1947-03-26

Mr. SPEAKER:: I have the honour to inform the house that I have received a message from His Excellency the Governor General, signed by his own hand, reading as follows:
I have received with great pleasure the address you have voted in reply to my speech at the opening of parliament, and thank you for it sincerely.
Alexander.
Government House,
Ottawa.



INDIAN AFFAIRS

[Stage Direction]
Second report of the joint committee of the Senate and the House of Commons appointed to continue and complete the consideration and examination of the Indian Act.-Mr. Brown.


[Stage Direction]
Right Hon. IAN A. MACKENZIE (Minister of Veterans Affairs) moved:
That the name of Mr. Fleming be substituted for that of Mr. Rowe on the select standing committee on public accounts.
Motion agreed to.


[Stage Direction]
Right Hon. L. S. ST. LAURENT (Secretary of State for External Affairs): I should like to table two copies of the first report of the atomic energy commission to the security council. While copies for distribution to all members of the house are not at present available, it is hoped to be able to obtain sufficient printed copies shortly.
The last occasion upon which a full statement was made to the house in regard to atomic energy' was on December 17, 1945. when the Prime Minister (Mr. Mackenzie King) described the events leading up to the Washington declaration of November. 1945. In view of the importance of the subject and the length of time which has elapsed. I thought it might be appropriate to make a statement to the house at this time. As this report is only of an interim nature and the discussions on the international control of atomic energy are still in progress, I should like, if it is agreeable to the house, to confine myself to a statement on the work of the Canadian delegation to the atomic energy commission to date, and to indicate the state of the discussions on the international control of atomic energy'. I feel that I need hardly' impress on the house the importance of the subject matter dealt with in this report and as I assume that the members interested in these matters will wish to read this document, I shall only pass in review the various phases in the deliberations of the atomic energy commission leading up to the completion of the report and its transmission to the security council. I shall also outline briefly the situation with regard to the discussions which have taken place on atomic energy in the security council.
As hon. members are aware, the declaration on atomic energy' made in Washington on November 15, 1945 by the President of the United States, the Prime Minister of the United Kingdom and the Prime Minister of Canada urged that at the earliest practicable date a commission of the united nations should be established to prepare recommen-
[Mr. A.bbott.1

Atomic Energy Commission
dations for submission to the united nations. Following a meeting of the foreign ministers of the U.S.S.R., the United States and the United Kingdom in Moscow in December,
1945,	the atomic energy commission of the united nations was established by a resolution of the general assembly of the 24th January,
1946.
The first meeting of the commission took place in New York City on the 14th of June, 1946. The countries represented on the commission from June 14 to December 31, 1946, were Australia, Brazil. China, Canada, Egypt. France, Mexico, the Netherlands, Poland, U.S.S.R., United Kingdom and the United States. After December 31, Belgium, Colombia and Syria were elected to replace Egypt, the Netherlands and Mexico. The Canadian representative on the commission has been, and is, General A. G. L. McNaughton.
At the outset, the atomic energy commission was presented with, two different plans. The United States government at the first meeting of the commission on June 14 put forward proposals for the international control of atomic energy closely resembling in many respects the plan as outlined in the Lilienthal report. The United States government's proposals included the renunciation of the atomic bomb as a weapon and suggested that when an adequate system of control had been established the manufacture of atomic bombs should stop, the existing bombs should be disposed of and the authority set up to administer the system of control should be placed in possession of the technological data necessary for the production of atomic energy. In addition, the United States government's proposals contained a statement which had no counterpart in the Lilienthal report "that there must be no veto to protect those who violate their solemn agreements not to develop or use atomic energy for destructive purposes".
At the second meeting of the commission on June 19, the Soviet government put forward its plan proposing the immediate outlawry of atomic weapons and the destruction of all stocks of atomic energy weapons within a three months' period. In addition, the Soviet government proposed an international convention for the prohibition of the production and use of atomic energy and the establishment of two committees; a "committee for the exchange of scientific information", and a "committee for the prevention of the Use of atomic energy to the detriment of mankind".
Australia, Brazil, Canada, China, Egypt, France, Mexico and the United Kingdom agreed in principle that the United States plan might form the basis of discussion in the commission. The Polish and Soviet representatives considered the Soviet plan should be given equal consideration with the proposals advanced by the United States government.
In June and July four committees were established by the commission: a working committee or a committee of the whole; a committee described' as No. 2; a legal and advisory committee; and a scientific and technical committee.
The discussions which ensued occupied the attention of the commission until July 31, at which time the commission went into committee to discuss in detail the question of whether an effective control of atomic energy was possible. The scientific and technical committee was instructed to report its findings with an indication of the methods by which it believed control might be achieved. In October the committee reported that "they did not find any basis in the available scientific facts for supposing that effective control is not technologically feasible."
The work of the scientific and technical committee coincided with the chairmanship of the Canadian representative from August 14 to September 14. and consequently responsibility for suggesting the next step which might be taken in the work of the commission fell upon the Canadian chairman. The Canadian delegation accordingly put forward a proposal that:
Committee No. 2 proceed to examine and report on the safeguards required at eacli stage in the production and use of atomic energy for peaceful purposes, to prevent the possibilities of misuse indicated in the report of the scientific and technical committee; that the committee may hold informal meetings as it may decide, at which scientific representatives may take part in the discussions.
The informal discussions which ensued proved of value in clarifying both the nature and the degree of the control which it is necessary to apply. In the discussions on raw materials the Canadian delegation was able to make a useful contribution by having officials from the bureau of mines and from the Eldorado refinery describe the characteristics of the processes of mining and refining of uranium.
In November it was proposed that the commission should report its proceedings, findings and recommendations to the security council in a first report by December 31. It was agreed that prior to this, committee No. 2 should report to the commission in plenary session. This proposal was accepted by the majority of the commission with the Soviet representative reserving the position of his government and the Netherlands and French representatives accepting on the "understanding that the
Atomic Energy Commission
[Stage Direction]
report would merely record the progress made in the commission to the end of the year without affecting the discussions in the commission."
At a further plenary session of the commission on December 5 the United States delegate introduced proposals for the inclusion of certain items in the findings and recommendations of the commission's report to the security council. These proposals cover some of the main elements of the United States plan as submitted on June 14.
During this time the general assembly of the united nations meeting in New York was debating the subject of disarmament, not only in relation to armed forces and their armament generally, but also specifically to the major weapons adaptable to mass destruction, including atomic weapons.
At a meeting of the commission on December 20. the Canadian delegation put forward a resolution which reads as follows:
Resolved that the commission approves and accepts the principles on which the findings and recommendations proposed by the representatives of the United States of America are based and instructs the working committee to include these findings and recommendations in the draft of the commission's report to be delivered to the security council by the 31st December, 1946, having conformed the wording of such portions of these findings and recommendations as deal with the same subject matter to the wording of the relevant parts of the text of general assembly resolution of December 14, 1946, on the "Principles Governing the General Regulation and Reduction of Armaments."
The Canadian resolution was adopted by the commission by a vote of 10 to 0 and accordingly the proposals as contained in the findings and recommendations of the first report of the atomic energy commission to the security council were amended. The first report of the atomic energy commission was subsequently approved and adopted for transmission to the security council on December 31 by a vote of 10 to 0. with the Soviet and Polish representatives abstaining. That is the report I have tabled today.
In January and February the security council discussed the commission's report at a number of meetings in which the Canadian representative. General McNaughton, participated under the provisions of article 31 of the charter of the united nations. Important statements of the positions of the Soviet and United States governments were made by their representatives on the security council. It became clear that, while all the members of the council were agreed on certain of the proposals, there was disagreement on a number of other proposals. including those on international inspec-

tion and on sanctions. It was clearly impossible to attempt to reconcile these differences in the security council and the council, therefore, decided to refer the matter back to the atomic energy commission. The atomic energy commission has been instructed by the council to prepare and submit to the council a draft treaty or treaties, or convention or conventions incorporating its ultimate proposals. In addition, the security council has requested the commission to submit a second report to the security council before the next session of the general assembly-that which will take place in September, 1947.
Because the discussion has been in general terms, there has been a good deal of misunderstanding about the position, for example, of the United States government on the question of sanctions against violators of an international treaty on the control of atomic energy. The latest statement of the United States representative on this subject has done much to clear up these obscurities. In an address on March 4 before the Overseas Press Club in New York, Mr. Austin, the United States representative on the security council and on the atomic energy commission, had this to say about the vexed question of the veto:
Nothing could be more dangerous than to act upon the assumption that a treaty or a voting system would operate automatically.
Let me illustrate the point by a brief reference to the veto. The veto power in the security council is widely thought of as a protection to an aggressor nation. Actually the veto would be no protection at all to an aggressor if the other nations should act together in accordance with the purposes and principles of the charter.
If any great nation possessing the veto power should ever embark on a course of aggression in violation of the charter, it would be committing an act of nullification, an act of rebellion against the united nations. It would forfeit its position under the charter.
No veto could protect such a nation from the consequences of its crime. Only the failure of the other nations to act together against it could spare the aggressor from lawful punishment. The heart of the problem of building collective security is the strength and the will of the member nations to carry out their obligations, individually and collectively.
Veto or no veto, the strength of the great nations in relation to one another is such that no one of them can safely go to war in violation of the charter if it is certain that the others would act together in the defence of the charter.
If the United States demonstrates convincingly that all its great material and moral power would be used in support of collective security under the united nations, that fact would have far-reaching influence upon the will and capacity of other member nations to act together to maintain peace. On the other hand, if we should falter, if we should dissipate our strength, if we should act in blind or shortsighted selfishness, we would inevitably undermine the whole cause.

Atomic Energy Commission
On March 10, Mr. Austin, speaking as the United States representative on the security council, in answering the Soviet representative's criticism of the United States government's position, said what the United States and the majority of the members of the commission were seeking was-and these are his words-"effective international control by a genuinely international cooperative development of atomic energy to which all nations would contribute their skills and their knowledge without secrecy, and in which all nations would share the benefits on an equitable basis. Our purpose is to assure that each nation can safely realize these tremendous benefits for itself without danger to its national security or the security of its own economic and social system." Mr. Austin went on to say: "The United States does not desire to impose its will, in questions of atomic energy, on other countries. The report itself proves the opposite. Ten countries united therein to forestall an atomic weapons race. The prohibition of atomic weapons in advance of a system of effective enforceable safeguards would not fulfil the mandate of the general assembly adopted unanimously, or prevent an atomic weapons race. My government has made it clear that we welcome all constructive suggestions which might advance the solution of our common problem and fulfil the mandate of the general assembly resolution."
It is to be expected that the studies in the atomic energy commission during the next four or five months will indicate precisely the safeguards which wall be required to protect complying states against the hazards of violations and evasions of the ultimate international agreement on the control of atomic energy. As is stated in the introductory paragraph to section C of the report which I am tabling today, the commission hitherto has limited its examination of the problems of safeguards and measures of control "to the more technical aspects of the control of atomic energy".
It is the hope of the Canadian government that further examination by the atomic energy commission of the problems placed before it by the general assembly of the united nations may lead to a realization on the part of all governments represented on the commission of the manifest advantages to be reaped under a system of effective control of atomic energy. The establishment of such a system would not only make a great contribution to the peace of the world, but would also make it possible for the peoples of the whole world to share in the benefits to be derived from the peaceful application of atomic energy. Canada, as a
member of the commission, will continue to do its utmost to resolve the difficulties which still confront the commission.
1 shall keep the house informed, as occasion offers, of the developments in the work of the atomic energy commission, bearing in mind that the results of the work of this commission, when available in the form of a draft treaty or convention, will naturally be submitted to this house for its approval and for the usual procedures of ratification. The present report is an interim report only and the security council in dealing with it recognizes specifically that "final acceptance of any part of the report by any nation is conditioned upon its acceptance of all parts of the control plan in its final form."
There is no commitment until commitment to the treaty in its final form, and that can be made only by bringing the treaty to the houses of parliament for the usual processes of ratification. The ultimate treaty or convention should be one which governments of democratic states can readily commend to their parliaments and peoples for acceptance. It is hoped therefore that the treaty or convention will be accompanied by a full report from the atomic energy commission setting out in detail the arguments and considerations in support of the provisions contained in the treaty or convention. It is also hoped that in the work of the commission a due perspective is maintained, so that the system of international control which is submitted to the nations for approval, goes as far as it is necessary in the matter of controls to provide international security and the benefits to be derived from the peaceful applications of atomic energy, but goes no farther.
Mr. GRAYDON:: Will copies of this report be available to hon. members, or is it the intention to have it printed in Votes and Proceedings?
Mr. ST. LAURENT: It would be quite an undertaking to have it printed in Votes and Proceedings, because it. is a document of some 85 or 90 pages.
Mr. IvNOWLES: It is in Hansard anyway.


Gordon Graydon: Not the report.
Mr. ST. LAURENT: No, not the report from the atomic energy commission.


Mr.  M. J. COLD WELL@Rosetown-Biggar: Did the minister not say he was going to have copies tabled?
Mr. ST. LAURENT: I am informed by the secretariat of the united nations that the question is now being considered as to when they will print this report. We have asked them
Meat Rationing

for sufficient prints to have copies available for those who are interested, in our parliament and even outside of parliament. The printing has not yet been undertaken by the secretariat. If it appears to be too long delayed it may be the desire of hon. members that we have it printed ourselves for circulation here.


Gordon Graydon: I think the public has had a good deal of difficulty in understanding the atomic energy reports. I have not read this one, but generally these reports are couched in such full-blown complicated diplomatic language that it is difficult for the public to know what is going on. Will the government consider having this matter referred to the committee on external affairs so that it may be dealt with by those qualified to deal with it, and if so, will they make our representative, General McNaughton, available for examination before the committee?
Mr. ST. LAURENT: If I could count on the unanimous consent of the house I would have no objection to moving at once that the report which has been tabled be referred to the committee on external affairs. The committee could then examine the report. As to making General McNaughton available for examination in the committee, I am sure the committee would not wish to interfere with the sittings of the atomic energy commission; on the other hand, I feel it will be possible to coordinate the work in such a manner that if he is required for the proper information of the committee he can arrange to attend. Have I the unanimous consent of the house to move that the report just tabled be referred to the committee on external affairs?


Some hon. MEMBERS:: Agreed.
Mr. ST. LAURENT: I move that the report tabled this day be referred to the standing committee on external affairs.


[Stage Direction]
Motion agreed to.


Hon. DOUGLAS ABBOTT (Minister of Finance):: I wish to announce that, effective tomorrow, the coupon rationing of meat will be discontinued.
The rationing of any commodity at the consumer level is a difficult and expensive operation. This is so both from the point of view of government administration and also in light of the burden which must necessarily be imposed upon the retail trade and consumer in the handling of coupons, and other routine requirements of the system. The difficulties

have been increased in recent months because the wartime prices and trade board has not been able to retain the experienced staff which was recruited originally under the stimulus of
a wartime emergency.
In the circumstances, the government has decided on a modification of control in this field which we believe will enable the system of coupon rationing, at the consumer level, to be abandoned, but will provide an alternative method which should not reduce exports of meat from Canada, particularly to the United Kingdom where food shortages are still acute.
By order of the wartime prices and trade board, existing regulations in regard to meatless days in public eating places will continue in force. Furthermore, in collaboration with the meat board, the wartime prices and trade board will continue an area distribution of meat in an effort to ensure an equitable distribution of the available meat supply to specified domestic areas. An effort will be made to hold the supplies going to each area at a level which will not reduce the amount of meat which would have been available for export if the rationing system had continued. Naturally this may not work out exactly. It will require the full cooperation of the public to prevent the supplies for each area from being too rapidly exhausted, thereby causing spotty or temporary shortages. With this in mind, the government will undertake certain publicity measures to inform the public of the need for restraint in this regard, and to invite their cooperation so as to keep this country's export contributions of meat at the highest level possible.


Mr.  M. J. COLD WELL@Rosetown-Biggar: May I ask the Minister of Finance if this announcement wall make any difference in the price levels of meats?


Douglas Charles Abbott: It should have no effect on that whatsoever.


Mr.  M. J. COLD WELL@Rosetown-Biggar: The price ceiling is to be maintained in the future?


Douglas Charles Abbott: There is no change in the price ceiling. This is merely the abandonment of coupon rationing to the consumer.
Mr. SEN-N: I understood the Minister of Finance to say, in connection with the discontinuance of meat rationing, that certain regulations were changed accordingly. There is now a regulation that only a certain quota of hogs can be slaughtered in country slaughter houses, the quota being based on 1941 slaughtering. Is it intended that that shall be changed?


Douglas Charles Abbott: There is no change in that for the moment, but I shall make inquiries and see what the situation is.

Transport Control



TRANSPORT CONTROL


Hon. LIONEL CHEVRIER (Minister of Transport):: On March 9, as reported on
page 1512 of Hansard, I replied orally to the following question asked by the hon. member for Moose Jaw (Mr. Thatcher):
1.	11 ave the railroads filed with the board of transport commissioners an application to incorporate emergency orders T.C. order 04F (maximum loading order) and T.C. order 18F (penalty demurrage), in tariff CFA, No. 67?
2.	Was this tariff an emergency order that came into being as a wartime measure?
3.	Has the board of transport commissioners taken any action to make this measure permanent?
My reply was as follows:
I think I can reply orally to this question by telling the hon. gentleman that the railway association of Canada have filed with the board of transport commissioners an application such as is mentioned in the first part of the question to continue the emergency orders of the transport controller. In view of the extension which was given yesterday to the National Emergency Transitional Powers Act 1945 until May 15. the transport controller will continue to exercise jurisdiction over these orders during this extension.
After conferring with the Minister of Justice, I find that order in council P.C. 4487 of June 9, 1942, under which all orders of the transport controller were made, will not be included in the bill called the Continuation of Transitional Measures Act, and that this order in council and regulations made thereunder will be revoked in the general revocation of orders and regulations of the governor in council which the government proposes to make effective the first day of April, 1947. Consequently I wish to correct any impression which hon. members may have received from my statement of March 19 that the orders of the transport controller would continue beyond April 1, and to make the following supplementary answer to the hon. member's question.
1.	The Railway Association of Canada has filed with the board of transport commissioners an application requesting the issuance of a general order of the board which would have the effect of continuing, after the cessation of the transport controller's authority, the provisions of emergency orders T.C. 04-F, 05-F and 18-F incorporated in tariff CFA No. 67.
2.	Tariff CFA No. 67, which is based on said orders T.C. 04-F, 05-F and 18-F, has not yet been approved by the board and is not in force.
3.	The board of transport commissioners has not yet dealt with the said application of the railway association but I expect will do so in the near future.



QUESTIONS

[Stage Direction]
(Questions answered orally are indicated by an asterisk.)
["In the Department of\nNational Health and Welfare there is a division called the Old Age Pensions division. The records of the provincial pension authorities are examined from time to time and the decisions of the pension authorities reviewed. Officials of the division work in cooperation with the provincial authorities to improve the administration and, as far as is practicable, to develop uniformity in the procedure for dealing with applications for pensions under the Old Age Pensions Act. In addition to the examinations in the provinces the division verifies the amounts charged by the provinces to the dominion as the dominion's share of old age pensions and pensions for blind persons.", '175S\nOrders jor Returns']
Mr. McILRAITH:: 1 and 2. The following firms manufactured wire nails in Canada in 1946:
production net ton
Canadian Tube & Steel Products
Limited	 1,637
Dominion Steel & Coal Corporation Limited	 16.013
Graham Nail & Wire Products
Limited	 4,603
Morrison Steel & Wire Company
Limited	 5,423
James Pender <fc Company Limited 5,812 Steel Company of Canada Limited 25,085 United Shoe Machinery Company of Canada Limited	  270
Totals	 58,843
estimated production net ton
Canadian Tube & Steel Products
Limited	 3,000
Dominion Steel & Coal Corporation Limited	 20,000
Graham Nail & Wire Products
Limited	 6,500
Morrison Steel & Wire Company
Limited	 8,000
James Pender & Company Limited 6,000 Steel Company of Canada Limited 26,400 United Shoe Machinery Company of Canada Limited	   270
Totals	 70,170
3.	No incentive bonus nor subsidy was paid in 1946 in respect to the manufacture of nails.
4.	No.
Note.-The manufacture of aluminum nails in 1946 might be considered as being in the
Questions

experimental stage. Small quantities were produced by the Aluminum Company of Canada Limited, Montreal, Quebec, the Independent Nail Compan}', Galt, Ontario, the Canada Tack & Nail Company, Morrisburg, Ontario, and Morrison Steel & Wire Company, Vancouver, British Columbia. Since approximately the first of the year the Steel Company of Canada Limited in addition to the aforementioned firms are in production of small tonnage of aluminum nails. The production of aluminum nails in 1947 will depend wholly on how much rod the Aluminum Company of Canada Limited can divert from other highly essential uses.



Mr. FULTON:: 1.	What is the maximum total amount any veteran will be required to pay under a contract to purchase a Valley view project home, includ; ing interest, under the standard 25 year contract?
2.	What is the minimum total amount any veteran will be required to pay under a contract to purchase a Valleyview project home, including interest, under the standard 25 year contract?
3.	What is the average total amount any veteran will be required to pay under a contract to purchase a Valleyview project home, including interest, under the standard 25 year contract?


Mr. TUCKER:: 1.	$6,151.34. with interest.
2.	$4,760.24. with interest.
3.	$5,199.39. with interest.
These figures include down payments of $600. and interest at 34 per cent is calculated on the unpaid balance.


STRUCTURAL STEEL-PRIORITIES
Mr. FRASER:: 1.	What priorities for structural steel in quantities of ten (10) tons and over, have been granted from January 1, 1946, to January 31, 1947 ?
2.	What firms, or individuals, received these priorities?
3.	What quantities were granted to each firm or individual?


George James McIlraith: 1, 2 and 3. The priorities branch did not issue any priorities on structural steel during the period mentioned because structural steel is not included in Schedule A of priorities officer's order P.O. 14. However the steel controller during the period issued directives to the mill whereby the following structural steel orders were given preference:

Structural Steel Orders given priority during 1946-Firm-Quantities in Net Ton.
Steel for Rhine Barges, Burrard Shipyard and Engineering Works Ltd.. Vancouver. 700.
Steel for Barges for Mackenzie River, Central Bridge Co. Ltd., Trenton. 47.
Steel for Manitoba and Saskatchewan Coal Co.. Vulcan Iron Works Ltd., Winnipeg, 42.
Steel for Emergency Fuel Oil Programme: Toronto Iron Works Ltd., 557; Horton Steel Works Ltd.. 663; Canadian Bridge Co. Ltd.. 52; Dominion Bridge Co. Ltd., 298; Farand and Delorme, 15; Hamilton Bridge Co. Ltd., 37; Standard Steel, 58.


FAMILY ALLOWANCES
Mr. CROLL:: 1.	How many families and children are in receipt of family allowances?
2.	What is the average number of children per family in those families receiving family allowances ?
3.	What is the amount of family allowances paid out per month to each province?
4.	What is the average amount of family allowance per child and per family?
5.	What steps are necessary to register a child for family allowances?
G. Are birth certificates required to be sent with the registration form?


Mr. MARTIN:: Number of
L	Families
Prince Edward Island	 12,129
Nova Scotia	 82,048
New Brunswick	 63,462
Quebec	 438,733
Ontario	 512,080
Manitoba	 95,872
Saskatchewan	 111.449
Alberta	 113,456
British Columbia	 122,477
Yukon and Northwest Territories	 2,292
Total as at Jan. 31. 1947	 1,553,998
Number of Children
Prince Edward Island	 30,467
Nova Scotia	 192,591
New Brunswick	 165,283
Quebec	 1,203.313
Ontario	 1.027,920
Manitoba	 200,727
Saskatchewan	 253.079
Alberta	 242,203
British Columbia	 235,955
Yukon and Northwest Territories	 5,097
Total as at Jan. 31, 1947	 3.556,635

Questions
2.
Prince Edward Island	 2-51
Nova Scotia	 2-35
New Brunswick	 2-60
Quebec	 2-74
Ontario	 2-01
Manitoba	 2-09
Saskatchewan	 2-27
Alberta	 2-13
British Columbia	 1-93
Yukon and Northwest Territories		2-22
Total as at January 31, 1947	 2-29
3.
Prince Edward Island	 S 180,495
Nova Scotia	 1,150,022
New Brunswick	 974,579
Quebec	 7,077,787
Ontario	 6,184,126
Manitoba	 1,213,011
Saskatchewan	 1,528,045
Alberta	 1,481,346
British Columbia	 1,395,965
Yukon and Northwest Territories	29,925
Total for the month of January
1947	 $21,215,305
4.	Average Allowance
per child
Prince Edward Island ....	$5 92
Nova Scotia	
5	97New Brunswick	
5	90Quebec	
5	88Ontario	
6	02Manitoba	
6	04Saskachewan	
6	04Alberta	
6	12British Columbia	
5	92Yukon and Northwest Territories, as at January 3.1, 1947	
5 87
Average Allowance per family
Prince Edward Island	$14	88Nova Scotia	
14	02New Brunswick	
15	36Quebec	
16	13Ontario	
12	08Manitoba	
12	65Saskatchewan	
13	71Alberta	
13	06British Columbia	
11	40
Yukon and Northwest Territories, as at January
31, 1947	 13	06
5.	A registration form may be obtained at any post office. A white form is used for initial registration. For later births a blue supplementary form is available. The form is completed by the parents and sent to the regional director of family allowances in the capital city of the province of residence.
6.	No. Arrangements have been made whereby birth registrations are checked with the provincial vital statistics records. Only in those cases where the birth date cannot be proved by this method is it necessary to request some form of proof of birth from the parent.


DEPUTY MINISTER OF FISHERIES
Mr. ARSENAULT:: 1.	Did the Quebec United Fishermen recommend any person for the position of Deputy Minister of Fisheries?
2.	If so, who was the person so recommended?
3.	Did the Quebec and Northern New Brunswick Fish Producers and Exporters Association recommend any person for the position of Deputy Minister of Fisheries?
4.	If so, who was the person so recommended?


Mr. MACKENZIE KING:: 1.	Yes.
2.	Dr. Stewart Bates.
3.	Yes.
4.	Dr. Stewart Bates.


OLD AGE PENSIONS
Mr. FARQUHAR:: What part does the Department of National Health and Welfare take in the actual administration of pensions paid under the Old Age Pensions Act?


Paul Joseph James Martin: In the Department of
National Health and Welfare there is a division called the Old Age Pensions division. The records of the provincial pension authorities are examined from time to time and the decisions of the pension authorities reviewed. Officials of the division work in cooperation with the provincial authorities to improve the administration and, as far as is practicable, to develop uniformity in the procedure for dealing with applications for pensions under the Old Age Pensions Act. In addition to the examinations in the provinces the division verifies the amounts charged by the provinces to the dominion as the dominion's share of old age pensions and pensions for blind persons.

175S
Orders jor Returns



QUESTIONS PASSED AS ORDERS FOR RETURNS


Mr. LOCKHART:: 1.	How many veterans' houses have been contracted for by Wartime Housing Limited in (a) Niagara Falls or adjoining townships;^ (b) Welland or adjoining townships; (c) St. Catharines or adjoining townships?
2.	When did construction first start on these
housing projects?	.
3.	How many are completed and occupied or ready for occupation in (a) Niagara Falls or adjoining townships; (b) Welland or adjoining townships; (c) St. Catharines or adjoining townships?
4.	What is the lot number, street number or plan number of each unit completed?
5.	What is the cost of construction only of each unit completed to date?
6.	What is the overall cost of each unit completed to date, including land, improvements, services and landscaping?
7.	Have any contracts for sale to veterans been completed to date?
8.	If so (a) to whom; (b) at what price; (c) where located, giving lot or street and number?


WAR ASSETS-BROCKVILLE MILITARY HOSPITAL
Mr. WEBB:: 1.	Has the building known as the military hospital at Brockville training centre been declared surplus?
2.	If so, has it been sold?
3.	To whom and at what price?
4.	Were any representations made to the Department of National Defence or war assets corporation for the purchase of this building?
5.	If so, when and by whom?


RADIO BROADCASTING-DOMINION-PROVINCIAL CONFERENCE AND ONTARIO BUDGET- NEWS COMMENTARY
Mr. CHURCH:: 1.	Who is the commentator that made statements about the dominion-provincial conference and the Ontario budget to which objection was taken in the Ontario legislature?
2.	When was he appointed and what other positions does he now hold?
3.	What government departments has he been an official of, and when, and what were or are his salary and other emoluments?
4.	What action will be taken to have some regulation of news commentators and their statements?


Mr. GIBSON (Hamilton West):: Return tabled.


RAILWAY GRADE SEPARATION
Mr. CHURCH:: 1.	What provision is now being made for grade separation in Canada?
2.	What is provided for reconstruction work after the war for grade separation throughout Canada?
3.	What part of it is devoted to the city of Toronto and on what projects?



FAMILY ALLOWANCES

Mr. GLADSTONE:: What is the cost of administration of the family allowances programme, annually?



MOTIONS FOR PAPERS


Mr. FRASER:: For a copy of all correspondence, documents, contracts or agreements exchanged between the government or any agency of the government and Canadair Limited.


Mr. HOWE:: Mr. Speaker, I have made inquiries and I find that the documents referred to which are now in the possession of the Department of Munitions and Supply occupy fifty-two filing cabinets, and that would be only part of the documents because I am sure that the R.C.A.F. also have from twenty to thirty filing cabinets full of these documents. That is an indication of how much correspondence is required to build an aeroplane. I think my hon. friend would hardly wish to have all these documents copied.


Gordon Knapman Fraser: Perhaps the minister will let me have the documents in regard to the sale of the property and the contract, because I would like to know who signed the contract for the government.


Clarence Decatur Howe: I shall be glad to furnish my hon. friend with those documents.
Motion dropped.


Gordon Knapman Fraser: For a copy of balance sheet of the Canadair Limited, as mentioned in section C, page 1542, Hansard of March 20, 1947.



LABOUR CONDITIONS


[Stage Direction]
On the orders of the day:
Mr. CLARENCE GILLIS (Cape Breton South):: Mr. Speaker, may I be permitted
to direct a question to the Minister of Mines and Resources, arising out of a telegram I received this morning, a copy of which I sent to the minister and so I do not need to read it. Is he aware of the fact that Newfoundland fishermen have been permitted entry to Canada and are being employed at Lunenburg and Halifax while 600 Nova Scotia fishermen are seeking employment, and can he do something about it?


Hon. J. A. GLEN (Minister of Mines and Resources):: Mr. Speaker, I received notice
of the question from the hon. member just before I came into the house. I am having inquiries made and will reply later.

International Trade



INTERNATIONAL TRADE


[Stage Direction]
On the orders of the day:
Hon. J. A. MacKINNON (Minister of Trade and Commerce):: Mr. Speaker, on the orders
of the day yesterday the hon. member for Danforth (Mr. Harris) referred to a statement made in the British House of Commons on Monday of this week by Sir Stafford Cripps on the subject of the British preferential tariff. The hon. member has asked me to make a preliminary statement to this house on the same subject.
In Hansard of March 17 last, at page 1415, my colleague the Secretary of State for External Affairs (Mr. St. Laurent) set forth at some length the position on the British preferential tariff shared by the British and Canadian governments having regard to approaching negotiations at the second part of the world trade conference, opening in Geneva on April 10.
This general declaration of policy is fully in line with the address I made to the Canadian Manufacturers Association, Ottawa Valley branch, on April 10, 1946, a copy of which the hon. member for Danforth very kindly sent over to me yesterday. I shall quote one paragraph from the statement I made at that time:
The proposals to be considered by the world trade conference, I would like to emphasize, make it quite clear that all tariff changes are to be made on an agreed international basis. There is no question of any nation or group of nations being asked to make tariff reductions which will not be matched by tariff concessions from all the member countries.
I know the historic contribution made by the system of imperial preference to the growth and expansion of our commerce. I am also ready to agree that this is not simply a question of trade, but is an issue which may affect the larger question of our relations in the British family of nations. Let me therefore emphasize as strongly as I can that Great Britain and Canada and the United States are all agreed that the one thing which has been decided upon is the procedure to be folio-wed at the conference. There is no intention to abolish imperial preferences, or to agree to large reductions in imperial preferences in exchange for meagre or nominal reductions in the tariff of the United States and other countries.
What was said on Monday last in the British House of Commons by Sir Stafford Cripps does not, it appeal's to me, add to or subtract from this government's attitude on this subject.


Mr. J. H. HARRIS (Danforth):: Mr. Speaker, if I may be permitted a supplementary question, does the minister say that his 83166-112J
statement is in full harmony with the statement made by Sir Stafford Cripps? If necessary will the minister make a supplementary statement showing the difference between what was said in this chamber and what was said in the chamber at Westminster, inasmuch as the Westminster statement definitely said that in certain instances imperial preferences would be reduced to expand imperial trade?


James Angus MacKinnon: I read the remarks of Sir Stafford Cripps as reported in the press.
I did not gather that there was a positive statement as suggested by the hon. member for Danforth, but rather that the statement was along the lines of our own announced policy on the matter.


Joseph Henry Harris: The British Hansard report will be in the hands of the minister in due course.



CANADIAN CITIZENSHIP


[Stage Direction]
On the orders of the day:
Gordon Graydon: I should like to direct a question to the Secretary of State. What progress has been made on the suggestion I made to him some weeks ago with respect to providing wallet-sized certificates for citizenship? I hope he will not be completely discouraged by the fact that only four hundred people have asked for and been granted citizenship papers.


Colin William George Gibson: The hon. member was kind enough to lend me a sample of a birth certificate issued in Ontario. The citizenship branch is having inquiries made as to the possibility of using that type of certificate as an alternative to the large one which is being issued. Investigations are being made to find out what would be the cost of issuing certificates of that size, and the decision will be made known in due course.


Mr. CRUICKSHANK:: May I ask the minister a question-


Gordon Graydon: May I ask a supplementary question?


George Alexander Cruickshank: Mine is supplementary.


Gordon Graydon: Mine is super supplementary. Has the speed of dealing with ' applications and granting certificates of naturalization gone up since the last report was made to the hon. member for Lake Centre (Mr. Diefenbaker)?
Business of the House


Colin William George Gibson: I should like to make a short statement in regard to that. A question was placed on the order paper asking what was the number of citizenship certificates issued since the first of the year. I may say that the number given did not include the number of applications which have been received by the citizenship branch. During the war the naturalization branch was very much understaffed and applications had piled up which were dealt with in the early part of this year. Consequently in the first months of this year the branch was dealing with applications which had been on file and which had been carried over from the previous year. Citizenship certificates are being issued, and while there had been a delay owing to a change in the forms which were being distributed across the country, considerable progress is now being made in issuing certificates.



MEAT RATIONING


[Stage Direction]
On the orders of the day:
George Alexander Cruickshank: I have been delegated by my colleagues around me to follow the hon. member for Peel (Mr. Graydon) with an emergent question. I should like to ask the Minister of Finance whether any allowance will be given on the turn-in value of meat coupons.



BUSINESS OF THE HOUSE


Right Hon. W. L. MACKENZIE KING (Prime Minister):: Before the order of the day is called may I say a word on the matter of procedure on a resolution preceding a money bill. I have had occasion to refer to this matter of procedure each session because of the length of time that has been consumed in discussion when similar resolutions have been considered to an extent and in a manner which is entirely contrary to the rules. I am referring at the moment to what it would seem may come to be possibly the case with respect to the discussion in committee on the resolution which will be called as the first order. It always seems that the government may be taking the point of view it does because of some particular measure that is before the house. It is not that. I am raising the point at the moment in order that hon. members may follow the rules of the house which have been framed in the interests of all hon. members.
Last year, with respect to a loan being made to the United Kingdom, I spoke in

regard to the procedure in committee on the resolution preceding a money bill. With the permission of the house I should like to read a paragraph from what I said at that time with a view to pointing out that- it applies equally to any aud every measure of a similar character. The statement I made wull be found in Hansard of April, 19-16, at page 761:
The rule is that a resolution must precede a money bill, but the resolution is intended merely as a notice to the house that a money bill is about to be introduced. It is not intended that the notice should be debatable; rather, the correct practice is that the resolution should be allowed to pass, the house go into committee and that, in committee, a statement be_ made on essential features of the bill which is later to be introduced, this to follow if so desired by some brief discussion. It is not intended that a lengthy discussion should take place at that stage. The discussion on the bill should come after the bill itself is introduced.
That statement is entirely in accordance with the rules of the house. It was made, as hon. members will see, in relation to the bill in respect to the loan to Britain at the last session, but it applies equally to the bill which is before us at the present time.
I hold in my hand a copy of Sir Thomas Erskine May's parliamentary procedure, fourteenth edition, as edited by Sir Gilbert Campion, who is the recognized authority on parliamentary procedure. At page 732 hon. members will find the following statement with reference to the scope of debate on resolution:
Debate in committee on a financial resolution is confined to the terms of the resolution itself and must not be extended to the related bill.
These are the words to which I wish to draw hon. members' attention. As I looked over the debate yesterday I observed that a good many questions did relate specifically to the bill that is based on the resolution. It is quite contrary to parliamentary practice that the discussion in committee on the resolution should be extended to the related bill. I mention this simply because among other things, the length of time this session is likely to run is going to be very considerable unless we all observe strictly the rules of the house.
If we had observed the rule with respect to the introduction of the resolution itself and passed it in a formal manner we should have saved a week of discussion already. There has been a week of discussion on the resolution. Practically all of that discussion will be repeated when we come to the bill itself. If the house is to take an indefinite time in debate in the committee on the resolution there is no saying when the house will be able to get through the work of the present session.
Let me mention to hon. members that if, through discussion on this particular measure,

Business of the House
we run on to the end of April, three months of the session will have passed. There will remain practically all the business of the session still to complete. That will mean that at the end of April we shall up to that time have had no opportunity to discuss the budget; we shall not have had opportunity to discuss any of the estimates; we shall not have time for any of the ordinary legislation of the session. By the time we get on into the spring hon. members I am sure will be hoping that we shall not continue during the summer into the autumn. That is a consequence which must follow unless we do in some way seek to curtail unnecessary discussion. I do not wish to curtail anyone contrary to the rules. I do not want to suggest that there should not be the fullest and freest discussion. All I am asking is that hon. members shall follow the rules as they are set forth in the rules of the house. If the rules are not adequate, let us change them. So long as they are there, let us follow them.


Gordon Graydon: May I be permitted to comment on the Prime Minister's statement? There is no desire, as I think the Prime Minister will realize, on the part of our party to delay in any way the proceedings in connection with the matter-


Some hon. MEMBERS:: Oh, oh.


Gordon Graydon: I hope that kind of thing is not organized by the government. I wTish to say to the Prime Minister that at the beginning of the resolution stage my leader made it very clear that this party was prepared to allow the resolution to go through on the basis that when we reached the committee stage there would be full opportunity on the part of opposition parties and others to examine the ministry, to ask and receive answers to questions.


William Lyon Mackenzie King: The committee stage on the resolution or the committee stage on the bill?


Gordon Graydon: The committee stage on the resolution. I am not complaining about the leader of the C.C.F., although immediately afterwards he made a speech which raised many questions, and of course it could not be allowed to go unchallenged. I am careful not to hold him or anyone else responsible, because everyone in the bouse must take his own responsibility. I do not think, however, that this is the kind of bill that the Prime Minister had in mind when he was reading the opinions he had. This is not an ordinary bill. It is not really one bill but fifty-seven bills, and it is impossible to apply even custom, let alone
the rules, to a bill in which there are fifty-seven units. The house is struggling to get information on the legislation as speedily as possible, having in mind the relation of dispatch to the public interest in general.
The Prime Minister has said that normally the minister in charge of the bill should make a statement on the resolution setting forth the essential features of the measure. But there are fifty-seven essential features to this resolution. While the Prime Minister has had long experience in matters of this kind, I still think it really gets down to the question of how a matter of this kind should be dealt with. That is a matter of opinion and I think the circumstances in which we now find ourselves will have to dictate the time that may be taken. I have not had nearly as long an experience as the Prime Minister, but I suggest that most members feel that not much time is wasted in dealing with a matter at one stage rather than another, because what members have to say at one time will seldom be repeated at another stage of the proceedings.
I beg your pardon. Mr. Speaker, for having taken so much time, but I felt called upon to answer the Prime Minister, because I am afraid that what he has said cannot meet with full agreement on this side.


Mr.  M. J. COLD WELL@Rosetown-Biggar: May I add this? I believe I was responsible for the initiation of the debate last Thursday evening. Looking at Beauchesne's Parliamentary Rules and Forms I find this:
Minister moves that Speaker leave the Chair for house to go into committee of the whole on the resolution. Speaker puts question on motion. (Debate allowed.)
It may be that the Prime Minister is quite right that this procedure does prolong the consideration of a particular matter. A few moments ago he quoted from another authority. Sometimes we find that one authority is cited in this house for a particular procedure, and sometimes, another. But our own authority-I looked it up beforehand, I may say-does clearly state, though the rule may not be a good one, that the minister moves that the Speaker leave the chair for the house to go into committee of the whole on the resolution; the Speaker puts the motion, and debate is allowed.
That is why we began the debate last Thursday evening. If you turn to page 159 and look at 418, in the second paragraph you will find:
The ordinary function of a committee of the whole house is deliberation, not inquiry. All matters concerning the imposition of taxes, or the grant of public money, must be considered in committee, as a preliminary to legislation;
Business of the House

and any other questions which, in the opinion of the house, may be more fitly discussed in committee, are dealt with in that manner. The provisions of public bills are usually considered in a committee of the whole house.
It was on our own book of rules, Beau-chesne's Parliamentary Rules and Forms, that we based both the speech and the amendment we moved last Thursday evening.
Mr. JEAN-FRANQOIS POULIOT (Temis-couata): I enjoy listening to the Prime Minister, who has such wide experience in parliamentary matters, but he spoke about debating resolutions of this kind, and if I am not mistaken he said that the discussion should not be on the related bill. How could it be? We have not got it. I do not think we have the bill now, and therefore, as we have not the bill, we do not know what is in it and it is pretty difficult to discuss the bill itself.
There is a distinction between the procedure in England and procedure here. Naturally we have some of the principles of British rules, but we have custom according to our pattern, and the result is an entirely different stew. In the parliament at Westminster the purpose of the resolution on a money bill is to notify the members that the government has obtained royal assent to sponsoring a certain bill, and the purpose of the discussion-not the debate, mark you, sir, but the discussion of the resolution in the committee-is precisely to afford the opportunity to members of parliament to ask questions of the ministry and also to make suggestions in order to improve the bill with their own experience. This we may call debating, if we wish; but at the present time I presume that the bill is all cooked and is kept in the icebox of the Department of Justice and will be served to us on a silver platter a little later, as soon as we are through with this resolution. Therefore debating this resolution means positively nothing, because whatever bombshell we may find in the resolution will not affect the bill even if it explodes.
There is something more than the big book that the hon. member for Rosetown-Biggar (Mr. Coldwell) has quoted from. There is a very small book called Standing Orders of the House of Commons, 1936. One day a member of parliament of ten years' experience asked me, "What do they mean by standing orders?" I said, "They are the regulations of the house, the rules of the house." I have the standing orders in my hand, and at page 17, rule 38, paragraph 1, I read:
38. (1) The following motions are debatable:
Every motion
(a) standing on the order of proceedings for the day (except government notices of motion for the house to go into committee at a later date);

This motion is on the order of proceedings for the day and therefore it is debatable. I am the more at ease in making these remarks, in all humility and candour, for the reason that I have not spoken on the resolution since it has been before the committee. But I am interested in getting some information; there is no man on earth who will prevent me from asking for it, and I will stand up again and again until I get it, because I want to be informed, even if the bill is cooked and is in the refrigerator of the Department of Justice. I want to get some information about this resolution. The denial of that right is antidemocratic, and I am sure the Prime Minister will not insist upon it. I am just as anxious as he is to get rid of the session and go home, although I enjoy the company of my colleagues. I find that my part of the country is the finest in the land; it is God's country, but I am here to do my duty. It is a great sacrifice for me to stay here, and my reward will be to get the information I ask for every time I ask for it. I am sure the Prime Minister is too fair-minded to insist otherwise. Therefore we must take with a grain of salt everything that is said regarding the interpretation of the rules. Campion is a famous author. For a long time he was assistant clerk at Westminster, and if I am not mistaken he is the clerk now. I know he is a great man; I know his book, but to quote from that book as against a standing order which is our rule of debate in this house- I do not say our rule of discussion, but our rule of debate-is not fair. We cannot quote Campion against rule 38, paragraph 1.
Therefore, sir, I suggest., not for your benefit but for the benefit of hon. members who were interested in that debate-because you are in the chair and it was a debate; when the chairman is in the chair, when the house gets into committee, it is discussion-that our rule is the contrary. The rule means debating. I am sure we shall be treated fairly in the future as we have been in the past, and we can take it that when we ask questions it is not done to delay proceedings but to satisfy our minds and get the information we think is in the public interest.


Mr. J. M. MACDONNELL (Muskoka-Ontario):: Mr. Speaker, I would not venture, especially in the presence of so many experts, to offer an opinion on the rules, but I do wish to say something on what seems to me to be the reasonable common sense of this situation. We have here, as has been pointed out already, not one bill but in effect fifty-seven bills.


Some hon. MEMBERS:: Not yet.

Business of the House


James MacKerras Macdonnell: Ordinarily when a resolution is moved by a minister he gives an explanation of the ambit of the bill to follow. Here, if I remember well, when the minister introduced this measure he gave an explanation or a reference to practically only one, or perhaps two or three, but certainly very few of these fifty-seven orders in council. If I remember well he confined himself almost entirely to the wartime prices and trade board. Therefore I submit that we are in a very special situation here, and that questions at this stage are on an entirely different basis from what they would have been had the minister in his opening statement referred seriatim to these fifty-seven orders in council which in fact we have before us and which we cannot ignore, because they have been placed in our hands.


Mr. CHURCH:: Why not sit in the mornings?


Mr. ILSLEY:: When a minister is introducing a new bill he explains that bill, but these fifty-seven orders in council are the law of the land, and have been for years; and they do not call for any explanation at the resolution stage.


William Lyon Mackenzie King: My purpose in rising was to try to prevent two debates where one should suffice. It seems that I have succeeded only in provoking a third debate. However, I should like to say just this word to the acting leader of the opposition (Mr. Graydon) and the leader of the C.C.F. party (Mr. Coldwell), who referred to Beauchesne, or to his own experiences in the house as to the rules and as to what is permitted or involved in following them. In my hand I have what I might speak of as Beauchesne up to date. Before coming into the house this afternoon I rather expected someone on the opposite side would quote Beauchesne as against what I might wish to say, so I asked the Clerk of the House if he would give me a statement on this point which I could read to the house as authoritative. The statement given me is as follows:
The adoption of the resolution is merely a formal matter and it is often allowed to pass without discussion. The stages of procedure where the principle involved and the details of the measure may be discussed are the second reading of the bill, committee and third reading. When this rule is not applied there is always a repetition of debate.
A moment ago my hon. friend the acting leader of the opposition said his experience had shown him there was not much repetition. Well, the Clerk of the House has had a very long experience and close observation of these matters and he says when the rule is not applied there is always a repetition of
debate, and I think that has been the experience of everyone. My purpose is none other than that of trying to economize the time of the house in having its rules obeyed. I cannot agree that because there are some fifty-seven orders in council attached to this bill, therefore the bill is not in the regular form. The Minister of Justice (Mr. Ilsley) answered that question completely and satisfactorily in what he just said. Really there is in fact less justification or reason for asking questions in committee in connection with this resolution than is frequently the case, since, as the Minister of Justice has just said, these orders in council concerning which questions are being asked have been the law of the land right along for some time and should be and are known to every member of the house. All that is essential in the committee stage on the resolution is a general statement or statements in regard to what is of special significance in the bill based on the resolution. As to this bill, hon. members know much more about what it contains and involves than in the case of most other legislation. So I would submit again that if we wish to get through with the business of the house in a way that will accommodate hon. members most satisfactorily in the end we shall best do so by observing the rules of the house.


Mr. SMITH (Calgary West):: And reconsidering the Easter recess.


Mr. HACKETT:: Mr. Speaker-


James Horace King: Order. Hon. members wall realize that there is nothing before the house. The Prime Minister asked permission to make a statement in reference to a resolution which is under consideration in committee of the whole. No one protested, so the right hon. Prime Minister made the statement; the acting leader of the opposition made a statement; the leader of the C.C.F. party made a statement, and something was said by other hon. members. I believe the house has been sufficiently generous, and I do not believe it would be the general desire to waste more time in discussing a way to save time on this resolution. I suggest that hon. members proceed with the business of the house,


John Thomas Hackett: May I say, Mr. Speaker, so far no one has protested, and unless you express in more formal terms your desire that I resume my seat-


James Horace King: Order. Unless the hon. member has the unanimous consent of the house I would ask hon. members to proceed with the business of the house.
Emergency Powers



EMERGENCY POWERS


[Stage Direction]
The house resumed from Tuesday.. March 25, consideration in committee of the following resolution-Mr. Usley-Mr. Macdonald (Brantford City) in the chair:
That it is expedient to introduce a measure to provide for the continuation of certain orders and regulations of the governor in council for a limited period during the national emergency arising out of the war and to provide therein that the governor in council may appoint and fix the compensation of the officers, clerks and employees necessary for the administration of any order or regulation continued in force by the act and further to provide that certain officers, clerks and employees may continue to perform the duties for which they were previously appointed.
John Thomas Hackett: Mr. Chairman-


Mr. POULIOT:: Mr. Chairman-


The CHAIRMAN:: Order. The hon. members will kindly resume their seats. The house in committee of the whole on a certain proposed resolution to provide for the continuation of certain orders and regulations of the governor in council for a limited period during the national emergency arising out of the war. We had considerable discussion in the committee last evening with respect to procedure, and further discussion in the house this afternoon. I am hopeful that the committee will discuss the terms of the resolution only, and not refer to the bill. The hon. member for Stanstead.


John Thomas Hackett: Mr. Chairman, I was anxious to accept the invitation of the Minister of Justice and refrain from any comment on the resolution, but as matters now stand, and in view of the remarks that have been made to us this afternoon, it seems that further information is necessary, and I have no reason to think that the minister will not be glad to supply it.
The resolution assumes that a national emergency exists; it rests on the assumption that such an emergency exists. In the course of his remarks the minister told the house that the cost of living in the United States had advanced, since the close of the war, by eighteen per cent, while in Canada it had increased by but six per cent. I wanted to know if he would foe good enough to tell us if in this computation of six per cent 'had been included all subsidies, all bonuses, all remissions of duties, all remissions of excise, and other sundry sources of revenue which are denied to the crown by reason of the alleged emergency.
[The Speaker.]


James Lorimer Ilsley: The answer is no.


Mr. ROSS (Souris):: Therefore it does not mean anything.


John Thomas Hackett: Then if the minister tells us that the increase in the cost of living in Canada has been but six per cent, and in computing that six per cent he has not taken into consideration all the bonuses, all the subsidies, all the remissions of duties and all excises, as well as other gratuities which have been paid and sources of revenue which have been dried up, I submit with great deference that his statement that the cost of living in Canada has increased but six per cent is incomplete, and cannot be relied upon; and that it may very well be that in this country, where we have been operating under a system of controls, the cost of living may have increased quite as much as it has in that country which has been held up-I shall not say to derision- but as an example of great misfortune and of bad. judgment, owing to the fact that it has released its citizens from these controls.


Mr. JACKMAN:: The awful example.


John Thomas Hackett: I submit it is not appropriate that the chamber should be asked to pass the resolution until information is made available to us establishing that the emergency still exists. If the cost of living is as high here as it is elsewhere, then that ground advanced in support of incorporating into statute form these orders in council, which were resorted to for the period of the war, vanishes.
We have also heard something about the danger of inflation. I would be very much interested in knowing to what extent inflation is the actual result of government policy. We have been told, upon reasonable authority, that half of the war was paid for out of taxes, that something like two-sixths was paid for out of borrowings and that the remaining one-sixth was paid for by inflation, by the printing press. I am asking the Minister of Justice if he will say whether that is approximately true. I know foe is not Minister of Finance today; but I am likewise aware that he knows probably better than any other member in the house, or indeed any other person in the world, the details of Canada's financing. I will ask him if it is true that relatively one-sixth of the cost of the war was paid for foy Bank of Canada borrowings.


James Lorimer Ilsley: Mr. Chairman, I would not dare answer that question without-


An hon. MEMBER:: I would not think you would.

Emergency Powers


James Lorimer Ilsley: Oh, now! I would not answer that question without verifying those figures from the Department of Finance. I do not know whether that is so or not.


John Thomas Hackett: I do not want to be unfair to the Minister of Justice because, in fact, he is not Minister of Finance at the present time. But knowing his mastery of the whole situation, knowing his knowledge of details and1 his gift for carrying them in his head, I would ask him if he would tell the committee whether a certain proportion of the cost of the war was not financed by that device known as inflation.


James Lorimer Ilsley: It was not financed by that device known as inflation. There was some.


Harry Rutherford Jackman: Well-


James Lorimer Ilsley: Let the hon. member for Rosedale answer, then. It was not financed by that device known as inflation. There was some inflation of prices, of course, dluring the war, in this country, as there was in every other country; and there was some borrowing from the Bank of Canada and some borrowing from the chartered banks. That borrowing from the Bank of Canada and from the chartered banks increased the volume of deposits and currency in the country.


An hon. MEMBER:: Considerably.


James Lorimer Ilsley: Yes. To the extent that the government availed itself of the money which it borrowed from the banks, that process assisted in the financing of the war. But that of itself is not inflation.
I presume the hon. member is talking about inflation of prices. Inflation of prices may follow from the borrowing by governments from banks. But the two things should not be confused. When the hon. member asks me whether we financed by inflation, I say no. We financed to some extent by borrowing from the banks.


John Thomas Hackett: What I am trying to get at is this: Whether we called it inflation or called it by some other name, did we not resort to practices which resulted in a greater issue of currency upon the same amount of security?


Mr. KNOWLES:: Greater production of
goods and services.


John Thomas Hackett: My question stands;
you ask your own.


James Lorimer Ilsley: The same amount of
security?


John Thomas Hackett: Yes.


James Lorimer Ilsley: What kind of security is the hon. gentleman talking about? Is he talking 83166-113
about gold? The Bank of Canada divested itself of its gold and thereafter the Bank of Canada did not have gold as a basis for its issue.


Mr. QUELCH:: Did we not go completely off the gold basis during the war?


James Lorimer Ilsley: Yes.


Jean-François Pouliot: I should like to ask just
one question of the minister, but it is a twofold question. He may not have the information before him now but it should be easy for him to get it. In order to be able to discuss sensibly, not only the resolution but the bill, we should know what commodities are now affected by controls. I am not asking for information about the orders in council because they have been published in book form, but I want the minister and the committee to understand just what I wish to know.
There are a certain number of commodities such as butter, shoes, sugar, milk, hats, ladies' wear, et cetera, which have been rationed or which have been under control. I should like to know why these commodities have been placed under the controls. Certain controls have been lifted while others are still in force. I should like to know why certain controls have been lifted and why other controls have been kept in force. There should be a tabulation to indicate, on the one hand, why controls have been imposed and, on the other hand, why other controls have been lifted. It seems to me that that information is necessary if we are to understand the working of the controls.
I presume it will be impossible for the minister to supply this information now but it should be easily prepared and available tomorrow or on Friday. Then hon. members will know exactly what commodities are under controls at the present time, what commodities are not under controls and what was the reason for the imposition of the controls. I have been informed by some of my friends that the reason why such a large number of hon. members voted in favour of the resolution yesterday was the requirement that a special permit is necessary before a new business can be started and that trusts and cartels and others do not want any new businesses. Apparently that was one reason why such a large number of hon. members voted for the controls.
I was told also by reliable people that another reason for the large vote was the fact that retail, wholesale and manufacturers' prices are established and that some people who are close to the strings may pull them so as to keep the controls in force. That is

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not my opinion; it is just a rumour which has spread quite widely. Perhaps I could go a little farther in explaining my question because it is a serious question. I received one of the greatest honours I have ever received when the non. member for High Park asked one of my questions the other day.	_
The argument in favour of price controls is that they are imposed to prevent the exploitation of the people, but I submit that the people are not being protected as they should be when the controls are lifted and even when they are still in force. I have not a complete list of the articles that are offered for sale, but from what has been said to me by big businessmen, during the war shoes were classified on the basis of samples which were submitted to the board by the manufacturers. These manufacturers used rubber and other material of a minor quality to make up the samples. The shoes were not as good but they were sold either at the same price or at higher prices.
Last year there was an increase in the price of agricultural implements. This came as a bolt from the blue. It was a surprise to all of us. It was announced by my right hon. friend the minister apparently as a matter of routine. Not a word was said to me about it, but I know that some of his colleagues looked surprised when the announcement was made in the house. It was decided that agricultural implements would sell at a higher price than before. There are all sorts of things like this that should be investigated. Does my right hon. friend think a pair of shoes is worth $16? Does he think a hat made from material costing $1, or perhaps only fifty cents, with from twenty-five to fifty cents worth of work on it, should sell for $15, $25 or $30?


An hon. MEMBER:: It is the idea.


Jean-François Pouliot: The idea is to exploit the people. If it was known that the people were being exploited, how is it that the prices board ignored that fact? I understand that is why some controls are lifted, to please a certain class of individuals, but the exploitation is that of the people.
What about shirts? Is it possible to buy a good shirt today for less than five or six dollars? And the price is rising. The information that was given to me by a man of considerable experience and by others, was that the shirts that we are now paying five dollars for are not worth more than a dollar and a half or two dollars. There is exploitation. If price control exists and is now in force the control must be incompetent. If price control has been lifted from these goods, the price

control board is equally incompetent because it does not impose controls on things which should be controlled.


Mr. PROBE:: What about baby diapers?


Jean-François Pouliot: I spoke of them a long time ago, and the authorities did not know that flannelette was used for that purpose. They thought it was used only for nightshirts. I gave an interview to the press on that, and I have it upstairs.
The ambition of the working man who makes a pair of shoes or a shirt or a suit of clothes is to have enough wages to be able to buy what he makes. That is a natural feeling. But when there are middlemen who make an undue profit at the expense of the masses of the people by overcharging them, that should be stopped, and it is the duty of the government to tell the prices board definitely to stop those practices which make the common people lose all faith in our democratic system.
Is it possible today to buy a shirt of average quality for less than $5? It is impossible, and the shirt that we pay five or six dollars for is not worth any more than two dollars and a half. Why is that? Is there any man who will say that, even if we have a slight touch of inflation, it is reasonable to pay $16 for a pair of shoes? You can go into a store and you will see shoes marked at from twelve to sixteen dollars, and the shoes are not worth more than three or four dollars. Where does the difference go? Not only that but it is very hard to get a suit of clothes. The other day I met a colleague of mine in the house. He was very well attired and I said, "This is a new suit you have on?" He said, "Yes". I said, "You look very well in it," and he said, "Well, I must because I paid $120 for it." That is a considerable sum of money, and there is no interference from the prices board.


Mr. LOW:: Was it worth $50 before 1939?


Jean-François Pouliot: I am not a tailor but I know that before 1939 one could buy a first class suit for $45. If prices had doubled in the interval, that would be only $90 today. But that is how it goes all along the line, and the answer we have from the prices board is that they are protecting us.
Take chocolates, for instance. You go into one store and pay seventy cents a pound for a box of chocolates. Go into another store and you will pay $1 a pound, and in another store you will pay $1.25. How is it there are different prices like that for ordinary chocolates? It reminds me of a trip I made to the Magdalen islands some time ago. I was a young boy and I went into a store which had three different kinds of chocolates. One kind

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was twenty-five cents a pound; another kind, fifty cents a pound, and the third kind, seventy-five cents a pound. I was young; I was earning my first money, and I asked the storekeeper for some chocolates. The man sold me chocolates for twenty-five cents a pound, 'but that was a favour he was doing me. 1 said, "That is a very reasonable price," and he said, "Yes, but if you were a married man and you came in here with your wife wanting chocolates I would sell you fifty-cent chocolates. That is a little better than the ones we sell to children and a little less extravagant than the ones we sell to boys who call with their sweethearts." The price for children was twenty-five cents; for married men, fifty cents; for bo3rs with their sweethearts, seventy-five cents-all for the same thing.
Mr. CASTLF.DEN: That is private enterprise for you.


Jean-François Pouliot: No. It was private enterprise uncontrolled by individual honesty. If there were more honesty in business I believe that the number of those who advocate control would be much smaller.
I wish to pay a special tribute to my hon. friend the member for Beauce (Mr. Dionne) for the excellent speech he made last week. He also spoke very well this week. He is a man of wide experience, and I am ready to support him in many of the things he said. He told me that there are people, even outside Canada, who go into a store to buy a definite thing costing such-and-such a price and if the article is marked for sale at a cheaper price they will not buy it. They judge the quality by the price, and naturally the merchants cater to their stupidity. We cannot prevent that; it is only human. But the public at large should be protected, and the necessary measures should be taken in order to protect those who go to buy anything so that no one will take advantage of their good faith or of their credulity.
May I say to the minister that I have made these remarks in the best possible spirit, so that if we are to have controls we shall have controls that really help. I am against the form of control that wTe have now because all or most of those who are in control are infallible; what they decide is the word of gospel; they accept no suggestions for changing anything from anybody. Their word is final. I should like to have the same recipe as they have, as those who succeeded in getting an increase in the price of agricultural implements. I should like to have their recipe for adjusting certain prices. Having said that, I hope something will be 83166-1131
done for the betterment of present conditions so that the people will not continue to be exploited as they are. We are exploited; everyone is exploited. Take, for instance, the grain companies. They have an organization to sell flour; they have subsidiaries to sell bread and pastry. They sell pastry at a profit of 400 per cent. They may make lots of profit but there are others who cannot make any. It is not fair, and the people are exploited.
Some years before the war I read an article which was published in a magazine showing the exploitation of the people of the United States in the sale of drug store items. It was formidable. The items consisted of things that are in daily use in- the home and they were sold at an extraordinary profit, an abnormal profit. All that should be corrected if we have an organization to see to it. Perhaps there are better systems than that. They may be explained sooner or later. I am sure that hon. members will give the minister their suggestions for improving conditions that are bad, and at the same time they may say what is good in the whole system. I am sure it will work well only when it is under the direct responsibility of the minister, at the same time the minister being responsible to parliament.


James Lorimer Ilsley: The hon. member asked a few questions which I think I can answer now. He asked why certain goods were subject to rationing. I gathered from the nature of the goods he mentioned that he did not mean coupon rationing; he meant why they were subject to orders providing for their equitable distribution. I do not know whether there are outstanding orders in any number providing for the equitable distribution of goods at the present time, but there was a time when there were many orders providing for the equitable distribution of goods.


Mr. GREEN:: Can we have that information at the present time?


James Lorimer Ilsley: Yes, I can get that. The reason for the orders, of course, was the shortage of the goods. When there were not enough goods to supply the trade and the public, the board provided for their equitable distribution.
With regard to rationing in the ordinary sense, there are just two articles subject to rationing since the announcement of the Minister of Finance this afternoon. The two remaining articles are butter and sugar. The reason there is the same one that I gave for the orders for equitable distribution, namely, that the demand is greater than the supply
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The hon. member asked me to give the committee the names of articles that are controlled. In one sense the prices of all goods and services are subject to control, because one section of the wartime prices and trade board order starts with these words:
That no person shall sell or offer for sale or supply any goods or services at a price that is higher than is reasonable and just or withhold any goods or services from sale or supply for a price that is higher than is reasonable and just.
It will be apparent that that provision is an extraordinarily difficult one to enforce. The reliance for enforcement must be based mainly on ceilings.
Perhaps the hon. member meant to ask me what articles are still subject to ceilings. Nearly all goods and services were at one time subject to ceilings, but in the summer of 1946 I made a statement in the house in which I said that thereafter only those goods and services which were named in the statement would be subject to ceilings and that others would be free from the control of ceiling prices. The control there would simply have to be the control that is found in the provision I have read, namely, that the prices of these must be not greater than what is reasonable and just. I have not that list before me, nor is it material, because in January the present Minister of Finance made an additional statement. His additional statement is found at page 67 of the report of the wartime prices and trade board. At that time the list of goods and services remaining subject to maximum prices was reduced. The list is still a long one. That list, in condensed form, but nevertheless complete, was published in the papers last January. It is a long list of classes of goods and services rather than of specific goods and services. I have before me the notice which was published in the paper, but of course it is so long that it would be difficult for me to incorporate it in my present remarks. I am informed by the officer of the wartime prices and trade board that probably seventy or seventy-five per cent in volume of all goods are still subject to ceiling prices, although great numbers of categories have been released from the control of ceiling prices.
The hon. member asked the reasons for removing ceilings, for removing articles from control. These reasons were set out in the statement made by the Minister of Finance on January 11, and the part of the statement enumerating these reasons is found on page 68 of the report of the wartime prices and trade board.


John Thomas Hackett: For the year 1946?


James Lorimer Ilsley: The 1946 report. The statement was made on January 11, 1947, and it is in the 1946 report. The Minister of Finance said:
There are a number of reasons behind the choice of these items for release from price control.
Improvement in supplies. When supplies are good, and particularly when they are sufficiently ample to produce prices below established ceilings, as in the case of a number of fresh vegetables, there is every reason for decontrol. When supplies of goods which are not fully adequate show every sign of improving further and when competition is increasing, as in the case of many household articles, there is also strong reason to remove price control. When competition in world markets is becoming keener and supplies are fairly satisfactory, as is generally the situation with fish, removal of price control is justified, though in some cases it remains necessary to maintain control over the quantity of exports to assure sufficient supplies in the domestic market.
Administrative problems. The burden, expense and complexity of administration when viewed against the lessening risk of serious price advances threw the balance toward decontrol in some fields. To an increasing extent, the relationship of prices as between standard and new lines in some businesses appeared to be having the effect of encouraging the production of new lines at the expense of output in lower-priced standard lines. This problem existed in regard to furniture and some household utensils and could not, at this stage, be entirely met under the general price control policy. Then again, there were a number of fields in which necessary price adjustments were pending. When this was the case and when it was believed that competition was growing and consumer resistance likely to develop in any event, decontrols seemed to be the best course.
There was also the risk that ceiling prices might come to be regarded as minimum prices- as the prices which the government authorized sellers to charge. Accordingly, in some cases where the threat of sharp price increases was passing, the government "was disposed to withdraw from price control and to let the trade consider its own longer-range position without any suggestion of government intervention.
In the case of some imports such as tapioca, arrowroot, and peanuts, it was necessary to choose between alternatives of letting the going ivorld price be reflected in Canada, of maintaining ceilings by payment of substantial subsidies, or of going without such imported commodities. In these circumstances, the course of decontrol was chosen.
That constitutes a fairly complete statement of the reasons for decontrolling any particular article or class of articles. I am unable to deal with the specific commodities mentioned by my hon. friend, but one can imagine the difficulty of effective price control of articles such as women's hats, because it is not possible to relate them to the prices charged for the same kind of hat in the fall of 1941 when there was not the same type of hat. With the passage of time, the ceiling

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principle becomes more and more difficult to apply to the control of prices of certain goods. The same considerations apply to many other commodities. It is impossible in price control to do a scientifically complete or perfect job. There will be some undue profits, no matter how competent the officials may be. They can only do their best.


Victor Quelch: I wish to ask a question regarding the government's general policy on subsidies. I understand that during the war the government's justification for the payment of subsidies lay in the fact that they considered that the saving to the consumer would be greater than the cost of taxation, owing partly to the danger from a spiral of inflation. I think that is generally correct, and the spiral of inflation would not be due so much to the expansion of money but would be due to the fact that, although there had. been a tre1-mendous increase in production, somewhere in the neighbourhood of fifty per cent of that production was drained away from the channels of consumption for war purposes, and therefore the money paid out on that production would, become a demand against consumption goods left in the country; that is, generally speaking. Then, coming to peace time, I understand the government's attitude toward subsidies is this, that they do not consider they would be justified in continuing the subsidy at a time when the cost in taxation may become as great as the saving to the consumer from the subsidy. Is that correct?


James Lorimer Ilsley: I do not know that I can state the view of the government in that regard. I should think it would be pretty doubtful whether the' payment of a subsidy is justified when it is simply the transference of purchasing power from one group of Canadian citizens to a slightly different group of Canadian citizens. Other considerations might enter in. It might, as a matter of social policy or something of that kind, be desirable to make that transfer of purchasing power, that redistribution of wealth, but it certainly would not be a policy for the prevention of inflation under these conditions. From the point of view of inflation prevention, it seems to me that when that point is reached subsidies should be abolished, if they are being considered as an anti-inflation device.


Victor Quelch: On the other hand, if later on we reach a position such as the governor of the Bank of Canada indicates in the 1946 report, where we may have great difficulty in maintaining demand against our production, then it might be advisable to pay a consumer subsidy in order to expand demand within
Canada. But, as the minister says, if that subsidy is paid from taxation, then the cost in taxation may be as great as the saving to the consumer and therefore you would not be increasing demand. The minister must admit that if that subsidy were paid from some other source than taxation it might be possible to expand demand in relation to production. It might be from idle savings, although, if you have to repay those savings at a later date you will still have the problem of a deficiency of purchasing power to deal with. You could finance the subsidy from the expansion of money through the Bank of Canada.


James Lorimer Ilsley: I think we are getting too far from the resolution. We are getting into the realm of monetary theory.


Victor Quelch: But the resolution provides for the continuation of orders in council in relation to subsidies, and I was trying to get from the minister what the government's policy was on subsidies in peace time. He agrees that, generally speaking, so far as he himself is concerned-he may not be speaking on behalf of the government-in his opinion the consumer subsidy should stop when the cost in taxation becomes as great as the saving from the subsidy.


James Lorimer Ilsley: I would have to add the qualification, unless it is desired for another purpose entirely, and I have used the term "social policy"-the redistribution of wealth. A policy of that kind, taking money from some people and giving it to others, might be desirable under certain conditions.


Mr. MacINNIS:: Would not the cost in taxation always equal the amount of the subsidy? I do not see how it could happen that the cost from the tax with which the subsidy was paid would be more or less than the subsidy itself.


Victor Quelch: Less.


Angus MacInnis: We shall let the minister answer that later. It is a mathematical question that is capable of answer one way or the other. If you tax S100 million out of the taxpayers and pay that amount in subsidies, that amount of subsidies is equal to the tax.


Victor Quelch: But suppose you have a spiral of inflation?


Angus MacInnis: I am not talking about what it would prevent or would bring about. I am talking about the point that has been raised, that the tax would be more or would be less than the amount paid in subsidy, which cannot happen.
The other point I would ask the minister is this. There might be a great deal of
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money available for the purchase of goods, or normally in circulation, but that money would not reflect itself in the purchase of goods unless it were distributed to the people or were in the hands of the people who needed goods.


James Lorimer Ilsley: Was that a question? I thought that what we were comparing was not the amount paid in taxes with the amount paid out in subsidy. Of course ordinarily that would be equal; but the amounts we were comparing were, on the one hand, the amount paid by the taxpayers in taxes and on the other hand, the amount saved by the consumers in prices. I am satisfied that the amount saved by the consumers in prices was many times greater than the amount paid in subsidies.


Angus MacInnis: That was a matter of the control of prices.


James Lorimer Ilsley: Yes.


Angus MacInnis: It was not a matter of the subsidies.


James Lorimer Ilsley: The subsidies made the control possible. The hon. gentleman is right; prices had to be controlled, too, but if there had been control alone without subsidies over a certain period there would have been no production.


Harry Rutherford Jackman: The minister made a considerable point of the fact that the increase in the cost of living in Canada since the war ended had been only six per cent, whereas in the United States, where controls have been abandoned, the cost of living index has risen eighteen per cent. My colleague the hon. member for Stanstead asked the minister whether or not the matter of subsidies, on which we spend a good deal of money each year, was taken into account when the Canadian cost of living index was computed. The minister said it was not, and I believe he went on to say he did not have the figures available. I should like to follow that up with several other matters which I think affect the cost of living index in Canada, and I wish to know whether the minister is able to tell us if these have also been taken into account, or if they have been neglected.
First of all, I refer to the matter of exports. To give a practical example, we find that in the lumber industry of this country we are allowed to export about forty per cent of the total cut, of which a large part goes to the United States where there is no price control on that product. As a result, our mills in Canada receive a great deal more money for this lumber which is exported, and the Canadian price on lumber used in domestic construe-

tion, and in other ways where it enters into the cost of production and therefore the cost of living, is kept down. The proof of this statement lies in the fact that if a producer of one of these commodities, part of whose output is exported, finds that he is not making a satisfactory profit on his domestic sales and applies to the wartime prices and trade board for an increase in price, clearly showing that he is receiving, let us say, $50 per 1,000 board feet for his domestic output and $75 or $80 for his exports, he will be told, "Yes, but your overall profit is satisfactory. Therefore, even if you are losing on your domestic output you are making enough on your exports to give you a fair over-all return." I am not quarreling with that policy, but I wish to point out that our cost of living index is manifestly unfair because we are taking advantage of a free market in the United States, where prices are uncontrolled, in order that in Canada we may quote prices which are substantially below the cost of production. Perhaps the minister will look into this matter-he may have the figures available from the wartime prices and trade board-and tell the committee just how much higher the cost of living would be in this country but for the fact that we take advantage of the free market in the United States and perhaps other countries. Then we may be able to get a true picture of what the cost of living index really would be in this country and whether or not controls have been a good thing for us. I am suggesting that it is unfair for us to sell part of our product in a free market and use the profit in order to show an unfair comparison with prices in our own market.


James Lorimer Ilsley: Unfair to whom?


Harry Rutherford Jackman: The comparison is unfair to the Canadian people if you are trying to show what controls have done, because you are taking advantage of an uncontrolled market across the line. I am not saying that is a bad thing for Canada, but a comparison of the costs of living in the two countries is unfair because our cost is artificially lowered by reason of the fact that we are taking advantage of a market where the price is higher as a result of the removal of controls.


Mr. SINCLAIR (Vancouver North):: But it is lower; the Canadian purchaser does pay less.


Harry Rutherford Jackman: Yes. If the hon. member had been here when I began my remarks he would understand the point I am trying to get at.


James Sinclair: I was following my hon. friend very closely.

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Harry Rutherford Jackman: In the beginning I said many products were sold in Canada at less than the cost of production because part of the output of the particular factory or mill is sold in a foreign country where prices are uncontrolled, and that therefore our cost of living index has in it an element which is below the cost of production by reason of the fact that we are selling in a free market across the line.


James Sinclair: That is good government in Canada, I would say.


Harry Rutherford Jackman: I am not objecting to that. It may be good government; I am not passing judgment on the policy, but I suggest that it is unfair to compare the cost of living in Canada with the cost of living across the line.


James Sinclair: That is the cost of living.


Harry Rutherford Jackman: I did not say it was not, but I am suggesting that we are selling many products in this country at less than the cost of production, which is obviously an artificial situation.


James Sinclair: The Americans are getting value for their money.


Harry Rutherford Jackman: The hon. member can make his speech later if he wishes.
The next point I desire to make is that I hear it said-and perhaps the minister can confirm my impression or disabuse my mind -that when price increases are asked for by manufacturers or producers they are much more likely to receive favourable consideration, if they have a just case, if the particular product on which they are asking the price increase is not included in the cost of living index. Perhaps the minister would be good enough to furnish the committee with a list of those products on which price increases have been granted, let us say since June 30, 1946, when the OPA went out of existence in the United States, and a list of those products in regard to which applications were made for increases but on which increases were refused, so that we might find out by a quick reference whether or not there is any truth in this assertion which is heard so frequently.
Another point which also affects our cost of living index is the fact that almost immediately after the OPA disappeared in the United 'States, or only five days later, we did away with the differential in our dollar exchange rate with the United States, bringing the Canadian dollar to parity with the currency of that country. I am not complaining just now about that action, but I wish to point out
that there is an element of unfairness in our cost of living index by reason of that change, as compared with the United States index. What actually happened was that it was made ten per cent easier to buy a vast quantity of commodities in the United States because the Canadian dollar was raised to parity in place of a ten per cent discount as compared with the United States dollar. Undoubtedly that had an influence on the price we had to pay in United States dollars for orange juice, citrus fruits and all the great number of commodities we buy in the United States. That had an effect on the cost of living index which, I believe, invalidated it in reference to any comparison with the United States cost of living index. At that time we had an estimated $1,500,060,000 of United States exchange, and the change in the exchange rate cost this country, on paper at least, about $150,000,000, quite a substantial amount and which undoubtedly would have a real effect on the cost of living index.
What I suggest to the minister is that if he could answer these points which I have raised, and perhaps have his department calculate the effect which they otherwise would have had on the cost of living index in Canada, we might find that, in place of our cost of living index not having gone up as much as prices in the United States, despite the continuance of controls in this country and the arguments offered for further continuance, there has not been very much difference between the cost of living here and the cost of living across the border.
The minister has not mentioned the fact that under these price controls we have black markets, the extent of which is perhaps not as widely known to government agents as it is to people in various businesses, where it has been found that legitimate business, from which a reasonable profit is expected, is put out of operation because black marketeers can make large profits and cut into the trade. In fact, some of them are making so much money that they have firmly established themselves, and are likely to be with us, perhaps on a legitimate basis, for many years to come, all to the detriment of the ordinary trade and the ordinary Canadian taxpayer.
Furthermore, while we point to a comparison of the cost of living index here with that in the United States, nothing is said about the control of standards. It is well known by the wartime prices and trade board that, while a price may remain the same on a particular article, the standard of quality may bear no relation whatsoever to the pre-war standard.
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As a matter of fact, very often these controls are nothing more or less than protection of inefficiency. Some businessmen like them because if they get a fixed price for buying and a fixed price for selling, with an adequate margin, they are content, and would like to see a continuation of that system. On the other hand, one of the greatest virtues of the whole system of free enterprise is that those who are inefficient disappear. If they cannot hold their own and render service to the people at reasonable prices, it is soon found that someone else takes their place and their business. As a matter of fact, when the government asks for the continuation of so many of these controls it should be remembered that during the war years we greatly increased our industrial capacity- perhaps by forty per cent-and managed to keep ourselves supplied. Furthermore, a million of our best young men and women were engaged in war industry, while another 800,000 of our best young people were in the armed services. Of that total of 1,800,000, at least 1,500,000 seem now to be employed, and engaged in turning out goods for peace time, in place of goods for war.
Surely the time has come when we can have competition, and when we can have goods available, if the free system is allowed to have its head and really get going. We had an example when only the other day the Ford Company of Canada reduced the price of its product, voluntarily; because all businessmen, and particularly those who really understand about business-I speak more particularly of the larger concerns-are united in thinking that the last thing they want is to see a run-away market, from which economic chaos would result.


Mr. NICHOLSON:: What was the percentage of reduction?


Harry Rutherford Jackman: I do not know what
the percentage of reduction of the Ford Company was, but one of my colleagues tells me it was $35 a car. Meantime, wages have gone up, and the reduction was most creditable.
One almost forgets that our economic system ever got along without controls. We had controls during the war, and many of us appreciate what they did to regulate the economj' of this country, and to do a good job of concentrating our efforts on war production. But the impression is growing up, having been under the tutelage of controls for the last seven or eight years, that we cannot get along without them. We are almost afraid to venture forth into the water for fear of drowning. We have to hang on to a life-preserver, a rope, or something of that kind. Business is

quite capable of taking care of itself. Supply and demand, production and consumption, are quite capable of adjusting themselves so that there will be a fair and equitable and, more particularly, a greater supply of goods than there would be under a controlled system.
I suggest to the minister that if he will give business its head he will find that there will be more production, and that competition will keep prices down. In fact, it is greatly to be questioned whether or not the government is of the opinion that we are heading for inflation or deflation. The consensus of the largest number of economists in North America at the present time is that we are facing at least a moderate price, recession. If that is so, then it means that demand is being overtaken by supply. When that happens there will always be some manufacturers who will want to keep their factories going 100 per cent, with the result that they will lower prices in order to get the business.
I should like very much to hear from the minister whether he or his advisers expect that we are heading for deflation, with perhaps some unemployment connected with it, or whether we are heading for inflation. Certainly if we are heading for deflation it is hardly the time to inaugurate or to put into statutory form the continuation of these controls.


James Lorimer Ilsley: We are not inaugurating it. In putting them into statutory form, we are simply continuing them for as long as is necessary, thereby permitting our getting out of them in an orderly fashion, as I have explained. I do not know how much I should go into general considerations.


Harry Rutherford Jackman: I should be very much interested in having some light on the price index.


James Lorimer Ilsley: Does the hon. member mean a comparison with that of the United States?


Harry Rutherford Jackman: Yes.


James Lorimer Ilsley: If that is what the hon. member wishes to have, I shall try to get some information along the lines requested by him. However I do not know whether it will be possible to get anything definite. I should think the revaluation of the dollar would have some influence, although not a very great one. It would not begin to account for the difference between the price rise in the United States and that in Canada. I shall also look into the subsidies situation.


Harry Rutherford Jackman: And exports.


James Lorimer Ilsley: Well, I do not think my hon. friend's point about lumber is a good one, at all. I think he was making his case the

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other way around; that is, he has established that the existence of controls keeps prices down.


Harry Rutherford Jackman: I may be handing the government a compliment on that export matter. But surely the minister will agree that if lumber, which is taken only as an example, is being sold on the Canadian market at less than the cost of production, the government would have to allow the price to be increased in order to make ends meet in the industry, if it were not for the fact that in a sense the industry is bonused by high prices in the export market. I am suggesting that, in connection with the comparison of prices of commodities included in the Canadian cost of living index, there is some unfairness when a comparison is made with the United States index.


James Lorimer Ilsley: I cannot see that point. I do not know whether domestic prices are less than the cost of production or not. I do not agree that they are; I do not know.


Harry Rutherford Jackman: Perhaps the minister will find out.


James Lorimer Ilsley: I do not know whether I can or not; I do not believe I can.


Harry Rutherford Jackman: I could soon find out from the department.


Mr. FLEMING:: Last night in the midst of some discussion, to part of which exception was taken by the Minister of Justice, questions were put by the hon. member for Vancouver South to the Minister of Reconstruction and Supply, which the minister said were perfectly proper questions. They had to do with Nos. 56 and 57 in this list of fifty-seven orders in council. The nature of the question was this: Why are they included in this measure?
Taking that as my starting point, from the point of view of relevancy and order, I should like to sajr a word concerning an order also included among the fifty-seven which, in my submission, clears ought also to be the subject of a separate bill, and particularly in view of certain observations made in the speech from the throne. I refer to the subject of old age pensions.
We have among the orders in council a number which deal with the subject of old age pensions, the gist of which is to permit the addition of some $5 a month by way of subsidy to the present statutory rate fixed by the Old Age Pensions Act. In the speech from the throne, to be found on page 3 of Hansard there appears this sentence:
Amendments to the Old Age Pensions Act will be introduced at the present session.
We have had it put quite clearly before the committee that some time at this session the government is to introduce a bill to amend the Old Age Pensions Act. Is there any reason therefore why this omnibus bill to be introduced should contain, presumably for a temporary period, the orders in council which relate to this very matter? It was indicated in earlier discussion in the house this session that the purpose of the amendments to the Old Age Pensions Act would be to increase the basic rate of the pensions above the present S20 monthly statutory rate plus the $5 provided for under the orders in council.
Would it not be sensible to drop these orders from among the group of fifty-seven in the omnibus bill and make them part and parcel of whatever bill the government may decide to introduce to amend the act itself? Why should we be taking two bites of the cherry? The effect of these orders has now been extended to May 15. We are no longer faced with the situation which the government might have stated earlier as a reason for continuing these measures. Certainly, with the extension of the effect of these orders to May 15 there is ample time for the government to bring in its bill to amend the act and increase the rates on a statutory basis, without asking the house to take time meanwhile to go over a number of these orders and to give them the effect of statutes for the meantime.
Surely the sensible and businesslike way to go about this is to say that in view of the extension of these orders to May 15 the government should bring in its measure to amend the act and increase the statutory rate. We heard) something this afternoon from the Prime Minister about duplicating debate. Is there any better way of duplicating debate than the procedure the government is following in this respect? We all must seek to approach this matter in the most orderly way, in a way that will save time and bring us most directly to the meat of the problem. I submit that the government will be making a contribution in that direction if they will bring in their bill to amend the Old Age Pensions Act and increase the statutory rate. In that way they will dispense with any necessity for including the orders in council relating to old age pensions in the omnibus bill. Surely that bill will be loaded down enough without including measures that are to be the subject of duplicating legislation at a later stage in the session. Not only are we going to duplicate discussion, but apparently we are going to duplicate the legislation itself.


John Thomas Hackett: Mr. Chairman-
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Donald Methuen Fleming: I would ask for some comment on these remarks of mine. I was not making them just for the sake of talking; I made them in the hope that they would be a contribution toward an orderly approach to the problem.


James Lorimer Ilsley: I do not know of any reason why the old age pensions legislation should not be brought in at as early a day as possible. It was quite obvious at the beginning of February that we would not be able to have the old age pensions legislation put through by March 31 and we attempted to avoid any hiatus. There are many considerations which I cannot outline to the committee. We had to keep in mind our dealings with the provinces. We had to have a little time on that and we knew we could not get it through by March 31. It might be possible to do it before May 15, but I do not know.
The same considerations apply to other legislation, such as the labour relations legislation. We have to get out of that field just as soon as we reasonably can and we have to have legislation about that this session. The existing orders in council are included under this measure although we are going to bring in legislation later in the session. That may mean duplication because it means making arrangements with all the provinces and giving them a chance to pass legislation. We knew we could not make the transfer to the provinces before March 31, but we might be able to do so before May 15. I shall have to speak to the Minister of Labour about that.
I would point out that we cannot do everything between now and May 15. We have not done anything yet except to deal with emergency legislation and the speech from the throne. We have quite a large sessional programme to go on with and we want to get a lot of this legislation through. If we start giving priority to everything, we shall not be able to do that.


Donald Methuen Fleming: Will the minister clear up one point? I take it that it is not the intention of the government to continue the orders in council in relation to old age pensions beyond the date when the amendments come into effect?


James Lorimer Ilsley: No.


Donald Methuen Fleming: In other words, the government is simply proposing to continue these four orders in council which relate to old age pensions until it gets the bill amending the act through the house?


James Lorimer Ilsley: Yes.

Mr, FLEMING: The bill to be introduced will cover all the matters that are within the scope of the orders in council?


James Lorimer Ilsley: Yes.


Howard Charles Green: Will the minister tell us what orders in council are to be replaced by statutes during the present session? In his preliminary statement he said that some of these fifty-seven orders in council were administrative, some were regulative, and some were legislative. It would be of considerable help if we knew which of the orders in council he considers to be legislative.


James Lorimer Ilsley: There are three classes of orders in council. There are the orders in council relating to old age pensions; there are the orders in council relating to labour relations, and there are the orders in council relating to veterans preference. Those three classes of orders in council are to be replaced by legislation this session.


Howard Charles Green: There are five orders under the heading. Civil Service Commission; nine under the Department of Labour, and four dealing with old age pensions under the Department of National Health and Welfare. What orders in council are to be replaced by statutes? Will all those that I have mentioned be replaced in that way?


James Lorimer Ilsley: What the hon. gentleman is really asking is which ones we are undertaking to revoke this session?


Howard Charles Green: I am asking which ones are to be replaced by legislation later in the
session.


James Lorimer Ilsley: That is ambiguous. I have had some experience in having my language examined rather closely and I am going to be somewhat careful. In a sense I cannot say that they will be replaced, if by replacing it means enacting the same language into legislation. The legislation may be a little different. What the hon. gentleman is asking is whether these are to be revoked when the legislation dealing with the subject matter is passed.


Howard Charles Green: That would meet it.


James Lorimer Ilsley: I could go over them and mark them.


Howard Charles Green: I think we are entitled to know which ones are to be revoked after they have been replaced by legislation at this session.


James Lorimer Ilsley: I do not think there will be any difficulty about that. Of course, once we give an undertaking to revoke we have to revoke. Certainly it is clear in my mind

Emergency Powers
exactly what we are intending to do. The principle of what we are intending to do is to enact old age pensions legislation, in which event these four orders in council relating to old age pensions would be revoked. That is No. 1. It is also our intention to introduce legislation providing for a preference to veterans in the public service of Canada, in which event the orders in council providing for that preference will be revoked.


Howard Charles Green: That applies to all five orders in council?


James Lorimer Ilsley: I do not know whether it does or not. Do the whole five relate to the veterans preference?


Howard Charles Green: They say so.


James Lorimer Ilsley: Cannot the hon. gentleman apply the principle himself instead of trying to pin me down here to numbers of orders in council. I am giving the principle of the thing, which is quite clear. Then, third, are the orders in council relating to P.C. 1003?


Stanley Howard Knowles: Be extra careful on that.


James Lorimer Ilsley: Perhaps I should be. At any rate the principle of the thing is this. We have this labour code so-called which provides for collective bargaining between employers and employees. It was passed as a war measure. We are now moving into the period when the jurisdiction passes to the province because the war is over. The provinces, we assume, will pass legislation covering part of this field. The part occupied by ourselves will be greatly contracted, and our legislation will cover that contracted field. Then those parts of the order in council which are replaced by our legislation and by provincial legislation will be revoked. That is the principle of what we are going to do, and I think that ought to be sufficient.


The ACTING CHAIRMAN (Mr. Golding):: What we are getting into now is the bill itself.


Howard Charles Green: Oh, no.


John Thomas Hackett: Where is the bill?


William Henry Golding: The hon. member had the bill in his hand.


John Thomas Hackett: Where? Have you it?


William Henry Golding: Certainly.


Howard Charles Green: We do not have it.
The ACTING CHAIRMAN (Mr. Golding)': I appeal to hon. members to deal with the resolution, which is a very simple one. These other matters can be dealt with when the bill is in committee, when all these details can
be gone into. I think my hon. friend will find that if he will cooperate with the Chair we shall make better progress than we are now making.


Howard Charles Green: On that point, Mr. Chairman, this was all threshed out before. The minister himself said that certain of these orders in council were legislative, and I am simply asking him to explain which ones come in that category.


William Henry Golding: That can be gone into in committee.


Howard Charles Green: No; we are entitled to have that information now. I submit that if the minister is not prepared to complete his statement today he should do so tomorrow and tell us which other orders in council are to be revoked because legislation is to be brought in replacing them.


James Lorimer Ilsley: I can do that. I can state what our intention is. I do not know just how rigid the undertaking should be.


William Henry Golding: The hon. member for Stanstead.


John Thomas Hackett: I thank you, Mr. Chairman. Some time ago I started to ask a question of the right hon. minister and it provoked so much discussion that I have not been able to complete it. The right hon. gentleman said that the financing of the war had been achieved roughly one-half by taxation and two-sixths-I said two-sixths by borrowing and one-sixth by inflation. The right hon. gentleman did not quite agree with my description of the method resorted to for the last one-sixth. It does not make much difference what we call it. It was a way of puffing ourselves up by resorting to the printing press or to borrowings from the banks. Since I embarked upon this inquiry earlier in the afternoon I have been fortunate enough to get a couple of documents which will possibly enable me-


William Henry Golding: I wonder how the hon. member relates this financial aspect of our war effort to the resolution now before us.


John Thomas Hackett: I think, Mr. Chairman, that you had the good fortune to be absent when I started on this question. I said that the resolution took it for granted that there existed a national emergency. I am not convinced that such is the case, and inasmuch as the existence of a national emergency is the basis of the resolution I was inquiring into
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certain features of the emergency referred to by the right hon. gentleman in his address which I thought should be supplemented by some additional information in order that we might deal with the resolution, as they say in that part of the country from which I come, en pleine connaissance de cause, which means with a little more information than you have at the present time. What I wanted to say was that the right hon. gentleman in his budget of 1943 said:
The plain fact is that this year we have had to depend too much on bank borrowing.
Then in the annual report for the year 1945 to the Minister of Finance and statement of accounts by the governor of the Bank of Canada I find this statement:
The remaining one-sixth-
That was the one-sixth of the cost of the war which had not been paid for out of taxation or borrowing. It was accounted for in this way:
The remaining one-sixth of the government's total requirements has been financed to a considerable extent by the chartered banks, which has involved a substantial increase in their holdings of government securities, and consequently in the volume of savings and demand deposits of the public with the banks.
This increase in deposit liabilities has in turn given rise to a need on the part of the chartered banks for larger cash reserves. The policy of the Bank of Canada-implemented through its purchase of government securities in the market-has been to keep pace with these necessities, without trying to bring about expansion of credit for purposes unrelated to war needs.
To a neophyte like myself that means a type of inflation. The question I wish to ask the minister-and1 upon the answer I think I can base the remainder of my argument-is, has not that device, whether it be called inflation or whether it be called by a more euphonious name, resulted in a reduction in the purchasing power value of the Canadian dollar?


James Lorimer Ilsley: No.


Mr. MACKENZIE:: Ask the hon. member to ask the question again.


John Thomas Hackett: What does the hon. Minister for Veterans Affairs say?


Ian Alistair Mackenzie: I suggested that the minister ask the hon. member to repeat the question.


Mr. ROWE:: Does the minister not understand it?


James Lorimer Ilsley: The answer to that question is not perfectly obvious, but my opinion is that the large increase in bank deposits during the war had an influence of driving the price level up; that what might be called inflation of credit and currency-


John Thomas Hackett: Is that different, from currency circulation?


James Lorimer Ilsley: I am talking about volume now; the volume of currency and credit in this country increased, and what might be called inflation of the volume of currency and credit in the country. My opinion is that that affected the inflation of prices; it caused some inflation of prices, but the two are different because perhaps one would not necessarily follow the other.
The reason I do not want to say "yes" to the question, did we resort to inflation as a device for financing the war is that it might be seriously misunderstood, it is so ambiguous. One hears about countries which pursue a policy of price inflation or might pursue a policy of encouraging price inflation so that their tax receipts will be much greater, so that they will get more money in that way, which might be a device of financing by inflation. I do not want to say "yes" to that at all.


Douglas Charles Abbott: Would the committee allow me to move that we report progress in order that I may have a couple of minutes before six o'clock to table supplementary estimates?


William Henry Golding: I might say to hon. members that I had hoped this resolution might be passed before six o'clock.


Howard Charles Green: What a hope!
Progress reported.



SUPPLEMENTARY ESTIMATES-1947-48

[Stage Direction]
A message from His Excellency the Governor General transmitting further supplementary estimates for the financial year ending March 31, 1947, was presented by Hon. Douglas Abbott (Minister of Finance), read by Mr. Speaker to the house, and referred to the committee of supply.
A message from His Excellency the Governor General transmitting supplementary estimates for the financial year ending March 31, 1948,
[Stage Direction]
Private Bills-Divorce
was presented: by Hon. Douglas Abbott (Minister of Finance), read by Mr. Speaker to the house, and referred to the committee of supply.
At six o'clock the house adjourned, without question put, pursuant to standing order.
Thursday, March 27, 1947