1946-07-03

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

Mr. DIEFENBAKER:: 1.	Has the Canadian Broadcasting corporation banned or refused advertising programmes offered to it at any time during the past year?
2.	If so, which programmes were banned or refused?
3.	Why was each refused?	_
4.	By whom was the decision made in each case?


Mr. McCANN:: 1.	The Canadian Broadcasting corporation has not accepted for its networks some advertising programmes offered during the past year.
2	and 3. It would not be in the public interest to give details of these non-acceptances as this might be embarrassing to advertising
agencies, sponsors and United States networks, would impair the relations of the corporation with those with whom it has business dealings and so affect its ability to serve the listening public.
4. By the corporation.


WARTIME PRICES AND TRADE BOARD-FARM MACHINERY
Mr. McCULLOUGH (Assiniboia):: 1.	Who are the members of the wartime prices and trade board?
2.	Is there any representative of organized labour and agriculture on this board?
3.	If so, who are they and what organizations
do they represent?	,
4.	What companies made representation to the wartime prices and trade board for increase in price of farm machinery?
5.	What were the demands of increase in retail prices in each case?


Mr. MAYHEW:: 1.	Chairman:	Donald Gordon, deputy
governor, Bank of Canada.
Members:
H. B. McKinnon, chairman of the tariff board.
David Sim, deputy minister for customs and excise, Dept, of National Revenue.
F. A. McGregor, commissioner of the combines investigation act, Dept, of Justice.
A. M. Shaw, director of marketing service, Dept, of Agriculture.
J. G. Bouchard, asst, deputy minister of agriculture.
W. A. Mackintosh, director general of economic reconstruction, Dept, of Reconstruction and Supply.
A. MacNamara, deputv minister of labour.
M. W. Mackenzie, deputy minister, Dept, of Trade and Commerce.
2.	No. The members of the wartime prices and trade board are employees of the government or government agencies and special groups are not represented.
3.	Answered by No. 2.
4 and 5.
Geo. White & Sons Co. Ltd., London, Ont., 22 per cent.
Otaco Ltd., Orillia, Ont.-variable amounts on each machine ranging from 8i per cent to 40 per cent.
Fleury-Bissell Ltd., Elora, Ont., 27 per cent.
John Deere Plow Co. Ltd., Welland, Ont., 20 per cent.
Brantford Coach & Body Ltd., Brantford, Ont., 45 per -cent.
Massey-Harris Co. Ltd., Toronto, Ont., 29 per cent.
Cockshutt Plow Co. Ltd., Brantford, Ont., 28J per cent.
Questions

International Harvester Co. of Canada Ltd., Hamilton, Ont., 23 per cent.
R. Noble & Sons, Shallow Lake, Ont., 25 per cent.
Note.-A great number of requests were made by telephone which were not confirmed by letter. During these telephone conversations the applicants were generally advised that a survey of the industry was being made and that the increase when approved would be uniform and would apply to all manufacturers.


VETERANS LAND ACT-MIDDLESEX COUNTY
Mr. WHITE (Middlesex East):: 1.	Have any farms been purchased in East Middlesex under the Veterans Land Act?
2.	If so, in what townships, concessions, and what are the lot numbers?
3.	What price was paid for each?


Mr. TUCKER:: 1.	Yes.
2.	Farms purchased in East Middlesex:
Township	Concession Lot Number	
Biddulph 			Pt. of 3 (proof line road)
" 	Pt. Lot 24 (southbouna	1	dary) 34" 	2	14a	3	Si of 11" 	3	34"London 	A	Xffj 4" 	5	Wi 22it	5	Pt. Si 32" 	6	Wi Ni of 2 and Ni 3" 	6	Si Si of 24" 	9	SWi of 23Westminster ....	E| of 12 (west gore)" ....	1	SWi of Si of 42a	2	Pt. of 79it	5	Pt. of 6" ....	6	Ni of 19North Dorchester	B	NE Pt. of 5u u	1	Ni Lot 2tt tt	3	Ni 23 SI 23tt a	5	Pt. of 18West Nissouri...	Pt. of 25" " ...	3	35" " ...	4	Ni of Wi of 2u " ...	6	Ei of 243. It is considered that the public disclosure	as to details of	prices	paid for various lands
purchased by the Veterans Land Act would be detrimental to the administration and operation of the act and not in the best interests of the veterans for whom the lands are purchased. This is in accord with statement made to the house on April 17, 1946, page 951 of Hansard, and on subsequent occasions.
1943-44 WHEAT PARTICIPATION CERTIFICATES
Mr. TOWNLEY-SMITH:
1.	When will the 1943-44 wheat participation certificates be redeemed?
2.	Will it be necessary for these certificates to be sent into the Canadian wheat board offices before being paid?
[Mr- Mayhew.l
3.	Have the forms asking for the return of such certificates been sent out from the Winnipeg office?
4.	If so, when?
5.	If not, what is the reason for the delay?


Mr. MacKINNON:: 1.	As soon as the participation certificates listed on the proper form are returned to the Canadian wheat board.
2.	Yes. These should be listed on special forms by the producer. These forms have been in the hands of the elevator companies since June 22. Producers who have not already done so, should obtain these forms from the local elevator and the elevator companies will return the completed forms with the participation certificates to the Canadian wheat board in Winnipeg.
3.	Answered by No. 2.
4.	June 22, 1946.
5.	Answered by No. 4.


INTERIM ARMED FORCES
Mr. DIEFENBAKER:: 1.	Are members of the interim force of the armed forces entitled to payment of gratuities?
2.	What action has been taken towards early payment of gratuities to men in the said force?


Mr. ABBOTT:: 1.	Members of the interim force of the
armed forces are entitled to payment of war service gratuity:	(a) On the date of their
acceptance for service in the permanent naval or military forces or the regular air force; (b) or, if not accepted for the forces named in (a) then they will be entitled to payment when they resume their civilian status.
2.	The paying authorities of the services are organized to make payment at time the member of the interim force becomes entitled as outlined in answer to question No. 1, above.


SUCCESSION DUTIES
Mr. FRASER:: What has been collected by the federal government in succession duties during (a) the year 1945; (b) the first five months of 1946?


Mr. McCANN:: Succession duty collections: (a) $21,876,664.37; (b) 87,510,342.80.



QUESTIONS PASSED AS ORDERS FOR RETURNS


SOLDIER SETTLEMENT BOARD


Mr. ROSS (Souris):: 1.	What soldier settlement farms, if any. have been sold bv the Soldier Settlement Board in the municipality of Arthur, province of Manitoba* since 1929-by section, township and range?

Questions as Orders for Returns
2.	What price did the Soldier Settlement Board receive for such farms?
3.	Have submissions been made to the Veterans Land Act Board to sell any of these farms to the board and if so, at what price?



MOBILIZATION ACT-MINISTERS OR CLERGYMEN

Mr. BLACKMORE:: 1.	How many religious denominations in Canada were recognized as entitled to exempt ministers or clergymen under the National Selective Service mobilization regulations? What are their names?
2.	How many Canadian men were allowed the exemption as ministers or clergymen?
3.	How many who applied for this exemption as ministers or clergymen were refused it?
4.	How many men applied for exemption on the grounds of being students for the ministry?
5.	How many such applications were (a) granted; (b) refused?
6.	From how many religious denominations were allowed applicants drawn?- What were they?
7.	How many students for the ministry were allowed to each of the named denominations?
8.	What was the number of college students classified as conscientious objectors (a) theology students; (b) non-theology students?
9.	How many of these have returned to their former training or vocation?
10.	How many of the college students classified as conscientious objectors are now making contributions to the Red Cross Society, and how many are not?
11.	How many of the men not making contributions are required to report periodically to the alternative service officer?
12.	What is the purpose of this reporting?
13.	To what different denominations do the men belong who are now detained in alternative service work camps, and how many from each?



IMPORTS OF CORN

Mr. HATFIELD:: 1.	How many bushels of corn were imported into Canada for the years 1941, 42, 43, 44, 45, and 46 to date?
2.	What amount of subsidy was paid each year on the corn imported?
3.	What are the names of the importers?
4.	For what purpose was the corn imported?



ALTERNATIVE SERVICE REGULATIONS

Mr. McMASTER:: 1.	How many persons are employed in administering the alternative service regulations of June 1, 1946?
2.	How many of these are mainly employed in looking after conscientious objectors?
3.	What was the gross expenditure for administering alternative service for the month of April, 1946 for (a) salaries; (b) office space; lc) other expenses?
4.	How many alternative service camps are still in operation?
5.	What was the cost during April, 1946, of maintaining these?
6.	What financial returns did the government get during the same period from the operation of these camps?
7.	If figures (for 6) not yet available, what was the gross profit or deficit from operation of all such camps in 1945?
8.	How many unemployed are now registered with national selective service?
9.	How many men are required in agriculture?
10.	How many of the registered unemployed have been offered work in agriculture?
11.	How many of these have refused to engage in agriculture?
12.	How many registered unemployed are receiving unemployment insurance?



NATIONAL SELECTIVE SERVICE-EMPLOYMENT OFFICES

Mr. BLACKMORE:: 1.	How many men of military age were employed in the National Selective Service offices throughout Canada from September, 1942 to Y-J day?
2.	How many of these men are now permanent civil servants in the employ of the national employment service offices throughout Canada?
3.	Have other non-veterans been appointed to the national employment service staff since the war ended? If so, how many?
4.	What steps have been taken by the government to give veterans preference in appointments to the national employment service?



CHATHAM, N3., AIRFIELD

Mr. BLACK (Cumberland):: 1.	What were the costs in connection with the airfield at Chatham, New Brunswick (a) land; (b) grading; (e) surfacing; (d) buildings; (e) equipment; (f) incidentals; (g) total?
2.	Who were the contractors, stating tender prices ?
3.	Has the property and equipment or any portion been sold or offered for sale? If so, to whom and at what prices?



BANKING AND COMMERCE

[Stage Direction]
Third and fourth reports of the standing committee on banking and commerce.-Mr. Cleaver.


[Stage Direction]
Hon. PAUL MARTIN (Secretary of State) moved that the house go into committee at the next sitting to consider the following resolution:
That it is expedient to amend the Public Printing and Stationery Act in relation to advances authorized to be made to the King's Printer for the purchase of materials to execute orders and requisitions and payment of wages, and to provide that the total amount of such outstanding advances shall at no time exceed the sum of two million dollars.
He said: His Excellency the Governor General, having been made acquainted with the subject matter of this resolution, recommends it to the consideration of the house.
Motion agreed to.
30S6
High Commissionerships


[Stage Direction]
On the orders of the day:
Mr. GORDON GRAYDON (Peel):: Mr. Speaker, I desire to direct a question to the Prime Minister in his capacity as Secretary of State for External Affairs. Will he inform the house how long the post of Canadian high commissioner to the United Kingdom has been vacant, and whether there are similar vacancies existing in respect of our diplomatic representation in Australia, New Zealand and South Africa?


Right Hon. W. L. MACKENZIE KING (Prime Minister):: Mr. Speaker, answering
my hon. friend, who sent me notice of his question, I would say that the post of high commissioner in the United Kingdom has been filled since Mr. Massey's departure from the United Kingdom on May 23 by the acting high commissioner, Mr. Frederick Hudd. In Australia Mr. C. M. Croft, formerly head of the commercial intelligence service and now commercial counsellor, has been acting high commissioner since the return to Canada of the Hon. T. C. Davis. Mr. Alfred Rive has been appointed high commissioner to New Zealand in the place of Doctor W. A. Riddell, who has returned to Canada on retirement. In South Africa Mr. J. C. Macgillivray has been acting higjh commissioner since the retirement of Mr. C. J. Burchell, K.C.


Gordon Graydon: May I ask a supplementary question? In the case of the three posts which are temporarily being filled does the government expect to make permanent appointments in the near future?


William Lyon Mackenzie King: The filling of these posts involves consideration of possible transfers in some of the posts which are already filled elsewhere. There has not recently been the opportunity which I wish to have in consultation with the Under Secretary of State for External Affairs and with my colleagues in the government to finally settle certain appointments. However, I expect it will not be very long before adjustments are made.



MOTOR VEHICLES


[Stage Direction]
On the orders of the day:
Mr. GORDON GR AYDON (Peel):: I wish to ask the Minister of Reconstruction and Supply if in any case passenger car priorities are granted to persons in agricultural production.


Right Hon. C. D. HOWE (Minister of Reconstruction and Supply):: Mr. Speaker, that is a rather broad question. It depends entirely on whether ownership of the passenger car is essential to the earning of the livelihood of the person concerned. Certain people associated with agriculture do earn their livelihood through the use of passenger cars, and these get priority if they qualify as eligible consumers within the terms of motor vehicle control order as amended. Others do not, and consequently they do not get priority.


Gordon Graydon: Under the class A and class B priorities there does not seem to be anything which gives officials of the department such discretion as the minister now indicates. I have in mind a man who has been-


Mr. SPEAKER:: Order.	,


Gordon Graydon: This is an important matter, and I ask the question only because it has broad general import.


James Horace King: Order. I think the hon. member has been given sufficient latitude in connection with his question.


Gordon Graydon: I assume I am permitted at least to ask a supplementary question of the minister with respect to it. Will the minister take into consideration the situation he has referred to and determine whether it applies to a case such as I have attempted to lay before the house?


Clarence Decatur Howe: I would call the attention of my hon. friend to Canadian war orders and regulations dated November 10, 1945, in which is it stated that an eligible consumer will be entitled to a priority certificateonly if he establishes to the satisfaction of the motor vehicle rationing officer,
(a) his need for the new passenger car for the purpose of his profession, business, trade or calling.


Gordon Graydon: In this case the farmer who needed the vehicle was refused it.
. Mr. SPEAKER: Order.



BUILDING MATERIALS


[Stage Direction]
On the orders of the day:
Gordon Knapman Fraser: Mr. Speaker, on June 18 I asked a question of the Minister of Reconstruction and Supply in connection with window glass. At that time the minister said-Hansard, page 2590:
Canada does not manufacture that product, and for our supply we are entirely dependent upon imports.

Combines Investigation
Since that time I have received a letter from Industrial Glass Works, of St. Laurent, Quebec, stating that they are making substantial or large shipments of glass each day.


James Horace King: Order. The hon. member is perfectly aware that if he wants any information he should put a question to the minister, but he should not give information to the house.


Gordon Knapman Fraser: I just wondered whether the minister had received a letter from this company informing him that they are manufacturing window glass.


James Horace King: I would ask the hon. member to limit himself to putting his question.



SUPPLY OF NAILS FOR DOMESTIC USE

[Stage Direction]
On the orders of the day:
Mr. G. J. TUSTIN (Prince Edward-Len-nox):: Mr. Speaker, I should like to address a question to the Minister of Reconstruction and Supply, of which I have not been able to give him notice because I have just received the communication. Has the nail situation in Canada improved at all? I am asked if it will be possible to get nails to manufacture crates and cases for the canning factories to take off the crops in my constituency. I should like to ask a second question : are any nails being exported from Canada?


Clarence Decatur Howe: Plants producing nails are or have been working to their full capacity for many months. I assume that the canneries of my hon. friend's riding have the same chance to obtain their share as any other canneries or any other users of nails. The answer to the second question is that the export of nails from this country is prohibited. I might point out, however, that all exports are crated, and nails are used for crates; the demand for nails for crates has reached amazing proportions. So I would not say that no nails are being exported, but they are not being exported in packages.



COMBINES INVESTIGATION ACT


[Stage Direction]
The house resumed from Tuesday, July 2, consideration in committee of bill No. 193, to amend the Combines Investigation Act-Mr. St. Laurent-Mr. Golding in the chair.
On section 4-Transfer from D.T. & I.C. Act of provisions re certain complaints.
Mr. CHURCH:: In reference to section 4, this matter of combines and restraints of trade came up a few years ago in connection with 63260-195
sections 498 and 498 (a) of the criminal code. There had been an indictment and some appeals before the authorities in Ontario in connection, I believe, with milk, electrical, contractors, agreements of manufacturers to sell exclusively, and also as to heat, light and power corporations, and a bill of indictment was laid before one of the assizes. Meetings had been held of various companies fixing prices and agreeing as to who should tender on certain contracts in connection with municipal work, and the question was raised as to the applicability of sections 498 and 498(a) of the code, which are referred to on page 233 of Snow's Criminal Code and the Dominion Trade and Industry Commission Act, 1935, to these particular combines. One of the cases went to the privy council, and it was held that these combines could not be regulated in this manner.
Combines in restraint of trade have been flourishing like a green bay tree under all governments since confederation. The sections of the code were found to be of doubtful effect. Why were they invalid and unworkable? Because they were made a football between the attorney general of Canada and the attorneys general of the provinces. I remember that in the 1926-27 session, on the Ottawa-Georgian Bay bill, on March 14, 1927, these particular matters were brought into issue regarding navigable streams, as to which rights were international and which interprovincial, and the jurisdiction of the dominion over boundary waterways schemes and interprovincial schemes. Unfortunately the bill was talked out at that particular session. These proceedings will be nothing but a farce, because you cannot by the widest stretch of imagination exercise any control over these international cartels. Security and social councils, so far as international regulation of combines goes, are a myth. I know, because I had some experience with the super-power trust for a good many years. It was contended by a former member for South York, Mr. Maclean, who was a very valuable member of this house and also a powerful newspaper man in Toronto, and I agreed with his contention, and submit it now to the right hon. gentleman who is leading the house, that it is the duty of the federal government to enforce its own law in relation to these combines that operate in restraint of trade. The reason for that is obvious; such combines come almost exclusively under the control of this parliament, since by section 91 trade and commerce are within its jurisdiction.
As regards the principle of referring these questions to the attorneys general of the provinces, I do not know how it got into the

Combines Investigation

act, but I contend that it has been fatal to the whole procedure. I have nothing but the greatest respectfor Mr. McGregor, having had a good deal to do with him in the days when he was an officer of the Department of Labour. He is all right, but the whole of this law is all wrong. We do not exercise over combines the same effective control that the Sherman Act exercised years ago in the United States, because under that act the president and others who have to do with its enforcement can take real action; and they have not our complicated division of powers under the British North America Act.
I suggest that the greatest step forward in the regulation of trusts and combines in this country was taken by the government of Mr. Bennett when he appointed the price spreads committee in 1933-34, on the membership of which sat my hon. friend representing the constituency of Haldimand (Mr. Senn). That committee accomplished something that had never been done in the history of this parliament. It made a real investigation into the operation of combines in restraint of trade. It summoned all interested parties; all sides of the question were debated; witnesses were heard representing trade and commerce and restraint of trade, and the committee submitted a very valuable report. It astonished the working classes of Canada to learn what was going on in the country in this respect. The report of that committee was the key to the whole situation.
We know very well how divided the attorneys general of the provinces are in matters of this kind. This was fully recognized by the former member for South York, Mr. Maclean, back in 1924, 1925 and 1926, and I have always agreed with the view he expressed that the federal law in regard to trade and commerce, and jurisdiction over combines in restraint of trade, should all be under the control of the attorney general of Canada, who should initiate proceedings, instead of leaving it to the provinces themselves, who have no jurisdiction.
Sections 498 and 498A were in the code before we had a commission and before the department was given the power it now has under the Dominion Trade and Industry Commission Act of 1935, and these particular sections have been before the law courts of the country for consideration. The cases are set out at page 233 of Snow's Criminal Code. One of the cases even went to the privy council. If this parliament really wishes to do something about combines it should put the power to enforce the law where it belongs. These combines and restraints of trade are flourishing like a green bay tree. We all know

what the American super-power trust has meant in connection with waterways in the United States. Private ownership had control of the whole thing and Ontario was finally redeemed from slavery by the government that came into office in the province in 1905. It gave the joy and boon of cheap light and power to people in the cities and in the suburban and rural parts, and domestic and commercial lighting in consequence costs nearly three times less than it did before. In my opinion, the government is not going about this problem in the right way. This is not the way to attack combines. These combines will go on as long as there is such a thing as trade and commerce, because you cannot stop restraints of trade by legislation in which clever lawyers can find loopholes whenever the need arises. I was president of the union of Canadian municipalities for some time and this whole question came up in the municipal association in Toronto. We had a full discussion of it then and I do not believe that under this bill we are going to make any progress at all in controlling combines because, as I say, lawyers can find a loophole in any act. A lawyer can go to the attorney general of the dominion and say: This is a purely provincial matter which should be referred to the attorney general of the province; and the result will be that the whole thing will become a political football. As I have already pointed out, the Sherman law in the United States has enabled those in authority to take effective action. The ratepayers of that country have been given the real picture.
See what has happened to the bank act. You can drive a coach and four through this act just as you can through the bank act. There is a section of the bank act that declares that banks shall not deal in real estate. Why then should it be necessary for a bank to have a thirty-five storey building to do work that could be done on four floors? Where have the attorneys general been so far as that is concerned? I suggest that the same thing is going to happen here under the Combines Investigation Act. I fail to see how combines are going to be regulated by this legislation unless the enforcement is by the attorney general of Canada.
But not being able to regulate combines in restraint of trade in our own country, they want to branch out now and regulate and control cartels in international affairs. They want to take in the seven seas. But the people are waking up and are finding that little or nothing can be done about it. I appreciate the fact that in Mr. McGregor we have a valuable officer, but Mr. McGregor cannot

Combines Investigation
do anything unless he is given proper enforcement machinery. Section 4, the bill states in the explanatory page, is substantially similar in form to section 20, chapter 59, of the statutes of 1935, the Dominion Trade and Industry Commission Act. Provisions of that act, which make its section 20 applicable to the combines investigation act and to sections 498 and 49SA of the criminal code, are proposed to be repealed by subsection 1 of section 14 of this bill. In my opinion this will mean nothing so far as regulating combines is concerned. If- we want to regulate combines effectively we must bring them within the jurisdiction of the criminal code, and to do that we must make the sections really effective. Before a bill can be laid before the assizes, section 4 must be invoked, and sections 498 and 498A of the code, and if you take the case to the law courts, after investigation by the Minister of Labour, you will find that you are wasting your time, because I doubt whether a bill of indictment would be laid before the grand jury. And if it were, it would no doubt be quashed later in the courts.


Mr. DIEFENBAKER:: Last evening the
minister made reference to certain changes which I suggested, and he indicated that if certain restrictive provisions "which the Right Hon. Mr. Meighen put in there in 1935-" and I add "were removed"-"I will agree to take out the provision restricting the laying of information to the attorneys general". I have quoted from the minister's statement at page 3073 of Hansard. I do not know of any record in support of the minister's statement. I hold in my hand the senate report of July 3, 1935, in which any recommendations for changes which were made in the bill as submitted to the senate committee were introduced, and concurrence was moved not by the Hon. Mr. Meighen but by the Right Hon. Mr. Graham, who presided over the committee. I mention that by way of clarification. Nowhere have I been able to find any suggestion, either in the banking or commerce committee to which the matter was submitted, or in the debates in the senate, which would bear out the statement that in fact it was Mr. Meighen who introduced the proviso that prosecution should not take place under section 498 of the criminal code and at the same time under the provisions of the Combines Investigation Act.
With regal'd to section 10A, when the commissioner is led to believe that there is a combine or a merger which contravenes the provisions of the act, does he proceed with the taking of evidence, either under oath or 63260-195i
not under oath, or how does he determine the question upon which a prima facie conclusion is arrived at that a combine does in fact exist? I took the trouble to read over the evidence of the banking and commerce committee of 1937, and it was interesting to note that one of the recommendations made was that as soon as any information came to the chairman of the tariff board which indicated that there was a combine in any particular commodity, that information should be communicated to the commissioner under the Combines Investigation Act. Last evening I was surprised to learn that as to radio tubes and sets, although the tariff board found in 1939 and 1940 that Canadian consumers were being unduly exploited through the arrangements then in effect, no information of that kind was brought to the attention of the commissioner. This is a serious matter. The supply of small radios has been clearly restricted by the actions of a combine operating not only internationally but in Canada.
Last evening I asked the minister what he was going to do about it. What is he going to do about the findings of the commissioner on the electric lamp combine? What is he going to do about the findings of the commission as to radio tubes and sets? There fes no doubt the findings are clear and definite-that there is a combine and that the Canadian, consumer is being exploited. What does he? intend to do about matches and the othe;r matters referred to in the report?
Under section 10A-and this is supposed to consolidate the section in the dominion trade and industry commission act and also in the criminal code-the commissioner may receive and investigate complaints and communicate them to the attorney general of the province or to the attorney general of Canada. Does that mean that^ he shall investigate them and communicate his findings, or is it merely permissive? So far as the crown is concerned I realize that "may" is mandatory. But is it not a fact that under these circumstances the word "may" makes no action mandatory on the part of the commissioner? I should appreciate it if the minister would explain general^'- the procedure. In the banking and commerce committee of 1937 one of the chief complaints was that, while there were preliminary investigations, little serious action was taken on the basis of the information secured by the commissioner. The time has come for a declaration by the minister as to the extent to which wrongdoing revealed in this report is to be proceeded against. I realize the difficulty with international cartels, hut what about the cartels operating in
Combines Investigation

Canada through companies nationally incorporated in Canada and doing business in Canada? What is to be done about these?
Mr. ST. LAURENT: I am not in a position to predict what actions are to be taken by the ten officers under the act setting up this commission. I suggest that they are to carry out their duties prescribed by the act. Section 12 of the act says that whenever a formal complaint has been made by six persons the commissioner shall make an investigation. Whenever he is directed by the minister to do so he shall make an investigation. Whenever he has reason to believe that a combine exists or is being formed, he shall make an investigation. I believe the commissioner, about whom such laudatory things were said yesterday, realizes his responsibility and the duties incumbent upon him under his oath of office, and that he will carry out the provisions of the act.
The hon. member refers to the statement about radio sets and electric lamps in the cartel report which was tabled at the last session of parliament. This system of licences and agreements between patentees is one of the things which has proved to be a serious embarrassment in proceeding against these organizations. It is for that reason that an amendment is suggested in the bill to enable the commissioner, under such conditions, to go to the court and ask the court to make such order as may appear to be necessary to avoid the consequences of abuses of these exclusive privileges which result from patents or from the registration of trade marks. Section 10A is to make it part of the duty of the commissioner under the Combines Investigation Act to make investigations when complaints are laid, or when directions are given to him, or when he has reason to believe sections 498 and 498A of the code are being violated. The section is substantially in the form in which it appears in the Dominion Trade and Industry Commission Act; and the effect of this and the repealing section, which is further on in the bill, is to transfer the power, responsibility and duty now resting upon the trade and industry commission, with respect to these sections of the criminal code, to the commissioner under the Combines Investigation Act. That is the extent to which section 10A goes.


[Stage Direction]
Section agreed to.
On section 5 - Commissioner shall cause inquiry to be made.
Mr. CASE:: This clause says:
The commissioner shall, on application made under section eleven of this act, or whenever he has reason to believe that a combine exists or is being formed-

The question in my mind is, upon the application of whom? Does it result from an individual application or a petition, or what brings about the investigation?
Mr. ST. LAURENT: Section 11 provides that an application for an investigation may be made by any six persons, British subjects resident in Canada, of the full age of twenty-one years.


Mr. STIRLING:: The basis of this act at least used to be that the combine was wrong when it was in restraint of trade. I take it that is still the basis?
Mr. ST. LAURENT: Yes.


Grote Stirling: Then I wonder if the
minister would comment on this wording which is underlined in section 5, "or whenever he has reason to believe that a combine exists or is being formed." I do not see how the commissioner can peer into the future and make up his mind when a combine is being formed whether or not it will result in the restraint of trade.
Mr. ST. LAURENT: If the situation is such that he cannot have any definite opinion about it, then he will not have the duty cast upon him by this section of making an investigation. "Combine" is defined in the act, and I think it is easy to conceive that one might come to the conclusion that certain negotiations were such that their completion would bring about the formation of a combine unduly restrictive of trade. I think it is quite easy to conceive that facts might come to the knowledge of the commissioner which would clearly indicate that there were in progress negotiations the culmination of which would be the formation of a combine restrictive of trade; and under those conditions it would be his duty to cause an inquiry to be made with a view to determining whether or not his impression was founded upon sufficient facts to justify intervention.


Grote Stirling: I can quite understand that the commissioner might so proceed when the combine had been set up and had commenced operation, but I find it very hard to believe that he would have sufficient prophetic powers to enable him, before it is formed, to decide whether or not it will be in restraint of trade. Would the minister go so far as to say that a combine can ever be a good thing?
Mr. ST. LAURENT: Not a combine as defined in the act, because there it is one which does unduly restrict trade or affect prices; so that kind of combine cannot be a

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good thing. It must be one coming under the definition, part of which requires that it must have obnoxious tendencies.


John George Diefenbaker: It is not "unduly" under this act, but under the code.
Mr. ST. LAURENT: But here it must be something which is against the public interest, so its obnoxious character is one of the things required to bring it within the definition; and if it comes within the definition it constitutes an offence and cannot be good.


Mr. KNOWLES:: I understand one of the reasons for adding the new words giving the commissioner the right to initiate an investigation on his own motion is that it was found that the provision that six people might make application was not worth a great deal. I am glad to see this addition giving the commissioner authority to initiate an investigation. I wonder if at the same time thought was given to reducing the number of people required under the other section, which we are not to have an opportunity to discuss, from six to perhaps four, or even two, so that we could make sure that any possible combine as defined by the act is investigated.
Mr. ST. LAURENT: Consideration was given to that point, and it was felt that whether the number be four, or six, or even two, when it requires to be in the form of a formal application for an investigation supported by a statutory declaration having the effect of an oath, it was not the thing that ordinarily would be done. What ordinarily occurs is that someone writes in and calls the attention of the commissioner to a situation which he considers fraught with danger to the public. The commissioner does get quite a number of frivolous communications. He uses his best judgment to sort out the wheat from the chaff, and whenever it appears to him there are anything like serious grounds for proceeding, he will do so if this section is passed as amended. Previously he had to have a formal application by six persons supported by their statutory declaration, or he had to have a direction from the minister. That required the minister to go into it and come to the conclusion that it w*as necessary to have an investigation made. My experience in the office of minister would lead me to believe that this would be something that would retard proceedings. The minister was required to go into it himself; and as the act read previously he had to go into it and not only take the vicarious responsibility for this being done in his department, but take the personal responsibility of asserting that he had given it sufficient study to come to a conclusion based upon his own research.
In these cases I think it is desirable to have a head officer in the commission who will do that on his own responsibility. Of course the minister will still retain his responsibility to parliament for the conduct of the official, but he will not have to make a personal investigation to put him in the position where he could go into court and say, "I have gone into this and have ascertained facts which justified me in giving that direction." If it is not to be done in that way it becomes just a hollow formality. If the minister is not to do it himself, I think it is preferable to have the statute indicate who is to do it and who will have to give sufficient consideration to the facts to form a reasoned, considered conclusion upon them.


Stanley Howard Knowles: I take it that the provisions laid down in section 11 will scarcely be used from now on. It is likely that most of these investigations will be made on the initiative of the commissioner in the light of information conveyed to him.
Mr. ST. LAURENT: That is what has happened during the last twenty-three years the statute has been in operation, and I expect it will continue to be the w'ay in which, in practice, it will operate.


Stanley Howard Knowles: The only reason for keeping section 11 is to provide a last resort, if both the commissioner and the minister fail to do their duty.
Mr. ST. LAURENT: If the commissioner and the minister both take the view that it is not worth while to make certain investigations, and there are six British citizens who feel strongly otherwise, they can force the hand of the commission.


[Stage Direction]
Section agreed to.
On section 6-Certificate for exercise of compulsion to witnesses.
John George Diefenbaker: I note the words-
The commissioner shall not exercise power to penalize any person . . . whether for contempt or otherwise, unless and until . . . a judge of the exchequer court of Canada or of a superior or county court has certified . . .
Why is this made so wide? Would it not be sufficient if it covered the exchequer court or the superior court, thus ensuring uniformity of procedure and application? The one condition which would be required in connection with a provision of this kind would be a degree of uniformity across the country. It was found necessary to appeal many of the decisions made from wartime prices and trade board regulations, because in one province a judge would look at the matter in one
Combines Investigation

way and in another province a judge would view it in another way. If the matter were left to the superior court, or particularly to the exchequer court, there would be uniformity and no possibility of discrimination.
Mr. ST. LAURENT: In only one case in twenty-three years has there been any attempt to penalize a witness for refusal to answer. It was recognized that all other investigating commissioners have, by statute, the right to do what is sought here.. In this instance it was felt that it would be better if before doing anything of the kind the commissioner, or one exercising his powers, were to realize that he had to go before a judge and justify what he intended to do.
In the provinces the superior court judges are to be found usually only in the capital cities. It is not a matter of very great importance whether that jurisdiction is or is not given to county court judges. I should expect however that it would be exercised with as much care by district or county court judges -as by superior court judges. As a matter of fact I should not expect that a commissioner would be apt to appear before a judge with an application which would not commend itself to anyone before whom it was brought. The action of the commissioner, or one exercising his power, would be a considered action, subject to publicity. I do not believe any inconvenience will result from the fact that the county court judges would have jurisdiction in this connection. I believe its value is in preventing the making of a hasty decision. The commissioner has to consider his proposed action, and must make an application in connection with it. This is something which will receive publicity. In my view with those safeguards it will be properly administered.


[Stage Direction]
Section agreed to. *
_ On section 7

Use of documentary evidence in criminal proceedings.
Mr. HAZEN:: Why have the last words in the act been dropped?.
Mr. ST. LAURENT: They are dropped because after documents are examined and made part of the evidence submitted they can never be used in any other proceedings. That is something which would give the sort of immunity which does not flow from any provision in any other statute. Here there may be various ether kinds of cases in which one would require to use the same documents as part of the evidence. These words would give to any document used in a prosecution under sections 498 and 498A, or under the Combines Investigation Act, an immunity with
{Mr. Diefenbaker.J
respect to proceedings in any other criminal court. It would seem to me that that is a dangerous principle.


Douglas King Hazen: I am not clear about the section as it now reads. It says:
No person shall be excused from attending and giving evidence and producing books, papers or records, in obedience to the order of the commissioner, on the ground that the oral evidence or documents required of him may tend to criminate him or subject him to any proceeding or penalty, but no such oral evidence so required shall be used or receivable against such person in any criminal proceedings thereafter instituted against him,-
And so on. I direct the minister's attention to the words: "or documents required of him . . . but no such oral evidence so required shall be used or receivable against such person". It does not say, "oral evidence or documents so required shall be used or receivable against such person". I find only the words "oral evidence". Then it proceeds to say:
Nor shall any such documents be used or receivable in any criminal proceedings.
These are criminal proceedings against the witness, or person who has been called. But if one goes back to the words in the sixth line, he finds "but no such oral evidence so required shall be used or receivable against such person." Why should the oral evidence not be received, and yet the documents be received against him? Should it not read, "oral evidence or documents?"
Mr. ST. LAURENT: No. When the documents are secured they can be used as evidence. But if a person is interrogated, and is not permitted to decline to answer, it would not be proper to use against him the answers he has been obliged to give, and which might tend to incriminate him. The words we wish to strike out would prevent even the defence from using these documents. It would make them documents which could not be used in any criminal proceedings, except those under section 498 or under the Combines Investigation Act.
I think it may have been well intended when inserted in 1935. but the language used goes beyond what was originally intended, because, as provided there, it would even deprive the owner of the documents of the right to use them in his own defence. I do not think that would be a proper provision to maintain in the statute.


Douglas King Hazen: As I read it, the evidence he gives cannot be used against him in criminal proceedings, but the documents, can be used against him in criminal proceedings. Is that what the intention is?

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Mr. ST. LAURENT: Yes. These documents can. be used against him when obtained in that way or obtained on a search warrant. They are material things which can be looked at. As I understand it, the provision which confers protection on one who is compelled to answer was not put there for his sake, but was put there so that he would be in a position to testify freely and truthfully. That does not exist with respect to the documents. They are material things. They do not need to be protected so as not to change the story they tell.


Douglas King Hazen: The Canada Evidence Act refers only to the evidence. It makes no reference to documents.


Mr. MacINNIS:: A nice point of law has been raised by the lawyers; but how can you proceed against the combine if the documents cannot be used?
Mr. ST. LAURENT: My own experience in the only prosecution I conducted under the Combines Investigation Act was that we made our case out of documents and correspondence.
Mr. DIEFENBAIvER: I must commend the minister for the statement he made a moment ago in answer to the member for St. John-Albert when he said that it would not be proper to use the evidence of persons brought before a commission to incriminate them in criminal proceedings. That is a proper point of view, and it is one which we on this side of the house took in connection with the espionage commission. My right hon. friend's declaration of a moment ago was entirely in keeping with the best traditions of British jurisprudence, and it was made without equivocation or addition-namely, that when a person is compelled to give evidence by any investigating body the evidence so given shall not be used against him. As a matter of fact there is one statute in which that right still exists-I refer to the Excise Act. Under the Excise Act a commissioner or inspector of the mounted police may, if he believes there has been any infraction of the Excise Act, order a person by subpoena to appear before him and to answer such questions as are put to him. In one such case I was not on the prosecution but on the defence, and the person being examined refused to answer unless protection was given to him. He was subsequently prosecuted for that failure but was acquitted. As I understand this section, it frees the defence from the penalty section which provides that once there is an examination on the basis of the documents that have been produced before a commission, the use of those documents is denied in the courts even for the defence. The section removes an anomaly, and I think it is a very proper provision.


Mr. McMASTER:: I cannot see why the evidence could not be used under further proceedings under this act.
Mr. ST. LAURENT: I think the hon. member's construction is correct. We feel that it is improper in this law to blank out a certain number of documents and say that they can never be used in any criminal proceedings by anybody. I think that is a wrong principle to have in this act, we are therefore asking that it be taken out.


[Stage Direction]
Section agreed to.
Section 8 agreed to.
On section 9-Powers of exchequer court in cases of use of patents or trade marks to limit production unduly or to restrain or injure trade.
Mr. RICHARD (Ottawa East):: Has the Minister of Justice had an opportunity to consult the Secretary of State as to the effect of this section in relation to section 65 of the Patent Act, which provides:
The attorney general of Canada or any person interested may at any time after the expiration of three years from the date of the grant of a patent apply to the commissioner alleging in the case of that patent that there has been an abuse of the exclusive rights thereunder and asking for relief under this act.
Then follows a list of what constitutes an abuse. As I see it, many of the provisos in section 9 (30) of the bill now before us are similar to the abuses named in section 65 of the Patent Act-. The commissioner has power under the Patent Act to revoke a patent, which is similar to the provision contained in this section. Is there not duplication? Is there any reason why this legislation Should be repeated in another act?
Mr. ST. LAURENT: The reason for asking that this section be enacted is that those who have patents do give licences in which they may insert conditions which may make possible the operation of a monopoly or combine, and an order tlhat another licence be granted would not remedy the situation. The present-provision, section 65 of the Patent Act, makes the only other alternative the cancellation of the patent. But in the bill before us it is suggested that the court be given the right to make such order respecting the use of the patent as may be required to prevent its being made a factor in the establishment and operation of a combine.


Jean-Thomas Richard: Section 66 of the Patent Act empowers the commissioner to grant a licence if there is an abuse, just as in this case.
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Mr. ST. LAURENT: Yes, bait it is felt that the granting of another licence to one more would not be a remedy. The remedy that is necessary is to prevent the owner of the patent from putting conditions in his licence which enable him to exercise control over the disposal of the patented article.


Stanley Howard Knowles: During the latter part of the war information came out that Bayer's aspirin was making a good deal of money which through devious routes was going to an enemy country, to Earbenindustrie, I think it was. Certain steps were taken in the light of that information which resulted in the company's profits in this country being entrusted to the custodian of enemy property. Since this section deals with patents and trademarks will the minister tell us how that matter now stands, and what could be done under this new section about a situation of the kind I have described?
Mr. ST. LAURENT: I am not in a position to inform the hon. member how that matter stands. My information is that it is not a patent which is involved there, but rather the registration of the word "aspirin" as a trade mark, and that this registration prevents anyone else from selling the same thing under the name of aspirin. It is acetylsalicyiic acid; and aspirin now appears in fact to have become more than a trade mark. A trade mark is used to designate a certain thing made by a certain producer; but aspirin has in fact become a household word, and much better known than acetylsalicyiic acid. There is a matter there which is under consideration. Even in the United States the word "aspirin" can be used by others than Bayer. In England the same situation exists. And that is the matter which is under consideration, and which, because of the form of our Trade Marks Act, which gives a perpetual right in a registered trade mark as long as it remains registered, creates a difficulty.


Stanley Howard Knowles: 
Stanley Howard Knowles: It is all wrong.


Mr. JAENICKE:: I should like to ask the
minister about the proviso of this section which stipulates thatno order shall be made . . . which is at variance with any treaty, convention, arrangement or engagement . . . with any other country . . .
What treaties or conventions have we with other countries, and what countries; and, briefly, what are the provisions of those treaties?
Mr. ST. LAURENT: There is an international convention for the protection of industrial property, to which Canada is a party, and which of course must be respected in any order which might be made under this section 30.


Frank Eric Jaenicke: Is that available to members of parliament, and do we know what other countries adhere to this treaty?
Mr. ST. LAURENT: I have in my hand a copy of the convention issued by the government of the United Kingdom, printed by His Majesty's stationery office, international treaty series No. 16 of 1928, which when issued sold for ninepence at any office of His Majesty's stationer; and the copy shows that it was entered into by Germany, the Austrian republic, Belgium, the United States of Brazil, republic of Cuba, Denmark, the Dominican republic, Spain, the republic of Esthonia, the United States, the republic of Finland, the French republic, the United Kingdom, the Dominion of Canada, the commonwealth of Australia, the Irish Free State, Hungary, Italy, Japan, Morocco, Norway, the Netherlands,
. Poland, the free city of Danzig, Portugal, Serbia, Sweden, the Swiss confederation, the Czechoslovakian republic, Tunisia, and Turkey.


Frank Eric Jaenicke: What happens to the rights of Germany, Japan, Italy and the free city of Danzig as protected under this treaty?
Mr. ST. LAURENT: Under our regulations concerning trading with the enemy, all property belonging to subjects of enemy countries

Combines Investigation
became vested in the custodian of enemy property and are still vested in him. Such rights as subjects of enemy countries may have had are now vested in the Canadian custodian of enemy property in respect of Canada.


Thomas Langton Church: I think the minister has stated the intention of the proposed statute. The statute is simply exploratory. It gives wider powers to the commissioner than he had before, to summon witnesses, to compel their attendance, and to make a more thorough examination than is possible under the act to-day. So far so good. No doubt it gives him wider powers to go into these matters, to call witnesses, to require the production of books, and to make what may be called a thorough examination of the whole case regarding combinations in restraint of trade. But I want to point out one defect. The commissioner has no further powers. He can go before a judge of the exchequer court or a superior court or county court judge or other judge and ask him to give him authority to lay an information. Then the judge may render a bill of indictment. I want to point out that under sections 498 and 498 (A) at present the commissioner-
Mr. ST. LAURENT: Mr. Chairman, I think the attention of the hon. member should be called to the fact that these sections have been adopted.


Thomas Langton Church: I am dealing with the sections-


The ACTING CHAIRMAN (Mr. Golding) :: The sections which the hon. member is referring to have been adopted.


Thomas Langton Church: Under the next section all the commissioner can do is to make a report. On page 233 of the fourth edition of Snow's Criminal Code, about twenty cases are listed under the sections in respect of which the commissioner makes his report, and in nearly all of them the convictions were upset on appeal. The enforcement of every section and of federate law in general is under the attorney general of the province. It is true that not only this act but all federal statutes are enforced by the provincial attorney general, the attorney general of Canada being relieved of all that responsibility, and the enforcement of all these federal laws costs the provinces a lot of money. With the complicated situation that exists, therefore, I doubt whether by this bill we shall be able to control combines in restraint of trade, or cartels.


John George Diefenbaker: This is apparently an additional power under the head of remedies, and while speaking of remedies and the 63260-196
necessity for the commissioner to have wide powers, I would read section 29 as it now stands. It is stated that whenever, as a result of an investigation under the provisions of the act, or as a result of a judgment, and so on-
-it appears to the satisfaction of the governor in council that with regard to any article of commerce, there exists any combine to promote unduly the advantage of manufacturers or dealers at the expense of the public, and if it appears to the governor in council that such disadvantage to the public is facilitated by the duties of custom imposed on the article. . . . the governor in council may direct either that such article be admitted into Canada free of duty, or that the duty thereon be reduced to such amount or rate as will, in the opinion of the governor in council, give the public the benefit of reasonable competition.
There is a section that gives unusual powers, and once more with reference to the small radio, and also to other matters which I have mentioned, one of the reasons advanced by the department why we cannot get these radios is, first, that there is a combine, and, second, that if a Canadian goes to the United States to buy one he is faced with a tariff, and so on. In view of the fact that there was a definite finding by the commissioner that the Canadian consumer is being detrimentally affected, the question I wish to ask before referring to section 30 is this: To what extent was that stringent power resting in the governor in council ever utilized? To what extent did the commissioner at any time ask that it be utilized in order to cover the situations particularly set out in the report of the commission? Because, if that section were used, the difficulties set forth in the report with respect to electric lamps, radio tubes and sets would be obviated if not altogether done away with.
Mr. ST. LAURENT: The hon. member has read the section and then paraphrased it.


John George Diefenbaker: Oh, no.
Mr. ST. LAURENT: The section applies when as the result of an investigation by the commissioner or a judgment of the supreme court or the exchequer court of Canada, or any superior court or circuit, district or county court in Canada, it appears that such and such exists. There have been no such cases. This investigation by the tariff board is not an investigation by the supreme court of Canada or by the exchequer court or by the commissioner under the Combines Investigation Act. It is not a case where this section would apply. The section is one which will be of considerable value whenever, after the restoration to the commissioner of the powers he enjoyed before 1935, he proceeds to make these investigations and makes these reports.

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This report that was tabled is not the kind of investigation to which section 29 applies, and the matter of tariffs is one which, as hon. members will have noticed from the speech of the Minister of Finance stating his budget proposals, it is felt should not be dealt with piecemeal or in any small way.
In the forthcoming international conference on trade policies the tariff and cartel matters are down for consideration. I hope there will come out of that conference measures for the freeing of trade which will be of genuine assistance to the peace-loving nations and which will remove some of the causes that create the isolationism that eventually leads to war.
I do not think this section should be interfered with. It will be of value to have it there, and occasions will probably arise on which it can effectively be used. In connection with these patented things, it is not the tariff that is the obstacle to freedom of trade; it is this interlacing and these licensing agreements which are used in an ingenious fashion. For instance, the registration of a trade mark is used to limit the zones in which certain traders can operate. The same trade mark being registered in the name of different owners in different countries and being applied to something in which there enters a patented part or patented material, makes it impossible for the licensees to invade the territory of another because they would be infringing the trademark of the other owner. These are matters which are somewhat like the devices that have had to be run down in the application of taxing statutes. The income tax statute has become complicated because of the large number of plugs which it has been found necessary to introduce from time to time to prevent leakages which ingenious persons had contrived to bring about in a manner that was not illegal.
These things have to be studied in that light, and I think the dispositions manifested by several of the western allies do give some promise that this kind of conference will bring about results that should remove some of the fetters that now embarrass trade and frequently enable inordinate profits to be realized.


John George Diefenbaker: I am not going to labour this matter of radio tubes and sets, but I do not seem to get an answer as to what is to be done. The minister said that the tariff had nothing to do with it. Let me point out that in 1939 the tariff board reported. as set forth in the McGregor commission report:
fMr. St. Laurent.1
The board strongly suggests that the selling margin granted jobbers and dealers should be drastically reduced. The average mark-up on the manufacturers' selling price of 113-11 per centum is ridiculous and such a method of meeting the competition of imported, unlicensed tubes is obviously made at the expense of the consumer.
In other words, in 1939 the tariff board found, first, that the public was being exploited, and second, those who manufactured radios in Canada raised the mark-up price 113 per cent above the manufacturers' price, so that the price would be high enough to cover the protection granted in this country. It is difficult for me to understand why a body charged with the responsibility of preventing and punishing combines in Canada did not have the ear to the tariff board or was not aware of the fact. The commissioner says he never heard of it until 1945, although the Canadian public were being exploited in this particular instance by agreements in restraint of trade. I accept the explanation, but. it seems difficult to understand that there should be such an isolation or insulation of different departments of government that the department charged with preventing and punishing this sort of thing is not made aw-are of the reports of another department of government which finds that the Canadian consumer is being exploited. Surely if there ever was a case which could have been proceeded with it is this one. There is the evidence; there is the finding not only of this commission but of the tariff board in 1939. While we sit the Canadian consumer is still being exploited to the extent of 143 per cent of a write-up. Apparently I cannot get an answer from the government that they will act in this case which affects hundreds of thousands of radio listeners in Canada. It covers tubes; it covers radios. We have the definite finding that the whole thing is wrong and an exploitation, but it is impossible to get an answer that this sort of thing is to stop and the offenders to be proceeded against. We did not need the present powers to go after these people. The power was contained in the original act, and as it stands to-day.
Under the criminal code, before a conviction can be had, it is necessary to establish that wThat is being done by a trust or combine is unduly to limit the facilities for transporting, producing, manufacturing and supplying; unduly to prevent, limit or lessen the manufacture or production of any article, or undid}' to prevent or lessen competition in the production, manufacture, and so on. In other words not only must it have that effect, but it must be done so flagrantly as to come

within the ambit of the descriptive word "unduly". Under the Combines Investigation Act it is not necessary to establish that what is being done is being unduly done. A combine, as definied in section 2, means a combination having or designed to have the effect of limiting facilities for transporting, and so on. In other words, under the Combines Investigation Act all you have to prove is that certain results follow. Under the criminal code you have to establish not only that these results follow the unlawful act but that what is being done is being done with the intent unduly to limit transportation, competition, and so on. That being so, I ask the minister why in section 30, the amendment now being brought in, has the word "unduly" been incorporated, thereby widening the ambit and the necessity for proof,, imposing an additional onus upon the commissioner beyond that which is now provided for in the act. I do not know whether I make myself clear, but in the act as it is constituted at the present time there is no necessity of establishing a state of mind, as would apparently be necessary if one were to set out to establish that what had been done had been done unduly. In the new section provision is made for the necessity of establishing that ingredient. I should like to know the reason for the change.
Mr. ST. LAURENT: I wish to congratulate the hon. member for Lake Centre on his strategy in making a political speech and then winding up by asking a question so that the answer will be to the question and the political speech left unchallenged.


John George Diefenbaker: No.
Mr. ST. LAURENT: There are none so deaf as those who will not hear. The hon. member has repeatedly asserted that it has been impossible for him to get any answer as to what is to be done about these abuses that are reported upon in the cartel report. If the hon. member were only half as eager to assist in making remedial legislation as he is to attempt to show that the government has been remiss in its duty, we should get along very much better.
With respect to his question, the criminal code provides that in order for conduct to constitute an offence it must be undue conduct. A long line of cases decide -what is required under these provisions. The Combines Investigation Act provides that in order for an organization to be a combine it must be something which has operated or is likely to operate to the detriment of or against the interest of the public, whether consumers, producers or others. We have endeavoured to
Combines Investigation
retain the language which has been the basis of decisions which have helped to establish what the law means to the public generally.
In this debate one hon. member-I forget which one-said that what was necessary was educational work to bring it home to those who organize and operate and exploit these monopolies and cartels what the state of the law is. Well, it may be an expensive way to educate them, but the best way to educate them is bring them before the court and have the court tell them that such and such are things which they cannot do, and if they do them they will be fined or go to gaol. That is the effective educational process which has been going on, and will have to go on in order to bring about that freedom of trade which we are all concerned to see realized.
I do not think it is helpful toward that goal to-


John George Diefenbaker: Bring out the facts.
Mr. ST. LAURENT: -cast blame here or there. Does the hon. member imagine that if it were not the intention of the government to take measures and to have measures taken to bring about the eradication of these abuses, it would have tabled this report? This report was requested for the purpose of ascertaining what the situation was. It was tabled for the purpose of permitting parliament and the public to realize that there were abuses which required intervention. We now come before this house asking it to give the commissioner the kind of legislation he feels he requires in order to be able to remedy these abuses; and the hon. member says, "I cannot get any answer from the government as to whether or not anything is going to be done about it."


John George Diefenbaker: Let me answer that. My right hon. friend says the best way to educate certain people who are wrongdoers is to bring them before the courts. I agree. There has not been very much education of wrongdoers under the combines act since 1935. There have been four major prosecutions. In two the verdicts were "guilty"; in one the verdict was "not guilty", and in the fourth there was a verdict of "guilty" in 1941. A combine was found to exist; the verdict was reversed on a technical objection on appeal; and last evening my right hon. friend said the reason the case was not retried was that the wartime prices and trade board kept prices down now, so that these people would not be able to continue to do wrong. This is the first time in history that in a criminal prosecution anyone getting a new trial has been able to say, "Well, now, I will never do it again.
63260-190!
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I cannot do it any more, anyway," and they are not proceeded against. My right hon. friend becomes very indignant. He says, "Do you think anyone would believe that unless the government intended to act it would have brought down the report?" In 1939, the government knew what was going on in regard to radios and radio parts; yet they have not acted. The tariff board pointed out the exploitation and the wrongdoing, but the persons in charge of prosecuting these wrongdoers who took advantage of the public; the persons in charge of the education campaign to which my right hon. friend refers, never heard anything about it because one department of government was so isolated from the other that it did not pass on the information.
I am not going to ask about the matter any more because, when I ask, my right hon. friend says it is political. I am not going to ascribe the failure to prosecute to political considerations, though there are many in this country who believe there is justification for such a viewpoint. My right hon. friend was ;he first to mention "political." If I or anyone ;lse in this house were inclined to be suspicious, jolitical considerations could be discussed at :onsiderable length at this time. However, m spite of the findings of the tariff board in 1939; in spite of the findings of a royal commission in 1945, we have as yet no suggestion that anything is to be done about the matter. I leave it there.


Mr. FULTON:: As I understand it, the measure provides that the exchequer court, on information exhibited by the Attorney General of Canada, may require individuals or concerns who have been found to be carrying on a cartel, to cease doing so, or to take such other action as will render the fact that they are a cartel harmless to the Canadian people. Is that the effect of the section? If that is not correct I would appreciate an explanation by the minister.
Mr. ST. LAURENT: I should like to explain that this is not intended to say to combines that they shall not continue to operate. If the hon. member will refer to the definition of "combines" in the Combines Investigation Act he will find at the end of subsection 4 the words:
Provided that this subsection shall not be construed or applied so as to limit or impair any right or interest derived under the Patents Act, 1935, or under any other statute of Canada.
Rightly or wrongly it might be argued that those who were carrying out the terms of licences they obtained from patentees did not come within the definition of a merger or monopoly as defined in the act; and this section is
fMik Piefenbaker.]
to enable the attorney general to go to the court and show that use is being made of a patent or trade mark as an aid to get into a monopolistic situation in order to take from the public more than the public should have to contribute, and to ask the court to order such modifications in the licence or agreement under which the patented right is being used as will make it possible to avoid those consequences. That is the purpose. It was felt that when all you could prove was that a certain number were conforming with the terms of licences, you would have to go a good deal farther to establish that there was a combine. But if those terms produced, as they did in the cases referred to in this report which was tabled last session, results harmful to the public, the attorney general could ask the court to relieve the licensees from such conditions, or to make such other order as might allow the patented right to be used but not in this obnoxious fashion.


Edmund Davie Fulton: It is not contemplated that it would be necessary to use this section against any organization or body coming within the definition of a "combine" under the Combines Investigation Act. Is that correct?
Mr. ST. LAURENT: No. They can be proceeded against, but it is quite probable that this will be frequently invoked, because it will be much easier to make out a case after we have had them relieved from the restrictive terms of licences. If a certain number of traders being prosecuted as a combine were to say, "Well, there is no agreement at all between us. Each of us is living up to the conditions that have been imposed upon him in his patent licence," that might be raised as a defence. But if we commence by having those conditions removed, and after they are removed the traders still act in a manner which indicates joint action to maintain prices, it will be much easier to obtain a conviction against them.


William Alexander McMaster: I do not like the last four lines of this amended section, which say:
. . . no order shall be made under this section which is at variance with any treaty, convention . . .
And so forth. I know that no contract between private individuals can be binding that has in view an illegal act. Unless the minister knows there are certain clauses in this convention which could be invoked, I would suggest that these words be left out. If at any time it is found that a decision offends against this convention the matter could be brought before this parliament. If this convention does protect anybody, and it is wrong, I suggest that it is not a good convention and should be changed.

Combines Investigation
Mj\ ST. LAURENT: There is in the international convention an article, namely article 5, which declares that importation by the patentee into the country where a patent has been granted of articles manufactured in any of the countries of the union shall not entail revocation of the patent. There are in that article conditions witih which the licensee under the patent must comply. Whether or not we have this proviso in the statute, no court would wish to make an order contrary to an international undertaking made by Canada. This is just a warning to the courts that there are such international agreements and that no order must be made in terms such as to violate the international agreement. That international agreement is reciprocal. Those who patent inventions in each country get the protection of the international agreement in the other countries, and vice versa.


William Alexander McMaster: I appreciate what the minister has said, but I point out that if people who form cartels take refuge under this convention, then it is time the law officers of the crown examined the convention to see where that can be stopped. There is no use in our passing legislation if it is to be ineffective because of this convention.
Mr. ST. LAURENT: I do not think any of these abuses could be protected under an international convention. But an order might be made with respect to a patent which would be so broad in its terms as to violate some of the provisions of the international agreement. All we want to guard against is that, in making orders, they be not made in such broad terms as to violate international agreements. I am convinced that they can be made sufficiently specific to prevent abuses, without restricting the legitimate rights which flow from international agreements.


William Alexander McMaster: In answering my question the minister has said that he does not want judges to make orders which would offend against any treaty, and then he proceeds to point out that they would not do so in any event, I suggest that if the treaty were brought to their attention they would be bound lay it.
If this clause were left off and a decision given adverse to the treaty, the matter would come before parliament, and we would know about it. Many of these decisions from the courts do not reach the ears of the general public. The matter would be brought before parliament which would deal with the effect of the decision. As I said before, we do not want the effect of this act to be abrogated through some judge's decision as to what the convention means.
Mr. ST. LAURENT: A certain end can be obtained by an order in general terms, and that order in general terms might violate the terms of the convention. The same effect can probably be achieved by making a specific order and by forbidding the doing of specific things. We wanted to guard against the former, and to answer the criticism by lawyers that we cannot have this kind of section because it might offend against international treaties. We are convinced that we can have it, and that orders can be framed which will be effective and which will not offend against the international treaty.


Mr. FLEMING:: I should like to ask the Minister of Justice or the Secretary of State, who is now in his seat, if the government has in contemplation any revision of the Patent Act. It may be that such revision is necessary, in the light of a good deal of this discussion both this afternoon and last night. Will the minister give us some indication as to whether the government has such revision of the patent law of the country in contemplation?


Mr. MARTIN:: I cannot say whether there will be any revision of the Patent Act, in so far as this particular matter is concerned. At the present time, however, consideration is being given to administration by the patent division, but in no way which would involve the matter now under discussion. What is being done will have to do with rendering more efficient the administration by the patent office.


Donald Methuen Fleming: I take it that that is a matter of administration within the department. Is it the view of the government that no amendment or revision of the substantive patent law of the country is necessary, even in the light of the information brought before the committee?


William Henry Golding: Order; we must discuss the section before the committee.


Donald Methuen Fleming: What I have said is most relevant to the discussion, because section 9 in the bill has to do wdth trade mark and patent rights.


Paul Joseph James Martin: I do not agree that any discussion of patent administration would be in order at the present time. However, I did reply by stating that consideration was being given to more efficient administration of the Patent Act. The consideration being given to the act itself would in no way affect the matter now under consideration.
Combines Investigation


Stanley Howard Knowles: I would refer to the use of the word "unduly" in the first paragraph of the section. It seems to me that the committee should consider the removal of that word from paragraphs (a), (c) and (d). With the inclusion of those words it seems to me the usefulness of those paragraphs is considerably reduced. I am not convinced by the minister's argument when he refers to the fact that these words appear in the criminal code. It seems to me that there is a difference between offences of this kind, punishment for which is the cancellation of certain licences cr patents, and offences under the criminal code which involve the payment of large fines or gaol sentences.
Perhaps the matter might be brought to a head simply by offering an amendment, one which I had expected the hon. member for Lake Centre would have offered. Since he did not, I now move, seconded by the hon. member for Kindersley (Mr. Jaenieke):
That the word "unduly" be struck out of paragraphs (a) (c) and (d) of section 30 of the Combines Investigation Act, as provided by section 9 of bill 193.
Mr. ST. LAURENT: I submit that the hon. member's motion cannot be accepted. All patents and trade marks do limit the actions of ethers. They do give exclusive rights which cannot be exercised except by agreement with the owner of a patent or the registered owner of a trade mark. It is only when they go beyond what is reasonable that interference can be sought.
The whole purpose of a patent and of the registration of a trade mark is to give an exclusive right to a patentee or an owner of a trade mark. He may be required to license others, under reasonable conditions. But by ,'irtue of the Patent Act he has monopolistic orivileges; and it is only when lie abuses those privileges that we can ask the courts to .nterfere. If he is making use of his patent merely to prevent some other person from producing his patented article and is not doing it in an unreasonable fashion, he is simply doing what the patent is designed to give him the right to do.


John George Diefenbaker: Why does the word "unduly" not appear in paragraph (b), where these words are used:
(b) to restrain or injure trade or commerce in relation to any such article or commodity.
Mr. ST. LAURENT: The word "unduly" is not used there because it is felt that making use of a patent or trade mark, now that those devices have been recognized for a very long time, is not, in itself, necessarily injurious or restrictive to trade or commerce. We have for a long time recognized patents of invention 
and trade marks. They are not regarded as of a nature to restrain or injure trade or commerce in relation to such articles. It is only when they are used in a manner which the public concept of proper business dealings *would regard as restrictive that they should be interfered with. The language used here is copied textually from section 498 of the criminal code, which has been the occasion for a great many decisions construing the language used. If my hon. friend will compare paragraphs (a), (b), (c) and (d) with section 498 of the criminal code he will find that the only difference is that in section 498 of the criminal code each one of these paragraphs begins with the preposition "to"; to unduly limit, restrain or injure trade, to unduly prevent and so forth, whilst here the use of the split infinitive has been avoided. Otherwise it is identical with the language of section 498 of the criminal code.


John George Diefenbaker: In the definition of "combine" under the Combines Investigation Act "unduly" does not enter into the picture at all.
Mr. ST. LAURENT: No. It is replaced by the phrase "has operated or is likely to operate to the detriment ... of the public."


William Henry Golding: Does the hon. member for Winnipeg North Centre wish to press his amendment?


Stanley Howard Knowles: Yes. The minister's argument only makes me feel the uselessness of these paragraphs as they stand.
Amendment (Mr. Knowles) negatived.


[Stage Direction]
Section agreed to.
On section 10-Procedure when in opinion of commissioner an offence committed.
Mr. ST. LAURENT: Mr. Chairman, sections 10, 11 and 13 should, I think, be considered together. If section 13 as it is here is adopted, I would then be prepared to accept the amendment to which I referred last night with respect to the removal of the limitation of prosecutions to the attorneys general. If that were accepted, the language of sections 10 and 11 would require to be changed as a matter of concordance. So that I think sections 10, 11 and 13 should be taken together, and if section 13 carries I have here a draft which eliminates the restrictive provision in the Combines Investigation Act and brings about the necessary concordance.
William Henry Golding: Shall sections 10, 11 and 13 be considered together?


Some hon. MEMBERS:: Agreed.

Combines Investigation


John George Diefenbaker: I think the point made by my right hon. friend covers the question I raised last evening. I thank him for accepting my suggestion that an information can now be laid, if this becomes the law, by any individual, thereby enabling any consumer in this country who believes that a combine in fact exists, and where proceedings have not been taken, to go ahead in the ordinary way in the courts. I frankly am appreciative of the minister's acceptance of my suggestion because it goes a long way towards putting into this legislation the teeth which have been lacking in the past. It will do a lot toward fortifying the people of this country in their opinion that a real effort will be made to prevent combines from unduly lessening competition and exploiting the public. Having said that, may I ask the minister this question? Why the insertion of subsection 3 in section 11:
Xo person shall be charged with an offence ao-ainst this act on the same information or indictment as that on which he is charged with an offence against section four hundred and ninety-eight of the criminal code.
Mr. ST. LAURENT: That is to replace the portion of section 28 of the 1935 statute which it is desirable, I think, to retain. The complaint was that indictments were being framed with several counts, some being under the criminal code and some being under the Combines Investigation Act. I thought that that was unfair and that the prosecutor should exercise his option and decide whether he was going to prosecute under the code or under the Combines Investigation Act, but that he should not have counts under both in the same indictment. I think that is only proper. I think it is proper to require the prosecutor, when there are two statutes which can apply to given facts, to frame his charges under one or under the other but not under both. But section 28 as enacted in 1935, went much farther than that. It read:
Xo person shall be charged with, tried or convicted of an offence against this act, by the same information, upon the same evidence or at the same time as he is charged with, tried for or convicted of an offence against section four hundred and ninety-eight of the criminal code.


John George Diefenbaker: Has that section been interpreted by the courts?
Mr. ST. LAURENT: Yes, it was interpreted in the Alberta case, and it was held there that because a charge had originally been made under the code and a stay of proceedings had been entered by the attorney general the subsequent proceedings under the Combines Investigation Act were illegal. That is why I said last night that if it were to be permissible to anyone to lay an information
I wanted to avoid having that information remain as a bar against other proceedings if the one laying the information did not follow up his charge and get a judgment upon it. Otherwise it might be possible for those who were fearing prosecution to have a charge laid against them and just rest behind that charge. The suggestion now is that:
Xo person shall be charged with an offence against this act on the same information or indictment as that on which he is charged with an offence against section four hundred and ninety-eight of the criminal code.


John George Diefenbaker: Why not "and
498A?"
Mr. ST. LAURENT: There is nothing in the Combines Investigation Act which is similar to section 498A. It is section 498 and the Combines Investigation Act which cover the same territory.
The hon. member has read the suggestions; he sees that it is necessary to have some slight changes for concordance to be made if that principle is accepted. So that if it were the pleasure of the committee to adopt section 13 and the pleasure of the hon. member to move the amendments to sections 10 and 11 set out there, perhaps all three could be adopted.


John George Diefenbaker: Mr. Chairman,
would this be the point to move the amendments? I move:
That the present section 10 be replaced by a section to read as follows:
10. Section thirty-one of the said act, as enacted by section twenty-two of chapter fifty-four of the statutes of 1935 and amended by sections four and twelve of chapter twenty-three of the statutes of 1937 is repealed and the following substituted therefor:
31(1) Whenever in the opinion of the commissioner an offence has been committed against any of the provisions of this act, the commissioner may remit to the attorney general of any province within which such alleged offence was committed, for such action as such attorney general may be pleased to institute because of the conditions appearing, any records, returns, evidence or report relevant to such alleged offence.
(2) The Minister of Justice may instruct counsel to attend on behalf of the minister at all proceedings consequent on any information being laid for an offence under this act.
I assume that is as far as I would go at this time.


[Stage Direction]
Amendment agreed to.
Section as amended agreed to.
John George Diefenbaker: I also move:
That section 11 of the bill be replaced by a section to read as follows:
Section thirty-two of the said act, as amended by section twelve of chapter twenty-three of the
Unemployment Insurance

statutes of 1937, is further amended by repealing subsection two thereof and adding thereto the following subsections:
(2)	No person shall be charged with an offence against this act on the same information or indictment as that on which he is charged with an offence against section four hundred and ninety-eight of the criminal code.
(3)	The provisions of this section which provide for the imposition of penalties shall not be deemed to deprive any person of any civil right of action.


Stanley Howard Knowles: Will the minister take another minute to explain why it will not be possible under the first of the subsections now proposed to do the same thing that it was possible to do under the old section 28? I am referring to those people who, fearing charges, get a charge trumped up against them under one act so that they will not have it under the other.
Mr. ST. LAURENT: There is no obstacle to there being more than one charge laid. The fact that a charge will have been laid by someone will not prevent an attorney general from laying another charge. The only defence one would have would be that he has been convicted or acquitted. Supposing someone thought he was going to get protection by having a prosecution brought against him, and a charge was laid but the informant did not proceed, nothing would prevent the attorney general from laying a charge for the same facts. The only defence the person prosecuted could have would be that the first charge had gone to judgment and had resulted in an acquittal or in a conviction. The existence of the charge would not constitute an impediment. So that I feel certain there is nothing to be feared from the possibility of trumped-up charges being brought by prosecutors who are not serious.


[Stage Direction]
Amendment agreed to.
Section 11 as amended agreed to.
Sections 12, 13 and 14 agreed to.
Bill reported, read the third time, and passed.


[Stage Direction]
Hon. HUMPHREY MITCHELL (Minister of Labour) moved that the house go into committee to consider the following resolution:
That it is expedient to introduce 'a measure to amend the Unemployment Insurance Act, 1940, to provide for clarification and rearrangement of its provisions and of the procedure to be followed thereunder; generally to enlarge the scope of the act to extend the application of the 
provisions and benefits of the act and of the qualifying period for insurance to certain veterans and merchant seamen.
Motion agreed to and the house went into committee, Mr. Golding in the chair.
Mr. MITCHELL:: I thought that this afternoon, as the hour is getting late, I might make a statement which I have before me, and perhaps hon. members would like to discuss the principle of the bill after they have heard the statement. I have drafted it in a manner which I hope will make it easier for hon. members to understand the rearrangement of the act and also certain sections of the act, and certain fundamental changes which are being made in it.
Five years ago, on July 1, 1941, contributions under the Unemployment Insurance Act first became payable. Now that we are considering a number of changes in the act to make it work more smoothly and to close some of the gaps which have appeared, it is perhaps well to take stock of what has been accomplished in order to place this important piece of social legislation in its true perspective. Many hon. members doubtless have read statements made in another place or on May 23 on the second reading of the bill. At that time some interesting statistics were placed on the record, and I will not repeat them at this time. However, I am sure you will be interested to know why it has been considered desirable to introduce the bill in this house, and the reasons why it was withdrawn from the other chamber.
Subsequent to the decision of the government to amend the Unemployment Insurance Act, it was decided to add sections to the bill which would involve expenditures of money.
These amendments relate principally to veterans and certain merchant seamen.
It may be well to recall that the Canadian unemployment insurance scheme is based on sound insurance principles, many of which are common to both commercial and social insurance.
The first of these is that there must be a reasonable interest in a contingency.
In the case of an employee, this contingency is his contract of service which may fail in its completion bjr a lay-off, by termination in accordance with its own terms, or by mutual agreement.
The second of these principles is that the indemnity or benefit arising out of the contingency must be related to, but must not exceed, the loss or value of the insurable interest.

Unemployment Insurance
The benefit may be related to part of the loss, as in some forms of automobile insurance, or a cash benefit related to, but less than earnings, as in unemployment insurance.
The third principle is that due weight must be given to what might be called the moral hazard. In commercial insurance this would result in a selection of risks, but in the wider scope of unemployment insurance results in the erection of proper safeguards in the public interest.
These past few years have proven an extremely difficult time. in which to recruit and train a staff to man the local and other offices of the commission. I think it can fairly be said that a good job has been done, although we are continually endeavouring to improve our standards. The continual training of staff on the job is expected to result in a still higher degree of efficiency.
We are operating a public service of the greatest importance by seeking to match jobs with those seeking jobs, while at the same time ensuring that claims against benefit rights accumulated in the war years are handled promptly and equitably.
The act became effective at a good time in so far as the building up of the fund was concerned. Employment climbed steadily, resulting in almost one-fifth of the papulation of Canada having a direct stake in the fund. With their dependents, this means more than 50 per cent of the population of Canada. This has helped to cushion these months of changeover and adjustment.
The effect of any social legislation is dependent on the extent of the classes of persons covered. In July, 1941, there was insured under the Unemployment Insurance Act almost all employment in industry, apart from the basic industries of agriculture, fishing, lumbering and logging, transportation by water and air, which presented special problems, as well as those excluded by reason of the wage ceiling of two thousand dollars.
It has been and still is the policy of the government to widen the scope of the act as rapidly as possible, and the changes effected, together with those projected, indicate the progress being made.
In January, 1942, action was taken by order in council to retain within the insured classes persons whose earnings exceeded two thousand dollars a year because of war conditions, such as increased hours and other factors.
In that same year action was taken to place veterans in as nearly as possible the same position as they would have had under the act had they not served in the armed forces.
This step was made effective by the postdischarge reestablishment order, is now in the present bill and will become part of the Unemployment Insurance Act.
It provides that employer and employee contributions, for the period of service in the forces subsequent to June 30, 1941, will be paid into the unemployment insurance fund by the government when the veteran completes fifteen weeks in insured employment in any period of twelve months following his discharge. This is proving a most satisfactory and realistic way for veterans to build up a share in the fund.
The only previous bill amending the Unemployment Insurance Act was passed in July, 1943, and effective from September 1 of that year the ceiling for salaried employees was raised from $2,000 to $2,400, to take care of the general rise in earnings.
In place of the order in council insuring those whose earnings were higher because of the war, the earnings ceiling was removed entirely for persons paid by the hour, day, week or on a piece rate.
The other change in coverage made at that time was the inclusion of all employees of public utilities who were within the insurable earnings limit, so as to remove discrimination between municipally-owned utilities and those owned by private companies. Previously, municipalities had been allowed exception for certain of their permanent employees.
Here let me say a word on this question of permanency of employment and coverage under the act. There are those who feel that where there is little risk of unemployment, the employment should not be insured.
On reflection, it will be quite clear that if those who were fortunate enough to have stable employment were excluded, it would be virtually impossible to build up a fund adequate to provide benefit for those with less stable employment without making the amount of the contributions prohibitive. It is only by spreading the risk that a sound scheme is possible. The man who pays his fire insurance premium and does not have a fire is fortunate.
Then even in employments regarded as most stable, unemployment is not unknown. In Britain, in the nineteen-twenties, when their unemployment insurance act permitted the withdrawal from the general scheme of industries which were thought to be particularly stable, the coal mining industry considered setting up a special scheme. The heavy unemployment suffered in that industry in the years that followed is only too well known.
Unemployment Insurance

Included in the 1943 amendments was one giving the governor in council authority to extend coverage to excepted employments on joint recommendation of the commission and the unemployment insurance advisory committee. This has made it possible to extend the scope of the act without waiting for an opportunity to introduce a bill into parliament.
Thus, in August of last year, employment in transportation by air and as a professional nurse (other than employment as a private duty nurse or as a probationer) became insurable.
Following a series of investigations into the peculiar problems, both seasonal and administrative, of lumbering and logging in different parts of the country, action was taken to make employment in this industry insurable.
Contributions are to commence in British Columbia on August 1 of this year. It is expected that in a comparatively short time the industry will be insured' across the country.
Discussions are now under way for further extensions in coverage by joint recommendation of the unemployment insurance commission and the advisory committee. However, there is now included in the bill an amendment which will make insurable employment in transportation by water-both inland and deep sea.
Until reciprocal arrangements have been completed with the United States and Great Britain, our coverage of deep sea vessels will be somewhat limited, but a start is being made and it is fully anticipated that proper arrangements can be made with these other countries as to the jurisdiction over vessels of different registry.
Many persons insured under the act are now faced for the first time with the need to take advantage of the benefit rights which they have been accumulating, and I think it may be of general interest to outline the handling of claims.
At the outset let me emphasize that the first action taken when an unemployed person enters the local office is to register him for employment and inform him of the employment opportunities which are available.
Only after this has been done are the necessary forms completed for the filing of a claim, if the insured person so desires.
A claimant must deposit his unemployment insurance book, or arrange to deposit it when he files a claim; he is required to give particulars of his employment during the previous six weeks, in order that the reasons for separation from employment may be verified. There is a disqualification imposed, for

example, if a claimant has left his employment voluntarily without just cause, or he has been discharged because of misconduct.
If the claimant wishes to receive benefit at the higher rate because he maintains a dependent within the meaning of the act, further particulars must be provided. He must give details of any spare-time occupation which he follows, because there are restrictions in the act governing the receipt of benefit by persons with spare-time jobs.
A claimant is ordinarily required to report once a week in order, to prove unemployment, capability of work and availability for work. He may be called in during the week because of an employment opportunity which has arisen. On his weekly reporting day, the placement officer must certify that there is no suitable employment available for him, before action is taken to record his unemployment.
There are a considerable number of claimants who live at too great distances from any local office to file claims in person. The practice is to permit such persons to file their claims by mail if the cost of return transportation from their home to the nearest local office exceeds thirty cents; they are then called "postal claimants." They not only file their first claim by mail, but they continue to report weekly by mail. Their statements as to unemployment, et cetera, must be certified by two responsible individuals. The payment of benefit is made by cash in the larger local offices and in the remainder, by warrant. Postal claimants are paid by warrant.
The contribution records of insured persons are maintained at eight points across the country. The contributions in the current insurance book, together with those in the records for a period of two years preceding the claims, determine the rate of benefit. Similarly contributions recorded for the five years previous to the claim, and benefit paid in the preceding three years, determine the duration of benefit.
The adjudication of claims is the responsibility of insurance officers appointed under authority of the act. These officers are located at numerous points across the country.
The main questions which an insurance officer must decide in adjudicating claims for benefit are whether the required contribution conditions have been fulfilled; if the claimant left his employment voluntarily, did he have just cause for so doing? Was he discharged for misconduct within the meaning of the act? Or does his unemployment result from a stoppage of work due to a labour dispute? Also, a claimant must be sixteen years of age and a resident in Canada before he is entitled to benefit.

Unemployment Insurance
Let us look at the important and controversial subject of suitable employment. The act specifies certain types of employment which are not to be considered suitable, for example, employment which arises out of a stoppage of work due to a labour dispute, employment which would require a claimant to become a member of, or to refrain from becoming a member of a union.
The act also states clearly that employment is not to be regarded as suitable if it is employment in the claimant's usual occupation where the wages are lower or the conditions less favourable than those observed by agreement between employer and employee. Neither is employment suitable in another occupation where the wages are lower or the conditions less favourable than those he obtained in his usual occupation.
On the other hand, it is likewise specifically provided that after a lapse of a reasonable interval from the commencement of unemployment, employment in another occupation is not to be considered unsuitable (in other words it is suitable) if the wages offered are not lower and the conditions not less favourable than those obtaining in that occupation.
It is only possible to consider whether a particular offer of employment is suitable in relation to an individual claimant at that time; what is not suitable to-day may well be suitable a month from to-day. The most careful consideration has been given to the guidance afforded insurance officers in adjudicating cases of refusal of employment which is apparently suitable, and reference has been made to both British and American experience in handling this problem.
Some of the factors considered by insurance officers are the difference in the rate of wages between the usual occupation and the work offered; whether there would be any sacrifice of skills in accepting the job offered; the length of unemployment; whether there is any prospect of the claimant finding work with his former employer within a reasonable time, or whether there is any possibility of his finding work in what is his usual occupation.
After an accident, for instance, a man may not be able to return to his former work, and he must consider a change in occupation immediately. Or a man who has reached retirement age for a given occupation cannot hold out for employment of that kind. Similarly, there are certain skills which were required during the war which have little or no place in a peacetime economy. Then there are always circumstances peculiar to an individual	claimant-his family responsibilities. adaptability, age and so on, which affect his suitablity for a job.
Let me emphasize that in no country has it been found practicable to legislate on what is suitable employment, because it is one thing one day for one claimant, and something else a month or two hence. It should always be remembered that if a claimant is not satisfied with an insurance officer's decision, he has a right of appeal to a court of referees, composed of representatives of employers and employees, and an independent chairman. In certain circumstances there is a right of appeal to the umpire. Gradually there is being built up from decisions of the umpire a most important and helpful guide to the interpretation of various provisions of the act, which is of great assistance in striving for uniformity of action among those adjudicating claims.
Glancing over the amendments in this bill, hon. members will notice that nearly two-thirds relate to changes in references made necessary by a rearrangement of some of the sections and by minor clarifications of old .sections, which experience has shown as desirable.
Of the other changes, I wrould draw hon. members' attention particularly to the following:
Clause 3 of the bill permits coverage of persons whose status as employees has given rise to some argument; for example, men paid on a commission basis may be either employees or independent contractors. On the other hand, clause 36 excepts from coverage a person who is virtually an employer; for example, a man who owns more than half the registered stock of a corporation.
Clause 6 of the bill permits repeal of section 23(2) of the act if the present proposal in the bankruptcy bill on priority of claims is approved.
Clause 7 is a major rearrangement of the present section in order to set out in a more straightforward manner the conditions on which benefit will be paid. It also increases the earnings permitted from subsidiary employment from $1 to SI.50 a day; widens the group of dependents in respect of whom the increased benefit rate may be paid; authorizes benefits to 'be calculated to the nearest five cents, and also permits small errors to be cleared from the books of the fund. Clause 7 takes up about one-third of the bill.
Clauses 10 and 11, together with part of clause 7, clarify the question of appeals to the umpire.
Part of clause 14 assures that benefits obtained by false pretences will not be retained by the claimant.
Unemployment Insurance

Clause 16 extends the time in which proceedings for an offence may be commenced from three months to twelve months of evidence of .the offence coming to the knowledge of the commission.
Part of clause IS permits benefit to be paid where contributions were not paid due to an erroneous decision of an officer of the commission.
Clause 20 grants authority to pay expenses which may be incurred if it becomes necessary to pledge securities held in connection with the fund.
Clause 21 makes the date of the report of the advisory committee the same date as that of the commission.
Clause 22 permits gradual extension of coverage to lumbering and logging.
Clause 23 makes the national employment service responsible to the minister and permits it to carry out additional duties not within its formal functions.
Clause 24 transfers to the act sections of the Veterans Rehabilitation Act dealing with unemployment insurance, with some enlargement relating to veterans of allied nations and certain merchant seamen. In this connection clause 32 repeals the relative sections of the Veterans Rehabilitation Act.
Part of clause 25 continues the requirements that employers report engagement of employees and that persons seeking employment notify the employment service.
Clauses 33 and 34 extend coverage to merchant seamen.
I would like to deal in some more detail with the principle of ministerial responsibility suggested in respect of the employment service.
The efficient administration of' the Unemployment Insurance Act requires an effective employment service. The problems of war made it abundantly clear that a national employment service has other important functions to fulfil. The complexity of post-war conditions, the conviction that employment must be provided for all who want to work show that the employment service has still to play a much larger part in our national economic life than that connected with unemployment insurance.
The national employment service should and must become a keystone in the carrying out of plans of the Department of Veterans Affairs, the Department of Reconstruction, the Department of Transport, the Department of Agriculture and the Departments of National Defence in their various activities for reconversion and reestablishment.
There must be the closest possible working arrangement between departments at the ministerial level, and the Minister of Labour

must have detailed knowledge and control over the employment service so that he can give his colleagues the cooperation necessary to carry the reconversion plans to a successful conclusion.
Then there are cases where special financial or other curative measures are necessary. Such cases include employment problems of youth, of older persons who are not pensionable, of persons not covered by unemployment insurance, as well as problems associated with apprenticeship, and encouragement of movements of manpower to agriculture (one of the most important responsibilities we face at this time), basic industries or domestic service. More efficient dominion-provincial arrangements to deal with these matters would be possible where the minister could issue direct instructions to the employment service.
In the administration of the employment service and unemployment insurance, Great Britain has divided authority at the top level between a ministry of labour in charge of employment, and a ministry of national insurance in charge of unemployment insurance and other social security benefits. The long experience of Great Britain in matters of this kind makes worthy of note her action in determining this to be the most desirable line of action between parliament and the administrators concerned.
In the United States, the department of labour and the social security board have each had a hand in administration of the federal employment service, which in turn are separated from the state unemployment compensation authorities. At present, there is a move on foot to vest complete control of the employment service in the department of labour.
In New Zealand, the employment service will come under a newly created ministry of employment. Their social security department, which will be responsible for unemployment compensation policy at top levels, will have no authority over the employment service. Australia is to follow New Zealand's lead with a. commonwealth employment service directly responsible to the minister of labour and national services, and free to act independently of the department of social services.
Thus the plan proposed for Canada follows the trend that experience in other parts of the world has found desirable in that it seeks to make the employment service directly responsible to the Minister of Labour, rather than to have the chain of authority directed through the unemployment insurance commission.
It should be noted that sixty per cent of the money voted by parliament for the activities carried out by the staff of the commission is spent for work not covered by the act.

Questions
If this sixty per cent is a responsibility of the minister, it is submitted that it is the duty of the minister to exercise supervision of the employment service, because it is through that service and by its staff that money voted is spent.
Unemployment insurance and the employment offices are a part of the general social security programme. They are primarily concerned with one of the most important fields of national welfare, the provision of insurance payments during periods of unemployment and the movement through the employment offices of persons in search of gainful employment.
It has facilities to deal with veterans and to meet the problems of persons requiring vocational guidance, or special attention due to physical handicap. It is already taking its proper place in the minds of both workers and emploj'ers, a place which they see is necessary in any plan to maintain a high and stable level of employment.
I imagine that most people have had contact with the employment service during the war, particularly when national selective service was in full operation.
I would suggest, Mr. Chairman, that you call it six o'clock.


Gordon Graydon: I understood it was the minister's suggestion, which I think met with general approval, that following his statement the matter might stand and the debate be resumed at a later time. It was our understanding that this suggestion had received the approval of the house, so that perhaps at this time the debate might be adjourned.


Humphrey Mitchell: I am sorry; before I
sat, down I meant to mention that the hon. member for Vancouver East, together with my hon. friend the acting leader of the opposition, suggested that the resolution might pass now and that the debate on the principle be held on the second reading of the bill.


Angus MacInnis: I do not want to be
deprived of the right to speak on this resolution if it comes up again, but under the procedure that has been developing in this house we have had no debate on the resolution, and the general debate has taken place on second reading of the bill. I think that is a good procedure to follow, since then we have the bill before us. So that if the other parties would agree to that, I see no reason why we should not have the bill introduced and given first reading to-day, in order that the measure may be advanced a stage.


Gordon Graydon: There is perhaps a
special advantage in that procedure which might be mentioned. We can then examine
the statement of the minister together with the terms of the bill, so that perhaps we ought to consent to the bill being introduced and being given first reading, in order that the debate may take place when second reading is moved another day.
Resolution reported, read the second time and concurred in. Mr. Mitchell thereupon moved for leave to introduce bill Xo. 243, to amend the Unemployment Insurance Act, 1940.


[Stage Direction]
Motion agreed to. and bill read the first time.
At six o'clock the house adjourned, without question put, pursuant to standing order.
Thursday, July 4, 1946