1946-07-29

QUESTIONS

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

Mr. BLACK (Cumberland):: 1.	Did the government arrange for the manufacture of railway cars for the Russian government with the Eastern Car company and other concerns in Canada?
2.	If so (a) what number; (b) at what price;
(c)	at what point of delivery?
3.	Have any such cars been condemned, sold or offered for sale for scrap or other purposes? If so, at what price?
4.	What loss, if any, is entailed and who pays same?


Mr. McILRAITH:: 1.	Yes; under mutual aid board arrangements.
2.	(a) 1,500 flat cars. Eastern Car company, New Glasgow, N.S.
700 flat cars. National Steel Car Corp., Hamilton, Ont.
800 flat cars. Canadian Car and Foundry Co. Ltd., Montreal, Que.
(b)	Eastern Car company. 1,500 cars including all spares and components-$4,370.29 each.
National Steel Car Corp. Ltd. 700 cars including all spares and components-$4,697.02 each.
Canadian Car and Foundry Co. Ltd. 800 cars including all spares ana components- $4,383.99 each.
The basic unit prices on all three contracts were originally established at a firm price of $4,260 per car, including standard spare parts. However, the final prices paid were slightly higher due to the fact that extra spare parts and other components were required on some of the cars as production got under way. The reason for the discrepancy in the final prices paid to the different contractors is due to the fact that some of the cars manufactured by one contractor required more extra spare parts and extra work than did other cars which were produced by the other contractors.
(c)	The above prices are all f.o.b. contractor's plants and shipments were consigned to the legation of the U.S.S.R. in Canada, Vancouver, B.C. for transhipment to the U.S.S.R. in Soviet ships.
3.	Of the 3,000 flat cars produced, 1,356 units were delivered to the Soviet Union and the balance, 1,644 units, were declared surplus to
War Assets corporation by the mutual aid board. The cars are of a type not standard in this country and although offers have been solicited for them as cars on a very wide basis by War Assets corporation, no sale has been consummated to date. Because of the acute shortage of cast iron and steel scrap and the possibility that the cars may ultimately have to be scrapped, an experimental scrapping operation was run on six cars to determine the net scrap recovery and the price which would therefore have to be obtained for the cars as cars to justify the loss of the scrap.
4.	As the whole cost of this project was being borne by the Canadian government as a part of mutual aid to the U.S.S.R. any receipts by War Assets corporation from the sale of these cars as cars or as scrap will result in a reduction of the total expenditure made by the Canadian government to assist our ally.


EXCESS PROFITS TAX-REFUNDABLE PORTION
Mr. McCULLOUGH (Assiniboia):: Wliat is the total amount of refundable portion of the excess profit tax payable to Canadian companies for the years 1941-42-4344-45?


Mr. McCANN:: Estimated
Tax	Refundable
Year	Portion
1941	 Nil
1942		 $30,000,000
1943		 65,000,000
1944		i		70,000,000
1945		 68,000,000
1946		 10,000,000


HULL IRON AND STEEL FOUNDRIES-INCOME TAX
Mr. HOMUTH:: 1.	Does the Hull Iron and Steel Foundries Limited, owe the Income Tax Department any money ?
2.	If so, how much?
3.	Is this sum for the year 1945?
4.	If not, what years is it for and what sum for each of such years?


Mr. McCANN:: 1.	Yes.
2.	Not finally determined.
3.	Only in part.
4.	For the years 1941 to 1946 inclusive.


PENSIONS TO WAR VETERANS
Mr. GRAYDON:: How many service personnel of world war II have been granted pensions?


Mr. TUCKER:: Return at June 30, 1946:
disability pension, 45,298.

Questions


REDCLIFF-RONALANE IRRIGATION PROJECT
Mr. WYLIE:: 
Mr. BERTRAND (Laurier):: 1.	No.
2.	See answer to No. 1.


EXPORTS TO CUBA-FISH AND POTATOES
Mr. HATFIELD:: 1.	What was our total export of fish, with value, to Cuba, each year from 1915 to 1945 inclusive?
2.	What was our total export of potatoes, with value, to Cuba, each year from 1915 to 1945 inclusive?


Mr. MacKINNON:: 1 and 2. Canadian exports to Cuba of fish and potatoes during each year from 1915 to 1945:-


RADIO BROADCASTING-C.B.C. CONTRACTS WITH GOVERNMENT DEPARTMENTS OR AGENCIES
Mr. FRASER:: 1.	Has the Canadian Broadcasting Corporation any contracts with any departments, or agencies, of the government?
2.	If so, what are these contracts for?
3.	How long do they run?


Mr. McCANN:: 1.	Yes. The Canadian Broadcasting Corporation has advertising contracts for the wartime prices and trade board, the Department of Agriculture food information committee, and the Department of Labour, entered into on behalf of its own stations and private stations on its networks.
2.	Contracts for wartime prices and trade
board:	"Household Counsellor"; "Ami du
Consom'mateur".
Contracts for Department of Agriculture food information committee: "This Hungry World"; "Partageons avec ceux qui ont faim"; spot announcements.
Fish	Potatoes
Year ended Mar 31-	Cwt.	Value	Bush.	Value1915 	... 72,721	$ 504,691	617,698	$ 382,1791916 	... 90,732	623.947	326,113	225,8751917 	... 122,729	1,073,355	997,581	1,226,7741918 	... 169,751	1,722,612	1,186,707	1,498,1081919 	... 169,570	2,581,561	732,478	871,7431920 	... 165,056	2,387,528	510,759	776,9641921 	... 124,628	1,459,988	578,524	871,9331922 	... 155,473	1.176,125	1,570,620	1,354,0641923 	... 105,430	832,767	1,688.207	1,170,5911924 	... 119,523	843,947	2,144,744	2.030,7591925 	... 106,014	996,157	2.716,579	2,149,5931926 	... 112,093	971,937	3,044.477	3.915,5131927 	... 132,134	973,550	1,915,817	2,855,2531928 	... 114,994	855,908	2,113,557	2,390,7561929 	... 92,714	848,661	2.380.902	1,506,5161930 	... 77,650	720,126	2,003,437	2,081,6251931 	... 66,797	521,044	1,401,343	1,230,4781932 	... 34,179	202,564	1,145,704	722,1441933 	... 17,511	86,938	480,106	329,7771934 	... 21,248	98,511	359,290	310,9811935 	... 38,280	225,250	309,896	280,5801936 	... 47,298	236.206	317,749	297,1671937 	... 46,911	225,266	399,596	487,981Year ended Dec. 31-	1937 	... 41,081	239,980	529,668	503,9381938 	... 37,854	212,739	302,032	251,5681939 	... 33,423	170,785	458,333	- 430,4461940 	... 30,645	186,360	452.770	459,8271941 	... 49,485	453,843	375,040	351,0941942 	... 22,692	301,383	260,195	281,7571943 	... 26,936	421,764	206,754	342,1651944 	... 30.311	511,557	285,175	622,0991945 	... 36,974	573,370	280,180	589,062
Questions
Contracts for Department of Labour: spot announcements.
3.	"Household Counsellor": Monday'through Friday, July 1 to October 25, 1946.
"Ami du Consommateur": Monday through Friday, July 15 to November 1, 1946.
"This Hungry World'": Thursdays, June 20 to September 12, 1946.
"Partageons avec ceux qui ont faim": Thursdays, June 20 to September 12, 1946.
Spot announcements for Department of Labour, dealing with unemployment insurance in the lumber industry: Six occasions commencing July 26.
Spot announcements for Department of Agriculture: Four occasions commencing July 18.


SALES TAX
Mr. PROBE:: 1.	On what consumer goods or services does the government levy the 8 per cent excise sales tax?
2.	What consumer goods or services are exempt from payment of the 8 per cent excise sales tax?
3.	What revenue was derived by the government for each of the goods or services enumerated in question 1 above in each of the three past fiscal years?


Mr. McCANN:: 1.	The Special War Revenue Act imposes the sales tax on all goods produced and sold for consumption or imported into Canada. Services are not subject to this tax.
2.	Those goods specifically enumerated in the exempting sections of the act, particularly schedule III.
3.	No segregation of the yield of sales tax from any commodity is made. The total revenue derived from this tax for the past three fiscal years was as follows:-
1943M4, $339,255,631; 1944-45, $401,108,503; 1945-46, 8326,252,798.


ST. MABY-MII.K RIVER IRRIGATION PROJECT
Mr. WYLIE:: 1.	What steps have been taken by the government to proceed with the construction of the irrigation project on the St. Mary-Milk river, during 1946?
2.	Have contracts been let?
3.	If so, to whom and at what figure?


Mr. BERTRAND (Laurier):: 1.	Headquarters have been established, arrangements for power have been made, acquisition of necessary lands is in progress and a contract for the irrigation and' diversion tunnels has been let.
2.	See answer to No. 1.
3.	To Bennett and White Calgary Limited; S798.916.
63260-250J


IMMIGRATION-MEDICAL INSPECTION DEPOTS IN EUROPE
Mr. THATCHER:: 1.	In what European countries does the immigration department maintain medical inspection depots at the present time?
2.	What steps have been taken by the immigration department to set up additional depots?
3.	At what points will these new medical depots be located?


Mr. GLEN:: 1.	There are no Canadian immigration medical officers located in continental European countries at the present time.
2.	The matter is under active survey and the governments concerned are being consulted.
3.	Decision cannot be made until action referred to in No. 2 above is completed.


UNITED NATIONS-EDUCATIONAL, SCIENTIFIC AND CULTURAL ORGANIZATION
Mr. KNIGHT:: What action has the government taken towards (a) the ratification of the charter for UNESCO- (b) the setting up of a national commission or committee to act as an agency of liaison between the Canadian government and the main body of UNESCO?
Mr. ST. LAURENT:
(a)	If time permits during the present session of parliament a resolution will be introduced in parliament for approval of Canadian participation in UNESCO. Following upon such approval acceptance of the constitution of UNESCO will be completed.
(b)	For some time past the government has been considering the form a UNESCO national commission might take in this country. It is not expected that such, a national commission would act as "an agency of liaison between the Canadian government and the main body of UNESCO" but rather it would assist the government in dealing with matters relating to the activities of UNESCO.


CANADIAN PACIFIC RAILWAY COMPANY-CLAIM OF DENNIS H. SAUVE
Mr. MATTHEWS (Kootenay East):: 1.	Did the crown sue the Canadian Pacific Railway company to recover damages as a result of injuries sustained in 1940 by Dennis H. Sauve, K37496, a Canadian soldier when travelling to Vancouver over the Kettle Valley line?
2.	Was this claim settled out of court?
3.	How much did the crown accept in settlement of this claim?


Mr. LAPOINTE:: 1.	Yes.
2.	Yes.
3.	$300.
Questions

violation of alternative service


REGULATIONS
Mr. COLD  WELL@: How many men are now serving prison terms for violation of alternative service regulations?


Mr. MITCHELL:: None.



QUESTIONS PASSED AS ORDERS' FOR RETURNS


Mr. PROBE:: 1.	What mileage of Trans-Canada highway is now completed and hardsurfaced (a) in Canada; (b) in each of the provinces?
2.	What mileage of the Trans-Canada highway still remains incomplete (a) in Canada; (b) in each of the provinces?
3.	What contracts for construction work on the Trans-Canada highway have been entered into by the federal government in the fiscal year 1946-47 in each of the provinces?
4.	What financial grants have been made by the dominion government for highway construction of any nature in 1944, 1945, 1946, in each province?


INDIAN RESERVATIONS
Mr. GRAYDON:: 1.	How many Indian reservations are there in Canada?
2.	Where is each located?
3.	How many Canadian Indians are (a) in reservations; (b) outside reservations?


Mr. GLEN:: Return tabled.


VETERANS LAND ACT-OXFORD COUNTY, ONTARIO
Mr. DANIEL:: 1.	How many farms have been purchased in Oxford County, Ontario, under the Veterans Hand Act?
2.	Where are these farms located, when and from whom were they purchased?
3.	What are the names of the veterans now established on these farms?



VETERANS LAND ACT-INGERSOLL, ONTARIO

Mr. DANIEL:: il. How many houses are being constructed under the Veterans Land Act at Ingersoll, Ontario, in the township of West Oxford?
2.	Who has the contract for the building of these houses?
3.	How soon will these houses be ready for occupancy?
4.	What does it cost to guard these houses while they are under construction?
5.	What is the average cost of each house?
6.	From whom was this land purchased and rhat was the price per acre paid?


Mr. MACKENZIE:: Order for return.


Walter Adam Tucker: With the exception that the figures will not be given in regard to the prices paid.



WAR ASSETS-FAIR MILES AND CORVETTES

Mr. FRASER:: 1.	What Fairmiles and corvettes have been declared surplus by the navy?
2.	What equipment was on each of these boats at the time they were declared surplus?
3.	What inventory of equipment was received by the War Assets Corporation regarding each of these boats?



WAR VETERANS-YUKON TERRITORY

Mr. BLACK (Yukon):: 1.	Are war veterans of Yukon Territory entitled to financial assistance from the government of Canada in purchasing lots in towns in Yukon and in the construction of homes thereon for their families and themselves?
2.	If so. from what department of-government, in what amounts and on what terms?



MOTIONS FOR PAPERS


[Stage Direction]
Mr. DIEFEiNBAKER:
For a copy of transcript of evidence given by Doctor David Shugar before the royal commission appointed under order in council P.C. 411, and including therein any observations or statements made by the commissioners.
Mr. ST. LAURENT: Mr. Speaker, I am sorry to have to oppose this motion. The following is from page 689 of the Report of the Taschereau-Kellock royal commission:
We respectfully recommend:
(1) That, because of the introduction into the evidence, necessarily and unavoidably of secret technical data, the publication of which, according to the witnesses most concerned, would not be in the public interest at this time, none of the evidence or exhibits relating to any top secret, secret, restricted or confidential matters be published except with the approval of the government in consultation with the heads of the services, departments or organizations concerned.
The motion of the hon. member is for all the evidence of one Doctor Shugar before the royal commission. I have not read the whole of the evidence, but I have read enough of it to find that it does refer to and discuss matters which come within the terms of that recommendation of the royal commission, and which it would be against the public interest to publish at this time. The matters which I noticed particularly were those having relation to scientific apparatus called asdic and radar.
Mr. DIEFENBAKER:: Mr. Speaker, in
view of my right hon. friend's explanation, I must necessarily accept the decision made. But there is one thing-and I speak with the consent of the house and Your Honour-that strikes me as most improper in the report of the royal commission. It is this, as it appears at page 683 of that report:
While it is sitting, and until its existence terminates, it is not subordinate to any body.

Immigration
That is a serious thing, particularly in view of the fact that this commission saw fit to publish part of the evidence condemning certain persons, unheard; and when those who are placed under suspicion ask for the opportunity to let the people of Canada know what they said, and in respect of which guilt was fixed on them, unheard, the answer is that it is not in the public interest to give the information. That is a very serious invasion of private rights in this country.


Mr. COLDWELL:: May I suggest to the minister that many of us are much disturbed about this matter. Could not a small committee of the house be set up on the understanding that any reading of the evidence would be regarded by them as confidential, so far as the safety of the country is concerned?
Mr. ST. LAURENT: I have no objection to the evidence given by Doctor Shugar being made available to a small committee, provided of course the members of that committee would say that they would not use the information they would gain from a perusal of the evidence, or that they would not themselves publish the information which they might have gained through such perusal. I understand that it will be rather difficult to draw a line. If some hon. members differed from us on the question whether the making of certain things known would endanger the safety of the state, it would be difficult to discuss such disagreement without referring to what is in the evidence. However, if the leaders wish to have a _small committee join with me to go over it, I should have no objection.


John George Diefenbaker: If I might make reference to what has been said by the hon. member for Rosetown-Biggar (Mr. Coldwell), I would not agree to a committee laying secrecy on top of secrecy.


Major James William Coldwell: What about a royal
commission?
Motion dropped.



UNEMPLOYMENT INSURANCE COMMISSION- RESIGNATION OF CHIEF COMMISSIONER

Mr. DUBOIS:: For a copy of all letters, telegrams and other documents in the possession of the department relative to the resignation of Louis J. Trottier, chief commissioner of the unemployment insurance commission.


Humphrey Mitchell: I have already tabled the documents referred to in this motion, and I suggest that it be dropped.
Motion dropped.



LABOUR CONDITIONS


[Stage Direction]
On the orders of the day:
Mr. STANLEY KNOWLES (Winnipeg North Centre):: I should like to ask a question of the Minister of Labour, of which I was unable to give him notice, but which I am sure he will be in a position to answer. Has he taken steps to implement the report of the industrial disputes inquiry commission which looked into the dispute between the Vancouver Province and the international typographical union?


Humphrey Mitchell: I believe I received the report on Friday. Steps have been taken by myself to endeavour to bring the parties together.


Stanley Howard Knowles: The minister's statement refers to the principal parties suggested in the report.


Humphrey Mitchell: Yes.



IMMIGRATION


[Stage Direction]
On the orders of the day:
Mr. G. K. FRASER (Peterborough West):: Mr. Speaker, I should like to ask a question of the Minister of Justice respecting a matter discussed last Thursday. Will the Dutch and Belgian wives and fiancees of service and exservice men be given priority over the 4,000 Polish army men to be admitted to Canada?
Right Hon. L. S. St. LAURENT (Acting Prime Minister): That is a question I cannot answer. The arrangements to bring to Canada
4,000	Polish ex-service men are being made by the United Kingdom government and the Canadian government, in cooperation. Some of the men are to be brought directly from Italy to a Canadian port. I cannot say in what way that might clash with the movement of wives or dependents of our own army personnel.


Gordon Knapman Fraser: I should like to ask the Minister of Mines and Resources if the transportation to Canada from Holland and Belgium of the wives and fiancees of exservice men has been held up because the immigration branch has not had officers over there. I understand officers are being sent from Canada to those countries. Will these wives and fiancees now be given priority?


James Allison Glen: I shall take note of the hon.
member's question and answer it to-morrow.
Atomic Energy



WAR ASSETS


[Stage Direction]
On the orders of the day:
Mr. C. E. DESMOND (Kent, Ont.):: Mr. Speaker, I should like to ask a question of the Minister of Reconstruction.. Would it be possible on priority if that can be obtained, to procure dredging equipment, if it is available, prior to its being turned over to War Assets corporation?


Right Hon. C. D. HOWE (Minister of Reconstruction):: I did not understand what kind of equipment the hon. member referred to.


Clayton Earl Desmond: Emergency dredging and drag-line equipment.


Clarence Decatur Howe: I presume that this equipment is owned by some department of government. It might be possible to borrow it to meet an emergency, but the sales of any war equipment can only be through War Assets corporation.


Clayton Earl Desmond: I have been given to understand that if there were a priority to meet an emergency it would be possible to release such equipment for use prior to its being placed in the hands of War Assets corporation.


Clarence Decatur Howe: As I have said, the present custodian of the equipment might be able to release or to lend it. But if a sale is contemplated, it must be made by War Assets corporation in due course.



INITIAL PAYMENT AND DOMESTIC PRICE

[Stage Direction]
On the orders of the day:
Mr. JOHN BRACKEN (Leader of the Opposition) :: I should like to direct a question to the Minister of Trade and Commerce. When answering a question the other day from this side of the house the minister indicated that he would be making a further statement with respect to the initial payment for wheat and possibly the domestic price for wheat. Can he now say when he will be able to make that statement.


James Angus MacKinnon: It must be made before Wednesday.


John Bracken: That means to -morrow.


James Angus MacKinnon: Yes.



ATOMIC ENERGY


[Stage Direction]
Right Hon. C. D. HOWE (Minister of Reconstruction and Supply) moved the second reading of and concurrence in amendments
made by the senate to bill No. 165. relating to the development and control of atomic energy.
Mr. GREEN:: Explain.


Mr. MacINNIS:: Has the minister a statement to make on the amendment? Is there anything that he disagrees with?


Clarence Decatur Howe: The amendments are purely in connection with language. There has been no change in the intent of the bill, and therefore I am quite prepared to move concurrence.
Motion agreed to; amendments read the second time and concurred in.



NATIONAL HOUSING ACT


[Stage Direction]
Right Hon. C. D. HOWE (Minister of Reconstruction and Supply) moved the second reading of bill No. 306, to amend the National Housing Act, 1944.
He said: Mr. Speaker, in moving the second reading of this bill, I would like to comment upon the amendments to the National Housing Act which we seek at this time. The bill itself is rather voluminous. However, the real changes are fewer than would appear.
Hon. members will recall that at the last session of parliament the Central Mortgage and Housing Corporation Act was passed. The act provides under section 18:
The Corporation shall, on behalf of His Majesty and in the place of the minister, have, exercise and perform all rights, powers, duties, liabilities and functions of the minister under the housing acts or under any contract entered into under the said acts, except the authority of the minister under the said acts to pay moneys out of the consolidated revenue fund, or under section twelve of the National Housing Act, 1944, to make grants for slum clearance.
This bill contains thirty-eight clauses, of which twenty-six clauses make no substantial change to the National Housing Act other than to give effect to this transfer of authority which I have just described. I do not think hon. members will wish me to review each one of these twenty-six clauses, particularly as they do not involve any change in principle or policy. I will, therefore, limit my remarks to

Housing Act
an explanation of the other twelve clauses of the bill, which in varying degree, affect the operations of the act.
I will deal first with clause 2 which deletes, from the definition of the cost of construction, the proviso that in the case of a loan for the construction of a house on a farm, the appraised value of the land shall be deemed to be not more than 20 per cent of the actual expenditure and other expenses and charges. This deletion is desirable to make the definition of cost of construction conform to a subsequent amendment changing the basis for loans for farm housing.
Clause 3 of the bill redefines economic rental of a family housing unit. No change in principle is involved, and the purpose of the amendment is to clarify the intent of the definition.
Similarly clause 4 clarifies the meaning of the definition of housing project. We wish to make it clear that in the case of a rental housing project, buildings other than houses necessary to a planned development may be included in the lending value.
Clause 5 of the bill introduces an amendment to the definition of a metropolitan area. "Metropolitan area" is now defined as a city together with one or more adjacent municipalities in the same province. We wish to delete the phrase "in the same province" which serves no useful purpose. The adjacency of Ottawa and Hull is the main reason for this change. This clause also redefines the "minister" as the "Minister of Reconstruction and Supply" instead of the "Minister of Finance". When speaking on the resolution I outlined the administrative changes which had taken place.
The change contemplated by clause 7, besides replacing "minister" by "corporation" is rearrangement of order and involves no change in principle. This clause was previously contained in the section dealing particularly with farm housing, whereas the travelling expenses allowed to lending institutions are equally applicable to other joint loans. We feel that it would be more logical and would avoid confusion if this section formed a part of section 3 of the Act.
Clause 8 provides for the heading of part I, "Housing for home owners" to follow rather than to precede section 3, because section 3 has application not only to loans for home owners, but also to housing for rental purposes and farm housing.
Clause 9 widens the scope of the operations of the National Housing Act in that the corporation will be given authority to make loans on houses where the owner has a leasehold interest in the land. At present it is not
possible to make a National Housing Act loan in our national park areas. The Department of Mines and Resources quite properly is unwilling to sell land to a prospective home owner in our national parks. However, they are willing to grant a lease for a satisfactory term. I think hon. members will agree that it is desirable for the terms of the National Housing Act to be available in such areas as Banff and Jasper. It is not the intention to use this authority, if granted, to promote National Housing Act loans on leasehold land in urban areas. In most cases the crown in right of Canada or in right of the provinces will be the owner of the land. Consideration has been given to qualifying for National Housing Act loans only leasehold land owned by the dominion or the provinces. It may well prove to be the case that it will be desirable to finance housing on leasehold land owned by individuals who are willing to arrange leases of sufficient term and under conditions which adequately safeguard the interests of His Majesty as mortgagee.
Clause 10 defines the type of security to be taken with leasehold property. It is complementary to Clause 9.
Clause 10 also provides for loans to home owners for a period of twenty-five years instead of twenty years as at present. It also provides that in areas adequately planned the loan may be made for a term of thirty years. When speaking to the resolution I dealt rather fully with the reasons for this change. I would like to repeat that the increased costs of construction have resulted in larger loans. The veteran is faced with heavier monthly repayments on the larger loan. We feel that under the present system of lending, there is no great risk incurred by increasing the term of amortization to twenty-five years. Monthly payments of principal, interest and one-twefth of the annual taxes afford a large measure of protection. It is interesting to note that under the National Housing Act in the United States, the most usual term of loan is twenty-five years. It is to be remembered that the period of risk is not the period of amortization. For instance, in the case of a twenty year loan, 50 per cent has been repaid in twelve years. In the case of a twenty-five year loan, 50 per cent of the loan has been repaid in sixteen years. Generally I believe that when about onedialf of the original loan has been repaid, the mortgage is well out of the risk area, not only because of reduced amount owing, but also because of the long record of payment by the borrower. We intend to apply the extra five years of amortization particularly to types of housing which we wish to encourage. For example, we feel that the extremely small four
Housing Act
[Stage Direction]
room bungalows of some seven hundred square feet are not the type of construction which should be encouraged by a loan with longer amortization. We would prefer for the same home owner to arrange a larger mortgage with the longer amortization on a one and a half storey six room house even if the upper two rooms are not finshed until a later date. Extra financing of 13-9 per cent can be made available with longer amortization without increasing the monthly payments of principal and interest. It would be our intention to apply the twenty-five year amortization basis only to the mere desirable classes of property which we wish to encourage.
Clause 13 introduces a new section-section 4A-to give authority to the corporation to enter into agreements to safeguard the interests of His Majesty in loans on leasehold land.
Hon. members will recall that in the War Measures Act provision was made by order in council for housing under the integrated plan. In my remarks upon the resolution I reviewed operations under this plan and indicated its terms and conditions. We feel that the integrated plan, which this year will produce some two or three thousand units, lends promise of even greater development next year. We feel that the plan is admirably suited for the best interests of the owner, builder and the government. It is affording control upon the sale price of new houses; it is assuring that materials are channeled into veterans' housing. Clause 13 also gives authority to the corporation to continue with this plan after the order in council is repealed. It will also be noted that provision is made for the appropriations already voted for loans and losses under part I to be used to finance loans under the integrated plan.
Under clause 14 a change is made to section 6 (1) of the National Housing Act. Hon. members will notice this subsection gives authority to determine the amount of the loss in respect of a loan under part I. It is quite evident that the intention of this subsection was to give authority for determining losses under all parts of the act. The amendment which I propose gives effect to this intention.
This clause also introduces two new subsections, 6(3) and 6(4). Subsection 3 is necessary to carry out the powers given in respect of the integrated housing plan when it becomes necessary to purchase a house which, under the integrated agreement, the builder may require the corporation to buy. Subsection 4 provides for the funds to make these purchases out of the appropriation provided by section 7 of part I.

It will be noted that clause 14 rearranges the manner in which regulations are made for the administrative functions of parts I and III of the act. No very great change in principle is involved, but now that the corporation is taking over the main administrative duties in operating the act, it is felt that the revision proposed will be more practical. The governor in council will continue to make regulations on these administrative matters where necessary, but it will be noticed that the new section 5(2) of the act provides that the corporation may prescribe procedural matters in connection with an application for a loan, the calculation of the cost of construction, standards, and whether it is desirable to take additional security.
Clause 15 substitutes the corporation for the minister, but makes no change in the length of amortization for rental housing comparable to the lengthening of the amortization period we seek for home owners. Section 8(2) of the National Housing Act provides for a term of loan for rental housing not in excess of twenty years. Where the project is protected by community planning and appropriate zoning, the loan may be for a period not in excess of twenty-five years. Although we would like to see an increased amount of rental housing, we do not believe that lengthening the amortization period will have that effect. We believe that it is not advisable to make any change in this section at this time.
Clause 15 introduces additional lending facilities under new section 9A of the National Housing Act which I reviewed when speaking to the resolution. We are in very short supply of housing in outlying areas. This is particularly true in mining and lumbering communities. From all points of view it would be desirable for on-site operations of lumbering and mining companies to employ a larger number of men, and particularly married men. The day of the bunk house is over, even for single men. Mining and lumbering companies are having difficulties in inducing married men to enter their employ because of the impossibility of bringing their families with them. We feel that every encouragement should be given to the development of family housing units in outlying areas, particularly adjacent to on-site operations of the lumbering and mining companies. The type of housing will vary according to location. It will range all the way from temporary housing units on skids to fully modern permanent houses. The development of such programme is hampered bj^ the lack of materials. It is also restricted by lack of financing facilities. Loans on this type of security are almost a blind spot in our credit

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structure. In many cases they are so remote or are located in such unmortgagable property that the mortgage lending institutions cannot provide financing. The capital investment for a substantial number of units places too great a strain upon the working capital position of the lumbering or mining company. Bank loans, besides being a demand obligation and current liability of the lumbering and mining company, are generally made with terms of repayment which provide too short a period to be appropriate for housing units, particularly when the company is depending upon the rentals from such housing units to provide the cash to liquidate the loan. The proposed amendment outlines in detail the type of loan which we propose. The main features are:
1.	The loans are made to, or are guaranteed by, the lumbering or mining company.
2.	The term of amortization may be as long as fifteen years.
3.	The rate of interest is 4 per cent.
4.	The company cannot earn on its investment in the housing project more thian the 4 per cent interest rate. Any current surplus must be used for a rent reduction fund. Should an equity exist after the loan is repaid, and the company has recovered its investment with not more than the 4 per cent interest, the value of the residue shall be used for charitable purposes or community benefits.
5.	Minimum standards for this type of housing will be very flexible because the type of housing, the locality', and the needs will vary greatly.
6.	The maximum loan will be 80 per cent of the lending value, although in many cases I think that the loans will be considerably less than 80 per cent.
7.	Provision is made for the sale of such houses by the company to home owners. In such cases the company will remain on the covenant of the mortgage even for that portion which has been sold to a home owner. Provision will be made that if the home owner's account is current, default in the blanket mortgage will not prejudice his position.
S.	The corporation, before recommending a loan for approval by the governor in council, will satisfy itself through inquiry to other government departments that the area in which the housing is to be erected has a productive period sufficient to justify the loan, and that the proposed housing is necessary in the area, and generally will result in additional employment.
I feel that this proposal will be a very valuable addition to the lending facilities under the National Housing Act. Many lumbering 63260-251
and mining companies are interested in housing and willing to do something about it. In most cases that have been brought to our attention, the obstacle has been a lack of suitable financing even more than the lack of materials. I would hope that it might be possible for prefabricated housing to be used for this purpose, particularly in areas where on-site skilled building labour is very scarce. In my opinion, the proposed amendment is the most efficient, cheapest and expeditious manner of meeting a very real need.
Clause 15 puts in statutory form the home conversion plan as new section 9B. There is only a modest amount in the estimates for additional development of the home conversion plan because it is not likely that many projects will be undertaken during this fiscal year. Materials are in short supply, costs are high, the number of houses suitable for conversion under the plan are few, and even those houses which are suitable cannot, in most cases, be vacated to allow the conversion to take place. As I mentioned in my remarks on the resolution, there are two hundred and sixty properties which have been converted, creating some twenty-one hundred units. It is our intention to repeal the orders in council under which this plan was authorized. We seek this new section of the National Housing Act because the corporation must continue to hold, operate and manage existing properties. Moreover, we would like to be in a position to convert any buildings suitable for the purpose, few in number though they may be.
Clause 15 also reenacts section 10 of the act, which gives the governor in council power to make regulations for rental housing. The changes proposed for new section 10 of the National Housing Act are similar to those that I described earlier for new section 5 of the National Housing Act which provides for the same type of regulation for housing for home owners.
Clause 17 of the bill proposes a modification to the authority already granted to the insurance companies to make direct investments in low or moderate rental property. It will be remembered that such investments when approved by the corporation, are subject to a guarantee by the government ensuring a 2£ per cent return to the insurance company. The insurance companies may invest up to 5 per cent of their Canadian assets under section 11.
Some of the insurance companies are showing great interest in this form of investment and would like to develop in Canada projects similar to those of the Metropolitan Life in the United States such as the Parkchester multiple unit development in New York and the
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horizontal developments in other communities. In light of our very great need for housing of this type, I am sure that the house will commend our efforts to stimulate the interest of the insurance companies -in this field of endeavour.
We believe that section 11 is satisfactory in its present form, except for one factor. The first step towards the development of projects either individually or on a national basis is the acquisition of land suitable for the purpose. Experience both in Canada and the United States has shown that this must be done some time before the project can be determined in final form. In order to secure land at a reasonable price, some degree of secrecy must be maintained. In some cases this can be achieved by securing options, in other cases, the land must be purchased. It would be most inadvisable to secure firm bids for construction from a number of contractors while the acquisition of the site was still under negotiation. Some companies are anxious to plan on a national basis, and for various reasons do not wish to proceed with all projects simultaneously. Opportunities to secure very desirable sites arise from time to time and it would be desirable for the companies to be in a position to acquire land which would be developed over the next two or three years.
The legislation in its present form makes such investment legal for life companies-* including the purchase of the land or an option -only when the corporation has approved the project in all detail including the cost of land, the cost of construction, design, lay-out, rental levels, etc. The existing section contemplates simultaneous acquisition of land and approval of the project including the cost of construction. This is not only impracticable but also increases the cost of the project and makes an orderly two or three year programme virtually impossible. Even if the land is acquired and the project approved in the same year, and listing the land as an asset in the annual statement of the company is not involved. No authority exists. There is provision in the insurance laws of the state of New York to allow an orderly approach to the problem.
Therefore, with the concurrence of my colleague, the Minister of Finance, I propose this amendment making it possible with suitable safeguards such as prior approval by the corporation, for life companies to acquire or option land suitable for such purpose. The corporation will, at the time approval is given, ensure that:

(a)	The land is suitable and that the corporation will be willing to approve the project on the land at a later date.
(b)	Only land within the over-all plans of the life company for projects will be approved for purchase.
(c>
The amount of land so purchased will not be greater than can be developed within the limitation of 5 per cent of Canadian assets of the company. Roughly, the maximum purchases allowed will be one half of one per cent of the company's Canadian assets.
(d)	The project will proceed within a reasonable period of time and there are no speculative influences in the purchase.
Inside land and even serviced land in residential fringe areas is not plentiful. We must ensure that too much of such land is not acquired for development by life companies in the distant future to the detriment and disadvantage of others who wish to erect residential property on the land in the near future.
Under this section, the guarantee to the life companies only becomes effective after the project has been approved by the corporation and construction commences. Land held for a future project is not revenue producing and it would be inappropriate for any guarantee of interest return to be applicable. We propose, that when determining the cost of construction at the time the project is approved, to include the cost of land previously acquired and to allow, as an addition to such cost, the taxes paid less any net revenue from the use of the land. We will not consider as part of the cost of construction interest on the cost of the land from the date of acquisition to the time the project is started.
Clause 19 repeals section 14 of the act and substitutes a new section providing for financing new farm housing. The existing provisions have not worked well. Except where a lending institution, willing to make the loan on the new house, is the existing mortgagee, no provision is made for refinancing an existing encumbrance. Even under such circumstances and in all other cases, the section contemplates farm land as one part, and the farm home another part of the farm. Financing has been difficult under such provisions and no loans have been made.
The amendment now proposed authorizes loans up to $5,000, the cost of the farm house or two-thirds of the appraised value of the farm, whichever is the least. If the farm is mortgaged, refinancing can take place so that the loan may be $8,000, the cost of the house and amount to repay the existing mortgage, or two-thirds of the appraised value of the

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farm whichever is the least. The interest is 44 per cent and the term of the loan twenty years.
The method of appraisal has been revised and is comparable to the method used in regular farm lending. It will be noted that where sufficient equity in the farm land exists, the equity in the new farm home can be financed by that means.
Revision of minimum standards and specifications will take place. Suitable flexible requirements will be devised to ensure that sound standards of construction will be reconciled with varying local conditions and requirements.
We will try to convince the lending institutions to enter into an agreement with the corporation to make loans under this section. We wish to avoid blind spots in coverage such as we have had in the past. Although the mortgage companies are not wildly enthusiastic about farm loans at the moment, I believe they, like ourselves, are anxious to see that the facilities of the act are available to all Canadians. Their cooperation under the recent arrangement to make non-farm National Housing Act loans in the smaller outlying communities is evidence of this desire.
Hon. members will immediately recognize that this change puts the corporation into the farm loan business. This is deliberate because a farm home is an inseparable part of the farm. If we mean business in promoting and financing new farm housing the loans cannot follow an urban pattern. We prefer the principle of joint "loans with a lending institution in the pattern of the National Housing Act rather than direct loans in the manner of the Canadian farm loan board. I therefore propose the amendment on that basis and expect that it will be effective. Should I be wrong, other techniques will be found because, although we like the proposed joint loan approach, the important end result is success in making these facilities available to farmers throughout the country.
I propose that this section come into force upon proclamation. Agreements with lending institutions must be worked out. Forms of joint mortgages for each province must be determined and in this respect we intend to break some new ground especially in the case of grain-growing farms. The old form of mortgage, together with a crop share lease, was not good enough even twenty years ago. We have no intention of imposing default on all housing act borrowers within an area just because there happens to be a general crop failure in that area. We will want full rights of col-63260- 251i
lection from borrowers able to pay and will insist upon an adequate escape clause to postpone amounts owing by the borrower when, due to conditions beyond his control, he is unable to pay. Towards this end we will be consulting with the provinces so that their legislation, protective and otherwise, will fit National Housing Act farm mortgage deeds. This will take time and. it is not likely that this section can be proclaimed for two or three months.
There are in this house a number of hon. members very familiar with the need for farm housing and who have had experience in the farm mortgage field. When we come to discuss the bill, section by section, I will welcome their comments. I think that this section is based on sound principles and will prove effective. Nevertheless, I am ready to accept suggestions for its improvement. It is an important section in light of the need of new and improved housing in the farm field, in the years to come.
This, Mr. Speaker, has been a rather lengthy review of the major changes which we propose in the National Housing Act. I have attempted to touch upon each change of major import and principle. As we go through the bill clause by clause, hon. members will have the opportunity of asking questions about changes which I have not specifically mentioned today.
There is one change which might have been included in my remarks. The act in its present form gives authority for loans for a maximum number of years. Take for example, a loan under part I for twenty years with the first of the progress payments being made on January 1,	1946. Mortgage practice and
convenience results in mortgage deed being drawn in a form that the borrower makes the first of his two hundred and forty monthly payments on, say, May 1, being a month or two after the completion of the house. Technically it might be argued that authority under the act only allows a loan to run until January 1, 1S66. Changes are included in the present amendments to allow the period of the loan to run from the date of the completion of the house rather than from the date of the first advance.
I would like to call hon. members' attention to the fact that although "corporation" has been substituted for "minister" throughout the act, no change has been made in the sections dealing with appropriations. We propose to rely on relevant clauses in the Central Mortgage and Housing Corporation Act which authorize the minister to advance moneys from the appropriations to the corporation for the purposes of the act.
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Mr. C. C. I. MERRITT (Vancouver-Burrard):: Mr. Speaker, the bill and the important statement which the minister made on the resolution stage are a new departure in the handling of the housing shortage in this country. They indicate to me something which I am sure everyone in the house and in the country will be very glad to hear-that the government has at last come to grips with the number one problem in the country, the housing of our people, and particularly of the returned men who obviously are bearing the brunt of the housing shortage. But at the same time, and while we welcome this evidence that the government has come to grips with the problem, surely that statement and this bill emphasize the previous lack of government policy in connection with this great problem. Surely the measures proposed by the minister and the things he has done in the last few months are proof of the government's failure to face a situation which has now prevailed in acute form for a year. And surely it shows that their attitude has been a passive waiting for improvement rather than an active attempt to deal with the matter.
The chief criticism that one can make of the statement and of the bill is that very simple one, and I submit, Mr. Speaker, it is a telling one too-that the bill is exactly a year late. This bill, and the appointment of the expediter of building materials and the concentration of housing activities under one minister, should have been brought into force at the last session of the last parliament, just before the end of the war, when victory was in sight. The need was apparent then, and plans should have been laid then. Had that been done, we would not have had the minister's statement the other day that the worst is yet to come, and his estimate that in the spring of 1947 the situation will be twenty per cent worse than it is now. I suggest that the "grin and bear it" stuff that the minister has given to the house would have been acceptable last year. The Canadian people would have realized the difficulties and, with such proposals as the minister is making now, and knowing that something was being done about it, they would have been willing last year to face a worsening of the situation in the spring of 1946 and to "grin and bear it." But this year the Canadian people will not find such a statement in any way acceptable. They will, I believe, look upon it as a confession of failure on the part of the government.
Having made that criticism, I want to refer to some of the good parts of this proposal, not only the bill but the executive measures which the minister has taken. There are,
IMr. Howe.]
apart from some very proper developments, and, I might say, modernization of the procedure under the National Housing Act, five most important new departures which the minister has taken.
First of all, housing has been centralized under one minister, where it should always have been.
Second, we have a full-time executive charged apparently with the development of over-all policy; and it is my understanding that that wholetime executive is a very able man indeed.
Third, we have what we obviously needed for many months-for a whole year-and that is an expediter of building materials. This, I understand, is to be one of the functions of the coordinator of housing. In addition we have the committee that the minister has mentioned, set up to deal with the building material problem. He tells us that progress has been made, and we are very glad indeed to hear it.
Fourth, and very important, the National Housing Act has been redesigned to meet Canada's particular needs. I think it is right to say that prior to the amendment proposed by the minister with regard to loans for farms and for the housing of the people engaged in mining and logging-three of our great primary industries-the National Housing Act was a mere copy of the procedure in the United States and in Great Britain, and had not been orientated to suit the particular Canadian need. This has now been done, and it is a very welcome advance.
Fifth, in the minister's statement with regard to the increase of the lending value under the National Housing Act, and also in the extension of the amortization period under the act, we have further evidence of improvement which will be very much welcomed.
All these particular matters can be dealt with when we come to the sections of the bill, when no doubt many hon. members will have improvements to suggest even beyond what the minister has proposed. But the point I want to make now with respect to these five important new departures in housing practice is this. All five new departures are simple; all five are practical; all five are obvious, and all five were urged from this side of the house during the last session of parliament and no doubt before that. The members of the opposition cannot take any particular credit for suggesting such obvious advances; but what we can take credit for, and what heightens my previous statement about the delay of the government in dealing with the housing problem, is that we did recognize that all these steps should have been taken immedi-

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ately, and not a year after the close of hostilities. We urged that these steps should be taken at once, but that was not done.
The minister has made some great improvements, but of course there will be very much more to do after the present emergency has somewhat settled down. I can suggest to him three rather important things he will have to do in his capacity as the minister responsible for the housing policy of the country. First of all, we will require a real low rent housing policy. Such a term is used in the act now; we talk of moderate rent housing and low rent housing, but what we have now is not low rent housing in the sense that it caters to families in the bottom third of the income brackets.
In the second place a great programme of slum clearance will have to be developed over the years. In connection with these two subjects particularly there is real need for a settlement and a definition of the relative responsibilities of the dominion, the provinces and the municipalities with respect to housing. I urge upon the minister that he lose no time in holding conversations with the provincial governments and representatives of the municipalities so that a plan may be agreed upon for a division of responsibility which will suit all those bodies and which will give us a housing policy with as little red tape and friction as possible.
The fourth point I want to suggest to him, and this is the immediate matter I wish to bring to his attention, is that there should be at once an upward revision of the targets he has set for the construction of houses in Canada and for the provision of building materials. What has the minister said with regard to the targets for the construction of homes? He has given the immediate over-all need as 150.000. That, of course, is the emergency need. According to the James report on housing, the actual need over the next ten years, as hon. members will recall, is some 730,000 houses. Then the minister said that in the spring of 1947, despite all efforts being made by the industry this year, the situation will have deteriorated so there will be an immediate need, an emergency need, for 180,000 houses; and he gives as the five-year goal the construction of 480,000 houses. His estimate for the fiscal year 1946-47 is 60,000 new houses constructed, of which I understood him to say about 15,000 will be provided by direct government agencies and the remaining 45,000 by private builders. I want to call the attention of hon. members to the fact that if. as the minister has projected, we have 60,000 houses this year, 80,000 next year and 100,000 for the following three years
we shall still fall short of the target he mentioned in relation to that five-year period, namely 480,000 houses. So it is obvious that if we are to meet this need with anything like the speed and efficiency the Canadian people would desire, the minister will have to shoot at a higher target in the production of houses, starting this year. It might be said that the minister is being properly conservative, that he is going to do this but he does not want to disappoint the people by aiming too high. If that is so I am entirely in agreement, but I would point out to him also that not only may his estimate of the numbers which will be constructed be conservative, but in my opinion at least his estimate of the number that will be needed is also conservative. So I say to the minister, let him give the number as 60,000, but let him work for a very much larger number.
The other matter upon which I suggest he should raise his sights is in connection with the material shortage, which of course is the paramount factor in housing to-day. The other day the minister gave a picture which to my mind was designed to show how the situation was improving and how the government was contributing to that improvement. There; is no question that the government's measures, taken on April 29, have begun to bear fruit, now, and certainly we wish them well; but surely it would be wrong to suggest that the improvement in the first half of this year resulted from government action taken at the end of April. I think I can show it to be the fact that these great percentage increases in production have resulted from the natural recovery of business after the end of the war, from a very low total production during the war years when, as the minister has said, the material, the men and the effort were being put to other uses. Just to give that comment some point I want to refer to some of the figures mentioned by the minister. At page 3675 of Hansard he said:
The supply of cement and cement products is moving steadily forward. Production volume is the highest since 1931. ... By May, 1946, the monthly production had again increased so as to raise the per annum volume to a figure somewhat over 10,000,000 barrels.
That sounds very good, and it is very good; but I want to call the attention of the house to the fact that according to the figures of the dominion bureau of statistics, in 1929, Canada's production of cement was twelve and a quarter million barrels, so we have yet some distance to go to catch up to our production in a good year-but seventeen years ago.
Again the minister spoke about great percentage increases in the manufacture of brick. According to the figures of the dominion bur-
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eau of statistics I find that the present average monthly brick production is almost identical with that of 1945; that there has been no actual increase in the average monthly production as between 1945 and 1946. I find, too, that Canada's production of brick in 1945, and the way it is running now, is less than half the brick production in 1929.
The minister referred to the increase in the supply of wire nails, There again I find the production is no better than 1943, which appears to have been one of our highest years.
The minister referred to an improvement in the production of structural tile. In 1929 we produced 221,300 tons of this product, while in 1945 we produced only 94,244. In 1929 we produced 307,400 square feet of floor tile, while in 1945 the production was only 197,164. In 1929 we produced, in thousands, 35,077 roofing tile, whereas in 1945 none was produced. For the first five months of 1946 the figures for structural and floor tile, which are lumped together in tons by the bureau of statistics, show a production running at the rate of
120,000	tons a year, or well under half of the production in 1929.
I mention these figures not by way of criticism of the minister, but in an effort to place in true iperspective the statement he made the other day, and to urge him-if he requires any urging-to go after this problem in a bigger way, a way of which he is capable, and not to be satisfied with the progress he indicated in his speech.
I turn now to the problem of increasing supply of building materials. At page 3674 of Hansard the minister said:
Extra cosits may be involved in obtaining increased output and, if so, the government is prepared to consider meeting these costs. Where plant expansion is necessary to eliminate materials bottlenecks, the method used to stimulate expansion of war plants will be made available.
I would make two comments on that statement, the first that again it is a year late, and the second that it is in the identical words, I believe, and certainly in the same sense, as the speech made by the minister in April to the Canadian club in Toronto. The house will notice that the earlier statement and the more recent one are both couched in the future tense, and do not indicate that any great progress has been made in dealing with extra costs, or with other problems which have been, troubling the building materials industry.
The minister insisted the other day that price ceilings are not hampering production of building materials in Canada. At that time I attempted to indicate, offhand and from memory-I had no material in front of me- one way in which the production of one type

of building material, namely lath, was being hampered by the price ceiling. Since that time I have received a report of a committee set up to deal with lumber prices and distribution in secondary industry and retail yards in Vancouver, This report is dated July 12, and a copy was sent to the minister. The whole report deals with the effect of price ceilings on the production of various articles which these lumber yards and secondary woodworking industries manufacture in Vancouver. If the minister will consult his copy, I believe he will find an answer to the problem he put to me.
One of the specific articles entering into the construction of houses, which is mentioned in the report, and the production of which is allegedly being held back by the illogical price ceilings in force with respect to these products, is fir flooring. It is stated that the retail price ceiling of flooring, when manufactured is less than the price ceiling on the flitches from which it is manufactured. Doors are almost unobtainable, and the reason given is the price ceiling. A similar condition exists with respect to lath, to which I referred the other day.
I do not wish to read in detail from the report, but in the section dealing with milit-work operations they say:
The millwork factories, generally speaking, state that they are unable to make long-distance plans unless the prices board will state its policy in regard to increases in prices of material and labour.
And again:
In regard to doors, the prices at present authorized result in very few doors being made.
In the summary of the report one finds certain rather significant statements, in these words:
The two most troublesome matters with which industry has to deal are the diota of the prices board:
(a)	That industry must absorb increased labour costs without price relief unless financial distress is shown.
(b)	That price increases cannot be granted on single items or groups of items if over-tall profit is satisfactory.
In addition, the members of the committee find a distressing lack of knowledge as to what the policies of the prices board are; which prevents long distance planning and reduces business almost to a day to day venture.
And again:
No firm faced with rising costs is willing to institute any long distance manufacturing plan based on past results. Manufacturers can only concern themselves with the conditions here present, and they state that unless the prices board can be more realistic they are unable to swing into full production.
Concerning the suggestion that firms must manufacture loss items if the all-over profit

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position is satisfactory, the plain facts are that only in a few cases are these loss items continued in production.
That will give some indication of the views of this body, at least, as to the effect of price ceilings on the production, of goods needed in house building. I would ask the minister when we reach the committee stage to indicate in greater detail what he is going to do to help the industry produce more building material. If the minister is right, and if price ceilings are not hampering maximum production, then what does he mean by the promise that the government will meet extra costs involved? Does that mean an increase in the price ceiling? Does it mean subsidies? What does it mean?
To my mind we must remember that we in Canada have faith in a free enterprise economy. Surely with the shortage of materials and houses the minister has shown, there should be the greatest possible challenge to private enterprise, to free enterprise. Under normal circumstances private enterprise should have no difficulty in meeting that challenge and getting after production without any great help from the government. In my view private enterprise in most respects is capable of doing this job and standing on its own feet. When the minister speaks of assisting with extra costs, I should like to know whether he means subsidies or price increases. The policy with regard to price controls on imported goods has recently been changed. I am wondering if before that policy was changed there was a lessening of importations into Canada of such items as glass and electrical equipment required in the building of houses, which are two items that we must necessarily import. One other difficulty which faces private enterprise in its efforts to meet this problem may be the necessity of obtaining quotas from the minister before they can go into production. Then again sometimes they cannot get the machinery necessary to set themselves up in business.
The minister has properly lamented over the strikes and work stoppages that have occurred. Is this not a problem for government labour policy? Should there not be a policy that would prevent these strikes and that would satisfy the various partners in industry? The government cannot just say that the strikes have occurred, and then wash its hands of responsibility for their effect upon the production of building material.
The minister spoke of assistance to building material producers by Way of double depreciation. Does that mean that the taxation policy of this government is going to hamper production? The minister spoke also
of a labour shortage. I will go all the way with him when he talks about the lack of skilled tradesmen and the necessity of our developing a skilled working force in the country, but what about the people who are already trained and working? Is the taxation policy of this government such that those people are willing to work and produce to the maximum of their capabilities, or is that taxation policy hampering production?
One does not hear a great deal about extra shifts, certainly not in the part of the country from which I come. I am told that the reason why there are no extra shifts being worked in the mills is a lack of logs. What can be done now that the lumber strike has been settled to get more and more men into the woods so that we can have extra shifts and increase the supply of lumber for the home market?
I should not criticize the government like this without admitting wholeheartedly that there is one factor for which the government cannot be held responsible. I refer to the shortage of materials and work stoppages in connection with the production of materials that are imported from outside Canada. I realize the serious effect that this has had upon the minister's efforts to increase production.
However, I contend that the solution of this whole problem is the government's ultimate responsibility. The reason it is not being solved faster is that which was given so regretfully by the Minister of Finance in his budget speech. After referring to the size of our national income and the amount of money we were making, he expressed regret that he did not see in the country that cooperation toward a single end which would make all things possible for us in Canada. If we' could get that happy cooperation toward a single end, many of the minister's problems with regard to the production of materials and houses would be solved. It is the responsibility of this government to see that policies are put into effect which will obtain that cooperation. After all, that is the ultimate purpose of any government.
The last thing I should like to refer to is the increase in the lending value, which the minister has said will be ten per cent. This will bring the lending value up from 135 per cent to 145 or 150 per cent of 1939 prices. The minister went on at some length to explain why no other increase was possible. If, as he says, the figure of 150 per cent closely represents the additional cost of home building from 1939 to 1946, I should have no great complaint to make. But I have some figures here which I obtained from a Vancouver
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paper and which suggest to me that the percentage of increase over 1939 costs is much greater. If I am right, then the ten per cent increase will not do any good.
My figures deal with a house 1,000 square feet in size, built on a lot costing 1500. With the lot at $500 and a 1,000 square foot house, the National Housing Act figure of $4.20 per square foot would give a total lending value of $4,700. The loan which would be granted under the act would be $4,100. The cost of construction is taken at $6 per square foot, which would make this house of 1,000 square feet cost $6,500. The owner would have to contribute $2,300 out of the total cost of $6,500, which means that he would be contributing about thirty-three per cent as a down payment. That makes it most difficult for many people to build houses.
The minister has announced a ten per cent increase. Using the same house as an illustration, and taking a similar lot costing $500, we find that the lending value on the basis of $4.62 a square foot amounts to $5,120. The loan which would be granted would be $4,384. The cost is still $6,500, and the amount the individual must put up in order to build the house is $2,116. The total saving to the person who wishes to put up a house is $184, or let us say $200 out of a total investment or a total down payment of $2,300. I suggest to the minister that that is not adequate relief. If my figures of $6 per square foot for the actual cost and the figures given by the National Housing Act authorities of $4.20 and $4.62 are accurate, they would suggest a need of further revision. I suggest to the minister that he try to raise the lending value to something more closely approximating the total cost.


Mr. JAMES SINCLAIR (Vancouver North):: Mr. Speaker, I should like to make a few general remarks on the housing act and the housing policy, especially as they affect British Columbia. I have no apologies to make for speaking from the provincial point of view, because this policy is of special importance in British Columbia-not just because the difficulties of our housing problem in Vancouver are much more aggravated than in any other part of Canada, but because lumber is the basis of housing, and lumber is the real basis of our industrial economy in British Columbia.
Vancouver has long been the timber capital of Canada; indeed, it is one of the great timber centres of the world. The people in the Vancouver area have always' been used to having cheap lumber in plentiful supply. So to-day when lumber is in short supply, at

least to the private builder and to the vetqran in the Vancouver area, you can understand why the irritation over the present housing policy is perhaps greater there than it is anywhere else in Canada. When I was at home at Easter, which is one of the few chances a western member gets to visit his constituents during the session, I visited the operators of the saw mills in my riding, which includes the greatest number of saw mills in any riding in Canada. I also visited what was left of the retail lumber yards in the Vancouver area, and also a number of building contractors, and discussed this problem with them. I found, to my surprise, that there is no lumber shortage in Canada to-day. The shortage is not in the production of lumber. It is the improper and inadequate distribution of the lumber that is being cut that is causing the trouble. I want to give a few brief figures to illustrate this point. This year we expect the greatest cut in Canada's history, roughly five billion feet of timber.


Mr. HACKETT:: At some time in his speech would the hon. member be good enough to indicate what underlies this faulty distribution?


James Sinclair: I am coming right at that now so far as the Vancouver area is concerned.


John Thomas Hackett: There is no lumber in the east.


James Sinclair: 
Charles Cecil Ingersoll Merritt: 
James Sinclair: I am talking about cheapest grades at the mills. Those are similar increases in the higher grades.


Charles Cecil Ingersoll Merritt: I am simply pointing out that the situation is worse.


James Sinclair: Yes, and when, these big saw mills go into the retail trade they have not the facilities that the small yard has. The price of labour in the British Columbia lumber industry is the highest in Canada. The big contractor who is building a factory or a baseball stadium wants hundreds of thousands of feet of lumber, with say fifty thousand feet of two by fours. In the lumber yards lumber is stocked in sling loads, 2.000 feet in, a stack, which can be lifted on a truck as a unit. It is no bother for the saw mill to sell to such a buyer, who simply lifts the stack on to his truck. However when the veteran goes to the mill with a requisition for 10,000 or 12,000 feet, four pages of typewritten requisitions for different types of lumber, so much flooring, so much sheeting, so much joists, wall board, shingles, and all the rest, the saw mill has not sufficient labour to go running around the yards to sort out fifty feet here, a hundred feet there, five hundred feet there, and so on, to fill the veteran's order. So it is the big contractor who is getting the bulk of the lumber produced in the Vancouver area to-day, simply because the saw mills are trying to cut their losses. He is engaged perhaps on a big-time housing project but also in building moving picture theatres, baseball stands, barbecues and all the rest.
The saw mills which were in business before the war are still selling their quotas to the retail outlets, but there has been a great change in the ownership of the saw mills. Buyers from the east have come in, even brewers, who saw that the lumber trade was going to be profitable in, time of war. The result is that many of the mills have changed hands and then have broken off the relations the mill had with the retail outlets, and as the hon. .member for Vancouver South, has said, many of the retail lumber yards are closed as a consequence. They are trying to stay in business by selling anything which comes to them-cement which they cannot get, nails which they cann-ot get, paint, tiles, and so
39S4
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on but they have not got lumber. Because of that the small builder and the veteran who are seeking small orders of lumber are having a very difficult job to get it.
One other thing I must say in support of the pre-war saw mill operators. 'Last year a movement was started by Mr. King of the King Mills to make building supplies available for veterans, entirely aside from any government priorities. Through his efforts, a movement was started amongst the mills which provided lumber for 1,200 veterans' houses last year in the Vancouver area. The great weakness, therefore, as I pointed out, as far as British Columbia is concerned, is in distribution, the fact that because of being forced to sell at below the cost of production without any sort of subsidy, the mills are naturally trying to cut that loss as far as possible by selling retail in large quantities, and at the expense of the small builder who cannot get lumber.
I come back to the lumber yard in the Vancouver area. The Minister of Reconstruction made the comment that he thought the retail lumber yards were doing very well out of this present emergency; and I agree that they are, in the east, but not in Vancouver. I want to	give you	some	figureswhich one operator	gave me	when	I	wasvisiting him. He had an order for 50,000 feet of structural timber, 12 x 12 and 16 x 10, from eastern Canada, He got $26 per thousand, wholesale price loaded in the railway cars. It was taken to Montreal at a freight cost of $29 per thousand, or a total cost of $55 per thousand. This of course was consigned to a retail	yard, in Montreal,	andall this man had to	do was to	pick	up	the
phone and tell the construction company their timbers were at the siding and the construction company picked it up. The retailer got $84 a thousand, or $29 net profit, $3 more per thousand than the logger got for logging and sawing the timber. The retail yards in British Columbia think they have a real cause of complaint; for on a similar deal in British Columbia they would get nothing. The small builder in British Columbia feels that he has an even greater cause of complaint.
The next point is the priority system. I agree with the hon. member for St. Paul's that this business of having the cities issue priorities is not working out. I am convinced that we should not have priorities laid down on a hard and fast national basis, but I do believe that the award of priorities should be on a regional basis. He used the example, I think, of the city of Toronto having no control over priorities in Mimico. I might take my own district of Vancouver. The city

council of Vancouver have no authority over priorities issued in North Vancouver or in New Westminster. So if some enterprising business man comes from the east to 'build a factory, and finds that he cannot get a timber priority from the city of Vancouver, he will go to North Vancouver or to New Westminster-New Westminster will invite him there-and they get the industry but the lumber comes out of the local domestic supply. The situation involves local pressures on local aldermen as well'. It would be better if we had a regional system from, say, 'Chilliwack to Vancouver and West Vancouver to Ladner, and some system of priorities laid down within that area.


John Thomas Hackett: Would it not be better to get rid of the priorities altogether?


James Sinclair: No, I would not get rid of the priorities altogether. I am convinced, speaking as a veteran, that a veteran's priority could be properly worked in that area. The sawmill people themselves showed it could work with those 1,200 veterans' houses which they supplied lumber for last year. Veterans and small builders would be encouraged to go ahead and build houses, and I am convinced that it is the small builder who is going to build houses in this country, not the large construction companies, formerly in heavy construction, who are in the housing business for money.
I want to summarize the effect of this policy on various individuals. First, on the small builder who cannot get lumber. He scrapes around from mill to mill. In the Vancouver area each mill makes something different; and he goes from one mill to another in search of lath, flooring, pine for wallboards, and shingles. During this time the house is standing idle. The rains come-and we have rain out there. He has to continue paying his help. As the minister has pointed out, we are short of carpenters, plasterers and bricklayers, and unless he continues to pay them, even when they are idle for lack of money, one of the big companies who are getting lumber will employ them, and so his costs will mount. So this $15 below the cost of production is no boon to the small builder since he can't get the lumber. One contractor who has an enviable business in West Vancouver told me that this business of shopping around to all mills within forty miles of Vancouver for lumber formerly assembled by local yards costs him a minimum of $30 per thousand more than the cost price of the lumber.
Now I am going to recapitulate the effects the present policy has in British Columbia, first on the retail lumber yards in Vancouver.

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Most of these, except those fortunate ones who are dealing with mills still in the hands of the pre-war owners, have been driven out of the lumber business; they are trying to sell paint, nails, wallboard, cement, et cetera, hoping they will last out until conditions become normal again. We are always going to need, even in the Vancouver area, good active retail lumber yards, just as we need in this country retail outlet of every description; and the responsible saw mill operators who have been in the business for years gone by, and who intend to remain in the business for years ahead, are the very ones who realize that most strongly.
Now I want to speak, secondly, of the effect on the British Columbia timber industry- and that is the worst effect of all. Timber is and has been and will be the very bedrock of our British Columbia economy. One-third of the people in British Columbia earn their bread and butter directly from the timber trade, and I think most of the rest of us earn it indirectly. Members from the west and the maritimes have spoken here, of course, again and again and again of how the trade policy of this country is determined down here for Ontario and Quebec; that has certainly been true of our timber industry. We have had to go abroad to seek markets for British Columbia lumber. Before the war we did not sell any British Columbia lumber to speak of-apart from a little of the big dimension construction timber,-here in the east, or on the prairies, except clear finishing stuff, because the prairies have quite a good saw mill industry. Apart from what we sold in the British Columbia market we sold clears to the prairie market and some structural timber to the eastern market, and to sell the rest we had to go out in the markets of the world-and when I say "we" I mean the provincial government and the industry itself. It is a well-organized and highly developed industry. They built up their trade routes and made their own contacts. Our people competed with high quality and low price against Russian and Baltic timber in Britain, in spite of the very long haul from Vancouver, and also obtained markets in South Africa, Australia, New Zealand, and even in the United States. And now government policy is forcing us to ruin deliberately that entire long, slow, difficult and entirely provincial development of our world trade, because we are being forced to sell at far below the cost of production here on the domestic market, and told to recoup it by charging exorbitant prices-the timber trade would be the first to admit it-in the export market. The effect in the future will be that the people of Canada will expect British
Columbia timber to be sold at less than the cost of production. Eastern lumber is being sold retail here at, for example, $60 per thousand, while $36 retail is the domestic price as far as British Columbia is concerned. The effect on our export markets is obvious; and in British Columbia we lived in the past, live now and are going to have to live in the future, on export markets. Yet we are being driven out of our painfully established prewar export markets by the very tactics which this government refuses to condone as far as wheat is concerned. If we proposed to go on world markets with our wheat to-day and charge all the market would bear $3, $4, $5 a bushel, in order to sell our wheat cheaply at home for a dollar or less, you know the screams which would go up from the prairie members on this side, and the even louder screams from prairie members on the opposition side. Yet that is the policy which is being followed in regard to British Columbia lumber. Quite true, it is to alleviate a national housing emergency, but even the present emergency does not demand a course that will ruin British Columbia's primary economy, and that is exactly what this policy is doing.
Now as to the present allocation of markets. Fifty per cent local; and no one would dispute the allocation of thirty-five per cent to Britain: we are for that, because Britain was our best and surest pre-war market, despite Baltic competition. There remains the fifteen per cent which at present is being broken down, ten per cent to Australia, New Zealand and other British dependencies and dominions, and five per cent to the United States. On that fifteen per cent we are expected to recoup the losses made selling fifty per cent domestically at a loss of $15 a thousand, and we cannot do it without charging export prices which will ruin any hope of keeping these markets in the 3'ears ahead.
One other thing as far as the timber trade in British Columbia is concerned. You all know of the recent wage increase which has been granted of fifteen cents an hour. It is being used as a pattern by the unions across Canada in their present demands and it has put the British Columbia industry, including the operators and the workers, in an even more difficult position to maintain production under present price policy. I would suggest certain remedies, and I do so realizing that the price ceiling must be maintained. I represent a labour riding, and realize that it is unpopular in British Columbia to suggest that prices, and especially timber prices, be raised; but despite this I suggest first of all that the price of domestic British Columbia lumber be
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raised $15 a thousand, so that at least the industry will be given a chance to sell at cost of production and not at loss. That would enable them to scale down a little their prices to our export trade. It would be still $10 less than the domestic price of eastern lumber.
Second, I think there should be a control reinstituted on the price of logs. When the ceiling was taken off logs the price went up $6, and the saw mills who did not own their own logging operations were squeezed, buying at $25 and trying to sell lumber at $26. I am afraid that if an increase were given to the saw mill operators on lumber without a control being reimposed on logging, once again you would have the loggers putting up the price of logs almost to a level with the price of lumber. That would not affect the big operators, H. R. MacMillan, Fraser Mills and the new British Columbia Products, who log their own timber. But the small operators and saw mills in the Vancouver area who buy from logging operators would be in just as difficult a position as they are at present.
Third-and this is most important to all the small builders in Vancouver-with that price the government should insist on every mill in the Vancouver area sending a high quota, as high as in peace time, to the retail yards, so that any man wanting to build a house could go to the retail yard as he could in peace time and get his lumber-because there is sufficient lumber on the market if available for proper distribution. Such a policy would actually save the builder money in British Columbia. He would have to pay $15 a thousand more on a ten thousand foot or five-roomed house, which would cost him $150 more; but on that estimate, which my contracting friend gave me of $30 a thousand extra cost to-day because of the present delays, and the time and difficulties involved in hawking around the saw mills trying to get fifty feet of lumber here and a thousand there, exposure of the unfinished house to the elements, the cost of having to keep men in employment without having work for them to do, and paying them-all these difficulties and inconveniences would be removed if the retail yards were given their proper quotas so that if the builder wanted lumber he could get what he wanted, no matter how small an order and all from one source. The net effect would therefore be to save the small builder $15 a thousand on his costs.
Lastly, I suggest that the system of priorities be put on a regional basis so that there will not be competition between adjoining towns, one town decently trying to carry out

the present emergent housing policy while another town looks to the future, desiring industries, and giving priorities for lumber to factories, theatres, shops, athletic stands and the like, lumber which should be used for housing. Only when these priorities are put on a regional basis, embracing a region which is more or less an economic unit, can there be satisfaction in the matter of priorities.
At one o'clock the house took recess.
The house resumed at three oVlock.
Mr. E. B. McKAY (Weyburn):: Mr. Speaker, I need not say that we all consider the present housing conditions in Canada as most critical; as a matter of fact some have even gone so far as to say that it is bordering on a disgraceful state of affairs. For a nation with such unlimited resources and at the moment, as in the past, idle man-power, there is positively no excuse for a shortage of houses. There has always been a housing shortage, so the war cannot be blamed entirely for the present deplorable lack of living accommodation. It is not a temporary condition, though it is particularly bad at the present moment. This is just another unpleasant result of capitalistic policies. People have moved from rural areas throughout the country to crowd out our urban centres. This has been going on for decades. In 1871, according to the Canada Year Book, our rural population was 80 per cent of the total population of the country. By 1941 the number of people living in rural areas had decreased to just under 45 per cent of our total population. The development of large overpopulated urban centres, at the cost of a depleted rural population, is a situation to be deplored; for a nation's strength always lies in its rural folk. It indicates that a most unsatisfactory economic situation existed in the rural areas; and for that matter, Mr. Speaker, it still exists or people would not be continually migrating to the larger centres of population.
Large industries located in our cities are taking a disproportionate share of the wealth of the nation, leaving rural districts on the whole in an impoverished state. As a result of the removal of wealth from the rural areas, housing generally there is at a very low standard. On the other hand workers flock to the cities to operate private enterprise. The wealth in our urban centres is concentrated in a few hands, with the result that thousands of workers are inadequately housed. They are paid low wages and thus cannot afford to provide themselves with houses of their own,

Housing Act
or even to pay rentals that would provide decent housing accommodation. According to the Curtis report, in 1941 one-third of Canada's population lived in the metropolitan areas of twelve cities in Canada. In these specific areas 63-6 per cent, or almosit two-thirds of the population were tenants living on incomes too small to enable them to purchase houses of their own. Of this group only one-third had incomes of $1,800 per year or more. An}mne should know that incomes below this amount are insufficient to permit people to buy or build their own dwellings.
It seems obvious, then, that unless the incomes of these people are increased the government must evolve some system of subsidized housing in order to provide these folk with decent living quarters. There is no subsidized housing in Canada as there is in the United Kingdom or New Zealand or even the United States. The few houses provided on small holdings under the Veterans Land Act or by Wartime Housing Enterprises represent a weak-hearted attempt to meet an almost hopeless situation; and because of this crisis in housing, what do we find? Three and four and five families living in dwellings only large enough to house one family decently. I need hardly say that such overcrowding breeds delinquency among children and creates a generally unwholesome atmosphere everywhere. This shortage of houses existed before the war, as was freely admitted by the Minister of Reconstruction and Supply (Mr. Howe) in his address on housing last Monday. The war aggravated an almost intolerable situation. Lack of construction during the war years and the accelerated movement of people from rural to urban areas to work in munition plants contributed to the crisis in housing we face to-day; and the veteran returning to Canada has to face that situation.
To say that similar conditions exist elsewhere is to beg the question. Canada has the material for construction; she has the man-power for it; but the programme thus far outlined by the government is woefully inadequate. The veteran is the forgotten man as far as housing in urban centres is concerned. Even in rural and suburban areas, projects for veterans have to wait because of shortages of building materials, shortages caused by the lack of any provision in our statutes prohibiting the erection of theatres, garages, filling stations and luxury homes throughout the country. Veterans do without, while materials are being used in non-essential building. Ceilings should have been imposed upon house building, as has been done in the United Kingdom. Until the present crisis is relieved, the construction cost
of houses should be limited to $7,000; and until veterans are provided with houses a regulation should be invoked giving priorities to veterans only for house building. Luxury houses can wait until veterans secure shelter for their families. I am certain this nation does not want men who fought for our way of life to be homeless. Nothing to-day is more important in my opinion than the provision of houses for the boys who fought for democracy.
Besides the difficulty of obtaining materials, the veteran is faced with inflated prices. To finance a pre-war modest home of $3,600 now requires $5,000 or more. The government provides little assistance to the veteran in securing a building loan at a low rate of interest. National housing provides only a portion of the money he requires for financing his dwelling, and at 4J per cent interest. No preference is given to the veteran over the civilian. An interest rate of 2J per cent might well have been provided as a maximum. The government could well have absorbed the difference between 2J per cent and the 4J per cent which is charged to civilians. This would in small measure meet the inflated prices with which the veteran is faced in the purchase of construction materials-inflated prices which in most cases developed while he was in uniform serving his country. He was unable to provide a home for his family, as most civilians here in Canada were able to do when they saw prices of construction products rising.
The government provides ex-servicemen with a few hundred dollars as a civil reestablishment credit, to assist them to provide accommodation for themselves and their families. With the inflated building costs and high prices for houses, this is only a drop in the bucket. The move was a commendable one as far as it went. The credit looked big to the soldier when he served on European frontiers, but when he endeavours to locate a house to-day it looks pathetically small.
Even second rate houses have advanced in price 50 per cent to 100 per cent. Veterans canniot hope to pay these excessive prices. Indeed it is anything but fair for a grateful country to expect them to pay those exorbitant prices. Long 'ago a ceiling should have been placed on the prices of houses. Ceilings have been placed on other commodities; why not on houses? They need not be selling at such unreasonable prices. I appeal to the government to do that at once.
During the war the wartime prices and trade board' placed a ceiling on rentals. This was an attempt to control rates which in many cases had become excessively high. It was for the most part successful-perhaps every-
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where except in the city of Ottawa, where some of us had to pay as high as $35 for one room. Nevertheless it was a step in the right direction. But no attempt has been made to control prices in house sales. Speculators and real estate dealers have been allowed to make a killing at the cost of the veteran. By allowing prices of houses to sky-rocket, and prices in general to run wild, the government has defeated the purpose for which the civil reestablishment credit was set up.
Prices have reached prohibitive heights. It has been a field day for private speculators. It is not fair to the boys who were seeking a place in which to live; it is unfair to the buying public at large. People have made enormous profits by selling homes to veterans scarred by war. Veterans have been forced to pay fantastic prices in order to obtain shelter for their families. This sort of thing should have been stopped long ago. Ceiling prices should have been placed upon these houses. It is not yet too late to rectify that error. If rental controls could be made to work, surely ceiling price controls could be made effective on housing.
It has been suggested that this type of control would be difficult to establish. I am not so sure about that. Has it been tried? I am satisfied that controls could be based, first, upon location-whether houses are urban or rural; second, upon the size and number of rooms; third, on the type of house, whether modern, semi-modern, or unequipped; and, fourth, upon age. I ask the government now to remedy this situation, which is working to the detriment of almost every married veteran in Canada.
There is a dearth of low-rental homes throughout the country. The bill before the house will not provide low-priced housing and therefore will not provide low-rental housing. Subsidized housing is the only answer to the problem. Private enterprise has never met this situation and is not meeting it to-day. It has failed miserably. The Canadian Legion is cognizant of the true situation. In the Ottawa Journal of July 19 the following appears;
The "primary need" in the national housing emergency is to provide low-rental'homes for war veterans, Major Gen. C. B. Price, of Montreal, president of the Canadian Legion's Dominion Command, said in an address at a luncheon meeting of the Dominion Construction Association management committee here yesterday.
A "good many" married veterans in low income brackets were "terribly discouraged" because all their efforts "to secure decent living accommodation, for their families, at anything like the rentals they can afford to pay, had been of no avail."
It was "nothing short of deplorable" that the veterans' chances of success in reestablishment

in civilian life were "far less than they otherwise would be, due to the constant strain of anxiety on the score of living accommodation."
Gen. Price appealed for the association's cooperation both in obtaining low-cost housing and in helping veterans reestablish themselves in building trades.
The only "practical relief" so far provided veterans seeking low-rent accommodation has been through Wartime Housing Limited, and the only satisfactory solution to the emergency was in making more subsidized housing units available to low income veterans, he said.
"Not nearly enough" had been done to ease the veterans' housing problem and veterans should be given a "right of way over all other house building activities."
In conclusion I wish to emphasize again these points:
(1)	The shortage of building materials could be substantially relieved by banning nonessential building.
(2)	Materials would go further if restrictions were placed on the erection of dwellings exceeding $7,000 in value.
(3)	A building loan should be provided veterans at a lower rate of interest than is charged under National Housing, to enable them to meet the high costs now prevailing.
(4)	A priority should be set up for veterans for home building.
(5)	A ceiling should be placed on selling prices of houses as a temporary expedient to enable the veteran to secure housing at a reasonable cost.
(6)	A subsidized housing programme should be set up by the government to meet the demand for low-rental housing.
The veterans are not receiving a square deal to-day in the matter of housing. All they ask is a square deal and nothing more. I believe that if the suggestions I have made are acted upon by the government, more and cheaper housing can be provided.
This country must provide housing for its ex-service personnel at reasonable cost, and the public would support any move on the part of the government to meet that situation. As Theodlore Roosevelt said, a man who is good enough to shed his blood for his country is good enough to be given a square deal; more than that no man is entitled to, and less than that no man shall have. Let us give our veterans a square deal in housing. They ask for nothing more, and to that at least they are entitled.


Mr. LEWIS MENARY (Wellington North):: 
Clarence Decatur Howe: Ordinarily questions and answers come at the committee stage. All I can say is that Wartime Housing has built certain projects with basements and other projects *without basements, and it has been found necessary to charge $7 a month more for a house with a basement than for one without a basement, in each case the computation being on the same basis. I think if my hon. friend undertook to put a cellar under his house for $256 he will find that he is very optimistic and is likely to be severely disappointed.


Lewis Menary: I know I have the right figure for the cost of the blocks, and I am sure I am allowing enough for wages for two men to lay the blocks in two days.
Mr. ALISTAIR STEWART (Winnipeg
North): Mr. Speaker, the Minister of Reconstruction and Supply (Mr. Howe) is going to have a rather rough time with this bill, and yet I should like him to know that we all realize the magnitude of the problem which he has inherited, and that we want to see that problem solved. However, I feel quite certain that it will not be solved on the basis of the statement which the right hon. gentleman made to this house last week. It was a frank statement; it was an honest statement, interspersed with occasional dashes of the minister's insuperable optimism. He told us that the deficit confronting the country was approximately 180,000 houses, but it is really much greater than that. Were the people of Canada to be properly housed we should; have to build anything between 700,000 and 1,000,000 more houses.
The minister has told us that it is the intention of the government to build another 480,000 houses by March, 1952, and that private enterprise is being depended upon to build them. I state quite categorically that private enterprise, I do not care how much it is assisted by the government, will not build that number of houses in this country by 1952. The aspiration is laudable; we should like to see these houses built, but I think we know from experience in the past in Canada, and from the experience of other countries, that private enterprise is not capable of handling the housing problem in a country such as ours, and the minister has said that that problem is rapidly worsening. He should know by now, from the deputations which have waited upon the government, from resolutions passed by municipalities, and from statements which have emanated from commissions of inquiry, that private enterprise cannot build these houses. If he is dissatisfied with the statements of groups outside of the government I will quote him part of pamphlet No. 21, issued as long ago as 193S by the Department of Pensions and National Health at Ottawa, as follows:
We need dwellings for the lowest income groups who have not, and may never have the ability or opportunity to earn sufficient to pay a self-supporting rent for the size of dwelling required to house their families under minimum permissible conditions of sanitation and decency. The construction of such dwelling accommodation obviously will never be undertaken as a commercial venture by private initiative. These people need to be assisted by the community, and the manner of this assistance is the housing problem in its thorniest aspect. Almost altogether this group is a class of renters, both due to limited finances, and to their necessity to be free to move in accordance with the location of their employment.
The officials of the government have been aware for many years that private enterprise cannot solve the problem of housing for the people of Canada. Private enterprise will invest money only in the type of construction from which it can make a profit, and there is no profit in building houses for the people in this country who need them most, the submerged third who must have houses which rent at from $10 to $16 a month. Private enterprise will erect the buildings we have been hearing about-theatres, garages, filling stations, and so on. I was in Montreal and I saw the foundation being laid for a new hotel of 1,100 bedrooms. I do not say for one moment that Montreal does not need another hotel, but I do say that if Montreal has got along for the last two or three years without another hotel they should be able to get along for the next two or three years
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and permit the plumbing supplies which will be used in the hotel to be made available for houses for veterans.
Once we solve the problem of slum conditions in Canada; once we solve the housing problem of those in the lower third of the income brackets, then we shall have solved the problem of housing. I think it is just as clear and plain as that. Yet the minister tells us that Housing Enterprises is building houses which will rent at from $39 to $45 per month for four or five rooms. Such rentals are completely outside the capacity of the ordinary wage earner to pay. These dwellings are all right for the white collar worker or the person who has an income of $2,400 or $3,000 a year, but such rentals cannot be paid by the majority of the people.
I was sorry to see-I hope I am not doing the minister an injustice-that the minister anticipates that the rentals of Wartime Housing units may be raised because the municipalities want additional taxes. A six-room wartime house rents for $30. According to the Curtis report the rental paid by a family of low income should be 20 per cent of the family income. A rental of $30 presupposes an income of $150. The great majority of the workers in my constituency who are now in wartime houses are not earning as much as $150, and the additional overhead of $2.50 for local taxes is going to bear heavily upon them.
But most unfortunate of all was the minister's statement at page 3688 of Hansard that slum clearance is considered to be inopportune at the present time. I think, Mr. Speaker, that the right hon. gentleman does not appreciate the housing conditions in Canada if he believes that. I will admit that there are psychological maladjustments which will occur when people double up in houses. They are dangerous, and socially regrettable, if you like, but they are not nearly as serious as the problems confronting those who are to-day living in slum houses, whose bodies and minds are being warped by the wretched conditions under which they live. I should like to think that an attempt to clear slums would be carried out concurrently with whatever else the minister has in mind.
The minister also mentioned at page 3691 of Hansard certain principles which were actuating the government. One I have already mentioned, the dependence on private enterprise. Private enterprise will never solve the housing problem of Canada; I say again dogmatically, it cannot do it. It has done it in no other country I know of. The only solution is for the government to tackle the problem and solve it.

The _ minister also states-and this is interesting:
If, however, with all the assistance we can provide for financing, materials and labour supply, the houses required to substantially improve the housing standard of the Canadian people are not forthcoming, then the dominion
overnment will take a direct position in the
ousing field.
That I feel, sir, is a shadow perhaps of things to come. But it is unfortunate that the government has not yet made up its mind that it is going into the housing field, because circumstances will compel it to do so, no matter how much it may try to dodge the issue.
Our principal housing problem in Canada is that of the submerged third, those whose incomes are under $1,200 and who can get decent housing conditions only when houses are subsidized or are built in such a way that low rentals are made available to them. Perhaps the house may think that I labour this point unduly, but the facts are on the record. The need for low rental housing is obvious to anybody who travels through the big cities or almost anywhere in urban areas.
Many of us receive pamphlets and publications from companies perhaps with an axe to grind. All of us are in receipt of the monthly bulletin I have here from the Imperial Oil company. A few months ago, in presenting their own social security plan within the company, they gave us an interesting table which shows that out of fifty persons at the age of sixty-five, four will have retirement incomes, four will be virtually penniless but able to work, forty-two will be without income and dependent on charity or the state. In other words, to put it into percentages, at the age of sixty-five, ninety-two per cent of our people have no incomes and no financial reserves. Surely it is obvious from that, that the people of Canada are still working with insufficient incomes.
But even more interesting and rather more specific is this quotation which I should like to give from a magazine called The Montrealer, which is distributed among the members of this house. It is an advertisement in the March issue. It is headed, "Gold is Where you Find it," and it says:
One section of Montreal, about fourteen miles square, is unique-"The gold vein" of the island.
In this area about fourteen miles square are housed some 14,000 families of this particular class, on the slopes of Mount Royal and Westmount, embracing St. George's and St. Andrew's wards, Westmount upper and lower level, Notre Dame de Grace, Hampstead, Montreal West and South, and Outre-

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mont. The advertisement goes on to pose the rhetorical question: How does "the gold vein" live? It proceeds to inform us how the gold vein lives. It says:
"THE ACTIVE" constitutes the younger element

the offspring of "The inactive"-junior executives, the junior clubmen of town, their young wives, the debs and subdebs of town, young ladies of affairs.
I have no idea what sort of affairs they are. It goes on:
"He" and "she" play golf, tennis, badminton and bridge. They ride, fish, hunt, ski and skate. They travel in smart sport cars. They drink and smoke and, most certainly, they entertain their friends and do it in a lavish manner.
Meanwhile Europe starves!
"He" wears flannels, golf pants, sport shirts, and his hats have to be just so. His feminine prototype is known for her smart coiffures, the very latest in perfumes and cosmetics, her enviably correct sport shoes and swanky evening gowns. Together, they buy anything the imagination can create, and there is continual competition to own it before it has been discovered even by the other alert "he's" and "she's" of "the gold vein." Quality is their criterion. They are "the people other people follow."
And "THE INACTIVE"? Never were quotation marks better placed than around that word, for it doesn't look as (though they do much more than sit and sit. But don't fool yourself! They are merely the "active" grown older, and their minds are active still and decidedly mature. At their every decision the market goes up or down a point or two. "He" and "she" wear the very finest clothes. "He" is a connoisseur of food, liquors, liqueurs and wines. "She" is interested in the newest fashions and clings to all that she found enjoyable and comfortable in the past. Both patronize the theatre and the arts, take cruises and can always be counted upon for substantial subscriptions to charity and cultural endeavours.
Those are the people of "the gold vein," Mr. Speaker, and these 14,000 people in "the gold vein" in the city of Montreal have collective incomes which are greater than the total earnings of the wage earners in the provinces of Prince Edward Island, Nova Scotia, New Brunswick, Saskatchewan, Manitoba and Alberta. These 14,000 families have assessed incomes of almost $135,000,000. The wage earners in the provinces mentioned have incomes of almost $125,000,000. These people in "the gold vein" in the city of Montreal can afford fine houses. Where do they get the money? By exploiting the people. These are the people who to-day can still get large dividends from industry. There is no hint of inflation apparently when we are told that the dividends paid by corporations in Canada were $5,000,000 greater this month than in July of last year. But let the steelworkers ask for a minimum wage of $33 a week; that, sir, is inflation of the foulest type and must be stopped. I should be inclined to
agree with the government's policy if I saw them preventing this distribution of unearned income in Canada to these people in "the gold vein" who to-day are living so well. That is how one section of the people live- "the gold vein". But go up to the parliamentary restaurant any time and look over into the city of Hull. The Hull police department reported recently about seventy-five buildings which contained 112 dwelling units which, in turn, contained 123 families. Only six of these seventy-five buildings were habitable. Thirteen of the buildings had indoor toilets, thirty-eight of the buildings had outdoor toilets, twenty-four had none at all. These are the people we have to help, these are the people whom the government is not helping.
But I should like to speak of an area of which I have some knowledge, my own city of Winnipeg, a young city, and yet one which has slum conditions which are an eyesore and a shame, not only to Manitoba but to the Dominion of Canada as a whole-and at that our slums are not so bad as those which exist in the eastern part of Canada. According to a census taken at the beginning of this year in my constituency, in which there are some 78,000 people, there were only nine vacant houses in January; eight of them were unfit for human habitation, and one was so broken down that no one could occupy it, and indeed there were no "to let" signs out at all. I went around to some of the slum homes. We have in Winnipeg a first-class health and sanitation department, of which Doctor M. S. Lougheed and Mr. Fred C. Austin are in charge, and it it was through their kindness that I was able to see some of these slums. I had seen them before; they have not improved with keeping. I went around with an able young inspector, Mr. George Kelly. I am not going to tell parliament about all the houses I saw, but this is symptomatic of affairs as they exist. I went to one building with nineteen rooms, and there were seventeen family units living in it. It was a frame building, dilapidated and down-at-heel, rented out to one of these pestilential house farmers. As one went in the door one was almost hit physically in the face by the foul and fetid stench in which the people were living. Here was the smell of cooking, of putrifying garbage, and of human excrement. Windows were broken in almost every room, patched up here and there with burlap or with paper. There was the occasional curtain, so dirty and grimy as scarce to deserve the name of curtain. Plaster in every room was cracked, broken, stained, perhaps with rain dripping down it, more often with the desiccated bodies of vermin which had been squashed to death
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on the walls. In most of these rooms the gas stoves were not properly working. I walked into one room where a young soldier had brought his wife that very day from hospital where she had given birth to a baby. She was heating water on a gas stove, which was leaking, to bathe the infant. The room was 14 feet by 10 feet, and they were condemned to stay there and to bring up the infant in such surroundings. In every room there was a slop pail, of course. It was used for garbage and everything else, often for lavatory purposes where there were children, because there was only one toilet in the whole building, only one bath for all these people. The beds were dirty and in many cases foul. I came across one old man lying in bed and we asked him the stock question, "Are there any vermin in here?" He said, "Hell, no, not even a bedbug would live in this place"; but he was wrong, because every time we lifted up a mattress there were colonies and clusters of these vermin just waiting for the onset of night to begin their daily meal.
It may be said, why do not these people improve their conditions? Are they so lost to all sense of decency that they want to live there? No sir, they do not want to live there, but we have conditioned them to such a state that they do live there now.
Let me quote from Mr. Austin's report. As I have said already, he is chief inspector of the division of sanitation and housing in Winnipeg. This is from a report which he read at the annual general meeting of the Canadian institute of sanitary inspectors in Toronto in May. Speaking of these areas, Mr. Austin said:
Infectious diseases spread rapidly in such areas. Offenders against the criminal code have their haunts in such areas. Juvenile delinquency rears its ugly head in such surroundings and sexual promiscuity is more or less commonplace, primarily due to the lack of privacy. Common use of inadequate plumbing fixtures is also a factor here. These all have their perpetuation, if not their origin, in the decline in the will, or wish, or ability on the part of the submerged, to overcome the handicaps of inferior accommodation, congestion of population, vermin infestation, dirty rooms and habits, general slovenliness, and the acceptance of debilitated living standards, due to a decisive breakdown in their morale. The latter is a concomitant of a debased standard of living, and to expect these people to get out of their ruts of their own accord or effort, is to expect them to raise themselves by their boot straps.
It is these people whom we have to help, it is these people whom the plan of the right hon. gentleman does not help, because as a principle he abjures subsidies, as a principle he will have nothing to do with them. He says: Let the municipalities and the provinces attend to subsidies. He is going to find out
fMr. Stewart.]
that it is financially impossible for the provinces and the municipalities to remove these sore spots from all across Canada. I should like to extend an invitation to the Minister of Reconstruction and Supply, and I should be quite prepared to pay the financial cost of such invitation. It would cost me six dollars and a quarter. I should like the Minister of Reconstruction and Supply to find out these things for himself; I invite him to come to Winnipeg and to live in one of these hovels, and when he comes back to Ottawa his mind will be radically changed, sir, about slums and how soon they should be eradicated. I said I would give him six dollars and a quarter. He may feel that that is not' unduly generous, but his government feels it is generous enough for the old people of this country. That is the weekly allowance of an old age pensioner, and since the government asks old age pensioners to inhabit these hovels, I think it is reasonable to ask the right hon. gentleman to do the same. Out of this six dollars and a quarter he will pay $4 for rent, and from the $2.25 left he will supply himself with all the food he needs to keep body and soul together. If he is willing to undertake the experiment, I shall be very glad indeed to pay up the six dollars and a quarter.
I want to point out that there is a lot of talk in this house about economy, about saving dollars and cents. Mr. Speaker, saving dollars and cents is not nearly as important as saving human lives and human respect. That is much more important than the financial economies we can make. But, speaking to this question from ithe point of view of dollars and cents, let me remind the house of certain reports which have been made. For instance, in 1935 there was a survey and a report made to the city of Detroit housing commission which showed that in the slum areas the death rate from pneumonia was three times as high, there were five times as many crimes, six times as high an infant mortality rate, ten and a half times as high a tuberculosis death rate, and fifteen times as many criminals in a small area as compared with a normal residential area. Surely, sir, there is an extraordinary extravagance with human lives and human happiness in these slum areas. Or let me refer to the city of Cleveland, Ohio, which made a survey of a blighted area which houses 2-5 per cent of Cleveland's population, and it was found that over a ten-year period this small area had 21 per cent of the city's murders, 12 per cent of the city's cases of

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tuberculosis, seven per cent of its juvenile delinquents; and eight per cent of the city's relief families.
But again let me come nearer home. Let me take my own city, where a similar survey was made in 1935 by the city health department. The department took two areas in
Winnipeg, area 1 being the Assiniboine river
north to Notre Dame avenue and Red river west to Sherbrook street, area 2 being Notre Dame avenue north to the C.P.R. tracks and Red river west to Sherbrook street including all Point Douglas. In other words, they took areas in the constituencies of the hon. member for Winnipeg North Centre and myself. What did they find? They found this:
Area 1 Area 2 Rest of
city
Infant mortality per 1,000 live births	
50-2	52	43Scarlet fever and diphtheria	per	thousand	
13-6	15'7	7-5Tuberculosis per ten thousand	
4-6	7-9	2-9Municipal hospitals annual admission per	thousand	
7-2	10-5	3-9Public wards admissions	per	thousand	
91T	101-4	52-9
Juvenile court oases from public schools per thousand students
registered	
16-9	23-7	11-5Arrests per thousand	
21-1	52-2	6-5Venereal disease clinic per thousand	
5	16-5	1-8
The population in the first area was 29,479, in the second area 23,246, and1 in all the rest of the city 170,292. This committee found further that the cost of social services such as police, municipal hospitals, children's aid societies, General Hospital, St. Boniface outdoor clinic, social welfare and children's bureau in area 1 was $257,000 and in area 2, $381,000, while for the rest of the city it was $612,000. If the cost of social services for areas 1 and 2 had been at the same rate per thousand1 of population as for the rest of the city, the cost would have been $189,000 instead of $638,000, thus saving the city of Winnipeg roughly $450,000 per annum. Surely no additional proof is needed to show the extravagance and wastefulness of slums in this country. We can eradicate slum areas and build) decent homes for the people and save money in the long run. That is looking at it from the financial point of view. From the human point of view we can give the people of Canada an opportunity for gracious living which they have never known before.
The right hon. gentleman's reputation stands high, and deservedly so, for what he did' in the line of production for the war effort. He can make that reputation even higher if he grasps the immensity of the problem that confronts him and realizes that it can be tackled only by the help of public funds.
It would be entirely negative were I to criticize without offering some suggestions of the type of policy which the minister should follow. In the first place, the federal parliament. I believe, eventually, will have to pass enabling legislation to which the provinces can adhere, and this legislation will contain in- it provisions for a tremendously enlarged programme of research into problems of house building in Canada. It might even go so far
as to have an experimental area where these houses could be constructed and people could live in them.
The dominion government will have to be prepared to take the responsibility to a large extent financially, even perhaps as high as ninety per cent, to provide loans to provinces and regional areas in order to wipe out these festering blots called slum areas. The federal parliament will have to make money available for low rental housing all across Canada. This is not a local problem; it is not one particular city's problem; it is a Canadian problem. I submit therefore that only the Canadian House of Commons can, tackle it adequately.
Loans which are advanced will have to be far beyond those at present envisaged. Loans should be for a minimum of at least forty-five years, and the interest rate must not be any higher than two per cent. We shall be asked, how can we afford it? If we go to the people and borrow at three per cent and lend at two per cent we shall have a financial loss. I do not think that is so. Assume for the moment that we raise a billion dollars from the Canadian people for a special housing loan -and that money would be readily forthcoming-we could lend it at two per cent. Despite the confusion which exists in the minister's statement as to whether the national income depends upon housing or housing upon the national income, I suggest that the increase in national income would be so marked that the Department of National Revenue would get back far more than the ten millions which we had apparently lost by lending the money at two per cent.
But if both houses passed enabling legislation, the provincial legislatures should also be encouraged to do the same thing, and I do not think they would require very much
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encouragement. The provincial legislature which to-day refused to take advantage of such an offer from the federal government would not exist beyond the next election, we can be sure of that.
There should be created in the provinces, departments responsible for community planning under the jurisdiction of a cabinet minister. I should like to see the matter of housing under separate portfolio in this parliament, but I am content at present to see it in the hands of the Minister of Reconstruction. The responsibilities of these departments of community planning would include the defining of various metropolitan areas and regions within the province, so that enabling legislation might permit them to establish community planning and housing commissions in such areas. I think it is a mistake, if the government is going to go into housing, as I think it will, to deal directly with the municipalities, because they are too small. We have to deal with metropolitan areas, and, in rural areas, regional divisions. Any moneys granted should be granted to the provincial governments, who in turn would channel it down to the metropolitan housing and planning commission and the regional housing and planning commission.
Of course it is obvious that these metropolitan and regional areas could be used for other administrative purposes, such as health, education and social services. The province would enter into an agreement with the dominion government which also, I hope, would have a department of community planning and housing, with loans to enable the metropolitan and regional commissions to undertake planning for future development and redevelopment, the acquisition of land for urban and regional development and housing construction, such as community centres and so on, and rental subsidies for tenants whose income is less than $1,000 a year.
Let us remember that almost one-third of our people are in the income brackets of less than $1,200 a year. These are the people whose houses would have to be subsidized. Above that level it is possible that, with ingenuity, we may have housing schemes built so economically that we shall be able to rent houses to those earning above $1,200 a year, and rent at reasonable rates.
This department should allocate dominion loans to the various metropolitan and regional commissions with the aid of the provinces. The local government has to take an important part in this picture, because while we may keep centralized control; while we have a centralized policy, to make it work we must have decentralized administration, first through

the province and then through the regional group. It is on the level of local government that the question will be decided whether good modern housing will be provided for those who need it. It will be only with the support of the whole local community for the planning scheme that any worth while action will be taken. With the exception of the land speculator and the jerrybuilder, community planning and housing is beneficial to all. It helps the home owner by reducing taxation; for slum clearance lightens the cost of fire, police and social services, and makes property values more stable. It helps the tenant by offering a good house in a nice neighbourhood. It helps the small storekeeper by leaving more of the consumer's dollar for food, clothes and furnishings. It helps the business man by providing a planned locality for his factory, with maximum traffic advantages. We should note that it is very important that this planning be done not in the sense of individual housing units but in the sense of complete areas. Such a scheme helps the municipal governments in the metropolitan area by relieving them of the drain that slums made upon their budgets, and offering them security for the future in planned development.
I could pursue these ideas very much further, Mr. Speaker, but my time is almost gone. I only want to point out to the right hon. gentleman that facts are already available showing that private enterprise is not going to do the job he wants done. Plans are available showing precisely what the government should do and what in my opinion it will be compelled to do by force of circumstances. At the moment the government has given no appearance of facing the fact that our problem lies in the lower third of the population of this country; and until it applies itself seriously to building houses for the submerged third of our people, the government consigns itself to impotence while it condemns the Canadian people to frustration.


Stanley Howard Knowles: Mr. Speaker, I rise to join in this debate for a few moments because, like the hon. member for Winnipeg North (Mr. Stewart) who preceded me and the hon. member for Weyburn (Mr. McKay), who spoke a little earlier, I feel the time has come to speak plainly to the government about its housing policy.
During the last few years the problem of housing in this country has been very serious; yet we had on our hands the needs of the war. We in this group did our best, while pointing out the impending difficulty which

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now confronts the country, to be constructive in our suggestions to the government and not hamper the various items of housing legislation that were brought before us. Each time we have had under consideration some new measure, or the amendment of existing legislation, we have pointed out that it was inadequate, but recognizing that at least it was an attempt to improve inefficient legislative machinery we hoped it would have some beneficial result. But now the war is over; we are thinking in terms of reconstruction and the future; and I think, as do all the members of this group, it is time to point out to the government that it has failed miserably in dealing with this problem, and that as long as its mind is set on some of the principles to which it adheres it will not solve the problem that is facing the Canadian people.
The hon. member who has just taken his seat made it clear that what we need in this country is not just a target for so many housing units per year; what we need is to tackle the whole problem of the conditions under which our people are living. I dare say some hon. members felt that my hon. friend's description of the slum conditions in the area which both he and I represent in the city of Winnipeg was, shall I say, picturesque. It was partly because of that portrayal that I felt, even though my colleague had covered the subject so well, I could not refrain from saying something at this time. It is not good enough to go on telling the people who are condemned to live in these impossible buildings that theirs is a problem which must wait until some other angles of the problem have been dealt with. I have suggested before, and I suggest again, that there is no time like the present to tackle the problem of slum clearance in some of the most disgraceful areas to be found in some of our large cities. I urge upon the minister and those under him who are dealing with this matter that even yet they give consideration to taking an area such as that along both sides of the main line of the Canadian Pacific railway which divides our two constituencies, clear out the buildings which are not fit for human habitation, and really establish in that whole area decent living conditions for the people, who incidentally are workers who produce enormously in terms of wealth for this country.
When I first rose I said if the government adheres to its present basic policy it will not get anywhere with this whole problem. I have in mind the statements the minister made, as recorded in Hansard for July 22 at
page 3690 from which page my colleague has already quoted in part. At that time the minister admitted to us that there was a real problem. He said:
That a deficit of housing will confront us for some time to come is virtually certain.
Then he went on to say:
At the same time, I can assure hon. members that no effort will be spared by my department and by the government as a whole to meet the deficit, to relieve a critical situation.
Further down on the same page he summed up the main principles underlying the aims and objects of his department, and gave this as number one:
High priority. Adequate housing for the Canadian people is one of the major tasks before us. The utmost effort will be directed towards meeting this need, and the resources of the country will be used to this end.
When one hears forthright statements of that kind one expects the government to mean them, and that nothing will stand in the way of the government's determination to get houses built to meet not only the immediate need in terms of housing units but also the need in terms of better standards of housing and the improvement of whole areas. But having said that the minister immediately went on to say, referring to his department and his government:
It is the policy to ensure that as large a portion as possible of housing be built by private initiative.
Well, Mr. Speaker, I could, but at the moment I am not going to, enter into an argument as to the respective merits of private and public housing, but it does seem to me this is the crux of the matter as far as this government is concerned. It says nothing'will be allowed to stand in the way; then immediately afterwards it says: We are fastening our flag to the mast of private enterprise. It seems to me the government needs to turn its policy right around and say: Our first concern, the first item in our policy, is to get houses built. But as one goes through the speech of the minister, and as one goes through the legislation we have before us, it becomes clear that the government's first concern is not the building of houses. The government's first concern is the maintenance of private enterprise in the field of housing. I insist that what we want is not the enunciation, first of all, of the method or the principle by means of which the end is to be achieved, but rather the determination that that end is to be achieved. The need is recognized by the minister as well as by the rest of us; for even when he gives his plausible
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reasons for not going ahead with shun clearance he is making an admission that the problem is there.
Then, respecting the government's activity in the housing field, the minister went on to say that the government is there only because it has been forced into it. But the thing that annoys us, entirely apart from the fact that we are dealing with differences in political faiths, is that we represent a people who are sorely pressed >by these needs, and we hate to see loyalties to a way of doing things put ahead of a determination to meet actual needs.
On the next page the minister said this:
We are in these endeavours because in each instance housing of this type would not otherwise be forthcoming. We would be very happy to withdraw, but there seems no immediate prospect of housing of this type being produced by other means.
All the way through the government's attitude there runs that refrain-that they do not like being in the housing field; that they would be happy to withdraw. They want to get out as soon as possible. Again I quote from the minister's remarks:
I hope that the dominion government's direct participation in the housing field will reduce rather than increase, but we are determined to see that an adequate number of homes are built in Canada in the future.
If the minister will stand by the last half of that sentence, I shall go down the line with him, because it implies that he is willing to throw over his prior insistence that they are going to stick by private enterprise. Surely after the observations of the hon. member who has just taken his seat the house is not going to be satisfied with legislation that will leave us with a worse situation a year hence than we now have, and which does not tackle the needs of our people who are living in substandard homes and in slum areas.
Again at page 3691 the minister said this:
The dominion government has made and will continue to make adequate provisions to make the financing of low and moderate rental housing projects possible. But subsidies to create uneconomic rentals are, in my opinion, a matter for provincial and municipal concern.
In that statement, as I see it, the minister not only throws the responsibility back to the provinces and municipalities, but he begs the question by referring to subsidies as involving the creation of uneconomic rentals. On the other hand the government by its housing legislation, and by all the various financial provisions the minister has announced from time to time, is doing just this for the financial interests. It is quite prepared to back the life insurance companies and lending institutions. It is prepared to take the risk

completely out of the hands of private enterprise in the housing field, which is supposed to be the lifeblood of private enterprise, and yet is not prepared to come to the assistance of people at the point where it will do the most good, namely in connection with the actual subsidizing of houses so that our people might begin to get more decent places in which to live.
I rose particularly to support whole-heartedly the appeal made by my colleague from Winnipeg North (Mr. Stewart), and also to say to the minister that while members of the government may have thought we were hard on them in other years when discussing their housing legislation, they will find that this year by comparison we shall be much more critical. We are now in a period of peacetime reconstruction, and we are convinced that this sort of thing does not meet the needs of our Canadian people.


Mr. E. D. FULTON (Kamloops):: Mr. Speaker, I rise to criticize the government for its failure to provide adequate housing legislation in the past, and also to point out where the present legislation will prove inadequate for the future. To that extent I am in agreement with the last two speakers, particularly, who did not hesitate to criticize the government, but I do not agree with them in many of the specific criticisms they have made.
I believe it is essential in this respect that we should clear our thinking on the question of low-cost housing, or the providing of low-rental housing for people in the low income group. To my mind that is an absolute necessity. But the fact that it is necessary to provide subsidized housing for those groups does not mean and does not imply that the government must go into the housing business. The fact that the government subsidizes housing does not mean that it must enter the field of the building of houses.
' (Listening to both hon. members from Winnipeg one would imagine that they believe the solution to the problem would be for the Minister of Keconstruetion (Mr. Howe) to go out with a hammer and nails and "build houses himself. I do not believe that is the solution. To my mind the solution would be for the minister to give real and efficient direction to an effective housing programme which would clear the tracks for people who know the building business, and make supplies available for those who are ready to build.
As it strikes me, the confusion in the minds of hon. members of the C.C.F. is that they believe that in order to have anything done the government must get into the business

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itself and, in this instance, have companies formed to build houses. I do not believe that that is the solution. It is true that every housing report I have seen indicates that some measure of subsidized housing is necessary to provide those in low-income groups with adequate living accommodation; but this does not mean that the government miust build the houses. What they must do is tackle the subsidy problem, and particularly the supply and control problem, and make it possible for builders to go ahead and build, as they are ready to do.
I should like to interject here that if the slum conditions in Winnipeg are anything like those outlined by the two hon. members from that city who have just spoken, then I agree with them that the government cannot stop until it has found a solution for that problem. It must tackle the housing question as a whole. It cannot stop and say: Well, we will not tackle slum clearance at the present time. If conditions are as the two hon. members have stated them- and I have no reason to doubt what has been said-then the government is most certainly open to violent criticism. The minister cannot say: We shall not tackle this problem of slum clearance at the present time; we will wait until we have done something else. The thing must be tackled as a whole, or it will not be cured as a whole.
In making a criticism of the government for its delay in beginning to solve the housing problem, and because the programme it advances now is not sufficient, I would recall to the minds of hon. members what the hon. member for Vancouver-Burrard (Mr. Merritt) said this morning, that the minister's statement and the forecast which he made, even as far as it goes-and that is not far enough-is approximately a year too late. We all remember that the password in the first two years of the war was "too little and too late." We urge the government not to let it be said in the. post-war period that they have introduced that watchword into the Canadian housing programme. If the government had faced these facts a year ago, when all opposition parties were doing their utmost to point out the seriousness of the situation, we might now be well on the way toward betterment of conditions-which the minister says will not arrive now until late next year, or possibly 1948. The minister was a year late in starting, and even now he is not going far enough, because, to judge by his own words, he is not prepared to tackle this question of slum clearance. But mainly, he is not going far enough because he
is not tackling the real root of the problem, the question of getting supplies to the builders so that houses may be built.
I want to emphasize that, in western Canada at least, we know that materials are available in the raw state. All we need to do is to get them out and then manufactured. We have the builders available if we can get the supplies. It is not necessary for the government to set up any more housing or construction companies; all that is necessary is for them to solve the problem of getting men into the woods to get out the supplies and then have them manufactured so that the builders can use them. In this connection I should like to refer to a statement which the minister made just a week ago when he was discussing this housing question. He was questioned, by the hon. member for Vancouver South and the hon. member for Vancouver-Burrard in particular, as to what he was doing to readjust the price structure, or what other steps he was taking to make sure that supplies flowed in a measure adequate to meet the construction programme which he had outlined. The tenor of the minister's replies was that there was no delay in producing supplies because of an unfair price balance. He is reported on page 3706 of Hansard, in reply to a question put by the hon. member for Vancouver-Burrard, as follows:
Can my hon. friend tell me of a case where production is being curtailed by unbalanced prices?
The hon. member for Vancouver-Burrard referred to-day to a survey which had been undertaken by the British Columbia Lumber Survey Limited, representing some eighty lumber manufacturing companies. In a letter which I have here they state the following:
I observe that Mr. Merritt was asked to name one case of curtailment of production which has been due to failure to get a fair price from the wartime prices and trade board. I suggest that Mr. Merritt ask the minister what the situation is in regard to doors. He might also ask how much flooring he expects to make when the price of fir flooring is less than the price of the flitch before they cut it.
Fir flooring was referred to this morning by the hon. member. The situation with regard to doors is one case where production is being curtailed by an inadequate price adjustment. I know that is a fact because in Kamloops, which is a city of some 8,000 people, there is a construction project of 100 houses being carried on under the auspices of Wartime Housing Limited. Am increase was recently authorized of forty additional houses. The first 100 have been under construction since August of last year, and so far only forty-five are ready. One reason why the completion of these houses has been
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Mr. J. O. PROBE (Regina City):: Mr. Speaker, I think the Minister of Reconstruction and Supply (Mr. Howe) should, before we enter the committee stage, satisfy the members of the house that he is going to do something beyond what he outlined a week ago to meet the housing shortage in this country. Unquestionably the minister haa done nothing about the low-rental housing problem, and no department of government or any public or private agency except his own department is in a position to do anything about it. The minister should give us some assurance of early action on that specific pro-63260-252
blem. I hope that in the committee stage he may see fit to add a clause which will allow him to come to grips with that phase of the problem.
Further, I should like the minister to tell us why the government is not prepared to adopt some form of the Swedish self-help plan for rural home construction. It has been stated a number of times in the house that under the National Housing Act there is possibly one loan in effect under that section which provides for assistance to rural home owners. I put it that way, a possible one loan, because when I conferred with the representatives of the Central Mortgage and Housing corporation they were unable to assure me that they could lay their hands on that one loan.
The government should investigate what other countries have been successful in doing in connection with housing. I should like to remind my good friend the hon. member for Kamloops (Mr. Fulton) and his party that even the Conservative government of Britain had to get into and subsidize low-rental public housing because it could not be done on a private enterprise basis. Surely that ought to satisfy my hon. friend's and his party's ideological viewpoint.


Edmund Davie Fulton: I advocated subsidizing, but not that the government build them.


John Oliver Probe: I agree that my hon. friend mentioned subsidizing, but he and his party are definitely averse to any government or cooperative operation having any part in the building of houses.


Edmund Davie Fulton: I would ask the hon. member where in our platform or in any of the party's publications he can find ground for that statement.


John Oliver Probe: My hearing is reasonably good. I might turn the question around and ask my hon. friend: Does he himself believe in municipal house construction? Apparently there is no answer. I think that is a vindication of the thing I wish to bring out, that his party stands for free private enterprise in all forms of activity, and therefore it is no stretch of the imagination to carry it into housing as well. But I have no wish to get into an altercation. I am simply pointing out that even Conservative governments in other parts of the world have found that private enterprise was incapable of providing low-rental housing. Private enterprise can only function at a profit, and low-rental housing is a non-profit, subsidized undertaking. Consequently private enterprise and low-rental housing simply will not mix.

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I would ask the minister to explain to the house why a longer period than twenty-five years can not be provided for amortization. Also why is it not considered good business for the government to borrow or provide money at a lower rate than the present 4i per cent which is permitted under the National Housing Act?
We should also have an explanation of why we are subsidizing builders to the extent of providing them with money at one-half per cent less than prospective owners, and why we cannot expand that concession, poor as it is, because the four per cent interest rate will not in my opinion meet the low-cost housing problem, even in part, to such cooperative and municipal building societies as are prepared to go into the housing field. It seems to me that if we are doing business we should do business with all prospective customers on the same basis, whether they be insurance companies, large building corporations, cooperative housing societies, municipal or provincial building societies. Surely this federal government of ours should be able to undertake the same form of contract with them all, and not put private building corporations on a preferred basis.
Then I think the minister owes this house an explanation as to why he has not gone into investigating fully the creation of a proper price ceiling on materials. I listened to an interesting discussion on the part of the hon. member for Vancouver North (Mr. Sinclair). As he developed his theme I wondered what point he was lending to. and I found that the Genesis and Revelations of his talk were: let us increase the price of lumber another $15 a thousand and we shall get all the building we require. Heaven knows we have increased the cost of building materials from $38 and $40, in the case of lumber supplies to $70 an4 S75, and we are still unable to get buildings completed. It is not a matter of raising prices; it is a matter of coordinating the entire construction industry. If we cannot secure a proper ceiling price which will permit individuals to acquire houses or builders to provide houses at a fair return to themselves, the minister has had plenty of experience with crown companies, and I for one would give him the green light if he were to create enough crown companies to get into the production business and show us that our natural products can be used for the citizens of Canada.
In the light of what thp hon. member for Vancouver North said this morning, I believe the minister should reveal to the house what regional differences exist in the price of such things as logs, rough dimension lumber, finish-

ing lumber, and the rest, throughout the various regions of Canada; give us an explanation as to why such prices exist, and, if possible, bring them into line so that there will not be the danger of flooding one market with materials to the exclusion of other parts of Canada. The minister did curtail somewhat the export of lumber and building products to other countries, but in my opinion he has not yet gone far enough. If the foreign market is too attractive to our cutthroat competitive businessmen, so that they would prefer to sell there in preference to dealing with their customers in this country, I think it is time we got a little bit rougher with people who have no other shrine at which to worship than that of the almighty dollar.
I intend to support the minister in the amendments which he is bringing into the house, but I appeal to him to do something further, because, while this is a temporary or a partial alleviation, it does not get to the root of the Canadian housing problem, and I am convinced that the minister is as well aware of that as is any other member of this House of Commons.


[Stage Direction]
Motion agreed to, bill read the second time, and the house went into committee thereon, Mr. Macdonald (Brantford City) in the chair.
On section 1- "Corporation."
Mr. IRVINE:: Before this clause carries, I want to bring one matter to the attention of the minister. I have information which would seem to indicate that a cooperative organization has been seeking to get support for their building programme through the act as it now exists, and I believe they have been refused. The association to which I refer was formed last fall under the sponsorship of branch No. 768 of the Canadian Legion in Vancouver. The purpose of the organization was to attempt to solve a veterans' housing problem by providing moderate rental accommodation on a mutual ownership basis. I understand that the Central Mortgage and Housing Corporation, while approving the technical details of the project, has refused the loan on the ground that, because this organization is a cooperative organization, it would not be a rental housing project but in essence a form of home ownership, and therefore is disqualified under the terms of the act. What I want to know is whether in the bill now before us there is provision by which associations of the type I have cited would receive financial assistance from the government housing scheme.


Clarence Decatur Howe: The point brought up by my hon. friend is one which I attempted to explain in my remarks last Monday. He himself gave

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the answer when he said that the association he suggests is not a true cooperative, it is an association of home owners. Take a typical case. Ten people desiring to own homes band together and call themselves a cooperative. They believe that the homes will cost $6,000 and are prepared to enter into a contract each to buy a home for $6,000. The cooperative has no other means of income except the payments due from these ten men who are home owners. We will say that something happens to the cooperative. We will say that one of the houses costs a good deal more than others; some foundation or other difficulty is encountered, or we will say that the whole project gets into difficulties; instead of the houses costing $6,000 they cost $7,000. Well, that is an incident which occurs in the course of business; prices and costs change; difficulties in building occur. Eight of the men might be able to go on and complete the agreement for a house costing $7,000; two men cannot do so. What happens to the position of those two? There is a collective agreement with the government. In other words, the group of ten are bound to carry out the obligation assumed by the ten, and two are unable to do their part. The other eight have the option of taking on the obligation which the two are unwilling to undertake, or the whole project is placed in default. Surely that ig not a sound enterprise either for those who participate in it as prospective home owners, or for the government as a lending institution.


John Oliver Probe: The minister will recall that in the public accounts the auditor general himself drew attention to considerable underestimates in connection with certain housing and reconversion projects, notably in Montreal. The Department of Reconstruction or the National Housing Act administration met that cost in the case of the individual, and I do>
not see that any public furore was raised because of it. The auditor general drew attention to it because it was not according to the original contract; yet the minister supported it. What is wrong with doing that on behalf of the Canadian people generally instead of in the case of an exploiter?


Clarence Decatur Howe: The home conversion programme was the government's own programme. The government was in a position to amortize its loss by extending the period during which it would collect rentals. But surely the government cannot underwrite every man.'s contract for a house, as it would be expected to do if the government assumed losses in the case of a cooperative formed by home owners who, instead of building individually, build as a group.


John Oliver Probe: Suppose there were some intermediary between the cooperatives, and the Central Mortgage and Housing Corporation. If we put a cushion in there to take on the guarantee against loss, would the Minister of Reconstruction consider an improvement in the terms under which he would do business with the cooperative?


Clarence Decatur Howe: The government would be delighted to do business with the cooperative on the terms stated, provided that the cooperative has a source of income apart from the project itself. For instance, we would be delighted to do business with the Saskatchewan Cooperative Elevator company, which is now the Saskatchewan pool, or with any number of other cooperatives. We would be pleased indeed to allow the act to apply in those cases, but not to a group of home owners. There are other sections of the act designed' for individual home owners. The type of organization suggested by the hon. member for Cariboo is not a true cooperative in the sense in which cooperatives are mentioned in the housing act.


William Irvine: I fail to see the point which the minister makes in answer to my question. I cannot see how the government would be in any worse position if two of the ten cooperatives failed to meet the original agreement than they would be if some private -corporation failed to meet it. The house, if.' constructed, would be in itself the govern

ment's own security, and I cannot see that' any great harm would be done in carrying on business with an organization of that kind. But I would ask the minister whether he knows of the housing bill in the United States, S-1592, sections 404 and 405. Is it true that they provide particularly liberal terms to mutual ownership or cooperative associations for the very reason that these associations provide a form of house ownership for families of low income, and would it not be possible to incorporate in this bill similar classes to meet the requirements of Canada?


Clarence Decatur Howe: We are discussing the preamble at present. If my hon. friend will allow that point to stand until we come to the amendment dealing with that matter, I will look into the United States housing provisions and discuss the subject with him then.


Howard Charles Green: W'hen the minister made his preliminary statement on July 22 he pointed out clearly and on more than one occasion that the dominion government would provide every facility to private enterprise
Housing Act

to build as many houses as were needed. He intimated that the government believes that the bulk of new housing for Canada will be constructed by private builders. My hon. friends to the left are very much against any suggestion of that type, but I think the minister was right in his summing up. On that same d'ay I questioned him about priorities, about allotment of materials, about the price ceiling on Lumber, and to the different questions he gave answers which, from information received from the Pacific coast since that day, are not strictly in accordance with the facts. I believe there is something the government can do to help private enterprise build more homes, certainly on the Pacific coast. In the first place, take the small builder. Ordinarily he gets no priority at all and he is having great difficulty in obtaining supplies. I have here a press dispatch of July 23 from Vancouver, in which there appears this statement by one contractor :
"I simply don't know what to do with my stiune," one contractor said. "I have no priorities and no material. I might as well fold up >my shingle and go out of business."
That is the picture from the point of view >.of the small contractor. Then take the dumber yards. In reply to my questions the jminister said that the lumber yards were making good money. At page 3707 of Hansard, he said:
The retail lumber yards have never made as much money in their history as they have in the last year. I cannot imagine why they would close down.
That answer was given in reply to my statement that the retail lumber yards were facing difficult conditions. I have had telegrams since from different lumber yards in Vancouver. One is from Fletcher-Wells Lumber Limited, dated the 24th July, which was two days after the discussion in the house. I quote:
According to papers, Mr. Howe claims retail yards getting material same basis 1941.
If the minister will remember, he said that lumber was being allotted to the yards according to the material they got back in 1941. The telegram continues:
This is untrue. All retail yards here have no stock and cannot buy from mills. You have our authority to give him our name as one who cannot get stock and would be glad to give you names of every dealer in city in same plight. Understand all this information sent to Mr. Howe last week.
Presumably it would arrive here about the time the discussion was taking place in the house. I am not suggesting that the minister liad it when he gave me the answer.
.[Mr. Green. 1


Clarence Decatur Howe: Has not the lack of stocks in the yards some relation to the strike in the lumber industry, which closed all the mills for a month?


Howard Charles Green: I have no doubt that has made the position worse than it was before, but that is not the main explanation of the shortage. Dealing with the answer given by the minister to the effect that the wartime prices and trade board were allotting lumber on the 1941 basis, I have here a letter from B.C. Lumber Survey Limited, dated July 26, three days ago, which states:
The timber control office in Vancouver has informed the newspapers that they make no check whatever of local movements of lumber, whereas the minister has informed the house that domestic lumber is distributed to dealers on the 1941 basis.
I do not think there can be any doubt that there is no allotment made in Vancouver. I believe if one were made it would help remedy this situation by giving the retail lumber yard some lumber to sell, and the retail lumber yard in turn could make lumber available to the small builder. Then there is the matter of the small sawmill. This afternoon I received last Thursday's issue of the Vancouver Sun, on the front page of which I see an article headed "Extinction threatens 300 B.C. sawmills." The first paragraph reads:
The threat of closure before the summer is out to-day hung over close to 300 British Columbia sawmills, whose only hope of relief is action by the prices board to adjust lumber price ceilings. The threatened mills-half of the total number in the province-are those which buy their logs on the open market, where price ceilings are suspended on logs. But the prices they charge for their lumber are still fixed, making it increasingly difficult for them to meet expenses.
The article goes on to say, in part:
The mills are now completely regimented on fixed prices, below cost of production (in the vast majority of cases), and there are existing arbitrary quotas and regulations which preclude any clean-cut normal business proceeding.
The article makes it quite clear that, whereas the big firm which has its own timber limits, cuts its own logs and saws them into lumber, is not affected by the fact that there are ceiling prices on lumber and no ceiling prices on logs, the small mill that has to buy its logs is caught between two fires. It would be a great tragedy in the coastal province if these small sawmills were put out of business.


Clarence Decatur Howe: If I may ask my hon. friend a question, who fixes the price of logs? Is it not the same small sawmill he is talking about, which is the only buyer of these logs?

Housing Act


Howard Charles Green: No, it is not.


Clarence Decatur Howe: Then who does fix it?


Howard Charles Green: The logging men fix the price.


Clarence Decatur Howe: Surely my hon. friend has heard of a buyers' strike. If the buyers refuse to pay these prices, where would the loggers sell?


Howard Charles Green: It is not quite as easy as that. It is not a case for a buyers' strike. If anything like that happens the big mills can simply hold their logs which they do not need to cut for themselves, and the small sawmill has to get them or go out of business.


Clarence Decatur Howe: But surely the big mills are not the sellers of logs?


Howard Charles Green: Some of the biggest firms are. Nearly half of all the logging in our province is done by firms who have timber limits and also mills; they are huge interests, and they are being benefited by this price control which is in existence at the present time. The minister can interview anybody in the logging industry of British Columbia, and I think he will find that the price control system there is entirely out of gear. Further, in answering me the minister said that if the ceiling were taken off lumber and the price were to go up $20 a thousand it would mean an increase of from $600 to $1,000 in the cost of a house. The first reaction to that statement was this article which appeared in Winnipeg the next day, dated July 24, headed, "Western lumbermen say Howe's statement misleading, harmful." The article states:
Approximately 12,000 board feet of lumber is used in the average small home built in this area . . . This estimated increase of $600 in the cost of lumber per home carries the implication that those responsible for the manufacture and distribution of lumber would impose upon their customers an increase of $50 per 1,000 feet, approximately 75 per cent.
Actually the minister's figures were based on an increase of $20 per thousand. The final paragraph states:
The statement added that the association, whose members operate nearly 900 lumber yards in western Canada, considers such statements as Mr. Howe's "not only misleading, but definitely harmful, and feels they should be retracted."


Clarence Decatur Howe: My hon. friend realizes that you cannot take ceilings off lumber and leave ceilings on nails and other materials entering into the construction of a house. Surely he would not suggest that; he is not wedded to the lumber industry to that extent.


Howard Charles Green: As this business is being carried on at the present time it is going to be difficult to get the number of houses the
minister requires, andi I am suggesting that he give further consideration to this question of the ceiling on lumber. The other day Donald Gordon explained to the committee on industrial relations what he was trying to do. He is trying to make these lumber people get their money out of the export of their material.


Clarence Decatur Howe: Not at all.


Howard Charles Green: At the same time they are losing money in the domestic market. Human nature being what it is, the result has been and will be that these people will not produce for the domestic market if they can avoid doing so. Donald Gordon is quoted in the press of July 27 as saying:
My job is to hold domestic prices and I'll use any weapon-any weapon at all-to do it. I'm holding domestic prices of lumber at a low level in relation to export prices because I believe the industry can still operate at an over-all profit. In other words the export market is subsidizing the domestic market.
I have a telegram here dealing with that question from Mr. Harold B. Collins, president of the British Columbia wholesale lumber and shingle association. It is dated July 23, the day after the minister made his statement in the house, and states:
Vancouver News Herald to-day quotes Hon. Mr. Howe as saying that if ceiling prices were taken off lumber the price of houses would in* crease six hundred to one thousand dollars. We point out that a five-room all-wood bungalow takes approximately twelve thousand feet of lumber which at an increase of ten dollars per thousand feet would mean an increase of one hundred and twenty dollars per house or double this amount if prices were increased twenty dollars per thousand. Under present conditions with lumber in short supply through being sold in Canada by manufacturers at less than cost of production it requires several months longer to build than former^. It seems reasonable to suppose cost of building would be reduced if contractor could complete building in less time which he could do if building materials were available. British Columbia wholesale lumber prices are approximately twenty dollars per thousand lower than export prices. It is not likely domestic prices would increase to this extent if ceiling were removed. Suggest you point out to Mr. Howe discrepancy in his figures which can be confirmed by any legitimate contractor and press for complete review of wholesale and retail prices of lumber in Canada by committee composed of manufacturers, wholesalers and retailers along with government representatives.
I suggest to the minister that this last idea is worthy of some consideration; in other words, that the whole question of wholesale and retail lumber prices should be carefully considered by a representative body. I also have a letter from the British Columbia Lum-
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ber Survey Limited dated July 26, dealing with this matter of the increase in the cost of a house. They say:
The lumber contained is never more than 15,000 feet which would give an increase of $300 per house at the outside.


Clarence Decatur Howe: An increase of $300 in the cost of a veteran's house is not important?


Howard Charles Green: Oh, yes, it is important; but actually, because of the way these supplies are being handled, the builder is forced to run around from one mill to another and from one yard to another, and he loses valuable time. In addition, I believe there is a black market, and all these things mean added costs which have to be paid by the man buying the house. I am not sure that the remedies suggested are the correct ones; they may not be, but in any event they merit the most careful investigation by the minister. The Vancouver Sun, which is a strong supporter of this government, said editorially on June 26 in an article headed, "Drop lumber controls now; how to build houses in Canada", by Roy W. Brown, the editorial director, who is a well informed and level-headed man:
You have a choice of two positions. You can maintain controls and have a scarcity of lumber with the many abuses which go with that scarcity; or you can take off the ceiling prices , and pay more for the lumber, but have it m * abundance.
That was his stand about a month ago.
I come back to my opening statement, which was that the government is relying primarily upon the private builder to build homes; yet he is being given very little by way of help to do that building. I suggest that the minister have his officials investigate the points I have raised. If he does so I believe he may find that the situation will improve-at any rate, on the Pacific coast.


Clarence Decatur Howe: I think I should discuss this question. In the first place, the department over which I am minister does not regulate prices. My hon. friend will understand that that is in another department of government- and quite properly so.
But I will say this: I have found the wartime prices and trade board ready to adjust prices whenever a manufacturer or producer can show a case for the increase.


Mr. GILLIS:: They do it quite easily, too.


Clarence Decatur Howe: However, he must show that under the present price set-up his operation cannot make a reasonable profit. It has been suggested to-day that Canadians are driving up the price of export lumber. That is not so.


Howard Charles Green: I did not suggest that.


Clarence Decatur Howe: I know, but others did. Canadian lumber commands an export market, and it is quite irrespective of any action Canada could take. All the wartime prices and trade board says to the producer of lumber is this, "We want a certain proportion of your lumber. We set a proportion for various parts of Canada. At the present time it is 50 per cent on the Pacific coast, though it has been 35 per cent. We want that lumber. We are willing to pay enough for it to let you make an over-all profit. If we fail to do that, make your case and we will make an adjustment. But you must first make your case."
Surely that is a reasonable attitude. My hon. friend is interested in financial matters. I suppose he has read the financial statements of the principal lumber firms on the west coast, several of which are a matter of public property, and all of which are on file with the wartime prices and trade board. If he will read those statements I think he would not suggest for a moment that the lumber industry on the Pacific coast is not in an exceedingly prosperous position.


Howard Charles Green: The minister is referring to the big fellows; I am talking about the little fellows.


Clarence Decatur Howe: The little fellow can also make his case. The hon. member is trying to confuse the issue when he says that the big fellow sets the price of logs.


Howard Charles Green: I am not trying to confuse any issue at all.


Clarence Decatur Howe: The log-producing and logbuying industry is, for the most part, quite separate from the operations which combine both. The small mill, which my hon. friend is speaking about to-day, buys from the independent producer of logs. The small mill group sets the price of logs. As soon as the small mill refuses to pay the current price of logs, then the current price of logs will drop.


Howard Charles Green: What is to prevent a big mill, which also cuts its own logs, from buying logs from the independent log producer?


Clarence Decatur Howe: Because they have their own source of supply.


Howard Charles Green: They are always glad to get extra logs.


Clarence Decatur Howe: Perhaps so. Timber control in its earlier stages was controlling the price of logs. Effective control became almost impossible, on account of black market operations which again came from the small sawmill. We found that, while we had a

Housing Act
ceiling price on logs, the ceiling was being violated. Those who had given the matter greatest consideration recommended to me that in the interest of over-all production it would be desirable to maintain the ceiling on finished lumber, and take off the ceiling on logs. That is the usual method of applying price control, namely to control the price of the consumer product, and not the intermediate product.
There is a flurry in logs at the present time, due largely to the strike. No logs were produced for a considerable period during the strike.


Howard Charles Green: The price went up again a few days ago.


Clarence Decatur Howe: Yes, but who buys them? If my hon. friend can show me that the big mills are bidding up the price of logs against the small mills, I shall be interested in exploring the situation. But that is not my information.


Howard Charles Green: I am told that small mills cannot afford to produce lumber at the price that is being asked for logs. That is sufficient consideration to merit an investigation by the Department of Reconstruction, or at least by the wartime prices and trade board. If that information is correct there will only be one result, namely that the small mill will go out of business, and there will be less lumber produced at a time when Canada needs lumber more than anything else.


Clarence Decatur Howe: May I point out that all the logs which are cut are being sawed into lumber by someone. I do not think my hon. friend would suggest that the same number of logs will not be cut into lumber, or that the same amount of lumber will not be put on the market.


Howard Charles Green: Logs can be held in the water for a year.


Clarence Decatur Howe: I should like to know of a concern that is holding them for a rise in price.


Howard Charles Green: You could not do anything about it, if they were?


Clarence Decatur Howe: Could I not?


Howard Charles Green: No, not under your present law.


John Oliver Probe: Who is the timber controller, and what are his duties? Then, what are the prices of logs and rough lumber in various regions of Canada? I believe this information would be useful. I am alarmed at the concern shown by the hon. member for Vancouver South respecting the small operator, and
particularly when I think of the way in which lumber prices in my own city have risen. It seems to me that if the small operator is suffering in the transaction, then the fellow at the other end supplying the logs is receiving an inordinate share of the total price. A statement showing the amount each of these individuals receives, from the tree to the finished house, would have considerable merit in this discussion. I know that in my own city lumber has increased in price since before the war from $40 to $75 per thousand. When I think of logs being worth from $6 to $12, I am inclined to think the difference is not all taken up by freight. Could the minister give a picture of the timber control situation, with figures?


Clarence Decatur Howe: I have not the figures before me. Prices of lumber in various areas of Canada are different, having regard to the conditions in those areas.


John Oliver Probe: Freight conditions?


Clarence Decatur Howe: No. The difference is largely governed by the amount of the product which goes for export. For example, on the Pacific coast the export quota was 65 per cent of the cut, this for historic reasons. The bulk of the coastal lumber has always been exported. Then, in the prairie provinces the export quota is two-fifths of the cut; in Ontario and Quebec it is one-third, and in the mari-times a different proportion.
The timber controller sees that the requirements of the home market are looked after in accordance with the formula set. He takes care of such priorities as may be issued by the director of priorities. He generally sees that the distribution of lumber conforms with the needs of the various areas in Canada. He has charge of the whole lumber programme and he functions with a staff of, I think, 300 persons. He has officers in all parts of Canada to see that the regulations are carried out.


John Oliver Probe: You have not discussed the prices of materials.


Clarence Decatur Howe: Prices are such that the producer is allowed a reasonable margin of profit.


Howard Charles Green: There is no ceiling on logs.


Charles Cecil Ingersoll Merritt: Going back for a moment to the subject the hon. member for Vancouver South was talking about, I should like to add my voice to his in asking the minister to investigate the situation in British Columbia with respect to price ceilings and the supply of lumber. It is apparent to me from what the minister has said-and I say this
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with all respect-that he is not as familiar with the situation there as are some of us who live in Vancouver.
For instance, the minister said that the lumber yards are doing better than they have ever done in their history. I understand that that is perfectly true of those located east of the rookies, but it is not true of British Columbia where the mills are direct competitors of the lumber yards and have simply forced them out of business. In order to get a return for its cut, a mill must take the retail price fixed by the board and not just the wholesale price.
The minister suggested that the financial position of companies in British Columbia was quite satisfactory and that, therefore, no price adjustment was necessary. Where do they get that profit? We who are from British Columbia know it comes from the export trade. As the hon. member for Vancouver North said, the domestic trade is carried on at a loss of something like $15 per thousand. There is another interesting thing about the structure of this industry. The minister referred to the large capital which had been built up on the export trade. These are the mills located on the Fraser river or at Port Alberni. In the normal days of peace their domestic trade was almost nil; practically 90 per cent of their business was export. Deep sea ships would come along their wharves, load and sail without coming near Vancouver.
On the other hand, a large number of mills -these are the mills referred to in the press report mentioned by the hon. member for Vancouver South-are domestic mills. Many of them are located along False creek in Vancouver, or in other cities and towns. Their natural outlet is a rail haul to eastern Canada. In order to sell their lumber export, they must put it in scows, perhaps tow it around from False creek to Vancouver harbour, unload from the scow into the ship which goes overseas. Under the quota system which is now 50 per cent, these domestic mills are being forced into a business for which they were never designed.
A comparison of the figures in relation to the large mills which have timber limits and so on and those in relation to the small mills which have no timber limits, no towing facilities and which are being forced to seek a market in an unnatural sphere will show that a great hardship is being borne by these small mills.
The minister said that if the cost of logs has gone up too much let there be a buyers' strike and the cost will come down. The minister knows as well as I that logs are

quite scarce and that any refusal to buy the logs offered would mean an almost immediate shut-down by the log buying mills. Surely the minister is not suggesting that they should shut down and cease production in order to get the log price down.
The last thing I want to point out with respect to conditions in the lumber trade on the Pacific coast is that the small log buying mill started this year not making a profit on its domestic business. Since that time there has been a $6 increase in the price of logs and a S2 per thousand increase in the cost of labour; that is, the hands in the sawmill itself. They have lost the ten cent premium oij the dollar on their United States business. The domestic quota has been increased from 35 to 50 per cent. At the spring session of the legislature the working week was reduced from forty-eight hours to forty-four hours. No great complaint is being made against any one of these things taken by itself, but when an industry which was not making a profit on its domestic business suffers five such blows wdthin a few weeks it indicates that before the end of the year the earning position of these mills will become seriously impaired. I urge the minister to look into this matter, because I believe in this particular case he will be able to And something to his advantage in his efforts to stimulate the supply of lumber.


Clarence Decatur Howe: My hon. friend has made out a good case for the small mill to present to the wartime prices and trade board for an increase in prices. I do not see why these mills do not present their case. I am assured by the wartime prices and trade board that no case has been made for an increase in prices at this time, and I am also told by that board that when a case can be made an increase will be considered.


William Irvine: I have just one question I should like to ask the minister. I think he said a moment ago that it was the business of the lumber controller to see that the home market was supplied. The hon. member for Vancouver North gave some figures which, if they were correct, would prove that ample lumber is now being produced in Canada to supply the home market and to permit the export provided for. His claim was that it was not being properly distributed, and I wish to know from the minister where the difficulty lies. I should like to know whether the controller is not controlling, or whether the figures given by the hon. member for Vancouver North are incorrect.

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James Sinclair: I referred to distribution within British Columbia; I quoted no authority for distribution outside the province.


William Irvine: It is British Columbia that I am talking about, because we have a problem in Prince George which is similar to the problem that exists elsewhere. I want to know where the trouble lies.


Clarence Decatur Howe: I do not know of any surpluses of lumber anywhere in Canada. It seems to me that there has been a fair job done in distributing lumber. All the lumber is consumed somewhere. The export quota is certainly being met in full and, so far as I know, all parts of Canada have a reasonable quantity of lumber. For a time we had great difficulty in getting lumber in to southern Saskatchewan. It was much easier to ship across the border. That was worked out, and arrangements have been made which, I think, have brought about a reasonably equitable distribution of lumber so far as geography is concerned. If there are accumulations in one part and shortages in another, that would indicate that the distribution was not reasonably even.


William Irvine: Is the controller limited to geographical considerations, or has he power to distinguish between industries and certain human needs? Can he not give direction to some extent as to which industry shall be supplied with lumber and whether it shall go for homes or for something else?


Clarence Decatur Howe: About thirty per cent of all small homes and a much larger percentage of the homes for veterans, are built under priorities, and special arrangements are made to divert materials into these homes. The remainder of the material goes into the retail market, and no control is exercised over what is built with that lumber.
There has been some discussion about the federal government assuming the over-all programme of construction control. It has been said that it is difficult for a city to do so, because the city may want an industry, and it would be difficult to say no to that industry; regardless of the need of lumber for homes. That bland assumption would indicate that it is very simple for the federal government to exercise similar control. But of all the controls which the federal government attempted to operate in time of war-and I think our wartime controls were more successful than those in any other country-we failed miserably in exercising construction control. Why? Because no one would accept our judgment as to what was essential building 63260-253
and what was not. We received terrific pressures from cities to allow exemptions from the established rules. Black marketing got so bad that the situation became quite uncontrollable. We had more difficulty in getting convictions for black marketing against building control than against any other control. It was practically impossible to obtain a conviction. There would be a flagrant violation of the control in some cities; a prosecution would take place, and the offender would be fined $5 and given a clean bill of health to go ahead. I am willing to operate any control that can be operated, but I know from experience that the federal government cannot successfully operate building control. Just as an example, a delegation of six mayors from large cities came to see me just after we passed the order in council permitting municipalities to operate building control. They said, "We cannot do this because it would never be uniform." They said: "We want you to prohibit certain types of buildings." I said, "I shall be delighted, if you will tell me what types of building to prohibit. Tell me and I will pass the order in council to-morrow." Some said: "Theatres." I said, "Fine; we will start with theatres." Then one mayor spoke up and said, "We have been trying for years to get a theatre built in my city and one is coming along now. You are not going to prohibit theatres." Somebody else said, "Prohibit luxury hotels." At once another mayor spoke up and said, "You are not going to prohibit hotels because we are promoting a hotel to be built in my city and we are going to have it in spite of anything you do." Two or three other types were mentioned, such as bowling alleys. Hon. gentlemen would think that surely we could prohibit bowling alleys during the war, but we had more trouble with bowling alleys being bootlegged than almost anything else. Finally I said to this group of mayors, "Perhaps you will retire and come back later when you have agreed on what you would like prohibited." They met all next day, but they never came back. So I wish that hon. members would drop the idea that the federal government is quite capable of telling people what they can use lumber for and what not.


Howard Charles Green: What about the distribution of lumber? Is it not possible for the timber controller to see that there is an equitable distribution of lumber?


Clarence Decatur Howe: I believe that is being done. I should like to know of inequalities in the distribution of lumber as between geograohical areas.

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Howard Charles Green: I mean within a geographical area, is it not possible for there to be an equitable distribution?


Clarence Decatur Howe: I am certain that if the industry within an area could agree on what is an equitable distribution, the timber controller would be glad to see the distribution made accordingly.


Howard Charles Green: I have a further letter from the B. C. Lumber Survey Limited, dated July 26, 1946, in which they say:
What is certain, however,

That is referring to the minister's statement on page 3709 of Hansard:
What is certain, however, is that Mr. Rosen-berry and the wartime prices and trade board were fully informed on the subject and have been so informed for a good many months. Mr. Rosenberry and Mr. Ashbaugh of the wartime prices and trade board received a delegation of the retail lumber men in Vancouver at the beginning of 1946. The only subject discussed at that meeting was the distribution of lumber, the yards having made the request that the board's policy of equitable distribution be applied to lumber. Thus Mr. Howe's department was fully informed that lumber is not being distributed on the 1941 basis and nothing has been done in Vancouver to implement this policy of the board.
Why cannot that policy be implemented in Vancouver?


Clarence Decatur Howe: I shall be glad to call that to the attention of the timber controller.


Mr. McMASTER:: Nobody has spoken so far from Ontario, which is suffering from a lumber shortage most of all the provinces. I understand that five billion feet is Canada's normal cut of lumber and that that will be the amount produced this year. More than half of that is produced in British Columbia. The government may have made a mistake in allowing, until recently, 65 per cent to be exported. I also understand that the railways have a priority on about 20 per cent of the whole cut. If that is the case, with. 65 per cent exported, now 50 per cent, and 20 per cent of the whole cut going to the railways, there is only 15 per cent left for ordinary construction, so that only a mere trickle comes from the northwest part of British Columbia toward the east. I am very much surprised that members from Saskatchewan and Alberta are raising so much trouble about this matter, because I learn from several sources, which I believe to be reliable, that the prairie provinces have an advantage over Ontario of $3 a thousand in price, although the lumber coming from British Columbia to Ontario must travel very much farther. As a matter of fact, the

lumber does stop in the prairie provinces, where they have no.t much lumber of their own.
I think I mentioned that British Columbia produces more than half the total cut of five billion feet. Let us, for the sake of argument, say that British Columbia produces two and three-quarter billion feet. Ontario, where there is such a large demand for building, and where the timber is now getting farther and farther back, produces one billion feet. A certain amount of that is hard wood and white pine, which does not go into building construction but is used for furniture and other purposes. The minister has just said that one-third is allowed to be exported. So the amount of lumber produced in Ontario that can be used for housing purposes is not large. Then there is Quebec and the maritime provinces which must grow the greater portion of the remaining one and a quarter billion feet that is produced from these other sources. The minister did not say exactly how much of this latter is allowed to be exported. If it is one-third you will see that, when you take into consideration the demand which is made in the maritimes and in Quebec, there is only a mere trickle coming into Ontario, and on that account we suffer more, perhaps, than any other province from lack of lumber.
I have often wished that in the beginning of the housing crisis the government had not been stampeded to the extent they were, because, as I said at the last session when dealing with this question, during the war the government were the largest consumer of lumber and they must have had and did have, throughout Ontario especially, buildings containing seasoned lumber, which could have been taken down and the seasoned materials used for the first six or eight months in the erection of new houses. Some person who should have known told me that the recovery could have been 70 or 80 per cent. This provision would have bridged the period between the time wTe needed lumber for building and such time as new lumber in a more seasoned condition would become more readily available.
I have often wished that the government had erected a more permanent type of building in their housing operations. I have mentioned once or twice before, and many other members have risen in their places in the house and made valid complaints about the situations in which these veterans' houses were built. That is, they were not built in urban districts, although they were meant for urban workers, but were located some distance out. I do not believe that the matter of a half acre of land surrounding a building would

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make up for the increased inconvenience the occupier would have in getting to work, or the extra expense involved in putting in different services, such as electricity, water and sewage, as well as the extra trouble the man would have in providing schooling for his family. However, the government did go out some distance, partly necessitated by the fact that they did not provide a more durable type of building. I will mention one municipality I know of, the township of York, which, as some hon. members know, is supposed to be a rural district, although there may be eighty-three thousand people in that comparatively small area, making it the largest rural municipality in Canada. But there are still unoccupied streets, although maybe not paved, provided with sewers, water and electricity, on which houses could have been built if the government had consented to erect them with brick, or concrete blocks, or some other substantial material. Had the government done this there would have been a great saving of lumber. An amount of 15,000 feet has been spoken of to-day as the amount of lumber in a house. I am not a builder or a lumber man, but it strikes me that that is exaggerated for the type of building which has been erected by the government for the veterans. Indeed I would say that half that figure would be more nearly correct. Of course, of this amount, the better part of the lumber is used for the trimming and siding, and it is unfortunate that an attempt was not made to provide more substantial material for the outside, so that this good lumber would have been more available for inside work.
During the war we heard a good deal about plastics and other synthetic materials, and that attempts would be made to create buildings entirely different from anything which had been made before. Strange to relate, the building industry is about where it was forty years ago. Mass production has been applied to practically everything except building, but in that industry they are still back in the old times when they produced very slowly, and with manual labour.	Of course to-day
increased labour costs have had much to do with the increased cost of building.
Houses being so necessary, I was interested in what the minister said about demands from municipalities for other buildings. I have not the figures, and my memory may not be very accurate, but I believe that for the month of April last the amount of construction in Canada was something in this ratio: $18 million for dwellings and about $42 million for industrial buildings, for churches, hotels, theatres and other kinds of buildings. That strikes me as a little out of line when we C3260-253J
hear such moving stories as we have heard here from both hon. members of my own party and hon. members belonging to the C.C.F., possibly also hon. members supporting the Liberal party about the shortage of houses. Surely the government should have sufficient control to see that buildings are provided in a more fair proportion as between homes and other types of construction than they have been. To that extent, I believe, the government has failed in its duty.
There is a black market, and if I were asked where these black markets are located I might not be able to tell you of them. When I suggest, to people who know, that about half the lumber which is distributed in Ontario goes to that market they tell me that the estimate is a little low. The reason for that condition, which has been touched upon by several other speakers, including, I believe, the minister and several hon. members from British Columbia, is that the ceiling is actually so low that the man who manufactures the lumber now eliminates the old retailer; he has to sell direct to the customer in order to get a fair return, because these large prices which he gets from the export trade do not balance the results of the very low ceiling and the extra costs of production. The result is that only a large buyer, shall I say a large consumer buyer, is able to secure this lumber, and the small man who ordinarily went to the retailer to get -a few hundred feet of lumber as he needed it cannot find any now, because-I do not care what anybody says-the small retailers are actually without lumber for the people who want it. People tell me that a certain company, which operates more largely in the prairie provinces than anywhere else, and in a small way in Ontario, is well supplied with lumber. I thought there was something strange about that, and I inquired from a man who has no reason to wish to do the government either a favour or an injury. He said it was because that particular company has always been a large buyer, and its very large buying power enabled it to purchase where the small man could not do so. That does not represent equality of distribution; and I think, since the government has undertaken this job, it might do it a little more equitably.


Charles Cecil Ingersoll Merritt: Would the minister explain a statement of his on the resolution stage with regard to the assistance being given to manufacturers of building materials to get increased production? Would he give the committee an idea of the type of obstacles they are encountering, the methods he is using to meet them, and what is being done about increasing the capacity of various lines in the country?
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Clarence Decatur Howe: I shall be very glad to do so. Would my hon. friend like me to do so now?


Charles Cecil Ingersoll Merritt: I think this is the proper time. As far as I know, there is no part of the bill which deals with it.


Clarence Decatur Howe: It is almost six o'clock. Would it be all right to do it at eight o'clock?


Howard Charles Green: There is a distribution as between areas. Would the minister tell us whether that applies also to such supplies as steel? Since the discussion on July 22 I have had a letter from Smith Sheet Metal Works Ltd., Vancouver. They state:
We are, and have been for thirty years, the only manufacturer of metal cornerbead, west of Winnipeg We are not able to obtain sheets for the production of cornerbead this year, although we have approached the steel controller on several occasions for a quota for this purpose.
Under normal circumstances, we acquire our requirements from the Canadian steel mills through a local supplier.
Due to the shortages, however, they will no longer accept an order for this purpose as it would come off their small monthly quota. As a result, we are not able to supply^ metal head, and the housing programme is being seriously held up. The eastern manufacturers are able to get sheets for this purpose and ship the goods out here.
I presume, the manufactured goods.
We feel that this is certainly very discriminating inasmuch as we are an old-time manufacturer of this article. Last year we produced three-quarters of a million feet, whereas this year to date we have turned out only 20,000 feet. We have tried to obtain from the steel controller, a definite quota per month but as yet we have received nothing but a run around, as he refers us to our local suppliers who in turn refer us to the steel controller.
What should a person do in a case like that?


Clarence Decatur Howe: The administrator of the wartime prices and trade board has that matter in charge. My over-all experience is that supplies of sheet metal on the Pacific coast have been better than in the east for the last several months. Evidently this man has depended on a supplier who has let him down. Ordinarily each industry has its own supplier and it is the duty of the administrator of the wartime prices and trade board to see that suppliers get their fair share of the over-all production. I think my hon. friend1 will find that this man's usual supplier gets his fair share.


Howard Charles Green: Is there anyone to compel the local supplier to supply him with the material?


Clarence Decatur Howe: If he can make a good case, the administrator will no doubt try to see that he is kept in business.
{Mr. Merritt.]


Mr. BENTLEY:: Will there be restricted areas in the application- of the act? Will there be any parts of Canada where loans will not be made available? There was a time under the National Housing Act when we could not get anything in Swift Current. Shall we be able to get any now?


Clarence Decatur Howe: Yes. The whole effort over the last several months has been to make sure that every part of Canada will obtain service. That is the purpose of the amendment. It is to make sure that rural areas and areas producing raw products will get the same service as is obtained in t.he cities.


Charles Cecil Ingersoll Merritt: Will the minister give
the committee figures for various parts of Canada, including Vancouver, as to the estimated cost of constructing per square foot of, say a house under S6,000, and the lending value per square foot-whatever figure is used by the National Housing Act authorities?


Clarence Decatur Howe: We have never released these prices. It is difficult to say. Under integrated housing there is a controlled price which would be a criterion. The floor price for speculative building would be something else. We can hardly give it.


Charles Cecil Ingersoll Merritt: I am only asking with respect to the estimated cost upon which the lending value of the loan to the home owner is based. Since the lending value must be established, and he must be told what that is, there should not be any secrecy about that particular cost.


Clarence Decatur Howe: The variation in lending value depends on the location of the house, the desirability, and various other factors. If we laid down a rigid lending value for any kind of house in any location, such procedure would be hardly fair to the lending authorities. The only way in which the prospective buyer can get a lending value on a house is to produce the plans and location of the house. Then he is given the lending value of that particular house.


Charles Cecil Ingersoll Merritt: In my speech this morning I quoted the figures $4.20 and $6 which I got out of a report in a Vancouver newspaper respecting certain houses there. The minister has placed his limit of ten per cent on the increase in the lending value squarely on the ground that the cost of building houses has gone up 150 per cent from 1939, and, as I said, if that is so his argument in his statement the other day is one with which I agree. But when I see a spread of SI.80 per square foot between the lending value and the actual cost in connection with a particular house in

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Vancouver, then I am led to believe that the actual cost must have gone up very much more than 150 per cent since 1939. Therefore, the actual increase of ten per cent in lending value, so far as I can see, is not going to relieve at all the situation which it was designed to relieve.


Clarence Decatur Howe: It is necessary to see the plan of the house before we can say whether the figures given by my hon. friend are valid, as regards the difference he mentions. If it is a controlled-cost plan of building, the spread is entirely out of proportion. If costs are controlled the spread should be very much less than that mentioned. In the case of the speculative builder, the purchaser makes his own deal, but I would be surprised if he went ahead on the basis of the spread indicated. I know of no way in which the government can protect that man against an exorbitant profit of the builder.


The CHAIRMAN:: Shall the section carry?


Some hon. MEMBERS:: Carried.


Charles Cecil Ingersoll Merritt: Subject to the statement which the minister will make, it is carried.


[Stage Direction]
Section agreed to.
At six o'clock the committee took recess.
After Recess
The committee resumed at eight o'clock.
On section 2-"Cost of construction".
Clarence Decatur Howe: Before the recess, I undertook to answer a question asked by the hon. member for Cariboo, I believe, as to what methods were used for stimulating production. In my remarks on the resolution, I stated that we were prepared to use the same methods for stimulating production of home building materials that were used for stimulating the production of war materials during the war period. Various methods have been used to increase the production of nails. We examined the industry and found that a price increase was required, and a price increase was granted. In the case of asbestos, an amount representing a very large investment was made by a private company in return for receiving double the usual rate of depreciation. In the matter of plumbing supplies, negotiations are now proceeding which may involve the government paying for certain equipment, under the proviso that the government will own the equipment until the cost of it has been refunded through depreciation account or otherwise. In the case of brick, new brickyards were opened by government assistance in providing labour; and also in one case by the government undertaking to purchase the output of the yard in the event that the brick could not be sold privately. In the case of wallboard, an old mill was opened by the government diverting raw material from the industry as a whole and undertaking to purchase any material that could not be sold privately at the ceiling price.
These are samples of devices that have been used in stimulating production. A great number of cases have been examined and have received treatment. In the matter of soil pipe, it was felt the difficulty was that the ceiling was too low, and the ceiling was adjusted in a manner that greatly increased production. The practice is to examine a situation, find out what is preventing the required expansion, and then to take remedial steps accordingly.


John Oliver Probe: Has the minister considered adding another safeguard which, in my opinion, is exceedingly necessary. I believe that the production of all these items the minister has mentioned can vary considerably within the plants themselves. That is, production may be either slowed down or speeded up by a variety of more or less artificial devices: at the wish of the management, for example; continuous delay in getting a spare part, and so on. Has the minister considered making part and parcel of any contract he has entered into with any of these various industrial groups a requirement that double shifts, or three shifts if necessary, be maintained in the plants? What is the safeguard with respect:, to seeing that this machinery is continuously* employed? That is extremely important. Certainly it is a rnuph more difficult thing for the minister to assure than it would be to say, "We shall raise the price of nails from $5 to $6.50."


Clarence Decatur Howe: In examining a situation the first question asked is, is the industry operating at full capacity; in other words, is it operating three shifts? If not, the first step taken is to bring it into three shift operation and to correct any difficulties that prevented that being done previously. It is very simple for the officer in charge to check whether a plant continues to operate with three shifts, because the rate of production on a three-shift basis is established and any drop in production calls for an explanation.


Mr. MacNICOL:: Is it possible for any company manufacturing bathtubs or boilers or iron pipe fittings or soil pipe to get enough pig-iron to operate to capacity on one shift,
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let alone three shifts? Is not the trouble with all such businesses to-day the question of pig-iron?


Clarence Decatur Howe: If my hon. friend is talking about to-day, he is quite correct. Before the steel strike, however, the steel controller was supplying industry generally with all the pig-iron it could use. At Algoma Steel we cut back the production of steel by 25 per cent in order that the coke and other supplies required for making cast-iron could be devoted to that purpose. As long'as the industry was working at capacity under government direction, I do not think anyone requiring pig-iron failed to get the amount needed.


John Ritchie MacNicol: 
Clarence Decatur Howe: That is, of course, the real problem. Before the strike, we were forcing our steel economy to the limit. But up to that time, while everyone using pig-iron was on the ragged edge, I know of no case where an industry had to shut down for any considerable length of time owing to a lack of pig-iron. We were just about getting by with what makeshifts we could use. No industry had any considerable stock of pig-iron, but all were getting current supplies sufficient for immediate needs, so far as I know.
In the matter of nails, we have been running our industry to capacity. The present curtailment in production of nails is due to the curtailment in production of steel rods, as well as strikes in one or two of the nail plants. Of course we have plenty of steel rods inside a picket line at one plant, but unfortunately they are not available at the present time. The industry is completely disorganized to-day, and it will be a matter of several weeks before we get back into our stride. But when we do, I think we shall be reasonably in balance, so far as raw materials of steel are concerned.


Charles Cecil Ingersoll Merritt: Will the minister assure the committee that the capacity of the building materials industry in the country is great enough to deal with the programme of housing he envisages for the next five years? Will he say at the same time whether that capacity is such that the programme could be increased over the figures he has given?


Clarence Decatur Howe: The reason the limit to the programme is set is to keep parallel with our ability to expand the materials market. The reason we set 60,000 houses for the current year is that we believed we could raise our sights on the required materials in order to produce 60,000 houses. The reason we have set 80,000 for next year is that we believe we can raise our sights on materials to supply 80,000 houses. The following year we believe we can hit the 100,000 level, and keep up our supply of materials.
But the supply of materials is the wholly governing factor in the number of houses. If we had twice as much material, and a sufficient amount of labour, we could build twice as many houses this year. We are forcing up this materials position as rapidly as we can, and as rapidly as experience tells us is possible of attainment. That is the wholly limiting factor in the number of houses to be built.


William Irvine: I should like to ask a question respecting devices which the minister indicated were used to increase production of materials necessary for the building of houses. Is it not so that to offer increases in prices

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to private corporations to increase certain products means that pressure is brought to bear upon price ceiling control? In the second place, does the minister not think it is a weak device to remove from any private corporation all risk whatsoever, and promise to take over any surplus which may be left after the building programme begins to slacken? In that event, the community is absorbing the entire loss; or, if the surplus materials are put on the market subsequently, it means that the companies will have to shorten their production, just as if the device had never been put there.


Clarence Decatur Howe: The agreements are made for a limited period, perhaps for two or three years. We are in the happy position that we are most anxious to step up our programme, and to use any surplus materials. We feel we are quite safe in guaranteeing to take the entire output, because we are delighted to step up our programme so that we can be sure of the housing output. In other words, we have an expanding demand, and any temporary surplus of materials, which has almost never occurred and is not likely to occur, would be bought by us and put aside until we could step up the over-all production to a place which would allow us to reabsorb that material.


Mr. ROSS (Souris):: What are the prospects for securing galvanized iron? In my part of the country I know of a number of buildings now under construction, but the people who are supplying the heating equipment in considerable quantities are short of galvanized iron.


Clarence Decatur Howe: At the present time the prospects are just terrible. Not a pound is being made in Canada.


James Arthur Ross: I was afraid of that.


John Ritchie MacNicol: I should like to ask
another question, to which I would expect the same answer. When I was home over the week-end I discussed the question of glass with a large dispenser of that product. I gathered from him that there will not be a pound of glass anywhere in their organization for some time.
Time is rapidly going on. Here we are almost to the first of August. A month from that, people will be protecting themselves against inclement weather. What can they do? Are any big buildings available to be refitted to accommodate the multitudes of people who are living in tents? It is not the industry's fault. Everything is being held up at the present time and the situation may
get worse. It is not the minister's fault or mine. But we must look forward to saving our people from freezing to death, or suffering bad health from exposure to weather. The next month will go by rapidly, and when that time is over we are up against it.


Clarence Decatur Howe: I am happy to say the situation respecting window glass is not as bad as that in connection with steel. It is true that our glass-making industry is gradually closing down, owing to a strike in a plant which manufactures soda ash.
But window glass is not made on a large scale in Canada. I made the mistake of saying in an earlier debate that it was not made here at all. It was called to my attention that we have one plant, Industrial Glass Works Limited, St. Laurent, Quebec, which manufactures glass, and which is back in business.
However, imports of window glass are improving. Belgium, which was one of our great pre-war sources of window glass, is gradually coming back into the market, and in the meantime imports from the United Kingdom and the United States are stepping up slowly, as well. So that I think in the matter of window glass we are fairly well off.


John Oliver Probe: Has the minister taken the precaution of leaving an avenue open for the renegotiation of prices he is currently allowing producers, in case the profit margin gets too high, in the opinion of the government; or has the minister left that to look after itself?


Clarence Decatur Howe: Contracts made to-day are not subject to renegotiation. But the position of the manufacturer is closely examined before increases are granted. I believe that adequate precaution is being taken to make sure that excessive price increases are not granted.


John Ritchie MacNicol: I learned only a few days ago from a soldier who had served overseas for five years some facts concerning the purchase of a house. When he came back he had to find a house for his bride and his child, and went to the organization set up for that purpose. Its name escapes my memory at the moment. He bought the house from them at $6,000. Upon going back later to inquire as to when he could get possession, he was told that it would now cost $6,500, and after he waited for some time longer and made a further inquiry, the price of the house had gone up to $7,000. I was just wondering what controls there were in connection with Wartime Housing.


Clarence Decatur Howe: Wartime Housing does not sell houses. I am sure my hon. friend is referring to the Veterans Land Act. I am not familiar with its operations.
Homing Act

Mr. MaoNICOL: Does it get its supplies from the government?


Clarence Decatur Howe: That comes under the Department of Veterans Affairs.


John Ritchie MacNicol: When I spoke a moment ago I said that I was not familiar with the name and I referred to it as Wartime Housing. However, after hearing what the minister has said I realize that it is the Veterans Land Act. Is there any authority to prevent them from advancing the price of a house after making a contract with a returned soldier? I do not believe any working man or any ordinary chap would be able in his lifetime to pay for a house costing $7,500, unless he had perfect health and had no trouble in his home or was not faced with many of the problems that confront people in his circumstances. God must love these people more than he loves the others because he makes so many of them. Their troubles are legion. I do not believe any ordinary man, even in a reasonable length of time, would be able to pay for a $7,500 house.


William Irvine: I should like to be assured by the minister that I shall have an opportunity to return to the matter of cooperative housing schemes which, so far, have not been able to use the provisions of the act. I believe this matter would come under section 9 of the old act, and I should like to ask the minister if it will be appropriate for me to discuss this matter under section 5 of the present bill?


Clarence Decatur Howe: My hon. friend spoke of United States legislation, but I think he has become confused between bills introduced in congress and legislation. Was it the Wagner bill he was discussing?


William Irvine: It is No. S-1592, sections 404 and 405.


Clarence Decatur Howe: That is the so-called Wagner-Ellender-Taft bill. It has been introduced in the senate, and it is having a rather rough time there if one can believe the press.


William Irvine: It is still living.


Clarence Decatur Howe: It is like the amendments to the National Housing Act; it is under consideration. That bill refers to a project constructed by a non-profit corporation organized for the purpose of the construction of homes for members of the corporation. That provision is in the proposed amendment, but it is not in the present legislation. The present national housing act of the United States reads as follows:
Loans under section 207 of this title are rental housing loans made to limited-dividend corporations.

Those are corporations offering housing for rent but not for ownership.
A loan may not exceed $5,000,000 in amount, nor more than 80 per cent of the administrator's estimated valuation of the completed property, nor more than $1,350 per room attributable to dwelling use. (In no case can loan exceed 100 per cent of administrator's estimate of building cost.) Amortization basis is stipulated in each case by the administrator.
That applies to a limited-dividend corporation erecting housing for rent. There is no provision in the present United States legislation, as I read it, for cooperative building of homes to be owned by the members.


William Irvine: That is a good reason why we should take the first step. I ask the minister if it will be appropriate for me to bring up the matter under section 5?


Clarence Decatur Howe: Quite.


[Stage Direction]
Section agreed to.
On section 3-"Economic rental of a family housing unit."
John Oliver Probe: This section provides that the economic rental means an annual rental at the rate of twelve per cent of the cost of construction of the family housing unit. That is the basis for the working out of the rent chargeable by a corporation when arriving at its contract with its tenant. Could the minister give us the background for this twelve per cent rate? I have no doubt it is -based on good business practice, but I would presume that if we were able to get money at one or two per cent, or something like that, we might be able to reduce that annual -rent to considerably less than twelve per cent.


Clarence Decatur Howe: This is on the basis of one per cent per month. That may not be a very good explanation. I am not very familiar with the act since I was not in on the drafting. This amendment makes no change in the original act in that regard. I cannot tell my hon. friend why one per cent per month is considered to be an economic rental, but apparently the present act provides for that.


John Oliver Probe: It must be based on some financial consideration, and no doubt all the factors that entered into the cost of the house are considered, plus the maintenance, interest on the principal, depreciation, taxes and the replenishment of capital after thirty or forty years. The National Housing Act permits that a housing corporation set up by an insurance company may charge an economic rent of twelve per cent of the cost of the housing project and still be eligible for a government guarantee in the event of loss.


Mr.   HOAVE@: One per cent per month is the maximum that can be charged and it is

Housing Act
adjusted down if the facts do not justify that economic rental. In other words, if all the items mentioned by my hon. friend add up to less than one per cent per month, the economic rental is limited accordingly.


John Oliver Probe: The National Housing Act of last year and the amendments of this year refer to the twelve per cent. That would make the rental of a $5,000 house total $500 a year, while the rent of a $3,000 house would be $300 a year. If we are interested in low-rental housing it seems to me that we must work out some basis where we do not have an economic rental of around twelve per cent of the cost of the house.


[Stage Direction]
Section agreed to.
On section 4-"Housing project".
John Oliver Probe: This new section will read:
"housing project" means a project consisting of one or more one-family dwellings, or one or more multiple-family dwellings, or a combination of one-familv and multiple-family dwellings, together with any public space, recreational facilities and commercial space and buildings appropriate to the project.
Later clauses of the National Housing Act refer to such things as community planning. There have been put up in my city several hundred structures for which we thank Wartime Housing Limited and other agencies, because they keep the weather off the inmates of those houses, but when I think of the beautiful little city we had before these structures were put up and what we have now from the point of view of community or city planning I consider it nothing less than a disgrace. I think the minister should consider adding these words to the end of this section, "consistent with recognized planning principles." Would the minister comment on that?


Clarence Decatur Howe: Section 9 I think covers the point my hon. friend mentions. It protects the standards and provides for suitable community planning. If my hon. friend is talking to me as a former resident of Regina about wartime housing spoiling the character of the city, surely that is a matter for debate.


John Oliver Probe: We had a planning commission in our city for twenty years, and they have been trying to remove some of the scars left by our earlier pioneers.


Mr. SMITH (Calgary West):: Be careful.


John Oliver Probe: Including my good friend the hon. member for Calgary West, who was at one time a resident of our city. When we are discussing planning principles I think we should be consistent in our definitions. That is the only reason I bring this matter to the
minister's attention. There is nothing here to indicate that we have in mind the planning of our cities.


Clarence Decatur Howe: That comes later.


[Stage Direction]
Section agreed to.
On section 5-"Limited-dividend housing company."
William Irvine: I want to bring to the attention of the minister once again the plea of cooperative organizations to come under section 9 of the National Housing Act. I have here the prospectus of the York Mills Cooperative Home Builders' Association, which was granted a charter by the province of Ontario on December 3, 1945. The prospectus sets forth the objectives of the association, conditions of membership, methods of financing, building, tenancy and ownership. This newly organized cooperative, having been granted letters patent, made their application to the proper authorities to be granted a loan on a basis similar to that for private corporations for the purpose of building houses to be rented at a low rental to the shareholders of the association until such time as thirty years had elapsed, by which time the house would become the property of those who had lived in it and had paid back the loan. They received a reply from the department stating, in effect, that no provision was made for making loans for the building of homes that would be ultimately owned by those who rented them, and consequently the whole project has been brought to a standstill.
Would the minister give the committee a real reason why a cooperative should be excluded from section 9 of the housing act? It seems to me to be an act which provides for the c-are particularly of insurance and loan companies. According to the act, on a house costing $7,000 to build, 95 per cent of the first $2,000, or $1,900, may be borrowed; 85 per cent of the second $2,000, or $1,700; 70 per cent of the next $3,000. or $2,100; making a total to be borrowed' under the terms of the act of $5,700 out of the $7,000. It appears that under this section of the act private corporations scheme so that, by borrowing the full amount which the act provides for, they can increase the payments of the borrower by a considerable amount, so that instead of an actual loan of $5,700 on a house of $7,000 they manage to get away with lending $4,410. Thus, instead of 81 per cent of the loan, they are granting 47 per cent of the loan. So it would appear that the act as it is working out is one which, chiefly benefits the lending institutions.
The point I wish to make is this. In the first place, is not the security of the property
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in question, supported by a cooperative organization, just as good collateral, if you like, or just as good a guarantee of repayment of the loan as that given by a limited liability company, or whatever name may be given to the corporation which will borrow the money and build these houses? In the last analysis, the only real security you have is the house itself. If a man fails to meet his payments under this cooperative plan the property will, of course, be taken over by those who made the loan, just as it would in the case of a private corporations making the loan.
In the second place, why should the government insist that houses should always be rented? When a man has been in a house for thirty years and has paid the full amount of the money borrowed, why should he continue to rent it? Should it not be his house? That is the proposal Which the cooperative makes. I want the minister to give that serious consideration. I should like the minister to satisfy the committee-and I hope I am not the only one who is not satisfied with things as they are now-that it is not right or that it is not practicable or fair or whatever he wants to say about it, to make provision for a cooperative to borrow under this scheme. If he cannot explain that satisfactorily, I trust that he will make a new provision in the bill to permit the cooperative to obtain a loan which is now available only to private corporations which insist that homes in Canada shall always be rented and never be owned by the people themselves.


Mr. HERRIDGE:: I should like to read a letter that I have received from a group organized in British Columbia along the lines my hon. friend has just mentioned, together with a short brief which they have presented, and this is only one group Which is considering making similar proposals. This letter is from a group of veterans in the university of British Columbia who have organized to form a Veterans' Cooperative Building Association. It reads:
Dear sir:
I enclose for your consideration a copy of a brief prepared by the Veterans' Cooperative Building Association, of which I have the honour to be president.
Our association was originally legion sponsored, but is now quite independent, although all members are veterans.
We have had every encouragement in our plans from all sources, including the Central Mortgage and Housing Corporation, and now have our building plans complete for an initial project of 52 units.	-
I feel sure you appreciate the housing emergency in Vancouver, and will give the enclosed material your earnest consideration and support.
Yours truly,
D. Brousson,
President.
They deal with the subject in this short brief:
This brief is prepared and presented by the Veterans' Cooperative Building Association, 553 Granville St., Vancouver, B.C.
This association was formed last fall under the sponsorship of branch 168 of the Canadian Legion in Vancouver, in an attempt to help veterans solve their own housing problems, by providing moderate rental accommodation on a mutual ownership basis.
With this in view, the association has applied for a loan from the Central Mortgage and Housing Act, 1944, to finance an initial project. Loans under this section bear interest at 3 per cent, repayable within fifty years.
In doing so, the association has agreed _ to submit to all the requirements of the section as regards limitation of dividends, rents and incomes in order to insure the low-rental character of the project.
The central mortgage and housing committee, *while approving the technical details of the project, has refused the loan on the ground that because we are a cooperative association this would not be a rental housing project, but in essence a form of home ownership, and therefore disqualified under the term of section 9.
This association does not consider this decision to be soundly based from a legal point of view since the identity of a body corporate and of its membership are separate and distinct things and while it is true the tenants would hold shares in the association, tenants might also hold shares in a joint stock company and at the same time rent houses from it. but this would not presumably disqualify -such -a corporation from operating under this section of the act. In other words, the decision appears to discriminate directly against the cooperative type of organization.
I am not. going to read the rest of the brief, and take the time of the committee in so doing. However, in addition to the questions placed before the minister by the hon. member for Cariboo, I should like the minister to explain why he considers that this is not a practical scheme, a scheme such as has been in successful operation in Great Britain, I believe, for at least fifty years, where the money had to be raised from outside capital. The loans were subscribed in the form of bonds or debentures to form a building association. These associations in Great Britain have had a successful history; you rarely hear of a failure; they have been successful in every way, and I should like the minister to explain why he does not consider, under our present conditions, the necessities of the times and the urge of these men to cooperate in doing something for themselves, that something of that type would not be practicable and satisfactory in this country.


Clarence Decatur Howe: My hon. friend suggests as a parallel an organization which has been successful in England. I suggest that that is not the case. The cooperative building societies in England are corporations of substance; they build houses for rent and they also build

Housing Act
houses for sale. I gave the parallel before dinner; I do not know that I need repeat it. We will say the number will be ten-ten men banding together to form a cooperative. For what purpose? To build houses for themselves to own. That is the real purpose of the thing. The trouble is that the cooperative has no substance. Each man puts in what he expects his own house to cost, no more. If one of the tenants gets into difficulty a flaw is thrown on the title of the entire project, or might be. There is no substance to fall back on if one of the tenants gets into any of the ordinary business difficulties which might be experienced by any one of the cooperators. Therefore it is not a corporation that is desirable from the point of view of the cooperators, and it is not a type of business which is desirable for a government lending institution or any other lending institution. There is no reason why ten people should gather together for this purpose. Under part I of the Housing Act each can build his own house and be better off, because he has title to the property at all stages and has everything under his own control. We believe that it is not good business for the government to support a type of organization that is not businesslike as far as its own internal arrangements are concerned and offers to the government no protection which it would not have in dealing with the members individually.


William Irvine: I still have to press the point that the minister has not shown that there is not quite as good security under the cooperative arrangement as under any other, for the only guarantee that the government will have from any of these private corporations will be the building itself, and that will still be there. If it burns down it will have been insured. The minister says that there will be the same advantage for a private individual to do it himself. Let me show the minister that he is quite wrong in that. This is from the estimate of a company newly formed, of which I spoke, the Cooperative Association of Home Builders, in Toronto. Here is what they propose. On a house costing $6,000 the rental charge at prevailing rates would be $40 a month. Principal and interest charges on $5,400 amortized over thirty years at three per cent would 'be $22.84; interest on membership equity, one per cent on $590 corporate equity, would be fifty cents; municipal taxes, approximately $6; vacancy allowance, $1; insurance, sixty cents; special sinking fund for retiring thirty year loan made by each of the applicants, $1.23; making a total carrying charge per month of $32.17. So that there would be paid back each month to the cooperators $7.83, which would go to private corporations under the scheme which is provided for in the act, and would be $7.83 a month more for the wage-earners to pay in order to get their homes. So that it does make a difference whether it is done cooperatively or done under a private corporation.


Edmund Davie Fulton: There is a further point, arising from the brief submitted by the organization referred to by the hon. member for Kootenay West, this veterans' organization in Vancouver. As they point out, if they are ruled out from the operation of section 9 of the act, then as a cooperative they would have to operate under section 4, where the rate of interest on loans is 4i per cent per annum, instead of three per cent, which it is under section 9. The point the organization makes seems to me to be a good one and not to have been answered by the minister; that is to say, that just because they are a cooperative organization instead of a limited company does not mean that they cannot as a cooperative enter into a project for the construction of homes which they will rent to their members.


Clarence Decatur Howe: Quite so. Will they keep to that business, though? If they do that they can qualify under this part.


Edmund Davie Fulton: I do not know whether they will or not.


Clarence Decatur Howe: If they stop right there they qualify.


Edmund Davie Fulton: They have been ruled out apparently on the ground-


Clarence Decatur Howe: They won't keep to that.


Edmund Davie Fulton: It seems to be a fine distinction which the minister is drawing. If they will form a cooperative for the purpose of entering this arrangement with the institution and renting to members it would be all right, but what is the objection when they start to allow members to buy from a cooperative? Where does the risk become a bad one?


Clarence Decatur Howe: They are getting into a different class of business.


Edmund Davie Fulton: They may be getting into a different class of business, but what is the change in the risk? Why is it less desirable from the government's point of view?


Clarence Decatur Howe: Well, I put the thing on Hansard yesterday. I would be glad to put it on to-day:
Under part I of the act joint loans are available to cooperative housing groups formed for the purpose of building houses or apartments for occupancy by members of the group. Under certain circumstances loans for rental housing projects may also be made under part II . . .

Housing Act


Edmund Davie Fulton: At 4J per cent.


Clarence Decatur Howe: Yes, that is right, provided that the corporation is already formed and has interests other than housing.
Applications are being received from coopera'-tive groups for loans at three per cent for periods up to fifty years under section 9 of the act. This section provides for loans to limited-dividend companies for low rental housing projects,
Mark the distinction-low rental housing projects.
Generally these applications are from groups of individuals being formed into a cooperative to build houses for their own occupancy with the equity being supplied by themselves. The form of arrangement involves a lease to the member of the cooperative, but in most respects the position of the member is that of a home owner. These applications have been declined because section 9 was not designed for this purpose, its conditions cannot be fulfilled under such circumstances, it was never intended that the tenants of a low-rental limited dividend project should be its owners and the position of the tenant with respect to both his equity and continued occupancy is unsatisfactory.
An individual going into such an arrangement nas no security of tenure because under the terms of section 9 he cannot continue to lease a unit in the low-rental project if his income exceeds five times his rental. This condition exists to assure the low-rental character of the project. Even if the tenant's rental-being paid in lieu of principal, interest and taxes-is current, he has no protection against foreclosure with loss of equity and tenancy if the project as a whole goes into default which might be occasioned by default of 5 per cent or 10 per cent of the tenants. In most of the applications we have received there is no indication of any reasonable measure of protection on this score. Nor are there funds, other than the tenants' equity, to assure completion of the project in a period of rising costs.
The position of the tenant when the loan on the project is repaid is not happy. Under the section he, as part owner of a limited-dividend company, or having an interest in it through a cooperatitve, may not receive more than his equity with 5 per cent interest. If the residual value of his house was greater than this amount he would have to make a corresponding payment to retain possession. If it was decided to sell the property as a whole the position would be even more difficult. To avoid this trouble it has been suggested that at this time we should provide that the units revert to the tenants at the end of the amortization period. This is not possible in the light of the intent of the act.
There are other reasons why we should not approve such applications. They, like the ones I have outlined, all add up to one conclusion. Section 9 was not designed for home owners. Nor was section 9, with long-term money at three per cent, designed as a substitute for part I of the act, which provides loans to home owners at 4J per cent for a term generally twenty years but under some circumstances up to thirty years. If we provide cooperative home-owners with three per cent money, our position becomes difficult with other homeowners.

Our position is very clear. We will not approve applications for loans under section 9 of limited-dividend companies where the prospective tenants directly or indirectly are financing the equity of the project nor where factors exist which are not compatible to a limited-dividend rental project as defined by the act. On the other hand, we are ready to approve such applications under appropriate sections of the act, such as section 4 (3), which makes provision for loans to persons incorporated for the purpose of constructing and managing a cooperative housing project.


Edmund Davie Fulton: A good deal of what the minister has read, it is difficult to digest at once; but listening to it, it struck me that the objections made were equally applicable against a low-dividend corporation, particularly the difficulty which might be encountered should it be desired to buy a whole project- the same difficulty would be encountered with a limited-dividend corporation. That was the main impression I got, that all the difficulties which the minister detailed in that statement were equally applicable to the other form of corporation. I do not see why the risk should be affected merely because the members of the cooperative are given the opportunity, by paying a sum in addition to their rent, to buy the homes so that at the end of the fifty-year period they might own their own homes. It works in this way, surely. If the cooperative puts up the necessary money and can enter into this project with the government and the lending institution, then the cooperative as a body would be bound to pay a certain sum a year to the lending institution. That amount would have to be paid monthly by the members of the cooperative as rent. Provided that they complied with these terms and, in addition, were willing and able to pay the sum, whatever it might be, say ten dollars a month extra, so that at the same time they might be buying their equity in their homes, in what way would the risk to the government be increased? Finally, although the experts in the minister's department may have advised him before this ruling was made, there is nothing in paragraph 24 of section 2 of the act, in the definition of limited-dividend corporation, which in itself excludes a cooperative from the provisions of this section.


Clarence Decatur Howe: It is not the intention to exclude cooperatives. We welcome cooperatives in that field, provided that they carry out the purpose of the section, which is to build low-rental housing.


Edmund Davie Fulton: I know that,


Clarence Decatur Howe: I know you do not understand it, but I am telling you what the purpose of the section is.

Housing Act


Edmund Davie Fulton: And I am asking the
minister whether he can justify such a ridiculous purpose, because if you can build low-rental houses and there is no greater risk in enabling people to buy the houses back, all houses should be put under that section. However, if the minister has made up his mind I will not argue further about the matter, though I do not see the basis of the decision.


Stanley Howard Knowles: Does it not boil down to this, that the minister and the government do not wish to make it possible for home owners to get money at three per cent?


Clarence Decatur Howe: Not at all.


Edmund Davie Fulton: That is the effect of it.


Stanley Howard Knowles: That is precisely the
effect of the ruling that home owners must came under the section that requires payment of four and one-half per cent. This special provision of three per cent is made available only to these other limited-dividend companies or cooperatives who are building homes for rent. The point which we are trying to get across to the minister, and which we tried to get across to the Minister of Finance in the budget debate,, is that this is what cooperatives are for, not to make a profit but to save riioney to the members of the organization. The hon. member for Cariboo has given figures to indicate the type of saving that could be effected. The minister has already admitted that ten individuals in a cooperative in the case he cited could each come under part I of the housing act, and there is certainly no greater risk if the ten of them come together under this proposal. As a matter of fact, there would be less risk because of the nature of cooperatives. It seems to me that what we have here as in the other debate is a failure on the part of the government to recognize the true purpose of cooperatives and their valuable place in our economy.


William Irvine: The minister said a few moments ago that one of the reasons why cooperatives could not be considered as eligible under section 9 of the National Housing Act was that they were cooperatives only with respect to building houses. If they were cooperating on something else; if they were a cooperative that entered into some other kind of business, they would be eligible. I just want to point out that the cooperative organization of which I spoke a few moments ago, the York Mills Cooperative Home Builders, give the following as their objects and general programme;
The objects of the York Mills Cooperative Home Builders shall be as stated in the letter patent, viz.: cooperatively for the members,-
(a)	To promote home ownership, and to buy, lease, sell, mortgage, exchange, administer, and otherwise deal in real and personal property, to deal in building of homes or other buildings required in connection with homes, and in the creation of parks, playgrounds, swimming pools and the like, with all equipment and accessories in connection therewith; and,
(b)	to carry on in all its branches the business of landscape architects and landscape artists and in connection with such business to deal in. buy and sell flowers, shrubs, and every kind of plant and tree;
(c)	to do all such other things as are incidental or conducive to the attainment of the above objects;
(d)	to draw, make, exchange, endorse, discount, execute and issue promissory notes, bills of exchange, bills of lading, warrants, and other negotiable or transferable instruments.
That is only part of their programme; it is more than merely building houses, and it seems to me that should bring this organization right within the minister's own definition, as one that should receive the benefits of such an act.


Clarence Decatur Howe: We shall see how profitable the other branches of the business are.


John Oliver Probe: The minister referred to the fact that the limited-dividend housing companies were intended merely to manage low-rental housing projects. In his definition of a low-rental housing project in section 25 he states an anomalous position, because he refers to a housing project undertaken to provide decent, safe and sanitary housing accommodation to be leased to families of low income, or to such other persons as the corporation, under agreement with the owner, may designate. In other words, I believe it is recognized, and was stated here in the house by one responsible minister of the crown, that these limited-dividend housing corporations were not necessarily entering the low-rental housing field. I hope the minister will correct me if I am wrong, but I do not think he can under the circumstances, because it is not intended that the low-rental housing project will be held exclusively for the marginal income group of individuals.
While I am on my feet, I should like to draw attention to the wording of paragraph 25, which is contained in section 5 of this bill. It seems to me, with my limited ability to phrase readable English, that the minister has left a loophole for limited-dividend housing corporations or companies to build slum-type dwellings, if I correctly read the word "exceeding" in line 40. It provides:
"low-rental housing project" means a housing project undertaken to provide decent, safe and
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sanitary housing accommodation complying with standards not exceeding those approved by the corporation . . .
Apparently the corporation has certain other housing projects, but a low-rental housing project must not exceed that standard. In other words, it may fall below the standard. I should like the minister to consider rewording this section. My mind is not that of an attorney, as I have said, but to me this is an invitation to a limited-dividend housing company to get into submarginal construction. Perhaps we might have an explanation on that, and at the same time the minister might tell us the reason for the statement that as other, alternative tenants you may have such other persons as the corporation, under agreement with the owner, may designate.


Clarence Decatur Howe: The purpose of the "not exceeding" is, "not exceeding a certain rental." In other words, the government is not prepared to lend three per cent money to build rich men's houses. The purpose is to keep housing financed by the three per cent loans down to reasonable rental. I may say that Housing Enterprises Limited is very much a borderline case. It is not the type of rental we hope to get with those loans. The standards of construction are, of course, approved by the corporation. The plans and specifications are submitted to the corporation and approved by it as well as by the local building authorities before any agreement is entered into. The "not exceeding" applies wholly to the economic rental.


John Oliver Probe: I applaud that meaning and intent on the part of the minister; but just listen to this again:
... a housing project undertaken to provide decent, safe and sanitary housing accommodation complying with standards-
Not rentals, but standards.

not exceeding those approved by the corporation . . .
I defy any person who understands the king's English, or for that matter any lawyer, to tie that up with rentals. I think the minister must re-word this section.
Section agreed to:
On section 6-Powers of approved lending institution to loan on first mortgage.


Clarence Decatur Howe: I have an amendment to this section which I would ask my colleague the Minister of Justice to move.
Mr. ST. LAURENT: I move:
That section 3 of the act as reenacted by section 6 of the bill be amended by adding immediately after the last word thereof the following:

"and to protect the mortgage security, the said lending institution and the corporation may join in makim- supplementary joint loans to the borrower and in the taking of such other measures and steps as may be required in accordance with normal mortgage practice, to safeguard the interests of His Majesty and the said lending institution."


John Oliver Probe: Might we have an. explanation of that?


Clarence Decatur Howe: The purpose of the amendment is to assure that the lending institution and the corporation have power to perform the normal functions of a mortgagee in the handling of a joint mortgage account. It is occasionally necessary in the handling of a mortgage account to advance money for taxes, insurance premiums and other matters affecting the security, and in some cases to advance money to take foreclosure action. These are specific examples of what might be done under this clause. I may say the auditor general has expressed doubt as to whether the act permits the mortgage company to make expenditures of the type I have mentioned, to protect the property. In the case of a farm, it might be necessary to advance money as a loan for seed grain; and in a city it is frequently necessary to advance money to pay taxes to prevent loss of the property to the city. This is simply to make it abundantly clear that the corporation has the right to advance money for those purposes.


[Stage Direction]
Amendment agreed to.
Section as amended agreed to.
On section 7-Contract with approved lending institution in respect to loans and resulting losses for rural housing.
John Oliver Probe: This section deals with the approval or at least with the inspection of farm homes for the purpose of lending money to be used in erecting houses on such farms. As was mentioned by several speakers this afternoon, to date the farm loan clause has been a failure. According to a recent report to the house, there was supposed to be one loan for farm housing alive somewhere in Canada. I paid a visit to the president of Central Mortgage and Housing Corporation a short time ago, in part to find out where this house was, but apparently he was in some doubt as to whether there was even that one loan in existence. There must be some reason why farmers have not been able to avail themselves of the terms of the National Housing Act. Would the minister indicate how extensively farmers have applied for assistance under this act, and what their reception has been. The absence of any loans in Canada in

Housing Act
ten or eleven years suggests to me that the act is not meeting with very favourable response, and that there must be a reason for it.


Clarence Decatur Howe: There have been no applications for loans under the farm section. The one loan referred to was in Davidson, Saskatchewan, which I would describe as an urban rather than a farm loan. That application was made under this section. The reason is that, administratively, the section has proved to be impossible.


John Oliver Probe: Are you now amending it?


Clarence Decatur Howe: We are amending it to make it workable, we think; and we hope to have it widely used as amended. The terms are being liberalized, and provision is being made for handling costs in connection with the making of loans, which are very much higher than costs in urban centres.


Mr. REID:: In view of the fact that the minister's officials are now sitting in front of him, may I point out that under the old National Housing Act there were certain districts where applications for loans were made to lending institutions. Sometimes those lending institutions took the position that, owing to the fact that a city or municipality from which an application came was under heavy bonded indebtedness, objection should be raised to making such loans. I hope that under the new act this will not take place. I call the minister's attention to this point because it acted to the detriment of a person with whom I am acquainted.


John Oliver Probe: Would the minister indicate if the changes he is proposing with respect to farm lending are such that farmers of all provinces, without discrimination, will be able to avail themselves of the terms- of the National Housing Act? I am chiefly interested in Saskatchewan, naturally, where the Central Mortgage and' Housing Corporation has done very little business. I believe that only 199 houses have been built in the last year and a half with money lent by that corporation. Is there to be any discrimination in the matter of lending money for rural homes in Saskatchewan?


Clarence Decatur Howe: The difficulty in making loans
in Saskatchewan arises from provincial legislation. I believe that legislation is being tested before the supreme court, and about the end of October we should know what the position is. Obviously the provincial legislation is in conflict with the requirements of the housing act as it stands on the statute books.


John Oliver Probe: Have there been any negotiations between Central Mortgage and Housing Corporation and the Saskatchewan government dealing with those specific points of legislation, in so far as the National Housing Act is concerned?


Clarence Decatur Howe: No, there have been no discussions. I happen to know that the point has been raised by the dominion, on account of the farm loan boards. I understand that a decision will be brought down in two or three months.


John Oliver Probe: There is no question as to the personal responsibility of individuals in that province.


Clarence Decatur Howe: Not at all.


John Oliver Probe: It is just on account of the legislation?


Clarence Decatur Howe: Yes.


John Oliver Probe: Because, after all. some question was raised as to the value of our government bonds. No doubt the minister is well aware that our bonds are travelling well above par at the present time, and1 it seems to me that financial institutions generally recognize that we are solvent. I think we are just as honourable as any other part of Canada, and I should like to impress that fact upon the minister. It seems to me that, without going into all this litigation the minister is talking about, we could still ask for the benefit of the act.


Clarence Decatur Howe: The difficulty is that we cannot operate the act differently in one province from what we do in the other eight provinces. I know a great deal about the integrity of the citizens of Saskatchewan, because I dealt with them privately for many years. But it simply is the difficulty of administration, where one finds a law' in direct conflict with the provisions of the measure we are now discussing.


[Stage Direction]
Section agreed to.
Section 8 agreed to.
On section 9-Terms of contract.
Stanley Howard Knowles: This afternoon, when the minister was speaking on second reading, he made some enlargement of his statement the other day respecting this section. I am soriy I did not get it down in black and white. Would he mind telling us again the addition he made with respect to the national parks.


Clarence Decatur Howe: I thought I was correct when I spoke the last time, but since then I have found that in northern Quebec there is land
Housing Act

owned in fee by mining companies which operate company towns and which do not make the practice of selling land, although under the Quebec law they can grant a 99-year lease for the land. Such 99-year lease is quite satisfactory for security of the equity of Central Mortgage and Housing Corporation, and that might be accepted in lieu of ownership. This measure gives that power. The corporation must, however, be certain that the leasehold equity is practically the equivalent of ownership, so far as the purposes of the corporation are concerned.


Stanley Howard Knowles: A week ago, when the resolution was under discussion, I asked the minister, as reported at page 3710 of Hansard, whether this section could be expanded to provide, for limited-dividend corporations building homes on property they merely lease rather than own outright. The minister replied:
I can hardly imagine a government agency lending money on houses where the control of the land is not permanently in the government.
The statement the minister has just made is generous on his part; but the thing that bothers me is that, a further extension of what this may mean now having come to light, still more may be involved in the wording of the section. It seems to me that the minister should word it a little more closely than it is now worded, to make sure that it will not be used to cover more than he has already indicated.	-


Clarence Decatur Howe: I am prepared to admit that the section is wide open. It permits the corporation to lend on housing on leasehold land.


Stanley Howard Knowles: That is, it permits what a week ago the minister could not imagine the government doing.


Clarence Decatur Howe: I could not imagine it then, but I find now there is a reason for it. In grants to mining companies or paper mills it is quite often the policy not to sell but to give long-term leases. If a lease is for ninty-nine years, that is regarded as suitable security. May I say that when I spoke a week ago I spoke in good faith, because I understood that the sole purpose of the amendment was to take care of the situation at Banff and Jasper.


Stanley Howard Knowles: I do not doubt the minister's good faith of a week ago, but I doubt his judgment now.


Clarence Decatur Howe: Perhaps so.


John Oliver Probe: I feel the minister would have every justification to make it possible for

residents to build on crown lands in national parks which they intend to hold in perpetuity. After the word "lessee", he can add two or three words such as "of crown lands", or their legal equivalent, which would make it possible to provide housing on crown lands that are national playgrounds or resorts. I take strong objection to money being lent by the Canadian people to individuals who are simply tenants of large corporations which are exerting a permanent hold on any given property. It seems to me that this provision would not be dangerous if it referred to land in the hands of either the dominion or a provincial government, but beyond that I feel the the minister should not go.
We do not want to perpetuate the land holding system of England which, as the minister knows, is now causing considerable difficulty in connection with the housing programme. Even before the present Labour government came into power, there was trouble because of the manner in which land was held by family corporations. It seems to me that we are moving backward rather than forward if we leave this section unchanged. The minister has said that the purpose of this was simply to make it possible to build in national playgrounds. Why not state it in that way and let the other people sell their land rather than just lease the right to build houses?


Charles Cecil Ingersoll Merritt: I want to refer again to the lending value. If the minister cannot give us the cost per square foot I wonder if he can give us some idea of what percentage of the total cost of a small house, say one costing up to $7,000, the prospective home owner has to put up? In the example I cited to-day, it appears he would have to put up 32 per cent. If the corporation and the lending institution put up only 68 per cent we are not very much better off than we were before we had the act. It is my understanding that private lending institutions will lend 60 per cent as a normal practice.


Clarence Decatur Howe: A four-roomed house built in Vancouver under integrated housing, in which case there is a cost limitation, costing about $5,500 would require an equity of about $600. In the case of a house costing in the neighbourhood of $6,500, the equity would run as high as $1,000. That is under integrated housing where profit limitation applies to the contractor.


Charles Cecil Ingersoll Merritt: I understand that, but am I to assume that it is the policy of the government to presume that, in the cases of houses built by ordinary contractors for veterans and others under part I of the act, exorbitant amounts are allowed for profit? Is that the

Housing Act
basis of distinction between an integrated housing scheme and one carried on under part I?


Clarence Decatur Howe: We have no way of checking the profit made on a house not built under a government plan. If a contractor cares to limit his profits and operate under integrated housing he would have the benefits of priority for materials and so on. We assume that the only reason a contractor would not want to qualify under that scheme is that he wanted more profit than was allowed.


Charles Cecil Ingersoll Merritt: I do not want to get into a theoretical argument and I know the minister does not, but surely some practical figures must be available with relation to loans to home owners under part I of the act within the last six months or so which would give us some idea.


Clarence Decatur Howe: I would say it varies a great deal. Certainly he could get no more favourable terms than those I have quoted if they operated under integrated housing, but they may be much higher if the builder is taking a larger profit.


Charles Cecil Ingersoll Merritt: According to the minister's statement the other day, the present cost of houses is estimated at 150 per cent of the 1939 cost. Why not find out what the cost of a house is to-day and work out your lending value in relation to that rather than use a base line which, so far as I can find out, is not used by any other agency?


Clarence Decatur Howe: I do not know anyone who is building more houses than the Department of Reconstruction and Supply. We know to a gnat's eyebrow how much it costs to-day as compared with the cost in 1939.


John Oliver Probe: I am still not satisfied with paragraph (a). Will the minister explain just why that clause is left wide open for the building of houses on leased property? Is the minister quite happy over the fact that by the terms of this bill any Landlord may ultimately acquire a house which a tenant has put on his property and paid for? That will be the ultimate goal of various individuals who will use this legislation. Why could this paragraph not be reworded?


Clarence Decatur Howe: I am not very keen anyway about the section and I would be quite willing to limit it to parks. However, I am told that that would prevent the building of certain projects in northern Quebec where the transfer of property is not possible, but where it is possible to obtain a ninety-nine year lease. I believe this has something to do with the mining laws of the province.


John Oliver Probe: I would suggest adding the phrase "of crown land" after the word "lessee", or some equivalent wording. Then this concession could be made where the land is perpetually owned by the people of Canada in the right either of the dominion or of a province. If it is held by some corporation which is simply subleasing the mineral rights, then I think we are starting up a dangerous business. I should like the minister to give some assurance on that point.


Mr. MICHAUD:: I do not know about the other provinces, but in my province we have continued the old English practice whereby land is leased for building purposes on longterm leases, 99 years or 999 years. I have drawn up hundreds of such leases. In many cases, the owners of the land do not wish to dispose of the fee simple and they divide up their land into building lots which they refuse to sell. The land upon which my home is built is under such lease. I have not approached the lady who owns the land, but I know others in the vicinity have and she definitely refuses to dispose of the fee simple. These particular leases are for 999 years. There are quite a few in northern New Brunswick and some in the city of Saint John. Whether the practice should be encouraged or not, I am not prepared to say. The fact remains that the practice has become established, some people happen to be in possession of a lot of land under leases of that kind, and unless the act is amended as suggested they would not be eligible to operate under it. Insurance companies, for instance, when they hear of these leases inquire about them and, when they find what the situation is, they withdraw any objection which they otherwise would have to shorter leases. If the leases are confined to longterm leases I do not see anything objectionable about it.


Stanley Howard Knowles: I think the minister has clearly revealed that he does not think this practice should be encouraged. I will quote again his words of a week ago, and I want to make clear that I am not doing so to suggest any bad faith on his part but rather to suggest that the snap judgment he made when I put the question to him a week ago expresses what he really thinks about this matter. He said at page 3710 of Hansard:
I can hardly imagine a government agency lending money on houses where the control of the land is not permanently in the government. It could do it in the parks, because the control of park lands is in the hands of the government, but I cannot imagine a corporation lending money to build houses on land merely leased from a private citizen.
iOf?
Housing Act

I went on to reply that I could not imagine it either, but that I wanted to be sure on the point. If the minister has a special case in mind, such as he has referred to in a mining area, I would suggest that some special provision be made for that in the section that relates to mining and lumbering operations. But let us not, in taking care of one special case, leave the door open to something which the minister himself says he is not very keen about.


Clarence Decatur Howe: This is a big country and the hon. member for Restigouche-Madawaska has pointed out that it is the practice in New Brunswick to have long-term leases running up to 999 years. In the United States, of course, a large part of New York city is built on land under 999-year lease. The same is true of Great Britain. I see no reason why a limitation should be put in the act which would prevent a corporation from lending on what is practically a perpetual lease equivalent to ownership.


Stanley Howard Knowles: Then we have got what I was suspicious of a week ago.


[Stage Direction]
Section agreed to.
On section 10-Terms of Contract.
John Oliver Probe: Paragraph (f) says:
The interest payable to His Majesty on the portion of the joint loan advanced by His Majesty shall be at such rate as is agreed upon between the corporation and the lending institution and set out in the contract.
What is that rate, and why is that rate not included in paragraph (f), or does the rate vary?


Clarence Decatur Howe: 
John Oliver Probe: This is purely affecting the contract between His Majesty, represented by the corporation, and the lending institution. Am I correct in that?


Clarence Decatur Howe: Yes.


John Oliver Probe: What rate of interest does the lending institution which borrows this 25 per cent, or whatever it might be, from the Central Mortgage and Housing corporation pay to the corporation for the money which it borrows and lends to the ultimate home owner? He pays per cent, regardless of how money fluctuates. What rate does the lending institution pay to the corporation? Is that a flexible and fluctuating rate? If so, why is the benefit of lower rates not also [Mr. Knowles.1
available to the ultimate purchaser, the man who borrows in the first place under the National Housing Act?


Clarence Decatur Howe: The lending company pays the government three per cent for the money. It is the joint rate which provides the maximum for the borrower. The maximum is fixed at 4-J per cent. By agreement it can be lowered if money rates justify a lower rate. We hope that if present-day trends continue it will be possible to lower the rate to the private borrower.


John Oliver Probe: If money rates continue to decline, the private borrower under the housing act may expect to receive the benefit of that? That is why this is left in?


Clarence Decatur Howe: That will certainly be the effort of those who are responsible for the administration of the act.


John Oliver Probe: Paragraph (k) on page 5 of the bill deals with a loan made to a builder. This is a new principle which is being introduced by the minister. Is there in the contract between the Central Mortgage and Housing Corporation and the builder who has built a house for sale a limitation of any sort on the profits allowed to the builder on resale to the ultimate purchaser, and, if so, what is it?


Clarence Decatur Howe: My hon. friend is referring to the statutory provision for the integrated housing plan. There the profit margin to the borrower is limited by agreement.


[Stage Direction]
Section agreed to.
Sections 11 and 12 agreed to.
On section 13-Corporation to safeguard interests of His Majesty.
Stanley Howard Knowles: Subsection 4B(1) deals with the matter which has just been under discussion. The minister, when speaking on integrated housing, gave a short outline of the plan and statistics as to the number of projects that have been launched and the number of units included. Can he give the committee a little more information about this plan with particular reference to costs, selling prices of homes under it and what has been the experience thus far? What have been the selling prices provided for in these contracts, and how much profit do these selling prices involve? May I also ask him whether there is any difference in the amount of profit per unit between a project of twenty units and a project of 117 units? I use those figures because they are taken from his table.

Housing Act


Clarence Decatur Howe: Under the agreement the builder agrees: (a) to provide land in any urban area; (b) to erect a specified number of houses thereon; (c) to apply for a loan under the National Housing Act in respect of each house; (d) to offer each house for sale for the approved lending value and certain carrying charges, plus the sum of $350 in the case of a two-room house, $425 in the case of a three-room house, and $500 in the case of a four-room house; and (e) to give preference to veterans in the sale of such houses.


Edmund Davie Fulton: Under section 4B, subsection 3 (b) it is provided:
that such other things shall be done as the corporation deems necessary in order to carry out the intent of this section and to safeguard the interests of His Majesty.
There is, on the face of it, no great objection to that provision, except that it does seem to be very wide, and as such, I think, might be open to objections in the future, when possibly the corporation will say that it will require a prospective owner to cany out this or that undertaking, and the owner may say, "Well, that is not in the act." I think it might be desirable to have defined more specifically what is the intent, and within what range the corporation may make regulations under this subsection. Would the minister take that under consideration?


Clarence Decatur Howe: I shall be very glad to. I think this is a special arrangement to meet a special condition. In other words, at the present time the demand is for houses for veterans, and low-cost housing is required; profit margins must be rigidly controlled. It may be that in later years the demand will be for another type of house, perhaps for others than that for veterans. It may fill up the demand for low-cost housing for veterans and require a different type of house. I think it is simply a flexible provision which will allow the regulations to be amended accordingly.


Edmund Davie Fulton: The only thing I am trying to get at is this: in what sorts of categories may the corporation make these regulations? Will it be for planning, standards of construction, standards of maintenance, times and methods of repayment; or what categories of expression are intended to be given to the corporation under this subsection?


Clarence Decatur Howe: This is an integrated housing plan: it simply provides for financing a contractor to build houses of a certain class with a profit limitation. As I say, present regulations require conditions which apply to the present day; in other words, it covers only low-cost housing for sale to veterans. I am
simply pointing out that under this clause it may be desirable at a later date to encourage contractors to build another type of house, and this is a clause which provides that the regulations may be geared as the times may indicate.	-


Stanley Howard Knowles: Does it work out that the profits in these cases are the amounts indicated by the minister, $350, $425, and $500?


Clarence Decatur Howe: That is right, yes.


Stanley Howard Knowles: Do I understand, then, that the profit bears no relation to the cost but is rather in relation to the number of bedrooms in the house?


Clarence Decatur Howe: Well, we put on the lending value of the property; that is, the corporation sets the lending value, and these are the additions to the lending value which make up the maximum sales price. It is the lending value, plus the additions which we have shown here, that is the over-all price.


Stanley Howard Knowles: I am still not satisfied as to the basis for the limited profit which is supposed to accrue to the builder per unit.


John Ritchie MacNicol: What is the supposed average price of a low-cost house?


Clarence Decatur Howe: It depends a great deal on who builds it. If Wartime Housing build it it is very reasonable, but if it is built by private capital it is about $6,000.


John Ritchie MacNicol: That, in my judgment, is a very high price to ask any returned man to pay. I do not see how these men can pay for a house costing more than $3,500 or $4,000 and have anything left for themselves.


John Oliver Probe: With respect to subsection 6, I notice that in two cases it suggests that purchases made by Central Mortgage and Housing Corporation Act are listed as losses. Would the minister please explain this section? To me it reads that if the housing corporation buys a house from a contractor following a contract entered into between a corporation and a builder; if within a year he fails to sell that house, the corporation buys it back from him or guarantees to take it back, and that the amount it pays is written into the books of the corporation as a loss. I may be quite wrong. I can see in connection with subsection 5, referring to taxes, that you could write those down as a loss, but certainly not the price that the builder of the property is going to be reimbursed in a bookkeeping transaction; that certainly should not be written down as a loss.


Clarence Decatur Howe: The reason the contractor cannot sell a house is, we will assume, that it is
Housing Act

priced above the market price. Under the guarantee we are obliged to take it off his hands at the price under the agreement. We assume that if the contractor cannot sell it at that price neither can we. Therefore the cost of the house to us is recorded as a loss until we sell it, and then the recovery is registered as a gain.


John Oliver Probe: You are holding an asset against a loss for the time being?


Clarence Decatur Howe: Yes.


[Stage Direction]
Section agreed to.
Section 14 agreed to.
On section 15-Loans for low-rental housing projects.
Mr. FEARKES:: Referring to the amending section 9A of section 15, dealing with the scheme for providing houses in what are called the lumbering and mining areas, as I indicated in the resolution stage. I believe that that scheme will have a stabilized effect upon the industry. But there are a couple of questions which I should like to ask.
First, does the term "the lumbering industry" refer specifically to lumbering, because in British Columbia a lot of the forest industries are divided up into logging industry or logging operations and lumbering operations, pulp and paper operations. Will this include all these operations? In other words, are logging operations included under the general term of "lumber operations"?


Clarence Decatur Howe: Yes.


George Randolph Pearkes: Because some are quite distinct; they are merely dealing with the export of logs. I think it might help 'things if the words "logging and lumbering" were put in that paragraph, because we regard those as two distinct operations.


Clarence Decatur Howe: We regard anything having to do with the cutting down of a tree as "lumbering" under the act,


George Randolph Pearkes: It is not so regarded in British Columbia. We have operations which are solely concerned with the cutting down of a tree and the exporting of logs to mills either, shall we say, on the mainland of British Columbia or, sometimes, to the United States.


Clarence Decatur Howe: I am proposing an amendment to this clause, and I shall be very glad to add the word "logging" to the definition.


George Randolph Pearkes: Thank you.
There is only one other point I should like to make, on the same subject. I am not at all
[Mr. Howe.l
sure that the eighty per cent of the loan is adequate. I have had it represented to me that some of these logging and lumber companies . have already invested practically all their fluid capital in the construction of mills. I can quote one instance where a new mill has been constructed, where new bunkhouses have been put up, and where thirty-five houses have been constructed by that company. The management of that, company have written in to me that they are at the end of their available capital and that the eighty per cent is not adequate to enable them to finance another building project. They suggest that another 200 houses in that particular area are needed immediately. Is there any chance of the minister reconsidering that and allowing it to go up to ninety or ninety-five per cent, instead of keeping it at eighty per cent?


Clarence Decatur Howe: I am satisfied that with the type of loan we are discussing eighty per cent is stretching it to the limit of what is prudent.


Mr. GIBSON (Comox-Alberni):: With reference to this section, I wish to thank the minister very much for having introduced this legislation at the present session. During my travels through the constituency last winter, I found that one of the greatest causes of dissatisfaction among the workers in basic industries was the fact that the National Housing Act was not applicable to them in unorganized communities. I brought back a suggestion to the minister that something might be worked out along the present lines, and I wish to thank the president of the Central Mortgage and Housing Corporation, Mr. Mansur, for the excellent work he did in preparing the legislation.
It is about time we realized the great debt we owe the workers in our basic industries who have left their homes and gone to isolated places where they have contributed so much to the economic welfare of the country. During the war period, we lost some of our best loggers. Jobs were available in the cities and in the shipyards where they needed the type of workers we have; loggers are men capable of handling large and heavy loads and heavy equipment, and the men have now found that they do not wish to return to the woods if they cannot take their families with them. I do not blame them. The logger has become tired of endorsing his cheque every month and sending it a distance of two or three hundred miles to his family, simply having enough money once a year to get home for the Christmas holidays.
There has been some criticism of the minister as evidenced by the question that some people ask as to where the jobs are

Housing Act
coming from to employ the owners or the tenants of these homes in the urban areas. It is said that you are building homes in the cities, and it is suggested that the greatest feature about it is that these people will be close to the unemployment insurance office. In my opinion it is important to provide homes for men where there are jobs to be had, and in this legislation provision is 'being made to that end. As the hon. member for Nanaimo has said, it is difficult for companies that are trying to finance their operations, particularly under the present ceiling price of lumber in Canada, to provide extra working capital for the erection of homes for their employees.
One thing I might mention is this. One of the great causes of dissatisfaction in the lumber strike in British Columbia is the fact that a great many men have to travel two hours each way to and from work. Men working in Alberni have to travel two hours out in the morning and two hours back at night, so that they are actually working a twelve-hour day instead of putting in eight hours. Under this provision, the company could provide homes and that would obviate one cause of dissatisfaction.
One thing I would suggest to the minister- and I have discussed- it with him to some extent-is the desirability of bringing fishermen under this section. It is confined to mining and lumbering operations, and I would appreciate it if the minister would give consideration to the fishing industry, bringing it under the same provisions as are extended to the others.
As regards cooperatives, about which we have been speaking, the minister is not partial to providing them with that type of loan. I believe that in my own constituency-and I have no doubt that other coastal members from British Columbia would say the same thing-we have fishing cooperatives of considerable substance, as the minister would discover, and they would probably be eligible for loans under a fishing section of this act. They would be excellent risks, and I can see no reason why they should not come under the heading of incorporated companies. I offer that as a suggestion to the minister.


Clarence Decatur Howe: When I visited the Pacific coast last winter I was greatly impressed with the necessity for the type of housing covered by this section, but I had difficulty in working it out, and the advice of the hon. member for Comox-Alberni was helpful to myself and the department in finding a solution which we believe will be workable. I wish to make that acknowledgement at this
time. I have an amendment which will include the fishing industry, and I would ask the Minister of Justice to move:
That subsections 1 and 2 of section 9A of the act, as enacted by clause 15 of the bill, be repealed and the following substituted:
"9A. (1) The corporation may on behalf of His Majesty, and with the approval of the governor in council, make a loan to a borrower engaged in the mining, lumbering, logging or fishing industry, to assist in the construction of low or moderate-cost housing projects in areas or localities that are adjacent to or connected with the operations of the borrower.
(2) For the purpose of this section the expression 'borrower' means an incorporated company engaged in the mining, lumbering, logging or fishing industry, and includes a company (in this section referred to as a 'subsidiary company') incorporated for the purpose of owning, constructing and managing a housing project, all the share capital of which, except directors' qualifying shares, are owned by an incorporated company (in this section referred to as the 'parent company') engaged in the mining, lumbering, logging or fishing industry."
Mr. ST. LAURENT: I so move.


[Stage Direction]
Amendment agreed to.
John Oliver Probe: I hope that does not preclude some questions on the section as amended. Under a concession such as this, will the minister explain why a company which is borrowing from the Central Mortgage and Housing Corporation is favoured with a four per cent rate, while a cooperative, if it can borrow, has to pay 41 per cent? I should like some explanation of that.


Edmund Davie Fulton: May I ask whether, in the opinion of the experts of the department, for the purposes of this section an incorporated company may include a cooperative company, provided that it is definitely associated for the purposes specified in the section?


Clarence Decatur Howe: If the cooperative is also a lumbering or logging company it will qualify.


John Ritchie MacNicol: Or a fishing company?


Clarence Decatur Howe: A cooperative simply for the building of houses in a lumbering area would not.


Edmund Davie Fulton: If it is a cooperative logging company it will be covered?


Clarence Decatur Howe: Yes.


John Ritchie MacNicol: Would it include fishing companies?


Clarence Decatur Howe: Hon. members will remember that there is a 4J per cent rate for home owners and privately owned rental houses. In the case of loans to limited-dividend companies a three per cent rate is available. It is felt that outlying area loans should be at a
Housing Act

rate between three and 4\ per cent. The rate should be lower than per cent, because in every case we have the guarantee of the lumbering or mining company. Further, the company is subject to limitation of earnings on investment to the rate established for the mortgage. Therefore the mortgage rate must have relation to a fair maximum rate allowable on the company's equity. On the other hand, the rate should be higher than three per cent for limited-dividend companies, if for no other reason than that the housing will be of great advantage to lumbering and mining companies. In the light of these factors, we felt that a four per cent rate was appropriate.


Robert Ross (Roy) Knight: I should like to ask the minister the position in connection with lumbering camps, particularly. I realize that mining towns have more stability, more permanence, and it seems to me that lumber camps are fleeting things.


Charles Cecil Ingersoll Merritt: It is just the opposite.


Robert Ross (Roy) Knight: All right; you tell the minister that when I have finished. If a logging operation runs out, what is the position if we have what are called ghost towns? What is the position if the project is abandoned?


Clarence Decatur Howe: The corporation must exercise care to see that the life of the loan is not longer than the life of the community or the operation. In my discussion of the bill this afternoon, I mentioned that the best possible advice must be obtained from appropriate authorities as to the life of the operation, and as to the appropriate type of housing. For example, housing for a short-term operation probably would be built on skids so it could be moved to another operation, if that were appropriate; but skill must be exercised by the corporation to see that their loan is protected, having regard to the nature of the operation.


Charles Cecil Ingersoll Merritt: Under subsection 6, which has to do with the terms of the contract, paragraph (a) reads shortly that the loan can be made only if evidence satisfactory to the corporation has been furnished as to the need for such housing accommodation-a perfectly proper provision-and that such housing accommodation will result in an increased number of people being employed in connection with the operation. It would seem to me that if there were a switch from bunkhouses to houses, so that people working in the operation were able to bring their families there, the purposes of the plan would be served. Surely it would not be necessary that these beautiful houses should bring many mere
[Mr. ITowe.l
people into the employ of the company. It seems to me that a logging operation or a mine has a set crew, and presumably they are there now even without the houses, if the project is being operated properly. I was going to suggest to the minister, in the first place, that this second provision, with regard to an increased number of people being employed, should be dropped altogether, or, in the alternative, that it be amended to provide that an increased number of people should reside in the area of the operation or in connection with the operation, rather than being restricted to an actual addition to the crew employed on the job. I think, too, that the retention of the men employed on one of these operations is perhaps just as important as increasing their number. One thing we should try to guard against is a continual turnover of men because they must go down to the cities to see their friends and their families. I wonder if the minister would consider making that change.


Clarence Decatur Howe: It seems to me that the position at the moment is very much the same as slum clearance. We would like to undertake slum clearance. However, we are faced with the difficulty that if houses were torn down before alternative housing was available there would be real and natural resistance. If housing in lumber camps was torn down to provide better housing, there again it might be depriving someone who would have no other housing at all. I think the purpose of the act was not simply to improve living conditions for the men who happened to be there, but also to provide a better class of accommodation for an expanded operation.


Charles Cecil Ingersoll Merritt: Yes, but at the present time, as I understand it, the husband working there is living in the bunkhouse, while his wife and family are living in Vancouver or Victoria or Alberni. If you built him a house and took him out of the bunkhouse you still get his family out of the city, and free accommodation there. I believe in that way you would more quickly achieve the purpose you are seeking, without imposing this additional restriction. To my mind, it is a restriction that is unnecessary, in that it ties the hands of the corporation too much. The coiiporation could quite easily give preference to those cases which wrould increase total employment in the camp, in getting this thing started, and then come in with the type I am talking about later; but I think to leave it in the statute is to limit the scheme quite strictly and quite unnecessarily.

Housing Act


Clarence Decatur Howe: Well, I will ask my colleague to move that the words "and that such housing accommodation will result in an increased number of people being employed" in lines 33 and 34 be struck out.
Mr. ST. LAURENT: I so move.


[Stage Direction]
Amendment agreed to.
John Lambert Gibson: Might we go back to subsection 4 of section 9A, where I read:
The loan shall be secured by a first mortgage or hypothec on the land . . .
Would the minister consider putting in the words "or second mortgage"? I know a great many lumber companies, in. their depressed conditions, have already blanket first mortgages with the banks, and this might be a little restrictive.


Clarence Decatur Howe: I am afraid we could hardly accept that. I think we must have a first mortgage.


Stanley Howard Knowles: Despite the'fact that the reference to providing employment has been struck out, I should like to comment upon the other side of the medal, as the Minister of Labour sometimes says. My colleague the * hon. member for Saskatoon City asked what happens in the event that one of these places becomes a ghost town. I notice that paragraph (i) of subsection 7, on page 15 of the bill, reads:
The borrower during the term of the loan may with the approval of the corporation, and upon terms and conditions satisfactory to the corporation, sell under agreement for sale or lease and option, units of the said project to prospective home owners.
I am wondering whether among the conditions satisfactory to the corporation before it consents to the sale of individual units is a concern for the position of the individual employee w.ho mi^ht be buying the house, in the event of the operation closing up.


Clarence Decatur Howe: That is the reason for the
approval of the corporation, that the sale be bona fide and not the sale of a ghost town.


Stanley Howard Knowles: In order words, it is quite clear that the company cannot sell on its initiative, that it must have the approval of the corporation?


Clarence Decatur Howe: That is right.
Mr. Z.APLITNY:	I should like to refer
back to paragraph (h) on page 9 of the bill, which provides that the maximum period for which the loan may be obtained is twenty years, or, under special conditions, twentyfive years. Could the minister tell us the minimum number of years for which a loan may be obtained?.


Clarence Decatur Howe: My hon. friend is going back a long way. We passed it sometime ago.


Stanley Howard Knowles: No, we have not. We are still on section 15 of the bill.


Clarence Decatur Howe: My hon. friend is talking about the length of time for a mortgage on rental housing, is that correct?


Mr. ZAPLITNY:: No. This refers to a joint loan which sets a maximum period of twenty years, and, under special conditions, twenty-five years. Is there a minimum as well as a maximum period, and, if so, how long is it?


Clarence Decatur Howe: There is no minimum. The loan is ordinarily for twenty years, and can be for twenty-five years under certain sections. There is no minimum length of time. However, if someone wanted to borrow for ten years I should imagine that the corporation would be glad to lend on that basis, if conditions permitted repayment in that time.


[Stage Direction]
Section agreed to.
Sections 16, 17 and 18 agreed to.
On section 19-Corporation may enter into contract with approved lending institution.
Edmund Davie Fulton: The minister gave some explanation of this to-day. I think he said that the object of allowing a loan to aggregate $8,000, if the land is already mortgaged, was to enable refinancing of the mortgage to take place. But it seems to me that it may have another effect, that is that since a man whose land is clear can only get $5,000, it makes it more difficult for a man whose farm or land is clear of all encumbrances to institute a wise project than it does for a man whose land is already encumbered. It seems to me that this requires more explanation. If the land is already encumbered, the security is not as good. It should be made clear in the terms of the contract that the existing encumbrance must be paid off, and I have not found any such provision in the section. Would the minister give us more information about it?


Clarence Decatur Howe: The corporation can lend only on a first mortgage. If there is an existing encumbrance it would be necessary to pay it off in order to give the first mortgage to the corporation. I think the two would be in exactly the same position. The size of the. loan depends upon the value of the farm.
Housing Act


Edmund Davie Fulton: Does it mean that an existing encumbrance must be $3,000 before one can get an $8,000 loan? If not, such person could borrow more than the man w'ho lias not already a mortgage?


Clarence Decatur Howe: The principle is that he gets $5,000 for building his house; and if he requires to remove an encumbrance in order to qualify for the loan he can refinance that encumbrance up to $3,000. But in any event the loan for the purpose of building a house must not exceed $5,000 in the case of either unencumbered or encumbered land.


Edmund Davie Fulton: The minister said that the corporation is allowed to lend only on first mortgage. Is that in the form of contract specified for their use or in the act?


Clarence Decatur Howe: In the original act.


[Stage Direction]
Section agreed to.
Sections 20 to 29 inclusive agreed to.
On section 30-Investigation into housing conditions.
John Oliver Probe: I note that under this the corporation will have the responsibility of causing investigations to be made into housing conditions in Canada. Prior to this time, I believe that was the responsibility of the minister. This might be the opportune time to ask the minister to give us a report on the state of housing in Canada, or to refer us to a booklet he recently caused to be published which would give us up-to-date information, somewhat more current than that found in the Curtis report of some years ago. What reports are available on the state of housing in Canada?


Clarence Decatur Howe: I assure the hon. member that any report prepared on the subject by the corporation will be tabled in the house by the minister.


John Oliver Probe: We have had none yet.


Clarence Decatur Howe: No; the study has not yet been made.


John Oliver Probe: Then, that is not helping us. Surely the minister has someone assigned to the responsibility of preparing statistics dealing with housing.


Clarence Decatur Howe: Yes; there are ten people devoting their entire time to the study. But it takes time; the corporation is not very old.


John Oliver Probe: But the minister has been associated with the subject for some time. I am serious about this, and feel that we should have periodic reports. I should like the minister to tell us what is being done to make such reports available to the nation as

to the state of housing. The minister has entered into contracts with certain corporations in Canada to provide certain housing materials. Surely to goodness a businessman will base his negotiations on contracts on statistical information of some kind. I maintain that the minister is remiss in not having reports available to us.
How many houses are we short in Canada at the present time? How are we to meet the housing needs of the people of Canada; or, to come more to the point, the people of Regina?


Clarence Decatur Howe: I have made a fairly exhaustive report on that, in connection with the discussion on the resolution.


John Oliver Probe: And I read every word of it.


Clarence Decatur Howe: I said that at the present time we are short 150,000 and that by next spring I believe it might be 180,000. I gave the results of the survey made to date. I have given several reports on housing, and I can assure hon. members that I shall keep the house advised from time to time on the position.


John Oliver Probe: Is there a publicity department? I read the minister's statement made to the house, and also heard it. Then, I was deeply interested in what he said that afternoon. However, it seems to me that what he gave was not an exact picture, but rather a rough approximation. If it is based upon statistical information, surely there is a written report to support it, one which we can study at some length. Is such a report available?


Clarence Decatur Howe: The Department of Reconstruction and Supply prepares a report on the state of the nation-


Stanley Howard Knowles: Yes, Mr. President.


Clarence Decatur Howe: -every two weeks, I believe it is, or possibly every month. It is an interesting report. Indeed, as a rule I use it from which to make public speeches, and from time to time I shall be glad to make it available to the house.


Stanley Howard Knowles: Do any of these figures the minister has bring up to date the kind of information given in the Curtis report?


Clarence Decatur Howe: The Curtis report is largely out of date, owing to the enormous change in distribution of income. It was a valuable report at the time. The report made this year will certainly be out of date three or four years from now. However, the situation will be kept before the house in much the same form as the Curtis report, but in line with present-day conditions.

Housing Act


John Ritchie MacNicol: Have we any record of
the number of evictions that take place monthly, in Toronto for instance? Every time I go home I see a pile of furniture in front of some house; then next day I read in the paper that so-and-so was evicted and quite frequently it is a returned soldier. I have one case in mind on Dufferin street. This was a soldier who had a distinguished record. The situation is nothing short of appalling. They have the same serious situation in the United States, but I should like to know what we are doing to prevent it here?


Clarence Decatur Howe: We have a close record of all evictions and we maintain close liaison with the mayor of Toronto in the handling of evicted persons. I might say that we have almost a running battle with every sheriff in the country in attempting to stop these evictions. My hon. friend probably knows that there was a court decision in Vancouver against our stopping evictions. A total of 179 evictions are being pressed in Toronto, and we are doing our best to stop their being carried out, but I am afraid, without success. We do our best, through emergency housing, to provide shelter for the persons evicted.


John Ritchie MacNicol: I am glad to hear that. This particular returned soldier's family consisted of the father and the mother. A son had recently returned from overseas with a war bride, and there was a daughter who was seriously handicapped by ill health. The father and mother must now live apart in separate rooms, and the son and his wife are also living apart. I do not know what became of * the daughter. The son came to see me when I was home the second last time, and he said it was driving them distracted to be separated. I hope something can be done to stop these evictions.


[Stage Direction]
Section agreed to.
Sections 31 and 32 agreed to.
On section 33-'Powers.
John Oliver Probe: Will this section permit a
corporation to enter into an agreement with any housing agency other than those specified in sections 4, 8 and 9? I am hoping this will give the president of Central Mortgage and Housing corporation power to enter into contracts with cooperatives.


Clarence Decatur Howe: This gives no right to lend money; it is just to cause the promotion of housing. The only change in the section is to change the word "he" to "it".


John Oliver Probe: Has any type of community construction been undertaken? That was 63260-2S4
recommended in the house last year, and I should like to know if any planned community has been undertaken anywhere in Canada?


Clarence Decatur Howe: There are paper towns such as Marathon and the Kimberley Clark project, and there is the small scale project in Ottawa where we have some 200 houses in a separate community.


Edmund Davie Fulton: Could the minister answer the question I asked earlier about the operations of Wartime Housing Limited for 1946 being cut off?


Clarence Decatur Howe: We started in July, 1945, to undertake a programme which we called the 1945 programme, but it was October and November before a start was made. The result was that that programme was carried over into 1946. The programme for 1946 was cut off at June in order that the houses started under the 1946 programme could be completed in 1946. VTe are now undertaking a 1947 programme, and it is hoped that we can build the foundations for a good part of that programme in 1946, 'but as far as materials required for the superstructure of the houses and fittings and so on are concerned, these may come along later. We should like to concentrate upon finishing the 1946 programme before we commence working on the 1947 programme.


Edmund Davie Fulton: It does not mean that you are not going to authorize any projects, or that projects just authorized recently are to be suspended?


Clarence Decatur Howe: No.


[Stage Direction]
Section agreed to.
Sections 34 and 35 agreed to.
On section 36-Advisory committees.
Mr. STEWART (Winnipeg North):: What advisory committees have been appointed?


Clarence Decatur Howe: The town planning committee was appointed, and a conference of town planning authorities was held recently in Ottawa. A permanent committee was appointed as liaison between the work of the corporation and the work of similar bodies in the provinces and municipalities. Then, there was the committee of the construction association which was formed to study the extension of building materials. I believe there are others as well.


Alistair McLeod Stewart: Might we see the reports of the construction committee?


Clarence Decatur Howe: I shall be glad to table the reports.


[Stage Direction]
Section agreed to.
[Stage Direction]
Housing Act
[Stage Direction]
On section 37-Loan insurance.
John Oliver Probe: Apparently this section provides for equity insurance, something that has been long overdue. We have had lots of concern for the creditor but none for the debtor. Apparently some arrangements are to be made, or perhaps they have already been made, because this is simply a rewriting of an old section, whereby the man who has borrowed money from Central Mortgage and Housing Corporation under this act or from a mortgage company is to have his equity protected in the event of death. What are the rates for this type of insurance in a typical case? Would the minister state whether he is favourably inclined to extending the principle of equity insurance to cover payments by the home owner under circumstances of all kinds?


Clarence Decatur Howe: I am sorry to say that this portion of the act is completely inoperative at the moment. The Department of Finance met with the insurance companies and attempted to work out suitable provisions. I think hon. members will all agree with the desirability of permitting a man to insure his life in order that he may carry out an obligation such as the purchase of a house. However, I am sorry to say that suitable provisions have not been arrived at. Since the responsibility passed to the corporation, it has been so busy with other matters that it has not attended to this particular duty. I hope sincerely that it will be possible for the corporation to work out terms with the insurance companies which will permit the bringing into force of this section. The present amendment is simply to change the word "minister" to the word "corporation."


John Oliver Probe: There is no real difficulty in coming to an agreement? It is simply that the negotiations have not been carried on sufficiently long to bring about an agreement. Is that correct? In the event that that is not feasible, I would suggest that in any event the government undertake this insurance principle itself, because many home owners could not meet the .physical requirements of an insurance contract. Then we could handle it in the same way as veterans insurance. However, I thank the minister.


Stanley Howard Knowles: Bearing in mind that the wider the coverage, the lower the cost, I hope that any studies relating to this matter will include an appraisal of the possibility of doing it for all contracts under the act.


[Stage Direction]
Section agreed to.
Section 38 agreed to.
Bill reported.
Clarence Decatur Howe: Mr. Speaker, with the consent of the house, since the amendments are very simple and we should like to see the last of this legislation, perhaps third reading could be given now.


Stanley Howard Knowles: Often when we do this we get representations next morning, and that is too late. I have no desire to say anything further on third reading, but I think, in fairness, it should stand over until the next sitting of the house.

Right Hon. L. S. ST. LAURENT (Acting Prime Minister) moved that the house go into committee of supply.


Stanley Howard Knowles: Mr. Speaker, I realize that the government is in a position to call any order they wish, but I understood from the order of business given on Friday night last that we would go into supply only after we had concluded certain other business.
Mr. ST. LAURENT: If there is any objection I shall not press the motion. We are not exposed to running out of work for some time to come. The motion was made only for the purpose of calling items concerning the Prime Minister's office and the Department of Justice and letting them stand, without proceeding with the discussion of the items.


Stanley Howard Knowles: Will the Acting Prime Minister indicate how many other departments have not yet been called?
Mr. ST. LAURENT: I think these are the only two, construing the word "department" as it has been construed since I have been here. The auditor general's items are usually dealt with as part of the affairs concerning the Department of Finance, and the items concerning the office of the privy council are usually dealt with as items relevant to the Prime Minister's office. They are the only ones that have not yet been called.


Stanley Howard Knowles: If there were other
departments I would not press my objection.
Mr. ST. LAURENT: If there is any objection I am quite willing to withdraw the motion, because I think we make more progress by cooperation.


John Bracken: Mr. Speaker, if I might say a word, I was not aware that there were two departments not yet in supply. If it had been otherwise I would have been agreeable to following the minister's suggestion; but if there are only two departments that have not

Judges Act
yet been moved into supply, I suggest with all deference that we should not be asked to go into supply now, since there will be plenty of time to move those two in.
Mr. ST. LAURENT: If the leader of the opposition would prefer that we wait, there is no objection.


John Bracken: It would deny the opposition the right to raise some matter on a motion to go into supply. That is what I had in mind. If there are only two departments not yet in, we shall not be holding up the work of the house by not going into supply now.
Motion withdrawn.



JUDGES ACT


[Stage Direction]
The house resumed from Friday, July 26, consideration in committee of bill No. 250, respecting judges of dominion and provincial courts-Mr. St. Laurent-Mr. Golding in the chair.
On section 3-Eligibility.
John Thomas Hackett: We had not finished the general discussion, I think, Mr. Chairman.
Right Hon. L. S. ST. LAURENT (Minister of Justice): I think we were on section 3 when the committee rose.


John Thomas Hackett: It was my recollection that the hon. member for Cariboo had asked a lot of questions which were not answered. I wish to ask the minister about the provision for a division between a judge and his wfife of the retirement allowance allotted to a judge on his retirement. I believe that, under section 26 of the Judges Act, county court and circuit court judges are retired compulsorily when they reach the age of seventy-five years. Under section 26A, w'hich was enacted on August 15, 1944, it was provided that the judges mentioned in sections 23 and 25 might arrange that a portion of their retirement allowance would be payable to their wives. If I have correctly read sections 23 and 25, the option was not extended to county court judges or judges of the circuit court for the district of Montreal. I may tell the minister that I am referring for the moment in particular to county court judges. In fact, was the option not extended to them?
Mr. ST. LAURENT: It was, [DOT] in fact, extended to them, but perhaps it would be more convenient for the members if we had this discussion when we get to the pertinent section of the bill, because it is dealt with in 63260-254i
this bill. This bill purports to reproduce what was done in that regard in 1944, and there are sections which expressly deal with it.


John Thomas Hackett: I am willing to accept the minister's suggestion, but I thought that if we were still discussing the general terms of the bill, and since there are a number of sections involved, it might be more convenient to do it now. I am going to suggest to the minister-and I am doing it at the instance of the hon. member for Calgary West-that judges of the county courts who, under section 26, were forced to retire when they became seventy-five years old, might now be permitted, by an appropriate amendment, to make the option which was denied to them by section 26A, subsection 1 (a). It does not mean any increase in salary or any more money, but it would ease the minds of those county court judges who were retired before section 26A, subsection 1 (a) was passed if their wives were permitted to avail themselves of the benefits granted by that subsection. It affects a very small number of judges, a group which is rapidly diminishing, and would dispel a great anxiety which has overtaken many of them, especially in view of the decreased value of the dollar.
Mr. ST. LAURENT: I think I understand the point the hon. member wishes to make. If I do understand him he wishes to know if it would not be possible in this act to give gentlemen who had become pensioners before the provisions were made in 1944, allowing for an optional division of pension rights, the right to make that option at this time. That matter was under consideration both in 1944 and again at this time. The pension provisions enable the governor in council to issue to a judge who has retired letters patent giving him an annuity, and his right to an annuity then is evidenced by and founded upon his letters patent. It is not by virtue of the statute that he is paid the annuity, but because of the letters patent which have been issued to him establishing that annuity in his favour When he gets those letters patent his contractual rights with the crown have come to an end; he has ceased to be a judge, and he has received a document which is full settlement of what the statute enabled the governor in council to grant him. It was felt in 1944 that these gentlemen, having received everything they were entitled to under the Judges Act, could not or should not be dealt with by amendments to the Judges Act. The amendments were made for those to whom the Judges Act still applied, and they were given the right to exercise an option. That right was extended to them for a period of ninety
Judges Act

days, and it was an irrevocable option. They were all notified that they had the right to exercise the option, and practically all of them did exercise it. But when we considered the preparation of a bill to be introduced at this time we did not think we could deal with this aspect, or with another application which has been before the government for at least twenty-five years; that is to say, for an amendment which would provide pensions for widows of judges. There are, I believe, over three hundred widows of former judges, some of whom are in straitened circumstances. It was felt that we could not deal with this class of retired judges still living unless we dealt with the widows of those who had predeceased them, and we felt that we could not do that until such time as we were putting before parliament something more satisfactory than at present exists with respect to old age pensions. That was the reason we felt that we could not single out one class of Canadians and ask parliament to make provision for them (Until there was something being done generally [DOT]with respect to old age pensions.


Stanley Howard Knowles: It is a good argument ^against the whole bill.
Mr, ST, LAURENT: No; I submit it is not an argument against the bill. The bill deals with the judiciary in office at the present time, and we are taking the responsibility of saying to parliament that we consider it desirable that these additional provisions be made for them, because they are the judiciary of the country at the present time.


John Thomas Hackett: And the judiciary of the future depends to some extent upon this measure.
Mr. ST. LAURENT: Yes, upon this measure, because it affects the judiciary in existence at this time. But I felt that it would not be proper to ask parliament, when dealing with the present and the future, to deal with pension provisions for those who had in the past served the country in a judicial capacity. It was that reason I had to give as an answer to a great many letters which I have received, and I must say that the answer has been accepted. I suppose there was not very much they could do but accept the answer, but I have not had anyone say that it was not a reasonable answer to make. I have had to answer the requests that were submitted to me, that more should be done at this time in this bill than it does provide for, and I have had to say that I did not feel that I should come to parliament and ask parliament to do more at this time .than the bill envisages. It is for that reason ,fMr. St. Laurent.1
that we have kept strictly to the situation which deals with the present and the future.


John Thomas Hackett: The matter has been considered?
Mr. ST. LAURENT: It w7as considered and discussed at great length; and I knew that even these provisions would not meet with unanimous approval. I did feel, however, that I could conscientiously recommend these provisions to parliament at this time, but that I could not go beyond, because there was nothing being done at this time for old age pensioners generally.


[Stage Direction]
Section agreed to.
On section 4-Salaries of judges of Supreme Court of Canada.
Mr. HANSELL:: On this section I wish to ask one question which could really apply to all the following clauses covering schedules of salaries. Does this schedule of salaries represent accurately what the judges really get? What I have in mind is this. I understand that judges carrying on some district court work in the provinces receive, in addition to their salaries, some amounts paid by the provinces. Would the minister enlighten us on that? I should like to get an accurate picture. Or are the amounts paid by the provinces included in this schedule?
Mr. ST. LAURENT: There are no amounts paid by the provinces to judges of the supreme court cr judges to the exchequer court, nor to judges who exercise the functions of judges in admiralty or in divorce courts in the provinces. I have no official information about this matter, but my impression is that there are performed by high court judges in the province of Ontario duties for which each receive an additional sum of $1,000 from the province, and there are additional duties performed by district and county court judges where there is not more than one in a district or county, duties as surrogate judges, for which an additional sum is paid by the province. In the province of Quebec there are no additional sums paid by the province, and there are other provinces where I understand no additional payments are made. I do not know what the situation is in the hon. member's province.


Mr. LOW:: There is paid $1,000 for the probating of wills.
Mr. ST. LAURENT: There are provinces w'here there is no additional payment for that purpose.


Angus MacInnis: I had a few words to say on the first section on Friday last. After I had finished the hon. member for Stanstead

Wheat Policy
(Mr. Hackett) took me severely to task. Since what I said at that time related to salaries,
I think my reply to the hon. gentleman will be in order on this section, because it, too, relates to salaries.
I have listened to the hon. member for Stanstead on many occasions in this house and have appreciated and admired the way in which he could marshal his arguments and his facts, and whether we all agreed on the case he made out, it was certainly appreciated by myself. I was not in the house when he spoke on Friday, and I had only an opportunity of reading his speech in Hansard. May I say I have never seen such a conglomeration of inanities in a speech delivered by a gentleman of his legal standing. But what I take exception to mostly is what he said in regard to myself. It has no basis in fact, either as regards my personal character or as regards the philosophy which I accept and expound. At page 3910 of Hansard he said1:
The argument of the hon. member for Vancouver East is an expression of his own political philosophies; eloquently and cogently stated, I admit.
I do not know whether it was eloquently or cogently stated, but I was certainly dealing with facts. He went on to say:
It is a statement of the doctrine of making everybody equally poor, which is a denial of the system which obtains here, namely, private initiative and competition. His is a socialistic system, a class system. Nobody must emerge ahead of anybody else. Everybody must be on a dead level of competence-or incompetence.
Did anyone in this house; did the hon. member for Stanstead ever in this house, hear me urging that we should bring everyone down to a dead level of poverty? As a matter of fact, everything I have said in this house has been said to try to raise everybody up to a high level of living. Surely, when I urge that the government of Canada should not increase the salaries of those who have already a high standard of living until it has done something to improve the standard of living of those who are grovelling in poverty, that is not to say that I wish to bring everyone down to the same dead level of poverty. If the hon. gentleman has not a better argument than that to put forward against my reasoning, it would be far better for him to hold his peace.
There are many things in his speech that are really not fair to the judges of the country. On the following page, 3910, he says:
To-day the judicial office has gone begging for good men.
That is to say, the judges we have to-day are not good men. I never said anything of that kind, because I believe we have good men as judges. He says:
To-day the judicial office has gone begging for good men. Oh, there are multitudes who are willing to serve. I admit that, but the best men are not available and we need the best men.
I maintain that that is a distinct reflection on the character and ability of the men who act as judges in this country to-day, and it was not I who made that statement. The hon. gentleman ended his speech with a most amazing assertion. He said:
I say to the Minister of Justice, give to the judges an increase in salary; give it to them immediately, that they may protect their own virtue even if the government is not as solicitous of it as it should be.
Surely, if it requires a decent standard of living to maintain one's virtue, my attitude is away ahead of the hon. gentleman's. He wishes to maintain the virtue of a mere handful of people. 1 wish to maintain the virtue of the whole of the people of Canada. That is the difference between the doctrine that is held by my hon. friend and the doctrine that is held by myself, and certainly I am not ashamed of my doctrine.
I have served the people of my community for the past twenty-five years. I served them first on the school board in my city; I served them later as alderman in the city council, and 'by virtue of the service I gave at that time I am here. I would1 not !be here if I were advocating such a doctrine as my hon. friend would have the members of the house believe I am advocating. As a matter of fact, his whole speech is all the proof that is required of the bankruptcy of his social thinking.
Section stands.
Progress reported.


[Stage Direction]
At eleven o'clock the house adjourned, without question put, pursuant to standing order.
Tuesday, July 30, 1946