book value of his inventory, too; are the stores replaced, and is a definite sum set aside each year in connection with this value, because it is largely a bookkeeping item? As we know, the Department of Transport has not been spending an awful lot of money during the war in this branch of its work.


Lionel Chevrier: The hon. gentleman asks what the value was in some year during the war. I cannot tell the hon. member. The only values I have are those in 1937 and those of to-day. But I can get the information for him. So far as par value is concerned, there is no such thing, but there is a book value, and I shall be glad to get that for him.


Mr. COCKERAM:: Will the minister tell us how much of these stores at the end of April were expendable, and what was the
amount of saleable goods; what are expendable by the department and what are saleable to the services?


Lionel Chevrier: They are all saleable. They can all be used and sold; there is no question about that; and as far as their expandability is concerned they are there in our stores to be used. For instance, we have seven or eight marine agencies all across Canada; one of these marine agencies is at Prescott; one is at Saint John; one is at Quebec; and the stores are there to be used by various branches of the marine agency from time to time. They are expendable at any time.


Donald Methuen Fleming: What would happen if the inventory of stores at the conclusion of a fiscal year exceeded the limit fixed by the statute?


Lionel Chevrier: It is not anticipated that that position will arise, in view of the statement which I gave the committee a moment ago, because the rise has been gradual from 1937 to 1946. Even if it did rise, it could only rise in the same proportion, and this amendment relating to a maximum of $1,600,000 will certainly keep it within the confines of the act. Later, we can seek another amendment from parliament if such should be necessary. The only thing I can do is to take the opinion of the ef .crs of my department who say that this is ample for the time being and within the next few years.


Alan Cockeram: They have not exceeded the limit in the past?


Lionel Chevrier: No; the limit has never been exceeded.


Alan Cockeram: Right now?


Lionel Chevrier: No. Perhaps I should have told the committee that by virtue of P.C. 2589 of April 1, 1943, the inventory of stores was extended to 81,500,000, and that was then the financial limitation put upon the stores. So that at no time was the amount exceeded.


Gordon Knapman Fraser: With this act you can exceed it at any time by putting through an order in council?


Lionel Chevrier: No. This act is simply giving statutory effect to what was done by order in council by virtue of the War Measures Act; and I need not tell my hon. friend that he would be the first to object strenuously if we attempted to hoist the inventory of stores by virtue of the War Measures Act, at any time. That is exactly what we do not want to do.
C.N.R.-Manitoba Railway


Grote Stirling: Do I understand that at any time during a fiscal year the total amount might exceed this figure but it must be reduced to that at the end of a fiscal year?


Lionel Chevrier: It cannot exceed this figure.


Grote Stirling: This deals with the end of a fiscal year.


Lionel Chevrier: That is right. At the end of a fiscal year it cannot, if this bill passes, exceed $1,600,000.


Grote Stirling: It might have been higher than that during the fiscal year?


Lionel Chevrier: It was not, at any time.


Mr. CASTLEDEN:: Suppose there is an excess of that amount; do you return these stores? Let us presume that at the end of the year the inventory was $1,700,000. What machinery has the minister to take care of a situation of that kind?


Lionel Chevrier: Wj could not return the stores because they are operating stores; they are used, but we do not anticipate that that will ever arise. It has never happened since this act has been in force, since 1937.


George Hugh Castleden: There may be contingencies, and you should be prepared for that, I should think.


[Stage Direction]
Section agreed to.
Short title agreed to.
Bill reported, read the third time and passed.


[Stage Direction]
Hon. LIONEL CHEVRIER (Minister of Transport) moved the second reading of bill No. 194, respecting Canadian National Railways and the acquisition of the Manitoba railway.
Motion agreed to, bill read the second time, and the house went into committee thereon, Mr. Macdonald (Brantford City) in the chair.
On section 1-Assignment of option.
Lionel Chevrier: When the house gave first reading to this bill I said that its object was to authorize the Canadian National Railways to purchase the railway and undertaking of the Manitoba Railway company. I went on to explain that in 1901 the Northern Pacific and Manitoba Railway company, the Winnipeg Transfer Railway company, the Portage and Northwestern Railway company and the Waskada and Northeastern Railway company leased to Her Majesty the Queen in the right IMr. ChevrierJ
of the province of Manitoba what was then known as the Manitoba Railway company for a period of 999 years, giving further in the lease an option to purchase the railway at any time during the currency of the lease for $7,000,000. Later, that lease was assigned by the province of Manitoba to the Canadian Northern Railway company. In 1901 the Canadian Northern Railway company came to parliament and obtained the authority to purchase the assignment of the lease, the railway and its undertaking and also the right to take up the option of $7,000,000. The Canadian Northern assigned its lease, and later, the Canadian Northern became a part of the Canadian National Railways, and what the Canadian National Railways seeks now is the purchase of the Manitoba railway.
The lease provides that for the first ten years the annual rental shall be $210,000; the second ten years, $225,000; the third ten years, $275,000, and the remaining period, $300,000. The Canadian National Railways has been paying that rental, but it now finds-


John Ritchie MacNicol: At which rate?


Lionel Chevrier: The last rate mentioned, namely, $300,000. By virtue of refinancing it finds it can borrow the money at an attractive rate of interest and save at least $90,000 a year. It has therefore sought the authority of parliament to purchase the railway.
The bill is very simple, and may be divided into four parts. First of all, it provides for the assignment of the option in accordance with the terms of the act which was passed by parliament in 1901. Second, it provides for the sale and acquisition of the railway and its undertaking, including certain stock. Third, it provides for clear title, as in any purchase; and finally, it provides for the method of effecting the transfer. That method may be subdivided into three parts. First, the Canadian National Railways may accept the purchase by means of an ordinary deed or conveyance or document under seal as one private individual would from another; or it may proceed again by expropriation as it does normally under section 17 of the Canadian National Railways Act; or it may proceed by deposit of certain plans in the land titles office of Manitoba.
The schedule to the bill provides for the length of line which is being purchased, which amounts to 353-17 miles. It provides for the purchase of seven branches of the Manitoba railway which are known as the Red River Valley railway, the Hope Farm branch, the Morris-Rrandon branch, the Souris River branch, the Portage la Prairie branch, the

C.N.R ,-Manitoba Railway
Lake branch and the Winnipeg Transfer branch; all of which totalled together make 353-17 miles.
As the committee knows, a matter such as this cannot be proceeded with unless it has the approval of the board of directors of the Canadian National Railways. The board of directors did give this matter consideration and by resolution approved the purchase of the railway as an excellent thing for it, first so far as refinancing was concerned and, second, so far as reduction of its fixed charges was concerned. Next, it was made the subject of discussion in the annual budget of the Canadian National Railways, and the railways and shipping committee then had an opportunity of going into this purchase. In its budget for 1946 the Canadian National Railways did provide for the sum of $7,000,000 to be set aside for this purchase. The budget of the railway for 1946 has been approved by the committee on railways and shipping.
Finally, while it may not be necessary for the railway to come to parliament for the approval of this purchase, it is felt that in a matter of this kind it is far better to obtain the best possible title that can be obtained, namely, one from parliament by an act of parliament, than by accepting a deed or by filing plans under the Expropriation Act, or by simply filing ordinary plans as set out in the last part of section 4. I think I have covered generally what I intended to say.


Thomas Langton Church: This particular bill has been before the country for a great many years. I object to a public ownership body, such as the Canadian National Railways, assuming all these dead-ends. The Canadian National Railways have taken over many of these provincial roads that were practically bankrupt. Now you are going to pay $7,000,000 for this one, through the purchase of stock. Some hon. members will remember the Drayton-Acworth report of 1917. The government of the day appointed a royal commission consisting of Mr. Acworth, an eminent British engineer; Sir Henry Drayton, chairman of the railway commission, and, I think, Mr. Smith, who was then president of the New York Central. They reported on the railway situation in Canada, and they found that the growth of the three transcontinental railways had far outstripped the growth of population; that there was overbuilding, and that sort oi thing, and as a result the government had to go in and save private ownership, which had failed. This was done by forming the Canadian National Railways, so called, which was supposed to be a public ownership venture.
I object to the Canadian National being loaded up with these dead-ends of provincial railways in almost eveiy province across Canada. In this case they say the property is to be conveyed free of encumbrance, and the transfer is to be effected through a straight stock deal between the vendor and the vendee. The Drayton report condemned this way of doing things. In the first place, the railway commission, now the board of transport commissioners, should have been asked to report on this propostion before anything of the kind should be recommended to this house. Then we have a committee on railways, canals and telegraph lines. What are they doing? They should be looking into this question. We have another committee on railways and shipping. I can find nothing in their report about this particular railway. You know the way Mackenzie and Mann acted out west. Theirs was a political railway first, last and all the time. They came to this parliament and got tens of millions of dollars guaranteed by the government, though there was no business for their railway because it was paralleled by two others. We had a carnival of building, of reckless waste and all that kind of thing, which cost the country a tremendous sum of money.
As I understand it, this provincial railway was leased to the Canadian Northern in 1901 for some $300,000 a year. Now we have a bill before parliament to validate all the mistakes made in that particular province in regard to railways, duplication, waste of all kinds and all the rest of it. That was a sorry day for the people of this country. They are paying for it yet in high railway freight and passenger rates. We had the overcapitalization and overbuilding of railways, with three where one would have done with branch lines running off the main line. These railway magnates went into almost every province and, then, when they faced bankruptcy in 1917 the government was compelled to take over the railways. Public ownership is not to blame in this case; this shows the evils of private ownership. I repeat that in my opinion the board of transport commissioners should be asked to report on this matter before we recommend a deal like this, because for long enough the Canadian National has been loaded up with these dead, bankrupt provincial railways and these dead-ends.


Mr. BROOKS:: I quite agree with the hon. member for Broadview that we should be very careful before taking over too many miles of railway in this country. We all remember that before the war our two great railways were going behind at the rate of thirty to forty million dollars a year. During the war,
2S16
C.N.R.-Manitoba Railway

of course, they paid their way and did a splendid job; but in these days, when we have transportation by truck, bus and other methods, we can see that the railways may not do as well in the future as they have done in the past. So that we may find ourselves carrying a heavier burden than we carried previous to the war. The hon. member for Broadview mentioned roads that have been taken over in other provinces. I know of lines that have been taken over by the Canadian National that were simply streaks of rust. I believe the committee should be told by the minister whether this is a paying proposition and what the prospects are for the future. I think we should know whether or not, to use a slang expression, the Canadian National are being sold a lemon.
I do not think I have anything further to say. During the war the railway line between Moncton and Halifax was so burdened with traffic that it was almost impossible to operate it efficiently. For a good many years they have been asking for a double track from Moncton to Halifax and from Moncton to Sydney but we could never find money for this purpose, though I think it is generally recognized as being very necessary. So I suggest to the minister that before we go on and buy up a lot of old, abandoned railways and branch lines throughout the country we spend some money in places where it is badly needed.


Lionel Chevrier: I am afraid I did not make myself clear, or else hon. members who have spoken are under a misapprehension. It is said that we should not take over this road, and that we should not take over old, abandoned railways. That is not what we are doing. We have this railway now whether we like it or not. We have it by virtue of a lease for 999 years, and the Canadian National has been paying rent at the rate of $300,000 a year. The hon. member for Broadview says that this is bad business, that it is not a paying proposition. I say to him that it is a paying proposition if we can reduce the annual rental which must be paid by the Canadian National from $300,000 to $210,000. We shall save $90,000 a year. There can be no doubt that this is an excellent piece of business from the point of view of both the railway and the public.


Alfred Johnson Brooks: Is the railway paying?


Lionel Chevrier: It does not matter
whether it is paying or not; this bill has absolutely nothing to do with that. I say that because it is a necessary part of the national system whether it pays or does not pay. We are bound for 999 years. We can continue
fMr. Brooks.]
paying rent at the rate of $300,000 a year, but if we can save $90,000 a year, why not do so? That is the only object of this bill. This is not the purchase of an old, abandoned railway. This is a going concern which is operating into the city of Winnipeg from Brandon, from Portage la Prairie, from the Souris valley, from the international boundary at Emerson and from Hope Farm.


Alfred Johnson Brooks: What does the minister mean when he says it is a going concern? A moment ago he told us it was not paying.


Lionel Chevrier: The Manitoba railway is in operation. It was operated first by the Canadian Northern, from 1901 until the Canadian Northern became part of the Canadian National. It is now part of the Canadian National Railways whether the committee likes it or not, so that I can see no merit in the argument raised by the two hon. gentlemen.


Mr. MacINNIS:: Perhaps the minister has given this information already, but could he tell the committee briefly how this lease happened to be made? Who were the contracting parties? Who	was	so	provident on	behalf ofthe dominion	as	to	enter into, a	999 year
lease?


Lionel Chevrier: I have already done that, but perhaps briefly I could repeat what I said, for the benefit	of	the	hon. member.	I statedat the outset	of	my	remarks that	the four
railway companies, whose names I then gave, had leased what was then known as the Manitoba Railway company, its line and undertaking, to Her Majesty the Queen in the right of the province of Manitoba for 999 years at a rental of $225,000 for the first ten years, $250,000 for the next ten years, $275,000 for the following ten years, and $300,000 for the remainder of the period.
There was contained in that lease a clause under which the railway could be purchased for the sum of $7 million during any time the lease remained unexpired. The province of Manitoba assigned the lease to the Canadian Northern. The Canadian Northern became part of the Canadian National Railways. The Canadian National Railways have been paying rent for the railway and its undertaking over a number of years at the rate of $300,000 a year.
This enactment is sought, not because it is necessary to come to parliament, but because it is felt that a matter of this kind should receive from parliament its endorsation by way of an act of parliament. The saving which will be brought about through this amounts to $90,000 a year.

C.N.R .-Manitoba Railway
2S17


John Ritchie MacNicol: How is that saving
brought about?


Lionel Chevrier: The annual rental for the unexpired term of the 999 years is $300,000 a year. The Canadian National Railways will purchase this line for $7 million. They can borrow the $7 million at a rate of three per cent, which will mean an annual interest of $210,000.


John Ritchie MacNicol: If the Canadian National Railways own it now, why have they been paying that money?


Lionel Chevrier: They own the unexpired term of the lease, by way of assignment.


John Ritchie MacNicol: To whom do they pay
8300,000	a year?


Lionel Chevrier: They pay $300,000 a year to the Manitoba Railway company, which is a subsidiary of the Northern Pacific.


Donald Methuen Fleming: Under the lease for 999 years I take it the taxes were payable by the lessee?


Lionel Chevrier: I should think so, yes.


Donald Methuen Fleming: That is usually so in these case s.


Lionel Chevrier: I am informed it is in this one.


Donald Methuen Fleming: I take it that the Canadian National Railways are responsible 'for making good on the covenant of the lessee to pay $300,000 per annum.


Lionel Chevrier: Yes.


Mr. McKAY:: May we have a report as to what maintenance has been established, and if any replacements have been made? How many terminals are involved? As nearly as I can figure, the cost of the railway rang about $23,000 per operating mile; but if terminals are involved, that is a different matter.


Lionel Chevrier: The railway is in good condition. Up until December 31, 1945, the Canadian National Railways had expended $966,001, or almost a million dollars by way of capital expenditure.
Answering the second part of the hon. member's question, I would point out that there are several branches. It consists of 353-17 miles, and is made up of what is known as the Red River Valley railway, which extends from Winnipeg to the international boundary line at Emerson. It consists, further, of the Hope Farm branch, which extends from mile 47-01 to what is known as Hope Farm. It consists, further, of the Morris-Brandon branch, extending from the town of
Morris to the town of Brandon; it consists of the Souris River branch, which extends from Hartney to Belmont.


John Ritchie MacNicol: All these are connected with the Canadian National Railways?


Lionel Chevrier: Yes; it consists, further, of the Lake branch, from Portage la Prairie to Delta; and further, of the Winnipeg Transfer railway, which is in the city of Winnipeg, and which is a small line connecting the Canadian National Railways with the Canadian Pacific Railway in that city, for a distance of 1-21 miles.


Eric Bowness McKay: I was more interested in
the terminals involved than in the various branches. Are there any roundhouses or shops involved?


Lionel Chevrier: I do not know the
answer to that question.


Mr. COLD  WELL@: Are there any other
agreements of this description made with the railways?


Lionel Chevrier: Does the hon. member
mean the Canadian National Railways?


Major James William Coldwell: One can scarcely understand how an agreement of this kind, for almost a thousand years, could be made, one which commits this country for 999 years, in the sum of nearly three hundred millions of dollars. The bill before us, which saves $90,000 a year, will save in the remaining length of time between eighty-five and eighty-six millions of dollars. Surely leases of this description are almost an insult to the intelligence of parliament.
I agree that the Canadian National Railways were loaded up with a lot of iine3; and I have always felt that if we want to be fair to the national system we should examine its capital structure and see to it that we remove from it a load which it is unfair for the railway to carry, especially in view of deals of this description made in the past. In days gone by, always to the disadvantage of the Canadian National Railways, when making comparisons with the Canadian Pacific Railway company, reference has been made to the tremendous capitalization of the national system. The result was that it was impossible to make a fair comparison between the two systems.
I wonder if there are any more of these improvident agreements. A lease of this description almost staggers the imagination. Just imagine committing a country to pay nearly three hundred millions of dollars over
2S18
C.N.R -Manitoba Railway

a period of 999 years! I congratulate the company and the minister for coming to us and suggesting that the country should save between eighty-five and eighty-six millions in the remaining period of time, and stretching to a time when most of us will not be here to endure the heat of a June afternoon in the House of Commons.


John Ritchie MacNicol: Why did the railway
company not bring in a bill like this years ago? It is quite clear that if everything is according to Hoyle, as it appears to be, it is a good bill for the country.


Lionel Chevrier: It is.


John Ritchie MacNicol: Only two years ago the
house voted a billion dollars to the Canadian National Railways by way of wiping off debt that the railways owed the country. This bill looks like something from which the country will derive some good.


Lionel Chevrier: There is no question
about it. The answer is that they could not borrow money at three per cent. That is why the bill was not brought in sooner.
The hon. member for Rosetown-Biggar raised a pertinent point when be said that this almost insults the intelligence of parliament.


Major James William Coldwell: I did not mean the bill; I was referring to a deal of this description.


Lionel Chevrier: Let me point out that parliament gave its approval in 1901 to this very lease, by virtue of chapter 53 of the revised statutes of Canada.


Major James William Coldwell: I was not here then.


John Ritchie MacNicol: Were the members all sober? It was still a Liberal government.
*


Lionel Chevrier: Parliaments change from time to time.


John Ritchie MacNicol: Has the minister in his practice ever heard of a lease that was to run for 999 years, or has he heard any other legal lights speak of such a lease?


Grote Stirling: There are plenty of them.


Lionel Chevrier: I am afraid I shall have to answer yes to that. I have heard of a number of such leases.


[Stage Direction]
Section agreed to.
Sections 2, 3 and 4 agreed to.
Schedule agreed to.
Bill reported, read the third time and passed.


[Stage Direction]
Hon. IAN A. MACKENZIE (Minister of Veterans Affairs) moved that the house go into committee to consider the following resolution:
That it is expedient to present a bill to amend the Soldier Settlement Act to provide that a soldier settler within the provisions of the act who served in world war II who has not abandoned his land and whose agreement has not been terminated, rescinded or assigned, and a soldier settler who did not serve in world war II who has not abandoned his land and whose agreement has not been terminated, rescinded or assigned, shall be charged in the case of the soldier settler of world war II a rate of interest of three and one-half per centum per annum in respect of his agreement made under the act after the standard date in the year 1942 or the date of his enlistment whichever is the earlier and in the case of a soldier settler who did not serve in world war II a rate of interest of three and one-half per centum per annum after the standard date in the year 1944.
Mr. ROBERT FAIR (Battle River):: Mr. Speaker, for a number of years past we have heard a lot about the sanctity of contracts, but in my opinion the contract being amended by the bill to be founded on this resolution is one of the most flagrant impositions that has been inflicted upon any group of people in Canada for quite a long number of years. I am not going to take the trouble to read the resolution, because in my opinion it should never have been placed on the order paper. It would have been much better if the Minister of Veterans Affairs (Mr. Mackenzie) and the government had seen fit to place on the order paper a resolution to precede a bill that would give the veterans of world war I who held contracts with the soldier settlement board on March 31, 1944, clear titles to their land. I have said what I have said, and I am going to say what I intend to say before this passes because of a solemn pledge that was made by the Prime Minister of Canada in 1917 to the members of the Canadian expeditionary force. I have placed this on the record before but I am going to do so again. One should always have a foundation for any case he wants to put forward, and for that reason I am placing this on the record once again. Sir Robert Borden had this to say:
You are men actually facing the enemy day and night. You are suffering greatly from fatigue, over-strain, and lack of rest. The marvel of it is that men could undergo such a strain without breaking; but you have never yet broken, and history will appreciate that in days to come.
You men are about to enter one of the most serious engagements that ever faced the Canadian corps. I cannot, at this moment, give any information as to where this attack will be

Soldier Settlement
staged, whether it be successful or not, it is to be borne in mind that it will not be an easy success . . . We feel confident that you will succeed where others failed: for you have never yet failed in anything you have set your hand to, as a Canadian corps.
He then went on to make certain promises in the name of this country, promises which the government of that day and this government as its successors should not hesitate to make good. However, as I see things at the present time, that is not being done. Sir Kobert Borden continued:
You can go into this action feeling assured of this, and as the head of the government, I give you this assurance; that you need have no tear that the government and the country will fail to show just appreciation of your service to the country and empire in what you are about to do and what you have already done.
The government and the country will consider it their first duty to see that a proper appreciation of your effort and of your courage is brought to the notice of the people at home, and it will always be our endeavour to so guide the attitude of public opinion, that the country will support the government to prove to the returned man its just and due appreciation of the inestimable value of the services rendered to the country and empire; and that no man, whether he goes back or whether he remains in Flanders, will have just cause to reproach the government for having broken with the men who won and the men who died.
We all know that after the first great war the government of the day decided to do something for veterans who wanted to settle on the land, but from our experience and the figures I have produced here we find that they were trying to do the men who settled on the land for something. On a number of occasions we have discussed this matter in the house and I am going to place some figures on the record. I hope hon. members will not concur in the report of the special committee which was set up to deal with veterans affairs, in which report they refused to recommend clear titles. I hope they will give expression to their own honest opinions, that is, that this resolution which I shall read in a short time will be assented to and that these old settlers will be given clear title to their land.
After quite a selection had been made, the total number of settlers placed by the soldier settlement board turned out to be 25,017. The total amount advanced by way of credit to those 25,017 settlers was $109,034,331. The rate of interest charged was five per cent on current accounts and seven per cent on arrears. Perhaps I should stop here to comment on charging veterans of great war I or any other veterans an interest rate of five per cent. If we want to use it we have the sole right to issue credit on our own account, so why
should we go to some private institution and pay them a rate of interest which compels us to charge the veterans who settled under the old soldier settlement board, or those veterans who are settling under the Veterans Land Act, these high rates of interest? Five per cent is a steal from these veterans of great war I, and seven per cent on arrears is a still greater steal. This country should not tolerate steals of that kind.	[DOT]
The total amount of principal repaid at the end of March, 1944, was $50,507,493.20. I am dealing only with what was paid by soldier settlers; I am not taking into consideration the amounts paid by civilian purchasers to whom the land was sold at a much lower price than it was contracted for by the veteran settlers after they either had decided on their own accord to get off the land or were kicked off by the administration. The total interest paid was S25,381,060.13, making a total of $75,888,553.33.
I should like to refer to the conditions under which these men tried to get along. Mistakes were made in settling these men and live stock and equipment were purchased at very high prices. Because the government policy did not provide for costs of production, prices of agricultural products dropped to a very low level. The government has seen fit from time to time to cancel certain amounts of these contracts and the total cancellation of principal amounted to $24,867,637.64. Interest cancellations amounted to $19,234,239.77, making a total of cancellations of $44,101,877.41.
Then we come to the cost of administration. Somebody has been trying to put across the idea that the cost of administration runs to only $100,000 a year, but the figures brought down in the house showed that the cost of administration up to the end of March, 1944, was $27,340,763.64. That is the cost of administration of the soldier settlement part only of this board from the inception of the scheme. That works out to an average annual cost of $1,100,000 for administration.
Going a little farther, we find that at the end of March, 1944, the total amount outstanding so far as the soldier settlers were concerned was $7,715,954.01. The total amount of arrears at that time was $1,054,269.30-I am still speaking only of the soldier settlement part of the programme. At that time 6,153 soldier settlers remained on the land; that is approximately 25 per cent of the original number. The average original amount of credit advanced to the settlers was $4,358.40. The average balance of debt of the settlers on March 31, 1944, was $1,254. That is equal to 29 per cent of the original amount of credit advanced.
Soldier Settlement

The number who acquired title during that 25-year period was 4,130, or approximately 16 per cent of the original settlers who made contracts with the government. I think there are in this house a number of business men; and I am going to ask any one of them, even the poorest business man in the house, whether that is a good business proposition and whether under those conditions they would force these settlers to continue to carry on, persecuting still further these soldier settlers of world war I.
Before going farther, may I state that the settlers who are now being settled under the Veterans Land Act, taking advantage of the full amount of the grant and engaging in fulltime farming, receive $2,320 by way of grant. This amounts to 39 per cent of the total credit extended.
The settlers I have spoken of owe at the present time only 29 per cent of their original credit. Those of us who have been in the house for some little time realize that the settlers have been trying to do something for themselves for a long time. Back in 1936, in Lloydminster, which is within thirty miles of my home, the soldier settlers' union was formed; and in 1938, as a result of their work, a brief was presented by the union to the Senate and House of Commons of Canada, of which I hold a copy in my hand. On the outside cover I find this:
To the Honourable the Senate and the House of Commons of Canada
Honourable Sirs,
In presenting this brief, our endeavour has been to draw attention to our unavailing efforts to bring about a conference between government officials and representatives of returned men on the land, which will have as its result the permanent solution of the soldier settlement problem without imposing on the taxpayer of this country further large expenditures, as occasioned in the past by abortive relief measures.
We submit that the evidence contained herein will be found, by any impartial investigation, to be conclusive in support of their claims, and we respectfully request that they be given every consideration by the government, which will lead to a conference at which all soldier organizations interested in soldier settlement be fully represented to bring about a permanent solution to the soldier settlement problem, based on the recommendations of the soldier settlers' union convention. 1936, and the resolution passed at the dominion convention of the Canadian Legion, 1936.
Most respectfully yours,
R. J. Stewart, President,
H. G. Mitchell, Vice-President,
H. S. Packman, General Secretary, Soldier Settlers' Union.
At six o'clock the house took recess.
After Recess
The house resumed at eight o'clock.


Robert Fair: When the house took recess at six o'clock I had just stated that for a number of years the old soldier settlers have been making attempts in vain to have something worth while done to relieve them of the load of debt which was placed upon them by the different governments since the end of the first great war. I also placed on record the introduction to a brief which was presented to the Senate and the House of Commons by the soldier settlers' union away back in January, 1938. Nothing of course was done at that time, and the settlers were disappointed then as they have been disappointed ever since. In 1939 the second great war broke out. At that time a number of old settlers were still badly in arrears, and the soldier settlement board, realizing that sooner or later it would probably be called upon to perform another duty, in the way of settling another group of veterans after the war which began in 1939 was concluded, decided that they had better start in and clean up the mess, get rid of some of the land and also get rid of some of the settlers on the land who were not able to make their payments.
Some people do not believe that this government and previous governments have taken any action to dispossess old veterans of the first great war; but the record shows that, from 1930 to 1942 inclusive, 1,006 settlers signed quit-claim deeds, and during the same period nearly 1,000 were served with thirty-day notices to get off or pay up. In most cases the settlers had to get off, because they did not have the wherewithal to pay up. We have been told that in the case of those who signed quit-claim deeds the action was as a rule taken voluntarily, but I believe that anyone who takes the trouble to investigate many of these cases will find that plenty of pressure was applied to make these men sign quit-claim deeds. That was common knowledge at the time. After the last war broke out, many of these old settlers sent their sons and daughters overseas to do the fighting so that Canada could continue to live in peace and prosperity, while they themselves were producing food, working as many as sixteen hours a day in food production; yet between April 1, 1942, and March 31, 1943, the board had 253 settlers sign quit-claim deeds, and 108 settlers were served with thirty-day notices to get off or pay up. This is the treatment which was handed out to men who, after having done their best, in many cases were not able to make good, not because of con-

Soldier Settlement
ditions over which they had any control but because of prices they had to pay at the beginning and because of an agricultural policy which was not in the interests of the producers. As a result these same veterans were thrown out in the gutter who went over between 1914 and 1918 and helped to keep Canada on the map under the union jack.
Then again we find that after the second world war broke out, numbers of these settlers who were in sufficiently good health to serve in that war found themselves under such a load of debt that they were not able to make a living for	their	wives	and families,	anddecided to enlist a second time and offer their lives if needs be as a sacrifice. The government, finding that these men had left and that in	some	cases	the land was	notbeing farmed properly, and finding that in some cases it was so poor that it could not produce enough to pay the taxes and accrued interest, passed, on the advice of the former minister of mines and resources under whose direction the soldier settlement board was then administered, an order in council so that the interests of the board would be protected. The order in council was passed on March 19, 1941, and is	known	as P.C. 138-1936. It	hadthe effect of	taking	away	the very bread	and
butter from the wives and families of the veterans of the first great war, veterans who were not able to keep up their payments and who had gone overseas to fight again. Lest there should be any misunderstanding I am going to read the effective part of the order in council. It is as follows:
Accordingly the hoard recommend that notwithstanding any provision to the contrary contained in any of the regulations providing for payment of dependents' or marriage allowance in respect of dependents of members of the Canadian armed forces, that in all cases where the dependents of an enlisted person continue to occupy the farm for which such person is indebted to the director of soldier settlement and in respect of which the contract terms are not otherwise satisfactorily provided for, there may be deducted from the dependents' or marriage allowance amounts sufficient to provide for payment of taxes levied by the local taxing authority in respect of the property in question and interest accruing annually on indebtedness to the director of soldier settlement, such deductions to be made monthly and in no case to exceed $20 per month except with the consent of the dependents concerned.


Some hon. MEMBERS:: Shame.


Mr. JOHNSTON:: It is a shame. He ought to be ashamed of himself.


Robert Fair: That is the stand taken by this government, the government which claims credit for the good things it is doing for the veterans of this war. What has it done for
the veterans of the first great war? Remembei that the men for whom I am speaking are also veterans of this war; that is, those who were lucky enough to come back. The government, in order to satisfy the treasury board, perhaps, and our monetary greed, takes away from the wives and families of those men who were over there fighting, the wherewithal which was provided by the government in order that these wives and families might live at least in decency while their men were away. Very fine treatment, indeed!
Again, a little later on we find that another order in council was passed whereby those settlers who were still in debt could make application to a board which was set up to have the terms of their agreement extended for another twenty years and also to have their indebtedness reduced. What is the effect of that? In the first instance the contract was for twenty-five years, and with the additional twenty years it means forty-five years that the settler must serve and pay the soldier settlement board a price far in excess of the value of the land and equipment he received. He has the opportunity to do that for the sake of what? That is praise for having gone over and fought in the first and second great wars. It is a shame that any government should impose a penalty of that kind on its soldiers.
Knowing these conditions, the soldier settlers could not carry on because our wheat prices until August, 1942, were down to seventy cents a bushel, f.o.b. Fort William, which is below fifty cents on the farm in western Canada. This is a price which did not exist previously except for a short time in the depths of the depression. The soldier settlers could not carry on. In April, 1943, they met at Saskatao-n to try to do something for themselves. In November. 1943. they held another meeting at Saskatooon and at that time they decided to circulate a petition to have clear titles granted. No expenses were incurred in the circulation of that petition so far as the government was concerned. Veteran settlers and civilians alike took copies of the petition, drove around the country over snow-blocked roads, obtained signatures to the petition and at the same time collected dimes and nickels from people in order that a delegation might come to Ottawa to present the petition.
On May 23. 1944, a delegation of nine representatives from that organization presented a brief to six members of the cabinet here in Ottawa, presided over by the then minister of mines and resources, who is now in another place enjoying all the cream which can be provided for him. These members were cordially received, and after having
Soldier Settlement

been given a fine reception and told that their request would receive sympathetic consideration the men went home feeling that at last they were going to have some justice meted out to them. I may say that was before the election took place. We expected an election that fall, and honeyed words were handed out at the time. The house was in session until August of that year, and no report was made to the house by the responsible minister. But some of us had hardly got home when an announcement came over the radio and was issued in the press that the government would not grant this request. At the time the delegation came to Ottawa we found that, the director of the soldier settlement board had inserted in The Legionary-I think with the permission and perhaps on the instructions of the then minister of mines and resources-a report dealing with these clear titles, setting out in detail one side of the case, which, I might say, has been torn to ribbons in this house since that time. The concluding paragraph of his remarks reads as follows: The gentleman to whom I am refering is none other than Mr. Murchison, the director of the soldier settlement board. He said:
In conclusion I am authorized to say that the proposal is not deemed to be in the public interest and, consequently, it is not being entertained by the government. Therefore, the best advice I can offer to the soldier settlers concerned is to get into step with those who manifestly prefer securing title to their farms by complying with the terms of their agreements.


Charles Edward Johnston: Who is he?


Robert Fair: He is the director.


Charles Edward Johnston: I thought he was a Hitler.


Robert Fair: The man with whom the new veterans will have to deal unless something necessary is done.
Then, feeling that the Prime Minister (Mr. Mackenzie King) did not know of the treatment which was being handed out to these old veterans, I made a special trip to Ottawa and visited the Prime Minister early in October, 1944. The Prime Minister listened carefully to what I had to say. I left a copy of the case with him, and he told me then that within a week or so the new Department of Veterans Affairs would be set up headed 'by the present Minister of Veterans Affairs and that he would turn the matter over to him. Having had conversation with the present Minister of Veterans Affairs (Mr. Mackenzie), I felt that at last we were going to get a square deal for the old veterans. The department was set up and no clear titles were forthcoming. Therefore, in March, 1945, the president and secre-
TMr. Fair.]
tary of the soldier settlers' association accompanied me to Ottawa. We visited the Minister of Veterans Affairs and had quite a long talk with him. We presented our case and he listened attentively. Then he gave us objections which were prepared for him, I believe, by the director because the words of the director were in the statement of the minister. They were to the effect that payments and pre-payments were being made; that if titles were granted to old soldiers the new veterans would not pay, and so forth. Payments and pre-payments were being made for a great many reasons. The sons and daughters of these old settlers had gone overseas. Some of them had gone to work in war factories. Some of them were receiving dependents' allowances on account of their sons and daughters who had enlisted. As a result of pressure, and plenty of it, which was being put on by the board, these old soldiers turned in every penny they could get hold of. As a result payments were coming in freely, and that is the way things were going. We were told that if titles were granted to the old soldiers the new soldiers would not pay. I wish to advise the government now that if they impose on the new veterans conditions such as were imposed on the old veterans we shall have a revolution in this country before long. Make no mistake about that. They may blame the communists for it, too, but they are the ones who will be to blame if these conditions occur once more.
Then we went to see the Minister of Finance (Mr. Ilsley) in connection with the same request, and he also told us that payments were coming in freely, and that he. believed in the sanctity of contracts. All these old veterans believe in the sanctity of contracts and they proved it by going overseas to fight for the country which is giving them their living. They came back and they were sold land, live stock and equipment at prices far in excess of their value. In my home district one halfsection was sold1 by a father to his son for $8,000 at a time -when prevailing prices of land in the territory were $1,000 to $1,200 for a quarter section. Needless to say, that land is not yet paid for.
When the government made the contract with these old settlers it was made on the basis of prices which existed at that time. We might say that during the years after the war wheat went up to $2.50 to $3 a bushel. Later, we find that the settlers were compelled to pay their debts when wheat went down as low as cents at Wininpeg. That meant a breaking of the contract by the government. When they sold land, equipment and live stock to these men they should have seen to it that

Soldier Settlement
prices were upheld. Proper floor prices should have been established until these things were paid for. That was not done, and yet the Minister of Finance believes that contracts should be maintained and honoured. We believe that too.
Some of our bureaucrats say that this is just the request of a few disgruntled veterans around Saskatoon. I want to contradict that statement flatly. The petition which was circulated contained some 12,500 signatures and was representative of the three prairie provinces. The request for clear title was also supported by the Alberta legislature, the Saskatchewan legislature, the Alberta farmers' union, the Saskatchewan association of rural municipalities, the Saskatchewan wheat pool, the United Farmers of Canada, Saskatchewan section, United Farmers of Alberta, the Alberta branch of the Canadian Legion, the executive of the British Columbia branch, and last, but not least, the dominion command of the Canadian Legion. In order that there may be no question as to the authenticity of these, I should like to read just one or too At a meeting of the Alberta provincial council, held in Edmonton from June 6 to June 9, 1943, the soldier settlers' committee presented a report, and the resolution adopted was as follows:
Whereas the majority of original soldier settlers, who are still endeavouring to carry on under the soldier settlement scheme have now found it, owing to advanced years and the adverse conditions prevailing in agriculture, particularly the lack of parity prices, increasingly difficult to liquidate their indebtedness to the settlement board.
And whereas the settlers have struggled on through the years of drought conditions and low prices unprecedented in the agricultural history of this country and have now nothing to show for. their years of toil and struggle but whatever equity they may have in the land which is liable to foreclosure.
Therefore be it resolved that we now petition the government to relieve the soldier settlers of any further payments and that they be given the title deed to their land or, failing this, that a parliamentary committee in eoniunetion with representation from the dominion command of the Canadian Legion, review the whole situation of the soldier settlers with a view to alleviating their present financial difficulties.
That resolution was sent here, but of course nothing was done about it. Then not very long ago, on October 26 of last year, the head of the Canadian Legion, Mr. Alex. Walker, presented a brief to the committee on veterans affairs, and under the heading "Soldier Settlement Act" he had this to say:
The bill under consideration lowering the interest rate for soldier settlers under the Soldier Settlement Act of 1919 meets one of the recommendations of the soldier settlement report of the dominion convention of the Canadian Legion
held in Vancouver in June, 1944, in that it proposes to lower the interest from 5 per cent to 3J per cent.
A further proposal recommended by this committee relates to the granting of clear titles to aged settlers or to those who had reduced their indebtedness to 25 per cent of the original purchase price. A great deal of discussion has been carried on during the past few years respecting soldier settlers of the last war and strong representations, from time to time, have been made from various sources to solve the problem of these veterans by granting them clear title to their farms. A debate occurred in the House of Commons recently on this subject and many members spoke in favour of the proposal. Representations by soldier settlers through the legion have followed similar lines and the following resolution is submitted for the consideration of this committee:
Therefore be it resolved that, in order to be fair to our ageing veterans and to bring the old and the new settlement acts more into line, the dominion government be asked to readjust the debts of the 6,153 original soldier settlers who have not paid for their lands, such readjustment to take into consideration the difference in interest rates charged under the said acts; and that following such readjustment the government be further asked to cancel the debts of those original soldier settlers whose debt has been, or may hereafter be, reduced to 25 per cent of the original purchase price or the reduced purchase price.
Right here I would say that if consideration were given to the difference between the interest rates charged the new veterans and the old veterans, all these old settlers would have been out of debt many years ago. After that brief was completed, the hon. member for Acadia had this to say, at page 315 of the proceedings of that committee:
On page 11 of the brief there is a reference to the old soldier settlers, and the recommendation there is that clear title be given provided a soldier reduces his indebtedness to 25 per cent of the original purchase price of the reduced purchase price. I do not think that will go far enough to satisfy the organization that calls itself the old soldier settlers' organization, because they are asking for a clear title for all soldier settlers of the last war. I think we must all agree that the soldiers who are in the most difficult position of all are those soldier settlers who have had no chance of reducing their indebtedness to that 25 per cent, the ones who have been up against bad luck. Some of you may call it bad management, perhaps, but we know that the situation these men went through in the depression years put them in a position where they could not get the money to buy the farm. I should like very much to see that 25 per cent taken out of your recommendation, making it wide open so that title can be given to the old soldier settlers, whether in the fortunate position of being able to reduce their indebtedness to 25 per cent or not. I wonder if Mr. Walker would comment on that?
The Witness:	I am sure it will not hurt our
feelings if you do give them clear title.
Then on October 1 of last year I moved a resolution in this house, which I shall not take time to read now since I see my time is flitting away. More than twenty members
Soldier Settlement

took part in. that debate, and with the exception of two or three all were in favour of the resolution, some saying that it did not go far enough. After the resolution was talked out one evening, it was sent to the veterans affairs committee. That committee then received a brief from the representatives of the settlers' organization; that was on May 6 of this year. Then at a meeting on June 18, 1946, the following members were present:
Messrs. Abbott, Adamson, Ashby, Baker, Bel-zile, Benidickson, Bridges, Claxton, Cleaver, Cockeram, Croll, Cruickshanlc, Dion (Lake St. John-Boberval), Drope, Emmerson, Fulton, Gauthier (Portneuf), Gibson (Hamilton West), Gillis, Harris (Grey-Bruee), Herridge, Jutras, Langlois. Lapointe, Lennard, Marshall, Mackenzie. Macdonald (Halifax). MaeNaught, McKay, Moore, Mutch, Quelch. Tremblay, Tucker, Viau, Whitman, Winkler, Winters, Wright.


James Horace King: Order. I am sorry to interrupt the hon. gentleman, but he has spoken for forty minutes.


Robert Fair: Mr. Speaker, I am presenting the case for the old soldier settlers, and I should like to be able to finish it.


James Horace King: Unless the hon. gentleman has the unanimous consent of the house-


Some hon. MEMBERS:: Go ahead.


Some hon. MEMBERS:: No.


Robert Fair: Thank you.


James Horace King: I understand that the hon. member has not the unanimous consent of the house.


Some hon. MEMBERS:: Certainly he has.


James Horace King: Is it the pleasure of the house that the hon. gentleman shall have an opportunity to finish his remarks?


Some hon. MEMBERS:: Yes.


Some hon. MEMBERS:: No.


James Horace King: The hon. gentleman has not unanimous consent.


Some hon. MEMBERS:: A recorded vote!


James Horace King: Has the hon. gentleman the unanimous consent of the house?


Some hon. MEMBERS:: Yea.


Some hon. MEMBERS:: Nay.


James Horace King: Those in favour will please say yea.


Some hon. MEMBERS:: Yea.


James Horace King: Those against will please say nay.


Some hon. MEMBERS:: Nay.


James Horace King: The yeas have it.


Robert Fair: When the brief was presented to the committee in May some hon. members wanted to deal with it at once, but there was not time that day. It could not be dealt with the next day because other business had been set down by the steering committee and as a result it was held over until June 18. When the matter was finally taken up by the committee the hon. member for Weyburn (Mr. McKay) moved:
(a)	That all soldier settlers who took up land under the Soldier Settlement Act of 1919 be granted clear title to such land as of March 31, 1944.
(b)	That clear title-


James Horace King: I understood that the hon. gentleman was going to conclude his remarks. If not, I shall be obliged to ask him to resume his seat.


Robert Fair: This is the wrong place in my remarks to bring the argument to a head, but I shall do so anyway. I can give the rest when we come to second reading, or in committee.


James Horace King: There is a rule which is well known to the hon. member. If he has not the unanimous consent of the house he is obliged to resume his seat. I wanted to be generous to the hon. member, to give him an opportunity to conclude his remarks; but if he does not conclude his remarks I must ask him to resume his seat and conclude at another time.


Robert Fair: Under the circumstances, Mr. Speaker, and finding that we have some hon. members who want to pound into the gutter some of our old veterans, I shall conclude my argument in forty minutes when the bill is up for second reading.


Mr. TUCKER:: I was not one who objected to the hon. member's continuing beyond forty minutes, but because some object to his exceeding forty minutes I say he has no right to say that they wish to pound the returned soldier into the gutter, and I ask him to withdraw that statement,


Charles Edward Johnston: We got that from the Minister of Labour (Mr. Mitchell). He used it the other night.


Ian Alistair Mackenzie: Order. You are the worst offender in the house.


Walter Adam Tucker: The remark is a reflection on certain members in the house; it might just as well be upon hon. members on the other side as well as upon this side. It is a reflection upon various members in the house, an unfair and improper reflection, and I ask the hon, member to withdraw it, without any qualification whatsoever.

Soldier Settlement


Mr. QUELCH:: On the point of order, I do not think there is anything unparliamentary in suggesting that certain people are advocating that the veteran be pounded into the gutter. The hon. member does not suggest that other hon. members, themselves, get down into the gutter. If he had, there might be some grounds for complaint.


Ian Alistair Mackenzie: It seems to me that the hon. member was speaking from his natural environment.


James Horace King: I must ask the hon. member for Battle River (Mr. Fair) at least to be kind enough to modify his expression.


Robert Fair: I shall be very glad on second reading to explain it.


Ian Alistair Mackenzie: No, no.


Robert Fair: I did not cast any reflection upon any hon. members in the house, not one.


Walter Adam Tucker: Whom were you referring to, then?


Ian Alistair Mackenzie: The hon. member
definitely said that members of the government were pounding the veterans into the gutter.


Robert Fair: He did not.


Ian Alistair Mackenzie: Yes.


Robert Fair: The Minister of Veterans
Affairs cannot put words into my mouth. I did not say "members of the government".


Ian Alistair Mackenzie: You said "government".


Mr. ROWE:: No, he did not.


Robert Fair: I did not.


James Horace King: I am sure the hon. member who has just resumed his seat will do everything possible to help the Speaker to keep things in order.


Robert Fair: I cannot hear you, Mr. Speaker.


James Horace King: I am sure the hon. member will help Mr. Speaker to keep dignity and decorum. Certain hon. members are under the impression that, since they are veterans, the remarks by the hon. member referred to them. I am sure the hon. member could modify his expression. I would not insist upon a withdrawal of it, but I would ask him to be kind enough to modify it.


Robert Fair: I did not refer to those hon. members who are complaining, or to any other hon. members in the house.


Alfred Johnson Brooks: Mr. Speaker, it was not my intention to speak on this resolution, but rather to speak on second reading of the bill. However, in view of the debate which has developed, I feel I must say a few words.
The resolution has been on the order paper since April 12, and we were beginning to think it was going to be almost a fixture. The committee on veterans affairs has been sitting for forty days or more, during which time it has had many matters before it. Very little from that committee has been brought to the house, for which possibly there is a good reason.
However, I am pleased indeed that at last a subject has been placed before the house, and that we shall have something definite to show for our work. This matter, in itself, is not contentious. The hon. member for Battle River (Mr. Fair) has criticized it, not on the ground of what it does, but rather on the ground of what it does not contain. As I have said, there was unanimous consent in the veterans affairs committee in respect of the matter contained in the resolution itself.
As hon. members will see, the proposed bill ratifies two orders in council which were passed some months ago. As a matter of fact one was passed in November, 1942, and the other in March, 1945. The intention of the bill is simply to ratify these two orders in council.
P.C. 10472 provided for two things. It authorized the director of the soldier settlement board, with the approval of the treasury board, to make capital reduction in the debt of certain soldier settlers. This, as we know, has been done. I believe there has been a reduction in the debt of old settlers to an extent of something like a million to a million and a quarter dollars. There is general approval among the soldiers and, I am sure, among civilians as well, from one end of Canada to the other, of that procedure.
The other provision in order in council P.C. 10472 was a reduction in the interest rate from five per cent to 3i per cent. This, too, has general approval.
Veterans are now taking up land under the Veterans Land Act. They are borrowing money and having land allotted to them on the provision of paying 3^ per cent. Strong representations were made to the government in 1942 that the interest rate charged the old settler should be the same as that charged the new settler under the Veterans Land Act. This also is provided for in the bill, and was given unanimous approval by the veterans affairs committee.
Order in council P.C. 8346 not only provides that the old soldier shall have a reduction in his interest rate from five per cent to 3J per
2S26
Soldier Settlement

cent, but also provides that all settlers under the Soldier Settlement Act shall be treated in the same way. So that there is a general reduction in the interest rate from five per cent to 3i per cent. I might say that this, too, has received the unanimous approval of the veterans affairs committee. It also fixes the date upon which this reduction of interest is to take effect, namely either the date upon which the soldier settler enlisted, or 1942, whichever is the earlier date.
I do not think it is necessary to make further comment because, as I say, there was unanimous consent in the committee. However, since the hon. member for Battle River has introduced the question of giving clear title to old soldiers I feel that as one of the members of the committee I should say a few words on the subject. First, I wish to commend the hon. member not only for his action upon this occasion but also for his actions in the past six or seven years, during ft'hich time he has fought what he and a good many others of us consider to be the battle of the old soldier. He is to be congratulated upon the interest he has taken.
The hon. member has mentioned that this matter was discussed by the veterans affairs committee for a considerable length of time. I do not think it is incumbent upon me to review the different arguments used by hon. members. Thie ground has been thoroughly covered by the hon. member for Battle River this evening, as it was covered in his former speeches.
I have felt that we might very well give special consideration to the old soldiers who took up their land'in 1919 and 1920 and who for the last twenty-five or twenty-six years have been struggling to pay off their debt. It has seemed to me that, now that, they have reached ages ranging from fifty-five to eighty years, we might give them some consideration.
We are told by Mr. Murchison, .director of the Veterans Land Act, that there was now due from these old soldier settlers something less than So million. In 1919 there were some 25.000 soldiers of the last war, men who had come back from overseas who were anxious to take up farms in this country, but to-day there are only 4,276 of those still remaining on their farms. They have paid many millions of dollars off their indebtedness to the soldier settlement board. As was pointed out this afternoon, they worked under terrible handicaps. First, they went through the great war. Next, they took over farms when prices were greatly inflated and they had to buy cattle at the rate of $100 to $150 a head. Prices of farm machinery were much more than they were in normal times. Be-

sides that, these old soldiers passed through the worst depression this country has ever known. From 1929 to 1938 Canada, along with the rest of the world, passed through a depression unknown to any other generation. Then along came the second great war. Many of these men enlisted for service and those who did not had sons and1 daughters enlisting in the service. Taking all these things into consideration, I submit that these men have a strong claim upon the generosity of the people of this Dominion of Canada.
When we compare it with the billions and hundreds of millions of dollars that are passed through this house, five million dollars is a small sum to pay for the sacrifices that these men have made during the past twenty-five years. This would not be a total loss. As the hon. member pointed out, we are paying for the supervision and direction of the soldier settlement board a sum amounting to well over $100,000 a year. The hon. member for Battle River said that it has cost 827,000 000 to administer the Soldier Settlement Act. I doubt if it is costing anywhere near that sum to-day, but there is no doubt that it is costing well over $100,000. If we washed out these debts and gave clear title to these men we would not be losing any great amount of money because we would save in the cost of administering this act.
As I pointed out a few moments ago, many of these men served in the last war and many of their sons and daughters have served. Some of these men are now sixty, seventy or even eighty years of age. They have lived on their farms for twenty-five years. What man living on a farm for twenty-five years has not the hope that before he passes on to the Great Beyond he will be able to leave a clear title to his land to his widow and children? It would be impossible for these men to do that at the present time. They are too old to make a success of farming. Without going into the arguments which have been so well advanced, I submit that we could afford to be generous to these men to that extent.
As far as the committee was concerned, we were not unanimous in turning this down. I think the vote was seventeen to twenty-one, and I was one of those who supported the motion of the hon. member for Melfort (Mr. Wright). If it had not been that the government brought in what I would term their tactical reserve for the vote it would have been carried in the committee and there would have been a direct recommendation from the committee that these old soldiers be given clear title. I am not going to labour the point any further because I do not think it requires any additional argument.

Soldier Settlement
There are some other matters I should like to mention while I am on my feet. One of these is brought to my mind by an article which appeared some time ago in the Globe and Mail. As I said at the beginning, there have been very few opportunities in this house during the past five or six weeks to bring up veterans affairs. This particular matter has reference to a soldier who joined up in September, 1939. He spent five years in the army and, while overseas, took four courses in agriculture. He hoped that when he came back to Canada he would be able to get a farm in this country and follow the vocation for which he had prepared himself and which he liked. When he came back to Canada he did obtain a farm. After seven months he found that it was impossible to get the loan under the Veterans Land Act for which he had hoped.
I do not want to criticize the director of the Veterans Land Act because I do not think there is an official in any department of government who is worked harder. Not only is he overworked, he is an harassed man. As my hon. friend has said, the conditions imposed upon these men made it almost an impossibility for them to make a success of their farming. They could not sell a cow or a pig; they could not buy a piece of machinery; they could not turn around without having to consult a representative of the soldier settlement board. Let us be careful this time. This letter from a young soldier which appeared in the Globe and Mail indicates that there is a tendency along that line. We should watch ourselves. I warn the minister and the department to be careful to see that technicalities do not interfere with the proper administration of the act.
For instance, a man who has been overseas may want to take up farming. He is told that his wife must be interviewed, but his wife may still be in England. She may have to remain there for five or six months and during that time the man will be unable to get a farm. His wife must be interviewed, I suppose given the once-over as we say, by the officials administering the act. These things react against the success of this scheme. Again I say to the minister that he should be careful to see that such things are not carried to an extreme. I brought up this matter of the letter which was reported in the Globe and Mail because there was an editorial in that paper, not only condemning the government but condemning the opposition because matters of this kind are not brought before the house and because there is no general airing of these matters before parliament.
Along the same line I have received a letter from a legion representative in Nova Scotia protesting the appointment of legal representatives to search titles and do other general legal work under the Veterans Land Act who have not seen any service at all. That is absolutely contrary to what we understand is the policy of the government.


Ian Alistair Mackenzie: Where is that?


Alfred Johnson Brooks: Windsor, Nova Scotia.


Ian Alistair Mackenzie: What position?


Alfred Johnson Brooks: It is a legal appointment by the Department of Justice. I will read the letter if the minister wishes. It is addressed to the hon. Minister of Justice, Ottawa, Canada and reads:
Dear Sir:
By order of the executive of Hants county branch, Canadian Legion, I am directed to enter a strong protest against the appointment of Mr. William R. Lawrence. LL.B.. of Windsor, as administrator of the Veterans Land Act for Hants county. My instructions are that there are in Windsor two barristers with war service. One Mr. A. G. Macdonald had overseas service in the recent world war and the other Mr. C. Wray Townshend is a veteran of the great war.
We feel that the announced policy of the government to give preference to veterans and particularly in all matters relating to the Department of Veterans Affairs should be strictly adhered to and we demand that an appointment be made in accordance with the merits of the ease. Yours faithfulfy,
(Signed) Robert C. Mills,
Secretary.
Hants county branch, No. 9,
Canadian Legion of the British Empire Service
League.


Ian Alistair Mackenzie: Would my hon. friend send a copy of that letter to me?


Alfred Johnson Brooks: I shall be very glad to, but I think the Minister of Justice (Mr. St. Laurent) could furnish his colleague with a copy because he received one.
I know that our ministers are very busy and that it is very difficult for them to find time to attend to all these matters. I also know something of the situation in Windsor, Nova Scotia. So far as Mr. Lawrence is concerned I have nothing to say against him. He is an estimable young man. But the point is that soldiers in soldier matters wish to deal with soldiers, and they feel that there is a breach of faith by the government unless they are allowed to deal with soldiers in soldier matters. They lose confidence in what the government tells them. They lose confidence in the government's assertion that soldiers will receive a preference in civil service appointments. This is not an isolated case. I could quote others. The other day I asked
2S2S

Soldier Settlement
how many employees of Wartime Housing Limited in a town in Nova Scotia were war veterans, and the answer I received was that there are eight full-time employees, five men and three women employed by Wartime Housing Limited in Pictou, Nova Scotia, and that one male employee was a veteran of world war I-only one returned soldier. There is not a town anywhere in the maritimes that sent more soldiers overseas in proportion to population than the little town of Pictou, Nova Scotia, and no town where there would be more soldiers to draw from in appointing men to these positions. It is not my intention to labour this point further. I had not intended speaking at all until my hon. friend brought up the question of giving clear title to the old soldier settlers. If that would cost this country any great amount I would be opposed to it at this time, when we should conserve all our resources. But it would not cost this country any great amount. On the contrary, we would be saved the expense of administering the act for possibly a great many more years.
My hon. friend has quoted the Canadian Legion. One of the arguments used in the committee was that the Canadian Legion was not in favour of granting clear title. I could quote what my hon. friend quoted, if it were necessary, but at page 1010 of the proceedings of the veterans affairs committee I did quote it and I shall not take time now to quote again the views of the Canadian Legion. I believe that this request is a pure matter of justice and that we could very well include it in the bill.


Mr. P. E. WRIGHT (Melfort):: Mr. Speaker, when the resolution was introduced it was suggested that it was non-controversial. I am afraid that that has not proved to be the case. But if the	government want a
resolution such as this to be non-controversial they have it within their power to make it such-
Mr.	MACKENZIE:	Is	my	hon.	friend
opposed to this?


Percy Ellis Wright: I am saying that it certainly does not solve the problem.
Mr.	MACKENZIE:	Is	my	hon.	friend
going to vote for or against it?


Percy Ellis Wright: I say that it does not solve the problem and that it is controversial.
Mr.	MACKENZIE:	Is	my	hon.	friend
against reducing the interest rate from five to 3i per cent?


Percy Ellis Wright: I am in favour of that reduction.


Ian Alistair Mackenzie: We shall see when thq test comes. We shall have the buttons off the foils pretty soon.


Percy Ellis Wright: A delegation of old soldier settlers came to Ottawa in 1944 and interviewed some members of the cabinet. These soldier settlers were assured that their problems would be given sympathetic consideration. Of course, that was before an election. In the committee the other day the minister made this statement:
As long as I am in charge of the administration, I will not stand for the destruction of that principle.
The principle he was speaking of was the principle of granting to these old soldier settlers clear title to their homes, as they should be granted.
The only principle involved here is the principle of justice. These men, if that principle had been observed, would have been granted clear title long ago. They were settled on land, as has been explained by the hon. member for Battle River (Mr. Fair), under conditions where there was no possible chance of them succeeding. I know those conditions. I have lived amongst these men. I know the struggle they put up over the years to meet their obligations. In 1940, when I first came to this house I spoke to certain members of the soldier settlement board, and they told me that many of these old soldier settlers who had not paid their debts and are still on the land are the hard core of those who, the implication was, would under no circumstances meet their obligations. Yet in 1944 over 95 per cent of these men whom the officials of the soldier settlement board said were the hard core of those, who had no intention of meeting their obligations w'ere meeting them because economic conditions in the country had changed and made it possible for them to do so. These men had to struggle for years against circumstances over which they had no control. What would any hon. member do if he had to make a choice between educating his family and meeting his payments? I know one of these soldier settlers on a quarter-section of land. He had three boys and two girls, very bright children indeed. He had to make a choice between meeting his obligations to the board and giving his children a chance to go to high school. He gave his children that chance. He sent them to high school and he was unable to meet his obligations to the board. What happened? A few years later, when this country needed men, two of these boys responded to the call to the colours and joined the flying corps and one of them did not come back from overseas. Did that father not serve his country better by giving

Soldier Settlement
his children their chance for an education than if he had met his obligations to the board?
There is now a small group of these soldier settlers left who, because of adverse circumstances, for family reasons perhaps, sickness, drought, poor land or other circumstances over which they had no control, have not been able to meet their obligations. Surely to-day the people of Canada can afford to give them clear title to their land.
There was no unanimity in the committee about bringing in this measure.


Ian Alistair Mackenzie: I am glad to hear that.


Percy Ellis Wright: The hon member for
Weyburn. (Mr. McKay) moved this resolution in committee:
(a)	That all soldier settlers who took up land under the Soldier Settlement Act, 1918, be granted clear title to such lands as of March 31, 1944:
(b)	That clear title be also granted to the widows, children or dependents of such soldier settlers:
(c)	That in the case of veteran settlers who have been dispossessed of their land during the period between September 3, 1939, and March 31. 1944, either such lands be restored and clear title granted to the settler or adequate compensation made to him.
That was an expression of opinion of a group in that committee, and that resolution *was lost in the committee on a vote. After it was lost, I brought in a further resolution which stated:
That the write-down of the indebtedness of soldier settlers, as recommended by the committee, provide that the settler be granted an equity of 33J per cent of the 1940-41 value of his land, irrespective of any payments made to him.
I am going to say this, that if the members of that committee had voted according to their consciences and not according to party lines, in all probability that motion would have passed.


Some hon. MEMBERS:: Order.


Ian Alistair Mackenzie: Mr. Speaker, I wish to raise a question of order. Every hon. gentleman who is a member of that committee is an hon. member of this House of Commons too, and the hon. member for Melfort (Mr. Wright) has said that if these gentlemen had voted according to their consciences something different would have happened. That is a complete reflection upon the privileges of hon. members of this parliament, and should be withdrawn.


Percy Ellis Wright: Mr. Speaker, if the Minister
of Veterans Affairs-


Ian Alistair Mackenzie: If he is only speaking for himself it may be true.


Percy Ellis Wright: If the minister considers it a reflection I am prepared to withdraw it. Nevertheless, I say that it would have been only doing for these old soldier settlers exactly what we are doing for our veterans to-day under the new Veterans Land Act. It was stated in 1942, when that act was brought in, and it is also stated by mortgage companies throughout this country, that to make a success on the land the loan must not exceed 50 per cent of the value of the land, and that was the basis on which the new Veterans Land Act was originally drawn up. Later, because of the increase in the price of land in Canada, we had to, or did, abandon that 50 per cent, and under the act as it stands to-day the new soldier settler is getting a 33J per cent equity in his land. Surely any member of that committee should have been prepared at least to give these old settlers an equal start with the young chaps who are settling under the Veterans Land Act to-day. That would seem, if they followed their consciences, to be the logical conclusion. If these young chaps are going to find it difficult, as many of them will, to meet their obligations with a 33J per cent equity, what of the case of the old veteran, whose average age to-dajr is fifty-six years and who finds himself saddled with a contract to last over the next twenty or twenty-five years? I am saying that it is not justice. What would it mean to this government of Canada to give clear title? Something over 85,400,000-an extremely small amount to-day in our national budget. We were spending that in a couple of hours during the war. This grant of clear title would give to these old veterans some security in their old age. That equity is necessary if these men are to carry on.
The veterans committee in 1942 were sympathetic to the idea of granting the old soldier settler an equity in his land equal to the equity being given to the new soldier settler. If you go back to the proceedings of that committee, you will find that view expressed in no uncertain terms both by members of the government and by members of the opposition. I am sure that there is nothing new about this. It is simply doing what has been recommended by not only a committee of the house but by the legion themselves. The Minister of Veterans Affairs (Mr. Mackenzie) was quick to pick up a resolution passed by the Saskatchewan legion last year which, opposed the granting of these clear titles. I know that hon. members are not so naive as not to know that there are certain things which take place in connection with resolutions brought before the legion. As a matter of fact this-
Soldier Settlement


Ian Alistair Mackenzie: Saskatchewan is a pretty good province, is it not?


Percy Ellis Wright: It certainly is a good
province, and we have a very good legion there. But, just as in a lot of other places we find some people working behind the scenes.


Mr. ABBOTT:: Surely not in Saskatchewan.


Ian Alistair Mackenzie: Not the government of
Saskatchewan.	.


Percy Ellis Wright: No; I can assure the minister of that. However, there was a feeling there that the old soldier settlers' organization should have worked through the legion, and the fact that they came direct to the government here instead of working through the legion branches-and I agree that they should have worked through the legion branches; I think one returned men's organization in the country is enough-prejudiced their case with the legion. I tell the minister this, that I am- quite sure that if we were to take a vote of the rank and file of the legion in Saskatchewan he would find that they are in favour of granting a clear title to the old soldier settlers.


Ian Alistair Mackenzie: They said the very opposite.


Percy Ellis Wright: I am sure of what I say, because of the circumstances under which that resolution was placed before the legion. Moreover the dominion command of the legion did express in no uncertain terms that these men should receive more consideration than is being given to them in the present bill.
There is no need of carrying on this argument at any great length. Apparently the government. are not prepared to give these old settlers a fair deal. That is their responsibility, but that does not make it right. As far as we of this group as -concerned, as far I think as most members of the opposition are concerned, and as far as hon. members on the government side of the house are concerned, they would like to see something better than is being proposed in this resolution.
I can only urge that the minister, when he drafts his bill, does not follow the lines of the resolution but does give a fair deal to our old soldier settlers.


Mr. J. A. ROSS (Souris):: In rising to support the remarks of the three previous speakers this evening, may I add, like the hon. member for Royal (Mr. Brooks), that this resolution itself is probably not contentious but it does not go far enough. May I commend the hon. member for Battle River (Mr. Fair) for

the consistent stand and fight he has put up on behalf of these old settlers, I think every year since I have been- a member of this house.
As a member of the veterans affairs committee, I was impressed with the brief and the arguments put forth by the executive representing the old settlers to the committee in the railway committee room during this session. I thought they advanced some sound and strong arguments as to a further adjustment, if not the granting of clear titles at this time.
I do not want to repeat many of the figures and arguments which have been advanced this evening, but I want to endorse what the hon. member for Royal has so well said, that after these many years these old settlers, whose sons and daughters went overseas and did a grand job for us in this war, are certainly entitled to more consideration than they have received at this time, and I am satisfied that many of them find themselves in financial difficulty to-day through no great fault of their own.
We have done a lot in the way of lending money to other people. The great loan, of which I was heartily in favour, to Great Britain runs for five years without any interest and for fifty years at two per cent interest. Had these settlers received the same rate of interest, I do not believe any of them would have been in debt to-day.


Ian Alistair Mackenzie: Who was in power then?


James Arthur Ross: I do not care who was in power then. I have criticized in the house and in committee on more than one occasion what was done for these soldier settlers and the people responsible for it. I say we have to d-o much better for the settlers of to-day than we did for the old settlers. I am fair about it; but I am not at all satisfied with what is being done to-day.
Yesterday we listened to the Minister of Labour (Mr. Mitchell) taking advantage of the orders of the day to deliver political propaganda in this house in talking about inflation. Will anybody tell me that we have not inflation to-day? I have argued consistently in the veterans affairs committee that the director has too great a burden and too much responsibility to-day in trying to settle full-time farmers and also to carry out the small holdings project.


Ian Alistair Mackenzie: Given to him by a parliamentary committee.


James Arthur Ross: I realize that, but I say I am not satisfied. I have raised objection repeatedly in the committee, and the more I

Soldier Settlement
am able to find out in the country, the more I am convinced that the method is wrong. Some hon. members have spoken of a vote which took place on June 18, a vote of seventeen to twenty-one. I am sorry I was unavoidably absent from the house that day and did not attend the committee.


Mr. SINCLAIR (Vancouver North):: Out on political propaganda.


James Arthur Ross: I was endeavouring to assist to save democracy in this country. I say to the hon. member for Vancouver North-


Ian Alistair Mackenzie: We try that occasionally ourselves.


James Arthur Ross: While I was out there, I had an opportunity personally to visit one of these centralized small holding projects of ninety units under the Veterans Land Act.


James Sinclair: It must have been close to Winnipeg.


James Arthur Ross: It was five or six miles out from the city limits of Winnipeg.


James Sinclair: The hon. member would not go any farther than that.


James Arthur Ross: What that land cost per acre was startling to me. There were ninety units of a half acre each, and the point which alarmed me was that right now, despite inflation, the great majority of these ninety settlers and their families are dissatisfied. The workmanship and the materials' do not satisfy these people at all. They showed me through their homes.


James Sinclair: Can they buy houses cheaper anywhere else?


Some hon. MEMBERS:: Yes.


James Sinclair: Where?


Charles Edward Johnston: Right in Calgary.


James Arthur Ross: According to one of the administrative officers of the department to-day these houses have cost from $5,900 to $7,000 apiece, and they are still working on them. The cost is not yet complete.


James Sinclair: What do they cost the veterans a month, $23?


Mr. DEPUTY SPEAKER:: Order.


James Arthur Ross: My hon. friend knows all about this. He says $23. The director gave us a different figure the other day in the committee. The figures which I have from the administrative officers show that while 63260-179
they cannot yet make arrangements for the purchase of these houses, they are paying $25 a month for the four-room unit, and $30 a month for the five-room unit, and that in all likelihood the rent would be immediately increased from $5 to $10 a month.


Ian Alistair Mackenzie: No, $22 to $23.


James Arthur Ross: I am talking about the rent for these units to date, and these settlers-[DOT]


James Sinclair: Wartime housing.


James Arthur Ross: The hon. member for Vancouver North will have an opportunity-


James Sinclair: We are now discussing the Veterans Land Act, not wartime housing.


Some hon. MEMBERS:: Sit down.


William Ross Macdonald: Order. May I remind the house that we are discussing a resolution with respect to the Soldier Settlement Act. The remarks of the speaker should be directly relevant to that act.


Ian Alistair Mackenzie: May I have the permission of the speaker to ask a question?


James Arthur Ross: Certainly.


Ian Alistair Mackenzie: Did he say that the figure was $30 a month under the Veterans Land' Act?


James Arthur Ross: Yes, the small holdings scheme. This was one of these units which have not been adjusted under this order in in council for the million dollar write-off.


James Sinclair: Why is the


James Arthur Ross: My hon. friend over there who has been so ambitious to become a parliamentary assistant should hold his peace. I was only making a comparison here, and I say that the letter points out-


Ian Alistair Mackenzie: The figures are wrong.


James Arthur Ross: That may be so.


William Ross Macdonald: Order. I think the house will agree with me that an hon. member should not be interrupted or asked questions without his permission.


James Arthur Ross: I do not mind it at all. I was simply making a comparison.


Walter Adam Tucker: May I rise to a point of order? I did not raise it with the hon. member for Royal (Mr. Brooks) and I hate to raise it now.


Some hon. MEMBERS:: Sit down.

Soldier Settlement


Walter Adam Tucker: I believe there will be a bill brought before the house on the Veterans Land Act. I suggest that the session is running on long enough without having two debates on the Veterans Land Act. I suggest that a debate on the Veterans Land Act at this point, when we are dealing only with the Soldier Settlement Act, is out of order. As I say, I hate to raise the point, but we wish to have the debate concluded, and to do so we had better try to keep to the point at issue before the house.


James Arthur Ross: I quite agree. I was simply trying to make a comparison to prove that we have more inflation to-day than we had when the old settlers were settled. I am thoroughly convinced that the units in Charleswood, which I have spoken of are not worth 50 per cent of the cost put into them on a cost-plus basis. I have inspected them and gone through them with the settlers.
I shall return to my original argument. As has been so well said, stock and equipment cost these old settlers a great deal in 1919 and 1920, following the last war. In other sessions I have given concrete examples in my own community. One of these settlers failed during the drought periods and signed a quit-claim deed to the board. He had agreed to pay approximately 85,000 for his halfsection, which is around 815 an acre. He did not have a chance to re-buy that farm when it was re-sold. It was sold to a citizen, a speculator, who was not even a British subject at that time-but that does not matter- for less than 8500, less than 10 per cent of what the original settler had agreed to pay for the farm; but the board would not give the settler a chance to buy the farm. In fact, if rumours are correct the same speculator is endeavouring to sell that farm back to the board to-day. I point that out as one of the examples of what the settlers had to contend with through no fault of their own. I thought that was unfair at that time. That is what we have been doing, and we are now in an inflationary period despite what the indices show-


James Sinclair: The hon. member and his party want to remove the price ceilings.


James Arthur Ross: I think we can still make these adjustments for these old settlers. May I ask the hon. member for Vancouver North, who has been so keen to take part in this discussion, if he is opposed to giving further adjustments to these old settlers?


James Sinclair: It is not a case of further adjustments. May I ask the hon. member a question? If you cancel these loans to the old settlers how are you going to collect the present loan to the settlers under the Veterans Land Act?


James Arthur Ross: I was making that very argument, that already under the small holdings units an order in council has been passed to write off 81,000,000 without the settler having a contract to purchase these homes. This write-off is being made before they are in there.


James Sinclair: That is an adjustment, not a cancellation. There is a great difference between an adjustment and a cancellation.


Ian Alistair Mackenzie: That has nothing to do with this bill. Why hold up this bill which reduces interest?


Mr SINCLAIR (Vancouver North):: You are better on the black market than you are on this.


James Arthur Ross: I have never been closer to the black market than the hon. member for Vancouver North. In fact, I do not profess to know as much about it as he does. The point is this. My hon. friend-


William Ross Macdonald: I must remind the house that it is necessary to have some limit to the interruptions.


James Arthur Ross: The point is that today these settlers are given a grant of 82,300 and some odd if they fulfil their contract, which was not the case with the old settlers. My argument is that the old settlers are entitled to at least as much as the present veterans, because in something over 90 per cent of the cases their families did make a great contribution in the recent war. They are the type of citizens who should be encouraged in this country to-day; and without repeating other arguments that have been advanced, I may say that at the proper time I am going to support the hon. member for Battle River and continue this fight until these old settlers receive a better deal for themselves and their dependents.


Eric Bowness McKay: It is my opinion, Mr. Speaker, and has been for some considerable time that the veterans who were settled under the old act of 1919 and who are still indebted to the federal treasury should be granted clear title to these lands as of March 31, 1944. In the first place, as has been said already to-night, when the loans were made no gifts were made to these veterans, as

Soldier Settlement
is being done to-day. Under the Veterans Land Act of 1942 a gift of $2,320 is made; and if that gift had been made to the veterans in 1919 I doubt if there would be any indebtedness whatever against their land to-day. After twenty-seven years of struggle with the elements and the federal treasury these people are still in debt. To-day, as has been indicated, the gift from the treasury amounts to 39 per cent of the loan. We will admit that some concessions have been made to these old veterans of world war I, in the matter of reduction of principal and reduction of arrears, but that will hardly compensate for a gift of 39 per cent of the original indebtedness.
In the second place, the interest rate on veterans' farm loans of 1919 was five per cent, with seven per cent charged on arrears. This was another factor which militated against the ability of these veterans to meet their obligations and reduce their indebtedness. The rate to-day of 3J per cent under the Veterans Land Act is still too high, but it would have enabled the veterans of the first war, had it been applied to their contracts, to meet their instalments without so much difficulty. Had the gift been granted, together with the lower rate of interest, on the loans of 1919 it is probable that there would b'e no demand to-day for cancellation of debts, since those debts would have been liquidated long ago.
It has been suggested that it would be unfair to the soldier settlers who have obtained clear title to their land to wipe out the indebtedness against the 4,200 parcels on which the debt is still outstanding. We have three soldier settlers in the house, at least three to whom I have spoken, though there may be more. Those three, all of whom have paid off their indebtedness, are in favour of cancellation of debt for these other unfortunate veterans. I cannot accept the view that any of the veterans who have paid off their indebtedness would be opposed to a fair deal being offered to veterans still in debt. I have not yet run across any who hold that view; I have yet to find a single man with a clear title who takes that attitude. Why should they? These men were comrades in arms. Some have been a little more fortunate than others. Some obtained good land, while others were placed on poor soil. It was not any fault of theirs. Some had good fortune, with substantial crops over a period of years, while others had misfortune dog their path year after year, with poor crops owing to drought, hail, pests and so on; and frequently they had family illnesses which held them back. To say that by cancellation of the debt on these particular lands we would not be 63260-179*
treating these settlers all alike is probably true, but we have never treated them all alike. Had they all obtained good land in 1919, the story to-day would be different. They are not treated all alike to-day, either. Some receive university grants which in all probability will run into thousands of dollars. That is an excellent thing, but other young veterans are only receiving the civil reestablishment grants amounting to a few hundred dollars. We are not treating them all alike to-day; and we did not treat them all alike in 1919. To argue that we must treat these veterans all alike sounds very fine, but the fact is that this has never been done.
The veterans who are requesting clear title to their lands have laboured for twenty-five years and more to obtain that title. We should not concern ourselves particularly with regard to those who have been fortunate enough to secure clear title. Our concern must be for the old veteran or his widow, who is still struggling to secure a clear title. It is a race against time. Their average age is around sixty, while a few are in the eighties. To illustrate how the old settlers feel about this matter may I quote from a letter I received from one of them out in Saskatchewan:
I served in France and Belgium in the first world war. Came home to find that while I was in hospital . . .-a hospital in England- my half-section had been sold to a German. One-quarter was my homestead and I owed for part of the other. I had to start all over again with the soldier settlement board.
I am in my seventieth year and after twenty-five years I find myself still owing the soldier settlement board almost a thousand dollars. I would like to have the satisfaction of having my land clear before I die, but if I continue to have hailed and dried out crops as in the past, I can expect to have a supervisor come and ask me to sign a quit-claim as others have had to do.
My only two sons volunteered and gave their services in this war. I have worked hard for them all these years and feel that I have surely earned the deed of my land.
No doubt all hon. members have received similar letters. Most of these settlers were industrious enough, but misfortune came their way. By granting them clear title to-day we would be righting a wrong and rectifying a grave injustice which has been allowed to continue altogether too long. It has been objected that to grant these clear titles would involve $5,000,000 in cancelled debts. When one considers that the administrative cost of the Soldier Settlement Act has exceeded $27,000,000, the $5,000,000 does not appear so very great. Neither does it seem so great when one considers that we expended much more than $5,000,000 a day during the last war. But now we are at peace, Mr. Speaker; the story is different, and unfortunately our attitudes are different. If this country is
Soldier Settlement

spending too much money in some respects or under certain departments, let us practise economy, but not at the expense of these old veterans. I feel we owe them a great deal; so let us give them justice now.
It has been said also that by granting clear titles administration of the Veterans Land Act would be made more difficult, and I have heard it said that young veterans of world war II would take advantage of the situation and stall in their payments, so that twenty-seven years from now they might get title from a humanitarian government of that day. I have too high a regard for these young veterans to think they would take advantage of a situation brought about by the misfortune of these elder veterans. More than that, it seems most ridiculous to me that anyone would wish to carry a burden of debt for twenty-seven years, just in the hope of getting clear title in the year 1973.
I am convinced that free title should be granted to every one of these old soldier settlers, or to their widows, who are still owing money to the federal treasury. It is t.he duty of all of us to give this subject our careful consideration. If that be done, I am certain we shall do justice to the old soldier settlers of a generation ago, who are fast disappearing from the scene.
Mr. J. 0. PROBE: (Regina City): Mr. Speaker, I have not spoken often during this session-
An lion. MEMBER: A pity.


John Oliver Probe: Yes, it is a pity. However, I feel I would not be doing my duty as a veteran of the last war, as a citizen of Canada or a representative of my constituency if I did not bring to the attention of the house some of the material which I, too, have received from soldier settlers who took up land following the first great war. Last autumn there was sent to me a series of photographs of homes of soldier settlers who had taken advantage, as they thought at that time of the settlement scheme following the first world war. I do not intend to show these photographs to hon, members, but I should be very glad if some of them who have not yet realized that these men have had to battle against untold difficulties and disappointments, would come up to my office and take a look at them. I have had them posted on the walls of my room for some months, as a reminder to me that I have a job to do 'here on their behalf.
However, I intend to read to hon. members the captions which appear over these various photographs. The heading on the frame on which the photographs are posted is in these words:

Soldiers' homes after twenty-five years of the worst kind of drudgery, coupled with an endless battle with hail, wind, drought and grasshoppers.
And with true soldier-settler wit we find repeated on the second line the statement by Sir Robert Borden following the last war:
Our soldiers shall never want after fighting so gallantly; the pledge of Sir Robert Borden for Canada; will it be honoured now?
Attached to these sheets are ten photographs showing ten soldiers' homes in one district. These are not in my constituency, and I am not now speaking from any political desire to obtain votes. This does not concern me particularly, because mine is an urban constituency. Opposite the first photograph is this caption:
No. 1 is the home of Frank Smith, who had to move out and make a living elsewhere.
What a hovel it appears! Then:
No. 2 is the home of Hugh De Blaquire, a man who was very badly wounded, and a 100 per cent pensioner. There is no water on his place, caused by the indifference of the board. The soldier settlement board even tried to compel him to make payments out of his pension.
No. 3 is where Herbert Darling was first located on a very poor quarter. The hole in the ground indicated by the arrow was where he lived for ten years. The bottom of an old bundle rack-
A hay rack, to any who are not farmers.
-formed the roof of his abode, while the sides were any old rough lumber. Eventually two of his good neighbours assisted him financially to purchase No. 8 where he now lives. Darling is a very good worker but has had very bad luck. He was severely kicked in the face by a horse.
No. 4 is the home of Ronald McDonnell, a front-line man. He and his wife and three children had to exist in this hovel.
I hope some of the members will look at it some time.
The soldier settlement board even tried to sell his place away from him while he was away trying to make a dollar on the side.
No. 5 is Y. Castiglioni's home. This is the worst ease of all. Eight children were raised in this hovel. There is only a quarter-section with 30 acres of waste land on the quarter. After being hailed out, dried out and blown out over a period of twelve years he was put off with a very sick wife and three children of school age. The soldier settlement board knew he had no place to go. This is the most dastardly piece of business on record.	-
No. 6 is the home of George Lobbans, a frontline man. This is a disgrace to Canada.
The picture here would indicate that that is no overstatement.
No. 7 is the abode of R. Hunter, another frontline man. After being hailed out five times in succession he was evicted because he refused to pay the board his last dollar.
Then, Nos. 8 and 3 were described in connection with No. 3.
No. 9 is the McNaughton home-


An hon. MEMBER:: General McNaughton?

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John Oliver Probe: No, not General McNaughton; he is provided for.
A family of five lived in this dump.
No. 10 is Mike Robins' home, a front-line man and very badly wounded. This is how Canada shows her appreciation for another veteran. Surely there are some gallant gentlemen in our house of parliament.
This has all been quoted from the group of photographs I have before me.


James Horace King: I am sorry to interrupt the hon. member, but may I call his attention to the fact that it has always been the practice in the resolution stage to discuss only the principle, and to reserve to committee of the whole a discussion of detail.


John Oliver Probe: I am in hearty accord with every word you have said, Mr. Speaker. I am trying to discuss the principle which underlies the resolution introduced by the Minister of Veterans Affairs (Mr. Mackenzie) to collect another sum of money from these people who are now old and should have been pensioned off many years ago, and given title to their places.


Ian Alistair Mackenzie: Is the hon. member in favour of or opposed to the resolution?


John Oliver Probe: I am opposed to the resolution as it now stands. I thought an entirely different form of settlement should be made.


Ian Alistair Mackenzie: Is the hon. member prepared to vote against the resolution?


John Oliver Probe: It is possible that I may vote for it, if I am forced to.


Ian Alistair Mackenzie: No, no; there is no forcing here.


John Oliver Probe: At present I am not discussing whether I shall vote for or against it. I was hoping to open the heart of the minister so that he might bring in a resolution more in keeping with the necessities of the case. I realize that the minister is introducing a resolution which will give something better than that which now exists in the form of contracts.


Ian Alistair Mackenzie: And you are going to support it.


John Oliver Probe: If the minister will just watch when my vote is recorded he will understand what I am going to do.


Ian Alistair Mackenzie: I am sure I will.


John Oliver Probe: I should like simply to draw two facts to the attention of the minister. Some seven or eight years ago a calamity occurred which affected the lives of the people of an entire province. In fact, it extended beyond the boundaries of one province. At that time when Saskatchewan asked for national assistance-


James Horace King: I am sorry to interrupt the hon. gentleman, but I think he will agree with me when I say that he should not go into details on the resolution. When the resolution has been adopted the house will go into committee and the hon. member will then have an opportunity to question any minister of the crown. When the resolution is accepted by the committee, it will be reported and a bill will be introduced. The hon. member will have an opportunity on the second reading to discuss the bill and then, when it is in committee, it will be discussed clause by clause. The hon. member knows that if an opportunity is given to discuss, on the resolution, all the details of a bill to be introduced there would be no use in introducing resolutions into the house.


John Oliver Probe: I am heartily in agreement with every word that you say and I congratulate you upon making your case so clear. What I was trying to do was to discuss the principle of this matter. As I say, when we have calamities at home in the form of drouth which affect a large section of our people there is a demand made nationally for a pound of flesh. But when there is a calamity far away -and I happen to know the extent of that calamitjq we generously say that we as a Canadian people will do everything to alleviate that distress. Why was it that the people of Saskatchewan were turned down in one case, while the people of Great Britain were supported in the other case? The Canadian people were ready to support a loan to Great Britain, but the fact is that a little extra profit would be made to our exporters who were going to provide the goods. Therefore the representatives of those exporters were entirely in accord with the provisions of that loan.
I voted for that loan, but it was not in order that we might make money out of the misery of the British people or take it from the poeketbooks of the Canadian people. Along with other members, I supported it from a humanitarian point of view. Whenever there is a calamity such as the one which affected the people of Saskatchewan, or the one which affected the people of Great Britain, or the one which affects the soldier settlers at this time, we should search our hearts and not our ledgers in order to find out whether or not the need is worthy of support.
The Minister of Veterans Affairs (Mr. Mackenzie) asked me whether I would support his resolution. I appeal to him to wipe out this debt which has been paid in hardship, in toil and in suffering. If he refuses to do that, then of course I shall still have to support the resolution. I must do that if we are going
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to be too hard or too calloused to do the thing that is right. But it is better than nothing and for that reason I will support it. However, I appeal to the minister to withdraw this resolution and replace it with another giving title to those soldier settlers who still have not paid the Canadian people the money that they nominally owe.
Hon. IAN A. MACKENZIE (Minister of Veterans Affairs): Mr. Speaker, I appreciate what my hon. friend has just said. The hon. member for Rosthern (Mr. Tucker) will give the details in connection with the 200 settlers whose claims have been advanced by a method which it is not desirous should be used in this house. If there is any further delay we will withdraw the whole measure and then the onus for its withdrawal will rest upon those who have-


Some hon. MEMBERS:: Oh, oh.


John Oliver Probe: I am not concerned about political manoeuvring. I said that I would support this as a half measure, but I appeal to the minister to do something better.


Walter Adam Tucker: Mr. Speaker, I did not expect that this resolution would take the time it has in view of the fact that it was passed as a unanimous recommendation by the select committee on veterans affairs which is composed entirely of veterans of the last and previous wars.


Alfred Johnson Brooks: It was not a unanimous recommendation. The committee felt that they should go farther and make additional recommendations, but since they did not do that there was no objection to what was done already. That is how far it was unanimous.


Walter Adam Tucker: My statement is correct. In committee certain things are agreed upon and recommended. Obviously everyone in committee cannot get everything he wants. If everything that is discussed in committee is to be the subject of extended debate in this house, then the situation will become very difficult. I would point out that this is one of the smallest of the fourteen bills that will be coming before this house.
I understood that the whole point in referring these matters to a veterans affairs committee composed entirely of veterans was to have the details threshed out and get a recommendation from the committee upon which this house could act with a great deal of assurance. I submit that this house could leave these matters in the hands of a committee composed entirely of returned soldiers without expecting to debate fully every detail that is

not agreed to in the committee. I suggest in all seriousness that if we are to follow the practice which has been indicated to-night of debating everything we do not happen to agree with we shall have to spend all the rest of this session until September on veterans legislation alone. I point that out to members of the house and I think most members of the committee will bear me out. If a matter which is recommended unanimously-


An hon. MEMBER:: Not unanimously.


Walter Adam Tucker: The reduction in the interest rate was recommended unanimously. There was a controversy in the committee over whether we should give clear title, but that is not the question before the house to-night. The question before the house to-night is whether we are in favour of ratifying a reduction in interest from five per cent to 3J per cent. The question of clear titles has been raised by the hon. member for Battle River (Mr. Fair), and there were other questions raised in the committee as to what should be done. If every hon. member raises those questions which did not find approval in the committee and they are the subject of extended debate in this house, then I submit that we may just as well not have a committee at all. I think my argument will carry the conviction of the house.


John Oliver Probe: I do not want to be controversial, but how are those hon. members who were not on the committee to discuss these matters?


Walter Adam Tucker: Naturally those things which are suggested by the committee as being worthy of passage by this house should be discussed, but if everything that happens to come in front of the committee is to be seized upon and fully debated in this house I doubt whether we can get through the essential legislation that the committee has agreed upon. That is a question of simple common sense.
I think hon. members of the committee will bear me out when I say it was expected that when this resolution was called to-day it would meet with such approval that it would go through in a few minutes, but the debate was precipitated by the speech of the hon. member for Battle River. The hon. member brought up a subject in which he is interested, and other hon. members have brought up other matters which did not find favour with the committee. Each hon. member feels that he has the right to bring up these matters and have them debated extensively. But I ask in all seriousness; are we going to get through this tremendous body of veterans legislation consisting of at least fourteen bills if every

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piece of legislation is to receive the treatment received by this resolution? I repeat, we might just as well have no committee at all if we are to debate here everything that is brought up in the committee regardless of what the committee recommends. That is no* meant as any criticism of those who have taken part in this debate. I appreciate that the question was raised by the hon. member for Battle River and that other members felt that they had to say something about it. But I suggest in all kindness to the hon. member for Battle River that there were on the committee from his own group two most able and conscientious members. I would say that there was no member of the committee who was more conscientious or more able or more anxious to do something for the returned soldier than those two members of his own group, and I submit that the hon. member for Battle River might have left it to his two able colleagues to press his viewpoint.
It is most significant that this matter was brought up and fully discussed in a meeting of the Canadian Legion, Saskatchewan command1; and I ask those hon. members who suggest that the members of the committee who voted against this proposal were not conscientious, would they say that the leaders of the Saskatchewan command of the Canadian Legion who last fall also voted against this proposal were not conscientious in serving the returned soldiers, their own comrades? I suggest to you, Mr. Speaker, that if we are to get along in this house and win the approbation and approval of those we represent here, the less we bandy about suggestions that only "we" are interested in the fate of our comrades who served in the last great war and in the first great war and that the others were not conscientious but voted from some ulterior motive, the better it will be. Otherwise we shall not get very far in settling these great problems.
I have some knowledge of what happened at the convention of the Canadian Legion, Saskatchewan command. The matter was thoroughly discussed there, and I am told that when the question was put to a vote no one rose and voted for it after it had been fully explained to them. A vote was called for again, and still not a man rose. To suggest that any member of the convention who did not approve the proposal was not working in the best interests of their comrades from Saskatchewan will not get us very far.
It was suggested by the hon. member for Royal (Mr. Brooks) that the proposal would have been carried in the committee if the government had not brought in their tactical reserves.


Alfred Johnson Brooks: I still contend that.


Walter Adam Tucker: Many members of that
committee are very busy and not able to attend all the meetings; nevertheless they have the right to attend and express their opinions and the right to vote. I submit that to suggest that they had not the right to vote and express their own honest opinions because they were not able to be in the committee all the time is nothing more or less than an attempt to establish that a minority of the committee is to control and decide what the policy of the committee should be.


Alfred Johnson Brooks: I never suggested that they had no right to vote. I did suggest that they came there just when the vote was on. You can draw your own conclusion.


Walter Adam Tucker: I submit in all friendliness that it should not be a matter of scathing comment that members of the cabinet, who are very busy, should attend the committee and exercise the right to vote which this house conferred upon them by membership in the committee. They had a right to be on the committee and vote as they felt best.
We have had a most marvellous relationship between all the members of the committee. It has been one of the finest experiences I have had to sit on that committee and enjoy the comradeship which I have had the privilege to enjoy during the two years I have sat on our veterans affairs committee.
As evidence of the fact that there is no attempt by the government to control the committee, the members know that we have a steering committee upon which the government, if every member is there, is in the minority. The members of the steering committee know that there has been no attempt at any time to force any decision upon them. Everything has been discussed and agreed upon unanimously. The opinions that come out of the committee I can assure the house are the honest opinions of the veterans of that committee, or of a majority of them, after thorough discussion. Any suggestion that everything that comes out of the veterans committee is to be rehashed and threshed over at length in this house would be to stultify the committee and should be opposed by every member of it.


An hon. MEMBER:: Louder.


Ian Alistair Mackenzie: This is good for you. Take your medicine.


Walter Adam Tucker: That committee has a tremendous amount of work still in front of it. It still has to report eleven bills. The greatest
2S38
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good feeling should prevail in that committee. If there is the thought that every word dropped in that committee and every suggestion made must be the subject of extended debate in this house it must be clear to anybody that the hope of putting through this volume of legislation might as well be abandoned to-night.
I have mentioned the fact that the Canadian Legion, Saskatchewan command, did not approve this resolution. I must confess that when people of the standing in the returned soldier movement of some of the members of the Canadian Legion, Saskatchewan command, after thoroughly considering this proposal came to the conclusion that their responsibility to their comrades required them to vote against it, it had a tremendous effect on my attitude toward the proposition.
We have heard it said that returned soldier organizations will vote for anything that they are asked to vote for so long as it means giving some advantage or money to the returned soldier. I should like to pay a tribute to some of the people in the Canadian Legion, Saskatchewan command, for whom I have the most profound admiration for the way in which they have served their comrades, in the first great war and in the recent war. In taking the stand they did on this question, a stand which could be attacked, they showed that they could approach the question in a statesmanlike manner in the best interests of their comrades. There has been the unworthy suggestion that there was manipulation behind the scenes.


Percy Ellis Wright: I did not state that. I stated that there was a certain feeling in the legion that the old soldier settler orgainzation should have acted through the legion rather than on their own, and their case was prejudiced in the convention because of that fact.


Walter Adam Tucker: Any man who suggests that men of the type who lead the legion, Saskatchewan command, would let a little pique influence them in deciding what they thought was best for their comrades is to do them far less than justice. I am astonished at my hon. friend throwing out that suggestion, knowing the members of the legion in Saskatchewan as he does. I am sure he knows in his own heart that men of the type they are would not let a little pique influence them and would not permit themselves to be manipulated behind the scenes.
There is another matter which I find quite significant. It has been suggested that the legion as a whole is in favour of this programme. I may be wrong in what I am going to say, and I can be corrected if I am;

but I have gone very carefully through the Legionary of June, 1946, and read the resolutions passed at the last national convention of the legion, on May 19 to 23, and after all, if there is one authentic way in which the legion speaks it must be through its national organization meeting in biennial convention. I have examined the resolutions from start to finish to see if the national convention followed the lead of the Saskatchewan command or if they followed the lead of my hon. friend the member for Battle River. I was interested to see that, as far as I could find, this matter into which some hon. members have gone with-I do not know what I should call it; not ecstasy, but the very opposite-


Ian Alistair Mackenzie: Hysteria.


Walter Adam Tucker: -was apparently of so little importance, in the view of the legion, or was actually regarded as detrimental-it must have been one or the other-that it found no place in the resolutions of the Canadian Legion at its national convention.


Alfred Johnson Brooks: May I ask the hon. member this question: is it not true that, when the Canadian legion presented their brief to our committee, they made a recommendation that the soldier settlers get clear title?


Walter Adam Tucker: I would point out to my hon. friend that the head of the Canadian Legion before their convention made a presentation on pensions. I find a resolution of the convention on pensions. I will read part of it:
We hereby endorse the presentation made by comrade Hale on behalf of the dominion command of the legion to the special parliamentary committee on April 9, 1946.
In other words, as to the matter which had already been presented by Mr. Hale to our committee on pensions, they endorsed that, but I can find no endorsation of the submission in regard to these clear titles. I draw a conclusion from that. It cannot be that this great convention would overlook something which is alleged here tonight to be so important to the welfare of the returned soldier. I can only draw the conclusion that it was brought to their attention, and that they must have endorsed the position of the Saskatchewan command * of the Canadian Legion.


Alfred Johnson Brooks: I should like to correct the hon. member on that. I think if he refers to page 1259 of the proceedings of the committee in 1945, he will find that the Canadian Legion did make the recommendation which has been mentioned here to-night.

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Walter Adam Tucker: I am saying that I take it that the legion would' speak through resolutions passed by their membership. This is the way, when they have just bad a convention, to find out what they are really in favour of; and when they do not pass a resolution in a matter I think that fact should have some significance.


Alfred Johnson Brooks: Well, would not the hon. member-


James Horace King: Order. I must remind the hon. member that we are not in committee, and no hon. member should interrupt without his permission the one who has the floor.


Walter Adam Tucker: A statement was read by one hon. member that this particular person would not object if we went ahead and did something he wished. But has that person a right to enlarge on the decisions of the Canadian Legion in convention assembled? What is the purpose of that convention if the resolutions are not to be taken as worth something in showing the wishes of the convention?	.
That is all I wish to say about that, that if it were regarded as in the best interests of the returned soldiers of Canada that this matter should be dealt with in the manner suggested by the hon. member for Battle River, it would, I feel certain, have found a prominent place in the resolutions of that convention.


Mr. PEARKES:: Would the hon. gentleman permit a question? Has he received a copy of the resolutions which were passed, from the legion?


Walter Adam Tucker: This publication containing the resolutions was handed to me.


George Randolph Pearkes: I am not interested in a printed newspaper. That has nothing to do with the matter.


Walter Adam Tucker: This is the official organ of the legion.


George Randolph Pearkes: But surely the official record-


Ian Alistair Mackenzie: Order.


George Randolph Pearkes: My question is, has the hon. gentleman received a copy of the resolutions which were passed at that meeting. from the legion?


Walter Adam Tucker: I will answer that in this way. I have read from the June issue of the Legionary, which bears this on its first page:
Official national magazine of the Canadian Legion, published by the Canadian Legion Press, Ltd., a dominion-chartered company owned by the Canadian Legion and operated by a board of trustees appointed by the dominion executive council of the Canadian Legion.
This particular issue was handed to me, as I remember it, by the newly elected president of the Canadian Legion as containing the resolutions which they passed at the last convention. He handed this to me, and there is not much more I can do than to accept their newly elected president's indication that therein I would find the resolutions of the Legion in regard to the various matters we were considering. As I say, I have gone through this as carefully as I can, and I cannot find anything on this matter. It may be that some hon. member, speaking later, may find something on it. I find something in regard to the Veterans Land Act, but on this particular subject there is nothing that I can find.
In regard to the situation generally, I do not intend to take up more than a few minutes, but I think there are a few figures which the house would like to have laid before it with reference to this matter. At least, I should like to refer to some significant figures. If hon. members will look at page 337 of the proceedings of our committee they will find a statement which is certified as correct by A. G. Woolsey, the chief treasury officer; it is the balance sheet of the soldier settlers of Canada as of March 31, 1946. The total amount of interest charges was $42,572,000. There have been deducted by various legislative enactments from soldier settlement loans alone an amount of $49,190,000. In other words, there have been deducted by legislative enactments of this parliament more than the total interest charges which have accumulated on the soldier settlers' debts since the inception of the scheme. I find another interesting statement. The suggestion has been made that seven per cent interest was charged. Well, very shortly after the first war there was provision for a remission of interest charges. It was actually provided that there should be a remission of 40 per cent of the amount due for stock and equipment in the case of stock purchased prior to October 1, 1920, and 20 per cent on the cost where it was purchased between October 1, 1920, and October 1, 1921; I find the total amount of interest which was not charged in this statement to settlers was $10,269,000. I must confess that, listening to hon. members who have spoken to-night and the suggestions that parliaments ever since the first great war have not made any really serious attempt to deal with this problem, their contention in the light of these facts did not sound fair to me. After all, the parliaments since the first great war have had men in them who were interested in returned soldiers; there were parliaments which had representatives of all the present parties except the Social

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Credit party, and I think these members gave some consideration to the problems of the returned soldiers.
I will not go into all the various ways in which write-offs have occurred, but the most recent was that which took place under the Farmers' Creditors Arrangement Act, through which nearly $7,000,000 was written off. Later, order in council P.C. 10472 was passed which provided that, based upon 1940-41 land values, the land obligation should be written down, or a reduction made in the soldier settlers' indebtedness based upon those values. We were assured by the director of the Veterans Land Act that he had gone beyond that to make sure that there would be a substantial equity in the land to the soldier settler. That assurance can be found in the minutes and proceedings of our committee. If any hon. member is interested in it, it can be found at page 1017 where it is pointed out there was a reduction over and above what was provided for strictly in the order in council, even providing an equity of as high as 50 per cent in exceptional circumstances. I am assured that that order in council was administered in a generous way. I have been assured of that even by members of the committee who are not of the Liberal party, and I have no reason to disbelieve their assurance.
Our committee has recommended, and it has been tabled in this house, that the time to apply under that order in council shall be extended to September 1 of this year in order that everybody shall get the benefit of the write-off. I should like to refer hon. members to one further set of figures, which are found at page 326 of the minutes and proceedings of evidence. Appendix A shows the loans repaid in cash. It shows that 5,662 loans have been repaid in cash up to date. But a surprising feature of that statement is the number of pre-payments which have taken place. On that point I should like to refer hon. members to a few figures which I am sure they will find interesting. I have already said that 5,662 have repaid their loans in full. On March 31, 1940, that number was 2,592, less than half of the number who have now repaid in full. Since 1940, 3,070 have repaid their loans in full. That is, prior to 1940, 2,592, and, since then, 3,070.


George Hugh Castleden: Has the hon. member the figures of those who lost their farms prior to 1940?


Walter Adam Tucker: I have them and I can give them to the hon. member in committee, but I do not wish to take up the time to go into great detail now. These various loans were graded and the grading will be found at page 340 of the minutes of the evidence. There is a table

which shows the standing on March 31, 1946 and a table which shows the standing on December 31, 1941. There is one interesting comparison which I wish to draw to the attention of the house. Grade 4 indicates no equity. On December 31, 1941, the number who had no equity amounted to 2,723. By March 31, 1946, that number had shrunk to 203. In other words, of all those soldier settlers numbering 2,723 who had no equity less than six years ago, the number had shrunk to 203, a reduction of over 2,500.
Hon. members may be interested in the number who had an equity of under 20 per cent. On December 31, 1941, the number who had an equity of 20 per cent or less was 1,078. They were classified as grade 3. According to the last return that number had shrunk to 518. That group had been cut in half. The number who had an equity of over 40 per cent in 1946 was 2,953. We have been assured by the director that practically all of them, except in the two lowest categories, those under 20 per cent who now number 203 and 518, actually 721, will have no difficulty at all in meeting their payments. This is the situation in regard to the 203. It seems to me that the situation ought to be weighed carefully. Those people who were put on land where they could not honestly pay for it, numbering apparently 203, can now apply, if they have not already done so, under this new order in council and' have their debt written down under the generous provisions and administration of the order in council. The alternative suggestion was that we give these gentlemen clear title. There is no reason to give clear title to others, to people who are prepaying their land and will have no difficulty in paying for it. It was suggested that it should apply only to those who cannot pay without a great deal of hardship. I submit that the order in council will take care of most of them, and that way of handling it is probably better than to create the impression that at some time, through sufficient -pressure brought to bear, agreements made under the Veterans Land Act will likewise be cancelled. That will not have to wait twenty years if the precedent is set. It would be just a matter of getting sufficient political pressure brought to bear to have many feel they would not have to pay their contracts under the Veterans Land Act.
I do not doubt that, within the next year, people would begin to take up the case of the Veterans Land Act if this were to go through. If that precedent were set, Mr. Speaker, what effect do you think it would have upon the successful administration of the Veterans Land Act? We expect to settle in homes in this

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country over 100,000 families in full-time farming and small holdings. It is recognized by all parties in the house that anyone settled under the Veterans Land Act at the present time and under the present circumstances has a better deal than the average returned soldier will get on his discharge. Eighty per cent of the returned soldiers will have to be content with a reestablishment credit which now averages about S421. Ten per cent will get the benefits of the Veterans Land Act which will probably average over $2,000. Four per cent will get the benefit of university education which will cost around $163,000,000, or about $4,000 apiece. Six per cent will get the benefit of vocational training which will cost around $1,100 apiece. That being the case, and this Veterans Land Act being something which every veteran in this country is anxious to have succeed in order to place
100,000	veterans in homes of their own under circumstances under which they can hope to pay for those homes in a reasonable time, I suggest that it would be a bad precedent to start giving titles now to people who have not been able to pay for their lands. I believe that is one thing which weighed with the veterans of Saskatchewan. I think that perhaps this thought weighed with the dominion command of the legion and I suggest that for any member of this house to wrap himself in a robe of greater friendship, greater devotion to the cause of the veterans than the people who serve the veterans in the great veterans' organizations of this country is attributing to himself too much virtue in that regard.
There is one other figure which I shall take the time of the house to give, and which I think would be of interest to hon. members, namely, the number of pre-payments. I have already said that in the four-year period 2,621 have paid in full a total of $5,476,489. During that time only 121 holdings have reverted due to death or abandonment of the $5,476,000, $2,183,000 has been prepaid; in other words, almost half the amount paid during that four-year period was prepaid.
As I have already said, I feel that the details of this measure can be given better in committee. I urge the house to pass this resolution which has for its purpose the reduction of the rate of interest from five per cent to per cent from the standard date. And I urge the house to leave something to the veterans affairs committee. If we hope to get through this great programme, as I think everyone agrees it should be put through for the veterans of this country, at this session if at all possible, I urge hon. members to cooperate with the veterans affairs committee in trying to put through the programme which
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they report to this house, with a reasonable amount of debate but without considering it necessary to discuss at length every single thing brought up in that committee.


Victor Quelch: Since my name has been mentioned several times during the debate, Mr. Speaker, I feel it necessary to say a few words. Let me say this to console the Minister of Veterans Affairs (Mr. Mackenzie), who does not like the debate held up. I suggest that owing to the fact that we are discussing these matters at this time, probably there will not be so much debate in the later stages. As far as the other fourteen bills are concerned, many of them will, I believe be non-controversial. I must admit I was surprised when I read the statement made last evening that this bill was not controversial, because to my mind this was bound to be a highly controversial measure.
As a member of the veterans affairs committee I appreciate very much the work that has been done by the chairman, as I think all hon. members appreciate it. But I say to him that when members of that committee work for two or three days on a certain measure and arrive at what they think is an agreement; and then, just before the vote is taken, the chairman marshals in his reserves in order to swing the vote another way, it is only natural that some of the other members should resent that action. I am not criticizing the chairman in these remarks, because that has been the practice in the past and no doubt will be the practice in future; but it is only natural that there should be some resentment felt since those hon. members who came in and swung the vote had not listened to the debate and had not the slightest idea what they were voting about.
The hon. member for Rosthern (Mr. Tucker) has referred to the fact that in committee this bill was carried unanimously, but he ignores one important thing. When we voted on this measure it was with the distinct understanding that further consideration would be given the old soldier settlers later on. Therefore we had hopes that additional measures would be brought in to take care of these settlers. But here we have a measure which represents the sum total of what the government intends to do for them. So it is only natural that our attitude toward the resolution to-day should be different from our attitude at the time it was discussed in committee, because at that time we thought further legislation would be brought down. The hon. member for Rosthern has had a great deal to say about the decision of the legion convention in Saskat-
Soldier Settlement

chewan, but I am sure he will admit that at times the people of Saskatchewan do funny things.


Walter Adam Tucker: I am forced to admit that; but not often.


Victor Quelch: Let me remind the hon. gentleman that the legion command in Alberta voted that clear titles be given these soldier settlers. The hon. member for Battle River (Mr. Fair) placed that resolution on record some time ago, and referred to it again tonight; but I cannot take any responsibility for what the legion does in Saskatchewan. What probably happened there, I think, was this. At that convention I believe that there was a good deal of lobbying, and that it was explained to the delegates that if they asked that clear title be given the old soldiers it might prejudice government action in regard to soldier settlers under the new bill. I have no fear that just because we may give clear titles to the old veterans of the first war, the new veterans will cease to make their payments. I think it is utter nonsense to suggest that any soldier of this war would wait for twenty-seven years in order to get title. He wants his title just as quickly as he can get it; and I think the records have proved that whenever a soldier settler has had the money to pay, he has paid. So that if to-day we gave clear title to these old veterans I anj sure there would be no question of the soldier settler of this war wanting to wait for twenty-seven years in order to get clear title also. However, I believe it may have been argued at that convention that this action would be detrimental in this way, and I think that may be why they took that stand.
We frequently hear members of the government eulogizing the government programme in regard to the rehabilitation of veterans of world war II, and I will agree that this programme is good. There may be exceptions to that statement, but I think it compares favourably with the programmes of other nations. On the other hand, however, I would say that the government's programme in regard to the veterans of world war I is altogether inadequate. To-day veterans of the first war are old men. What chance, for instance, will the men coming out of the veterans' guard have to get back into industry? The ages of these veterans range from fifty-five to eighty, so they have not a chance. It is all very well for the hon. member for Rosthern (Mr. Tucker) to be so optimistic about the four thousand soldier settlers on the land to-day and to say that men who have an equity of 30 per cent are almost sure to be able to pay for their land. Let me remind the hon. member that

in 1929 there were many farmers who did not owe a cent; who had paid up their life insurance and had money in the bank, but who lost their farms five or six years later. If men in that position can lose their farms I suggest that we should not be overoptimistic about men who have only a 30 per cent equity in their farms and who, in many instances have nothing but old machinery.
As we know, the history of the old soldier settlers has been tragic. Of the 25,000 who settled on the land, in the neighbourhood of
16,000	lost their land. The hon. member for Rosthern stated that 5,600 have paid up, but we still have some 4,000 who, generally speaking, have only a small equity in their land. The resolution before the house is based upon order in council 10472, and for a little while I wish to deal with the history of that order in council, the reason it was brought forward and to what extent it covers the needs of the soldier settlers. P.C. 10472 came into being very largely as the result of a recommendation of the committee on veterans affairs that sat in 1942. I want to read to the house the recommendation of the legion to the committee at that time, which recommendation is to be found at page 158 of the committee's proceedings for Friday, July 10, 1942:
The legion, therefore, recommends that the principle contained in section 9 of the new bill, respecting the veteran's debt should, as far as possible, be applied to soldier settlers under the old act and that the director be given power to rewrite contracts accordingly.
On page 162 of the same proceedings I find this statement by the chairman of that committee :
I was going to point out that failures have been largely due to circumstances over which the settler had no control. What we should attempt to do, I think, in making a report, or suggested amendments, is to try to bring this situation of settlers in distress in conformity with the present bill 65.
I do not think the hon. member for Rosthern or the minister would try to argue that order in council 10472 did bring the old Soldier Settlement Act into conformity with the new one. It is only necessary to read the two recommendations to see that in reality the order in council was the negation of the recommendation made by that committee. I say that because in the recommendation of the committee we find it recommended that soldier settlers be given equity in their land. When that, recommendation was made it was the general understanding of the members of the committee that the equity would be along the lines of that given under the new act. I could quote member after member speaking in the committee who advocated that the principle of the new act should apply to the

Soldier SeUiement
old. I have already quoted the chairman as saying that the aim of the committee should be to give to the soldier of the last war the same benefits as received by the soldier of this one, under the act.
So, when the recommendation read that equity should be given, the understanding was that the equity would be along the lines of that given in the new Veterans Land Act. But what do we find in the order in council? We find in it that there is no provision for any equity. I quote section 1 (b):
(b) make application to the director for a reduction of his indebtedness to the director, and the treasury board may on the recommendation of the director confirm or reduce such indebtedness, provided, however, that the recommendation made by the director shall be based upon the amount which in his judgment constitutes the present and prospective productive value of the land; the effective date of reduction if any shall be the standard date in 1942.
In other words, if the director had followed out the order in council in detail he would have reduced the debt of the soldier settler only down to the actual value of the land. The soldier would have had no equity in the land at all. Fortunately, I believe, for the veterans, the director of the soldier settlement board did go beyond the order in council, and he did provide some equity.
On the other hand if, when the adjustments were made, the old soldier settlers had been given equity to bring them into line with the soldiers settling under the new act, they would have been given an equity of at least 33} per cent, because that is the equity so granted under that act.
Under the new act the veteran is given an equity of 23} per cent, and he pays down 10 per cent himself, so that he has an equity of about 33} per cent. In addition, he is given a grant of 81,200 for machinery. So that actually in land and machinery he has an equity of 46 per cent.
If a soldier settler had been given an equity of 33} per cent four years ago, then naturally, after four years of war and good prices for farm products one would expect to find that soldier settler in far better shape than merely having an equity of 33} per cent. If a soldier settler cannot increase his equity considerably during a period of high prices, what chance would he have to increase it in later years, when prices may have fallen?
In spite of the fact that the soldier was supposed to have been given an equity of 33% per cent, we find that to-day there are 1,446 settlers with an average equity of only 30 per cent. So that apparently they made no progress at all. We find there are 518 with an equity of only 14 per cent. If they were given
an equity of 33% per cent they must have gone back. Then there are 203 with no equity at all. Surely these figures are evidence that the intentions of the 1942 committee were not carried out.
I hold in my hand sessional paper 125B. In this paper the question is asked;
How many of the 3,800 soldier settlers classified in grades 3 and 4 as at March 31, 1942, have had their debts adjusted under P.C. 10472?
The answer is;
1,739 debt reductions have been approved by treasury board to May 31, 1946; further 72 cases are under review.
The second question was:
How many of the above failed to make an application under this order?
The figure given in reply was 1,787. I think the reason is obvious. Forms were sent out, and it is stated on those forms that their debts would be readjusted so that the amount of the debt would be equal to the value of the land. Then they were asked to sign the forms for another twenty-five years. A lot of them said, "Thank you for nothing," and made no application at all.
Then the third question:
How many of those, whose debts were adjusted, had their debts reduced to the point where they had an equity in their land of (a) over 30 per cent; (b) over 15 per cent; (c) under 15 per cent, based upon 1941-42 values?
The reply is that only 377 were given an equity of 30 per cent, 1,298 an equity of 15 per cent and sixty-four an equity under 15 per cent.
These figures prove conclusively that the intentions of the 1942 committee were not carried out. I am not blaming the director of the soldier settlement board, because he went farther than he had a right to go under the order in council. I am, however, criticizing the government for passing an order in council that was a direct negation of the recommendation of the 1942 committee.
When the question of giving clear titles to veterans in the last war came up in committee there was a good deal of discussion, and I think that generally the committee was sympathetic to it. But as I have said, however, when the time for the vote came the forces were marshalled so that there was no chance that those who were in favour of it would win out. But what I am surprised at is this, that when a motion was put to grant the soldier settlers of the last war an equity of 33} per cent, the committee turned it down by a vote of twenty-one to thirteen. Again, of course, that was the direct result of bringing into the committee all the reserve
Soldier Settlement

army of government members. Four cabinet ministers were included in that reserve, just to make sure that it would carry out the wishes of the government in that regard.
The government could have at least given soldiers of the last war that much consideration. It would have been right in line with the recommendations of the 1942 committee. Mind you, the whole basis of the new Veterans Land Act is that a soldier has no chance ever to pay for his land unless, when he starts out, he has an equity of 33j- per cent. The mortgage companies take the stand that a man must have an equity of 50 per cent in his land if he is ever to pay for it.
If it is necessary for soldier settlers under the new act, men who are young, men who, generally speaking, have fairly new equipment, to have an equity of 33J per cent to pay for their land bow much more necessary is it for old soldier settlers ranging in ages from fifty-five to seventy years to have an equity of 33-j per cent if they are to pay for their land.
Yet, strange as it seems, the committee recorded a vote against giving them that equity. The minister repeatedly asks the question: Are you in favour of the present resolution? I would reply in this way: If you find a starving man and someone offers him' a small crumb, even it be a small crumb I would say by all means give it to him. Therefore I shall support the resolution as being just one small donation; but it does not begin to meet the need.


Ian Alistair Mackenzie: I gave an assurance this afternoon to the hon. member for Yale (Mr. Stirling) and the hon. member for Lake Centre (Mr. Diefenbaker) that an opportunity would be afforded of discussing the questions raised this afternoon by the hon. member for Lake Centre. Perhaps the house would consent to have the debate adjourned.
On motion of Mr. Merritt the debate was adjourned.



CASE OF SERGEANT T. BUCK SUZUKI

[Stage Direction]
Hon. IAN A. MACKENZIE (Minister of Veterans Affairs) moved that the house go into committee of supply.
Major James William Coldwell: Mr. Speaker, before you leave the chair I should like to bring before the house a case which is dissimilar to those that have been discussed this evening but which I think should be presented to the house. This is the case of Sergeant T. Buck Suzuki, No. B-90180. This is a case of real injustice. This man served with distinction in the Malaya com-
 I
mand. After the outbreak of the Pacific war he was moved out of the coastal area in British Columbia and his wife and baby are in Ontario. I may say that he has never seen his child. His parents are naturalized Canadians and his wife was born in this country.
I have communicated with the Secretary of State (Mr. Martin) regarding the disposal of this man's property. We have heard a lot about the property of soldier settlers to-night. This property was sold for 11,963.33 by the custodian and I am told that that is considerably below its actual value. There is an insurance policy of 83,000 covering the house, and furniture to the value of $500. I am trying to summarize this as quickly as I can. There were over seven acres of land which were never assessed below $100 an acre, and the house was rebuilt in December, 1941. This man states that he can obtain from a builder a statement that a house similar to his would cost between $4,000 and $4,500.
To-day I had from the Secretary of State with whom I have been communicating a letter which really does not answer my questions regarding the disposal of this property of a man who served creditably in the armed forces. It merely states that the property belonging to this man was one of those acquired under the Veterans Land Act, that the amount realized is standing to his credit in the Vancouver office, and that it is a very small amount. In addition, the evacuation section of the Department of the Secretary of State have told this man whose property has been sold that a small amount for legal fees in connection with the conveyance of the property will be charged later.
I am bringing this matter to the attention of the house because here we have a man who served with credit. He happens to be a Canadian of Japanese origin who rose to the rank of sergeant. He comes back to this country and finds that during his absence his property-


Ian Alistair Mackenzie: Did he serve with the Canadian forces?


Major James William Coldwell: With the Malayan
command. He found that his property had been sold for a sum of money which, on its face, was ridiculously low and, in addition, he is faced with having to pay legal fees in connection with this sale. I am placing this case briefly before the house because I believe it should be drawn to the attention of the house being, as I contend, a matter of injustice.


Ian Alistair Mackenzie: I shall be very glad to see that the case is investigated by the veterans affairs committee.

Supply-Health and Welfare
Motion agreed to and the house went into committee, Mr. Macdonald (Brantford City) in the chair.



NATIONAL HEALTH AND WELFARE

[Stage Direction]
Miscellaneous grants-
Grant to Health League of Canada, $10,000.
Robert Wellington Mayhew: Mr. Chairman, this afternoon on the debate on the interim supply bill the hon. member for Lake Centre raised the question of a press release dealing with the suspension of ration banking facilities at La Banque Provinciale du Canada. I promised to give a statement this evening on this matter.
The system of ration coupon banking is a convenience to business introduced so as to simplify the handling and distribution of rationed commodities. The chartered banks are used as agents of the wartime prices and trade board to centralize the accounting of coupons deposited and to enable ration cheques to be used by business men in settling for purchases of rationed commodities and thus avoid the repeated handling of large quantities of individual coupons. Naturally it is necessary under the system that the banks provide a service to include the careful checking of coupons and operation of the ration coupon accounts in accordance with regulations of the wartime prices and trade board. For these services the banks are paid a fee, depending on the nature and volume of the transactions.
In the case of La Banque Provinciale du Canada there has been considerable difficulty in obtaining a proper operation of the system and the bank does not appear willing to provide the services required. As a consequence, the regulations of the board respecting the safeguarding of the coupons and the accounts have not been observed. A number of prosecutions are now pending against some individuals on the staff of La Banque Provinciale du Canada. The charges include the facilitating of black market operations. It is not possible to state precisely how long these particular irregularities have continued, since the investigations on which prosecutions will be based are not yet completed. In all the circumstances the board has reached the conclusion that the services of the bank will not be utilized in this connection after July 31. It is necessary to provide some advance notice of this intention in order that transactions pending or in process may be properly completed.
While the decision may cause some inconvenience to the ration coupon accounts affected, it should be remembered that these
accounts are not part of the ordinary banking accounts, which are, of course, not affected in any way by the action taken by the board or the irregularities mentioned. Moreover, the board would be willing to reinstate La Banque Provinciale du Canada if adequate assurance can be obtained that they will provide the services required.
The hon. member asked why this statement was not made in the house instead of by means of a press release. The action taken by the board followed considerable discussion with senior officials of La Banque Provinciale du Canada, as a part of the administrative duty of the board. It is also part of the administrative duty of the board to enforce its regulations wherever violations are discovered, and it was not considered that this instance constituted a matter of policy which needed to be brought to the attention of the house.


John George Diefenbaker: Possibly the hon. gentleman will be able to give additional information because the information he has now furnished is indefinite. Will he be able to advise the nature or degree of the irregularities in black marketing that have been ascertained as a result of the investigation, also the number of prosecutions that are being taken and the number of informations that have been laid as of this time?


Robert Wellington Mayhew: I have learned a great deal about this transaction since I left the house about 4.30 p.m., but not being a lawyer I hardly know how far I can go without doing an injustice to those who are being charged or to the cause of other governments. But I can go this far. There are at least four, three of whom have already admitted their guilt.


John George Diefenbaker: Possibly the minister could go a little farther and indicate the depth of the ramifications. Is it widespread or narrow in compass?


Robert Wellington Mayhew: There are four banks in Quebec, nine chartered banks altogether. This has affected only one bank. It would not be wise for me to go any farther at the present time. There will be other occasions for giving information. I shall be pleased to give it personally to my hon. friend if he wishes.


Mr. FULTON:: The bank coupon system referred to by the parliamentary assistant is run, I understand, very much like a checking account, except that the currency is ration coupons instead of money. It is fairly easy for a bank to make an honest or a dishonest mistake, just as it is easy for a merchant to make an honest mistake. I should like to
Supply-Health and Weljare

know if the ramifications include only bank officials or extend to merchants who have bad transactions with the bank.


Robert Wellington Mayhew: It affects both.


Jean-François Pouliot: As a matter of personal explanation, may I say to the parliamentary assistant that I did not run away from the battle this afternoon. He did not answer me at once and unfortunately I had to leave the chamber. I would say that what I want is not discussion in my office with anyone from the Bank of Canada. I want a public explanation in the house. That is all.


Robert Wellington Mayhew: I assure the hon. member for Temiscouata that I was not reflecting in any way upon him because I realized fully that he was looking for information. So far as the answer to his question is concerned, it will be given to him in the budget debate.


Jean-François Pouliot: Thank you.


John George Diefenbaker: I have a few more questions to ask, and possibly it would be better if I just read that portion of the press release to which I intend to make reference:
Officials of the board explained that they had repeatedly drawn the bank's attention to irregularities in handling coupon accounts and had recommended safeguards to protect the public.
Would the parliamentary assistant be able to advise how many branches of this bank were involved, where they are located, for what period of time the irregularities had been brought to the attention of the board and the bank warned that a continuation of them would not be permitted?


Robert Wellington Mayhew: In my statement I said that I could not advise the house how long these irregularities had been going on because it was felt that might prejudice the case so far as the government was concerned. If my memory serves me aright, more than one branch of the same bank is involved. Naturally, in a transaction of this kind where there is crooked work it takes more than one man to be crooked, and there had to be men outside the bank as well as inside the bank.


John George Diefenbaker: It is now almost eleven o'clock. Possibly between now and to-morrow afternoon the hon. gentleman will be able to procure certain further information, because it appears that as yet we have not received very full information. I do not want, to bring up any matter that would in any manner prejudice the case, but surely the house is entitled to know something of these irregularities, their extent and the degree of enforcement by the board, for apparently this has been continuing for a considerable period
(Mr. Fulton.]
and must have had wide ramifications. Certainly it deserves a wider and better explanation than the hon. gentleman has so far given.


Jean-François Pouliot: Mr. St. Amour, formerly of La Banque Provincial, is one of the bigwigs of the Bank of Canada.


Ian Alistair Mackenzie: The hon. member for Lake Centre (Mr. Diefenbaker) is a very fine lawyer and knows that it might be embarrassing at the moment to disclose certain information which might prejudice the processes of justice in the prosecutions that may be pending. But any information that may properly be given will gladly be given.


Mr. COLD  WELL@: Would it be possible to give at the same time the scale of salaries paid by this bank to its employees so that we may know whether they were paid a sufficient amount of remuneration to remove them from temptation in responsible positions?


Ian Alistair Mackenzie: I think that is a reasonable request.
Item stands.
Progress reported.


[Stage Direction]
At eleven o'clock the house adjourned, without question put, pursuant to standing order.
Wednesday, June 26, 1946.