1947-03-06

INDIAN AFFAIRS


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Mr. D. F. BROWN (Essex West) presented the first report of the joint committee of the Senate and the House of Commons to continue and complete consideration and examination of the Indian Act, and moved that the report be concurred in.
Motion agreed to.


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On the orders of the day.
Mr. STANLEY KNOWLES (Winnipeg North Centre):: I wish to direct a question to the Minister of Finance. In view of the report in today's Montreal Gazette that retail prices of milk, butter and sugar are soon to go up, will he assure the house that no such increases will be allowed until the subject of price control has been discussed in the house?


Hon. DOUGLAS ABBOTT (Minister of Finance):: I did not catch the last part of my hon. friend's remark, but I saw the statement in the Gazette. It is the usual newspaper comment, and I have no comment to offer with regard to what has been said there.


Mr. COLD  WELL@: The last part of the question asked by the hon. member for Winnipeg North Centre was: Will the minister assure the house that these price increases will not go into effect pending discussion of price control in the house?


Douglas Charles Abbott: No; I cannot give any such assurance. I am not of course suggesting that the price increases will go into effect. I answered my hon. friend the other day and said that the matter of price increases was one of government policy which would be announced at the appropriate time. But I can give no assurance that no price increases will go into effect until the general policy has been discussed.


Stanley Howard Knowles: It is a matter which is of great concern to the people of Canada.



REFERENCE TO STATEMENT BY MINISTER ON MARCH 4

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On the orders of the day:
Mr. HAROLD W. TIMMINS (Parkdale): Having regard to the statement which the 83166-69
Minister of Reconstruction and Supply made on March 4 to the effect that he "had not heard of a shortage of nails in any part of Canada during the past two months", is the minister not aware that in the Toronto area the shortage is so acute that the builders cannot complete the houses started in 1946, and will he make a statement in regard to the matter?
Mr. GRAYDON:: Is the minister not going to answer?


Mr. CHEVRIER:: The question is clearly out of order.


Mr. SPEAKER:: This is a lengthy question, and I would ask the hon. member to put it on the order paper.


Gordon Graydon: I submit that it is a very urgent matter.



PRIVILEGE


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On the orders of the day:
Mr. J. A. ROSS (Souris):: On a question of privilege, Mr. Speaker, yesterday afternoon at page 1040 of Hansard the Minister of Veterans Affairs (Mr. Mackenzie) said:
... I shall say a word or two at once in reply to the statement just made by the hon. member for Souris (Mr. Ross) . . .
Last evening my hon. friend referred to a cost plus contract, to which I shall refer in a moment. These, however, were not cost plus contracts . . .
According to the minutes of the proceedings of evidence before the special committee on veterans affairs on June 3, 1946, in reply to a question I asked, Mr. Murchison, director of Veterans' Land Act, stated that the great majority of these houses were built on a cost plus basis; that some 2.551 housing units, out of the lot, were on a cost plus basis in seven provinces of the dominion. If I may be permitted to do so I should like to refer to that evidence, to establish my point:
By Mr. Ross:
Q. Are all the veterans' homes under the Veterans' Land Act constructed on a cost plus
basis?
A. No; I mentioned in the statement which 1 made this morning that a number of these houses were let on a firm price basis, one at Calgary, one at Lethbridge, and one at Moncton, and also a few in Ontario, about two hundred, which were let on a firm price basis. The rest were all cost plus basis.


Some hon. MEMBERS:: Order.
Right Hon. IAN A. MACKENZIE (Minister of Veterans Affairs): If I may reply quietly to this question of privilege, Mr. Speaker, I



The Address-Mr. Townley-Smith
should say my statement was absolutely correct, and that the contractor's fee was about $210 per house.
MB. rOULIOT-REFERENCE IN "LA PRESSE" TO RULING BY MR. SPEAKER
On the orders of the day:


Mr. JEAN FRANCOIS POULIOT (Temis-couata):: I rise to a question of privilege, Mr. Speaker, to vindicate Your Honour. My contention is that no journalist may impute motives to Your Honour or mention in the press motives which Your Honour has not expressed in your rulings. So far as I am concerned the rulings of the Chair are complete in themselves, and no press reporter has the right to impute motives to the Chair. Since the beginning of last month I have been waiting for a correction of a report which appeared in La Presse of Montreal of February 1, in connection with the tributes which were paid the day before to the late lamented Mr. Cardin. I have checked up what was said by Your Honour, which appears at page 21 of Hansard, and I do not find anything of the kind reported by the correspondent of La Presse and appearing at page 25 of the issue of that newspaper of February 1. This is what it said:
L'Orateur avait interrompu M. Pouliot parce que celui-ci avait emaille son discours de citations de M. Cardin, choisies parmi les occasions oil i'ancien ministre liberal s'etait trouve en disaccord avee le gouvernement.
Since my English speaking friends are kind enough to listen to me and no doubt are anxious to know how the remarks of Mr. Speaker were reported, I shall translate what I just said:
Mr. Speaker interrupted Mr. Pouliot because in his speech the latter mentioned quotations from Mr. Cardin chosen from the speeches in which the former Liberal minister was in disagreement with the government.
I contend, sir, you never said anything of the kind. I believe it was unfair for this newspaper to give these remarks as having been made by you, and I hope the proper means will be taken to have that newspaper report corrected as soon as possible.



GOVERNOR GENERAL'S SPEECH


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The house resumed from Wednesday, March 5, consideration of the motion of Mr. J. W. MacNaught for an address to His Excellency the Governor General in reply to his speech at the opening of the session, and the amendment thereto of Mr. Bracken, and the amendment to the amendment of Mr. Coldwell.

Mr. F. W. TOWNLEY-SMITH (North Battleford):	On two previous occasions, Mr. Speaker, I have drawn attention to the fact that in my constituency of North Battleford we have two branch lines of the Canadian National railways that are incomplete. In each case the ends have been built but the centre portion has not been completed. In the line from Frenchman's Butte in northern Saskatchewan to Heinsburg, in northeastern Alberta, there is a gap of roughly forty miles. In the line from St. Walburg to Beaver River, some 135 miles still remain to be constructed. Many years ago people were encouraged to settle in these districts, which are heavily wooded, with the definite promise that a railway would be built to take care of their needs. They have been let down very badly and are now suffering unnecessary hardship because of the failure of some people to keep their word. Both Liberal and Conservative parties promised these branch lines. It is always bad business to break a promise.
The difficulties experienced by those unfortunate people who were persuaded to spend the best part of their lives in these two districts have been recounted on several occasions by the hon. member for The Battlefords (Mr. Campbell), the hon. member for Atha-baska (Air. Dechene) and myself. There are no good roads, and when winter comes the obstacles these settlers encounter become almost insurmountable. There is no encouragement for them to increase production either of grains or of live stock, as the long haulage, running anywhere from twenty to one hundred miles, is prohibitive. Schools and social services were practically nonexistent until the new government took over in Saskatchewan, when schools and teachers were provided under great difficulties. The lack of railway facilities makes the situation very bad; the whole area which should be serviced by these lines is really an economic loss. If sickness assails them they can get no help. The emergency hospital planes which have been inaugurated by the government of Saskatchewan have proved very helpful, but even so the situation is still bad and the mortality rate is high.
May I say here how thoroughly I agree with the hon. member for Lanark (Mr. Blair), who dwelt upon the lack of consideration being shown the unfortunate people suffering fiom tuberculosis, cancer, arthritis and the like. I should like to say, however, that in my province of Saskatchewan free treatment has been provided for those suffering from cancer. Cancer clinics, hospitalization and all treatments known to medical science are provided, and at least we have awakened to the great need for research and free treatment.

The Address-Mr. Townley-Smith
I would not feel inclined to encourage any further immigration into that part of my constitUencjr until the railways are completed. In my opinion there is no need for giving occasion to the distress the newcomers would be called upon to undergo, and it would be both unkind and unfair to ask them to consider making their homes in these districts.
For the third time I appeal to the government to take steps to have these lines completed.
Arrangements which have been made with Great Britain for the disposal of the major part of our wheat crop appear to be in the main, satisfactory. Most of my constituents agree that the handling of the wheat by the Canadian wheat board is the proper way to do it.
In this northern country, however, large quantities of coarse grains are grown. It is felt that if the system of handling wheat by the wheat board is sound and satisfactory, then coarse grains, particularly oats, barley and rye, should be handled in like manner. The wheat board has certain authority over these grains, fixing quotas, arranging ceiling prices and the like; and it is felt-and I quite agree with the idea-that the one board should be completely responsible for all grain in exactly the same way as it has complete authority over the nation's wheat.
May I suggest that serious consideration be given to this request. It is already within the power of the governor in council to order that this be done, and I can assure the government that steps in this direction would be highly appreciated by the majority of the growers. I have heard it argued that while our wheat is mainly exportable, and can properly be handled by the wheat board, coarse grains trading is mostly interprovincial and cannot be handled by the wheat board because it comes under a different classification, and any definite attempt to have it handled compulsorily by the board might have the effect of upsetting the legislation and making it ultra vires.
If that argument is sound, then it is fair to say that if we were unfortunate enough to have two disastrous crop years, and no wheat were available for export, but just barely enough for the country's own needs, the wheat board act would become ultra vires and the Canadian wheat board would have to go out of existence. This, in passing.
I express the hope on behalf of my constituents that eventually the government will bring all grain completely under the control, regulation and sale of the Canadian wheat board. I am indeed happy to see this request made by the Canadian Federation of Agri-83166-694
culture, following the ideas and suggestions made by this organization fifteen years ago.
The matter of quotas for coarse grains, which is arranged by the wheat board from time to time, is causing some concern. As is generally known, the yield of oats is roughly twice that of wheat, and it would therefore be reasonable and logical for the delivery quota of oats to be twice that of wheat. This, however, was not done; and until nearly the end of the year only five bushels per acre could be delivered at country elevators. The natural result is that thousands- upon thousands of bushels of oats are lying in heaps on the ground, without any protection, and now covered with several feet of snow-all this in spite of the fact that feed grains are badly needed, especially in eastern Canada. There is no possible chance of this grain being delivered to the elevators before spring, because all the country roads are blocked, and unfortunately there is a good chance of a great deal of it being spoiled and becoming a complete loss.
The same thing to a lesser degree is true with respect to barley. Farmers haul in wheat, the higher priced grain, first. And then, being short of storage accommodation on the farms, the cheaper grains have to lie in heaps with little or no protection. If the quota on these coarse grains could have been increased earlier -the Minister of Trade and Commerce (Mr. MacKinnon) told us a little over a week ago that the quotas were now open-I do not think the shortage of feed grains would have been nearly so serious. May I call this point to the attention of the Minister of Agriculture (Mr. Gardiner) who may see in it some connection with the shortage of hogs and the consequent difficulty with the British bacon contract.
Another point in connection with quotas and the storage of coarse grains was brought up within the last few days, while Bill No. 23 respecting the Canadian wheat board was being considered. Fear was expressed by some western members-indeed an amendment was offered because of this fear-of the possibility that there would not be enough room in the elevators before July 31, 1950 for just the wheat crop. What, then, is to become of the coarse grains crop, if this fear is realized? Where and how is it to be stored? And if prices are descending, is the grower to take the loss because the elevators cannot make room for him? I fear the decision of the agricultural conference recently held in Ottawa to increase the quantity of coarse grains, and the desire of the Minister of Agriculture to see more barley grown will meet with disappointment, unless some definite consideration is given both as to quotas and to prices
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The Address-Mr. Townley-Smith
Coarse grains must be carefully considered if the production of live stock-pork, beef, mutton and poultry-is to be maintained; and also if dairy products-milk, cream, butter, cheese and eggs-are of sufficient importance to enter into the national scheme of things.
Now for a few words on the prices of grains. The prices of oats and barley are quite out of line with wheat. If wheat is worth $1.55 per bushel, then oats should be worth 75 to 80 cents per bushel, instead of 514 plus the 10-cent equalization bonus, making 614 cents. Further evidence of the inequality of values in oats is demonstrated by the fact that five grades are selling for the same price. No. 2 C.W., No. 3 C.W., Extra No. 1 feed, No. 1 feed, and No, 2 feed, are selling at the ceiling price. The best oats, No. 2 C.W., are selling at the same price as a very poor sample, five grades lower, namely No. 2 feed. The reason is, of course, that the ceiling for the good oats is much too low. It should be around my earlier estimate of 75 cents, while the ceiling for the low grades of oats is somewhere near their value. I will not go into detail, but a similar situation exists with respect to barley. No. 3 C.W., a very good grade of barley, is selling at 64J cents plus a 15-cent equalization bonus, making 791 cents; while No. 3 feed is selling for the same price. Barley, incidentally, ought to be priced, to be in fair alignment with wheat, at two-thirds of the wheat price; so that the good barley should be selling for $1.05 per bushel. Again may I draw to the attention of the Minister of Agriculture what I believe to be an important factor in the present shortage of barley, namely the price factor.
This question of proper alignment or true relationship of prices is far more important than many people think, and has a definite effect upon the state of an industry, and even upon the economy of a country. According to the Canada Year Book of 1945, in which at page 204, average long-term yields and prices are given for the three principal grains, wheat, oats and barley, we see that the yield of wheat is 15-6 bushels per acre, and the average price 87 cents per bushel, and that for oats the yield is 30-3 bushels per acre and the price 41 cents per bushel. For barley the yield is 23-3 bushels per acre and the price 51 cents per bushel.
Let us extend these yields and prices and find out what the farmer is really interested in-the return in dollars and cents per acre. We find that for wheat he received $13.57; for oats, $12.42 and for barley $11.88. In other words he received $1.69 per acre more for growing wheat than for growing barley, or better than 14 per cent. If we consider
TMr. Townley-Smith.]
the question in the light of today's prices we find that the return per acre for wheat is $24.18; for oats, $18.48, and for barley, $18.64. There is a gain for the wheat grower over the barley grower amounting to $5.54, or 354 per cent per acre. Who then would want to grow barley when he can make 354 per cent more by growing wheat?
This is what I mean when I say that prices are out of line. This is one of the reasons, and a very important one, why there is a scarcity of barley. If these prices were adjusted, our farm economy would level itself off. The barley farmer could grow barley, the oats farmer could grow oats, and the wheat farmer could grow wheat. As a start toward this happy and logical state of affairs I suggest to the Minister of Agriculture, who is concerned, and rightly so, over the shortage of barley in the country, that the ceiling price on this commodity be raised by ten cents per bushel, and that he arrange also for a bonus of $5 per acre. This will still fail in bringing about a proper equivalent value, but it will help give evidence of a desire to correct the situation and may be a means of getting more barley. The same thing applies to oats.
In my opinion feed grains will not be forthcoming until some levelling up of prices takes place. Indeed the whole question brings us into the realm of what we call parity prices. A great deal has been said about parity at different times, and demands have been made frequently for an explanation of the term. I think the word was most unfortunately chosen. Webster says that it means the quality or condition of being equal or equivalent. When we use the term in connection with prices I think of it as meaning a true or equivalent relation in the values of the commodities being priced.
I believe that the values of all the things in common use in our economy can be brought to a common denominator and the prices all made to bear a true relation to each other. This will not be easy, but it can be done. First, we shall have to make a start within an industry itself. It has been said that parity means the true relation between the price of the things a farmer has to sell and the price of the things he has to buy. This is so, but I think we shall have to begin even closer to home than that, and establish, first of all, parity between the things themselves which a farmer has to sell. Thus, as I said a short time ago, if wheat is worth $1.55 per bushel, then oats are worth 80 cents and barley $1.05.
Working on this hypothesis, how much is butter worth per pound, or potatoes per bushel, or hay per ton? A great many factors will come into the question, including, of course,

The Address-Mr. Townley-Smith
our old friend supply and demand, which will be the classical variable. Then after straightening things out in this particular industry and that particular industry we can begin to work on parities as between different commodities. If wheat is worth SI.55 per bushel, how much is an eight foot binder worth, or a six tube radio, or a pair of shoes? Once we have decided what the common denominator is we can get pretty close to equivalent values.
The really difficult ones will be those that are not quite so tangible. For instance, what are a medical doctor's services worth, (a) if you die; (b) if you don't die; (c) if you get better but wish you had died? What is a lawyer's advice worth (a) if it is good; (b) if it isn't? What are the services of a minister of the crown worth, (a) if he is a Liberal; (b) if he is a Conservative? We may after all have to be a bit arbitrary about some of these things.
Seriously, to get back into agriculture, my farmer friends are satisfied that $1.35 per bushel for four years is a reasonable and stable income. What they may think about it if the prices of other things are allowed to go up sky-high is something else. I have not quite understood a lot of the criticism that the price is so much below the world price. As the S1.35 is an average price spread over a number of years, how is it possible to tell whether the price is good or bad until the four years have passed and the average can be computed? Anything else is merely conjecture or guesswork and may prove to be badly wrong. The farmer knows he will get S1.35 and if he feels he cannot produce wheat for that price he has the opportunity of quitting and directing his energies into some other chanel. Also *with the further assurance that the wheat board will buy all the wheat that will be grown during the term of the contract the great fear of being left with a large quantity on his hands has disappeared.
May I now be allowed to discuss for a short time a matter which has not been brought up in this house or if at all, then not for a considerable time. Every year about this time we see in the newspapers what are called estimates of the amount of grain which will be grown in Canada. May I suggest that this guesswork is no help at all to the agricultural industry but is, on the contrary, quite detrimental? In the first place, the guess is never accurate, or even nearly accurate; in the second place, it is invariably too high-I could say with reasonable safety always too high. In the third place, the principle or the practice of telling the world how much wheat or oats or barley or rye or anything else may be expected from
our growers in. any given year, especially when the estimate is too high, is a bad one and is a great disservice to the farmers of the country.
Let us first consider the matter of accuracy. Hon. members will bear me out when I say that two or three guesses are made during the year. They are all different, and they are practically always adjusted on a descending scale. The first guess for 1947 may be expected any time now. Before seeding is finished, we shall read that John Jones, the famous maker of fur-lined refrigerators, in his journey from Montreal to Vancouver, said in an interview that his observations led him to believe that the prospects for a bumper crop all across Canada were never brighter. There could not possibly be less than 500 million bushels of wheat, and coarse grains would be grown in like degree. Unfortunately, because John Jones spends a lot of money on advertising, this foolish statement of his gets big headlines. Even now nobody knows for sure how many acres have been planted to wheat, but a small thing like that does not deter the publication of the second guess. Now we are getting closer. A number of organizations who have agents out in the country are getting into the game. By now it is known that the weather has been unfavourable, perhaps dry and wfindy, or there have been late frosts. Cutworms and grasshoppers have taken their toll. Root-rot and browning have cut the stands considerably. They are still guessing at the acreage, because no one but the farmer himself knows exactly what has been planted. So the third inaccurate guess is made-300 millions.
Then a newspaper, in a moment of enthusiasm, sends out someone from its city office to drive all over the grain-growing provinces, to put the finishing touches on the guesses. But, Mr. Speaker, the farmer owner himself, who has walked into his grain fields a hundred times already this season, and who knows where the thin places are, and whether the heads are large or small, whether they are well filled or just half filled, still does not know what the yield will be. If after threshing he finds that his guess was within one and a half bushels per acre, then he knows that he was an excellent estimator. Yet this guess, according to the Year Book 1944, would produce an error of 35 million bushels in the total crop estimate for wheat alone. But the man driving along the country roads in a good ear at forty or fifty miles an hour, seeing perhaps the best crop, perhaps the worst, is acknowledged to be able to say what the harvest will be.
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The Address-Mr. Townley-Smith
If we must indulge in this pastime, why do we always get our estimates too high? If there is any merit in sending out information to an anxiously awaiting wheat market, why do we always send it- out in a manner calculated to break the market down to lower prices? Why not, every once in a while, give the farmer a break and lead the markets to believe they may be short of wheat, and the people short of bread?
I believe the principle to be unsound. A parallel case would be for the Department of Trade and Commerce to tell the importing countries that Canadian pulp and paper mills will this year produce $500 million worth of pulp and paper, and then about June cut the estimate down to $400 million, and finally cut it again to S350 million, which would be within S50 million of what it was in 1944. What a howl would go up! Yet the case is not quite parallel, because nobody ever knows how much grain is produced in any given year. We know, of course, how much is delivered to the elevators, but no one knows how much is used for feed on the farms, how much is spoiled and lost, or how much is held back in storage in the farm granaries. There is no system for finding that out, so that even final estimates are at best just guesses which may or may not be reasonably close. The pulp and paper mills would know exactly what their production was, but whether or not the}' would want the information broadcast half way through the production year is something else again.
No; the principle and practice of issuing inaccurate information is vicious and wrong, and when it concerns foodstuffs or wearing material it is more particularly so. It is just as wrong as the practice of gambling in these commodities on the grain exchange or the cotton exchange, and is often regarded as being part of the system. It is high time we cut ourselves away from this iniquitous system of trading upon the wants and needs of the common people and regarded these gambling operations as the relics of a careless and selfish civilization. This must be what Mr. LaGuardia had in mind in his statement before the food and agricultural organization at Copenhagen, which he repeated before the united nations organization at Lake Success last November, where it was greeted with prolonged applause. This is what he said:
You cannot have both stability in prices and security for the farmer, as well as fluctuation in prices. It is no use saying that we are not going to interfere with free exchange and free sales. If you want what is needed, you will interfere and you will put every gambling grain exchange out of business in Chicago, Winnipeg, or Liverpool, or wherever it exists.
[Mr. Townley-Smith.1
As is generally known, Mr. LaGuardia was secretary general of UNRRA, and his knowledge and experience in the feeding and clothing of the poor and destitute peoples of the world cannot be denied. His statement, therefore, must be listened to with the greatest consideration and concern. It is indeed fortunate that we in this country have taken steps to check the gambling in grains. Let us hurry the process along and bring into being a system of orderly marketing which will be acclaimed by ordinary peoples all over the world. Let us be fair and compassionate, and put humanity first.
Mr. G. S. WHITE (Hastings-Peterborough):: Mr. Speaker, I would first like to refer to a statement made yesterday by the Minister of Veterans Affairs (Mr. Mackenzie) at page 1041 of Hansard, where in replying to certain remarks that had been made by the hon. member for Souris (Mr. Ross), he said:
Last evening my hon. friend referred to a cost plus contract, to which I shall refer in a moment. These, however, were not cost plus contracts; they were management fee contracts, and the average price or fee or reward to the contractor was in the neighbourhood of ?200 per house.
A few moments ago the hon. member for Souris rose on a question of privilege, Mr. Speaker, but he was not allowed to make his statement. I would therefore refer the minister to the proceedings of the special committee on veterans affairs of June 3, 1946, where at page 773 the hon. member for Souris asked the following question of Mr. Murchison, director, Soldier Settlement and Veterans' Land Act:
Are all the veterans' homes under the Veterans' Land Act constructed on a cost plus basis?
Mr. Murchison's answer was:
No; I mentioned in the statement which I made this morning that a number of these houses were let on a firm price basis, one at Calgary, one at Lethbridge, and one at Moncton, and also a few in Ontario about 200, which were let on a firm price basis. The rest were all cost plus basis.
Then I would refer the minister to appendix "B" to the proceedings of the veterans affairs committee of June 24, 1946, where at page 1082 a table is given headed "Veterans' Land Act-Cost plus fixed fee contracts" which shows that 2,551 housing units were constructed in seven provinces; one of the units specially mentioned is the Winnipeg, Manitoba, project, where 245 houses were constructed, and comprised in that are 90 units which are known as Charleswood units, of which the hon. member for Souris was speaking. Having regard to this information contained in the proceedings of the veterans

The Address-Mr. G. S. White
affairs committee, perhaps the minister would make a further statement particularly in view of the statement made yesterday that these contracts were not on a cost plus basis.


Mr. MACKENZIE:: I think perhaps there is a little confusion over the term used. As I stated, and this is the actual fact, there was a management fee paid in certain cases, and it amounted to $210. In one case it is cost plus and in the other it is cost plus a fixed fee. That is the only difference. The fixed fee was $210.


George Stanley White: So that there will be no misunderstanding, when the minister refers to $210 as the management fee, does he call that a cost plus contract?


Ian Alistair Mackenzie: No, I would not; some might.


George Stanley White: Am I correct then in stating that the proceedings of the veterans committee which I quoted, and I refer particularly to the evidence of Mr. Murchison, the director of the Veterans' Land Act, is wrong? In answer to a question put by the hon. member for Souris (Mr. Ross) Mr. Murchison said that apart from the few units which he mentioned the rest were on a cost plus basis.


Ian Alistair Mackenzie: It is not necessarily wrong at all. I say I have given the correct analysis of the situation. It is a management fee, plus cost basis; actual cost, plus a fee of $210 a house. Nothing can be more explicit than that.


George Stanley White: The minister may say that nothing can be more explicit than that, but when you speak of a cost plus contract the ordinary person understands that to mean exactly what it says.


Mr. TUCKER:: What does the hon. member find fault with?


George Stanley White: May I ask the minister one further question? Yesterday he informed the house that repairs would be made to these veterans' houses at an expenditure of some $500,000 to $700,000. Until such time as these repairs are completed, what will be done about the contracts now pending, and what will be done about eviction orders now pending?


Ian Alistair Mackenzie: I think it is unfair to ask such a question at this time. All I can say is that the administration will deal with the whole situation with sympathy, with understanding and I hope with some expert knowledge.


George Stanley White: I do not think it is a bit unfair at all.


Mr. DEPUTY SPEAKER:: Order. I should like to remind hon. members that we are not in committee. Hon. members should make their speeches and not question other hon. members.


George Stanley White: The minister of his own accord introduced this matter into the house.


Ian Alistair Mackenzie: No.


George Stanley White: Just a moment, please. He said that he was being very frank. He explained that the taxpayers were to be called on to pay S500.000 to $700,000 to repair these houses. I am not quarreling with that, but I am bringing to his attention now the fact that in a. great many instances there are contracts pending for the purchase of these houses. Where repairs are to be made it is only fair to know what is to be done in regard to these repairs before the contract is signed. The same thing applies to any veterans who may be faced with an eviction order. There are to be repairs to be made on these houses. What is to be done in regard to the eviction orders? I am not trying to embarrass the minister.


Walter Adam Tucker: What does the hon. member mean by "eviction order"? Explain that.


George Stanley White: The hon. member is a lawyer, and surely I do not have to explain to him what is an eviction order.


Walter Adam Tucker: When a man buys a house under the Veterans Land Act he cannot receive an eviction order. I wish the hon. member would explain what he means.


James Arthur Ross: Some veterans have received orders to get out by May 1.


Walter Adam Tucker: That is not an eviction order. The hon. member is talking about a legal eviction order. That is not one at all.


Mr. DIEFENBAKER:: It is a dispossession.


George Stanley White: I should like to remind the minister and his parliamentary assistant that it is most difficult, indeed almost impossible, to do certain repairs on a house and have anything like a first class job after they are completed.
I should like to refer to the announcement made by the Minister of Finance (Mr. Abbott) a few days ago in regard to the rental regulations. He dealt with relief to be given certain people who had bought houses between November 1, 1944 and July 25, 1945. This relief will be of litle effect, because like all these controls there are certain strings attached

The Address-Mr. G. S. White
to it. The minister said that the landlord who had purchased property would be given an opportunity to prove to the court of rental appeals that he needs the house more than the tenant needs it, in which event he can give the tenant three months' notice to vacate. I do not need to point out that any practising solicitor in Ontario who has had any experience at all with a court of rental appeals would certainly advise his client that he had little or no hope of succeeding. The landlord must go through further red tape and expense, and what possible chance or hope has he of convincing a court of rental appeals that he needs the house more than the tenant does? What benefit will this be to veterans?-because the dates mentioned in the remarks made by the minister were November 1, 1944 and July 25, 1945, and the great majority of veterans were overseas at that time. They had not purchased any houses, so apparently the veteran is getting no better treatment than anybody else.
Because of the policy of rental control adopted by the government in the freezing of leases many landlords refuse to allow tenants in any part of their property, because once a tenant gets in there is no way of getting him out. One often hears the poor landlord much abused, but I would point out that every municipality receives practically all its revenue from the taxation of real estate. While rents have been frozen for years, the cost of labour and materials for repairs has sharply increased. In fact landlords who supply services such as light, heat and janitor have been doing so at increased cost; and yet they have had no rent increases.
I suggest that these rental regulations are most unjustified when they apply to small villages and rural townships. They even apply to a farmer who may rent his farm house as a dwelling. Once that house is rented it comes under rental control, and if he should decide to rent the whole farm he must apply for an order to exempt his lease as far as the farm house is concerned.
I suggest to the minister that some reasonable increase be allowed in all rents and that veterans who have purchased dwelling houses at an}' time in the past or in the future be allowed to obtain possession of them within a reasonable time.
The present rent controls are an injustice, and the real pity of the whole thing is the utter futility of the government's policy as a solution of the housing problem. The only solution of the housing problem is to provide an adequate number of housing units. Rental controls have made housing construction unremunerative, and eviction control has frightened capital from housing. I submit

that unless houses are built soon and in sufficient numbers, the present policy of rental and eviction control will materially contribute to inflation.
Many veterans and others find it difficult to obtain building material, yet there are no shortages, at least in Ontario, of building material for garages, summer cottages, theatres and buildings of that type; one has only to look at the pictures published in the Toronto papers to see that a large number of garages, theatres and buildings of that type are being constructed.
The speech from the throne made no mention of any reduction in the income tax, but the estimates tabled on Tuesday of this week may be some indication that relief will be afforded to the income tax payer in the lower brackets. The small reductions announced in the 1946 budget and made effective only in 1947 were trifling when one considers the reductions already made in the United States and the still further reductions proposed. For example, we find that in 1947 an unmarried person-and I particularly refer to an unmarried woman-must pay this most excessive tax on all income over S750. In the city of Toronto the cost of board, street car fare and laundry amounts to at least $750 a year. Thus we find that once the bare necessities of life are paid for, the unmarried woman must pay income tax beginning at twenty-two per cent on income over S750, which percentage increases rapidly as the income rises.
The provision in the 1946 budget by which a married woman cannot earn more than $250 a year without reducing the exemption allowed her husband is in large measure responsible for the present shortage of nurses. This matter was referred to in detail by the hon. member for Lanark (Mr. Blair) the other night. During the war years many married women who were registered nurses were prevailed upon to return to their profession, and they did so; but from the first of January, 1947, many of these women refused to work any longer in hospitals. In my opinion the minimum allowance for a single person should be at least $1,200 a year and the minimum allowance for a married man should be $2,000 a year, with increased exemptions for children.
I would point out to the Minister of National Revenue (Mr. McCann) that the provision with regard to medical expenses is most unfair, because the only exemptions allowed are for amounts in excess of four per cent of the taxable income. I suggest to the minister that all medical expenses be allowed as a deduction.

The Address-Mr. G. S. White
I would draw the attention of the Minister of National Revenue to the 1946 personal income tax form. Any income tax payer who comes within the provisions of section 31 of the form finds that in computing his tax he must still use the method employed when the normal and graduated tax was in effect, and make the deductions at the rate of S150 for his wife and S28 for each child under the normal tax and $80 for each child under the graduated tax. Surely the minister and his department are able to bring these forms up to date, especially when one remembers that the savings portion of the tax was abolished on July 1, 1944.
I should also like to point out to the Minister that the luxury tax of twenty-five per cent on all silverware articles, watches, clocks and so on, is most unfair. Any young couple who start housekeeping today must pay this most excessive tax on silverware. I do not think even the minister would deny that silverware is a necessity. If the tax on silverware applied only to sterling silver, no one would complain. Clocks and -watches are also necessities, yet they bear a twenty-five per cent luxury tax. To the average young couple of today the cost of house furnishings is high enough without their being called upon to pay the twenty-five per cent luxury tax on certain necessities.
I should like to refer to the matter of cheese, in which the county of Hastings is most interested. This county not only produces the best cheese in Ontario, but also the largest quantity. Yet during the past few years the production of cheese in the county of Hastings, as well as throughout Ontario, has been falling. It is interesting to note that a brief on prices of dairy products was presented by the Canadian federation of agricultural and dairy farmers of Canada to the cabinet on November 28, 1946. In this brief are set out the results of a survey in Ontario, as to the price received for milk and the cost of production in August. 1946. There is also an itemized statement showing in detail the cost of production. The cost of production for milk for the various commodities, f.o.b. plant, as shown by the brief, is as follows:	Fluid
milk per hundred pounds, $3.65; milk for cheese per hundred pounds, S2.88; milk for concentrated products per hundred pounds, $3; cream for butter, per pound butterfat, 74 cents, or in terms of 3-4 milk per hundred pounds, $2.54. For purposes of comparison, the present prices received by farmers, f.o.b. plant, for milk going into these products is as follows: Fluid milk in Toronto per hundred pounds for 3-4 milk, $3.45; milk for concentrated products per hundred pounds, approximately $2.25; milk for cheese per hundred pounds, approximately $2.15; cream for butter, per pound butterfat, 52 cents, or in terms of 3-4 milk, per hundred pounds, $1.77.
I have also a statement from the agricultural food board dated February 24, 1947 which shows returns to producers in Ontario on a delivered basis. These prices are as follows: Milk for fluid sales, $3.35 to $3.50 per hundred pounds of milk; milk for concentrating purposes, $2.25 to $2.35 per hundred pounds of milk; milk for cheese, $2.05 to S2.15 per hundred pounds of milk. Returns for butter fat, 52 to 54 cents per pound, which converted to a milk equivalent basis would be $1.82 to SI.89 per hundred pounds of milk (no value allowed for skim milk).
I would point out that there is practically no difference between the figures quoted in the brief of the Canadian federation of agriculture and those quoted by the agricultural food board as to the returns received by the farmer. In every case, with regard to fluid milk, milk for concentrating purposes and milk for cheese and butter, the cost of production is more than the actual price received.
The brief submitted to the cabinet on November 28, 1946, contains a detailed statement of the cost of producing 100 pounds of milk for sale to cheese factories, condenseries, and creameries; and with your permission and the consent of the house, Mr. Speaker, I should like to have this table appear on Hansard.


William Ross Macdonald: Has the hon. member unanimous consent to have the table appear in Hansard?


Some hon. MEMBERS:: Agreed.


George Stanley White: Thank you.
_ Results of Surveys in Costs of Milk Production
(Ontario Basis for 3-4 Milk)
Average Net Cost of Producing 100 lbs. of Milk (delivered basis)
For Sale to Condenseries
In-
Item	Denom.	1943	1946	creaseOats	18	Tbs.	$ 29	$ 32	03Barley	7	lbs.	10	11	01Dairy concentrate	6	lbs.	17	17	-Mixed hay	80	lbs.	39	44	02Silage 	120	lbs.	24	27	03Labour 	24	hrs.	SO	1 19	39Haulage 	12	15	03Pasture	24	31	07Depreciation ....	28	33	05Breeding 	04	06	02Misc	13	16	03$2 80	$3 48	5 68Less Credits .	37	48	illNet Cost ....	$2 43	$3 00	5 57
The Address-Mr. G. S. White

Average Net Cost of Producing 100 lbs. of Milk (delivered basis)
For Sale to Cheese Factories
In-
Item	Denom.	1943	1946	creaOats 	18 lbs.	$ 29	5 32 $ 03	Barley	7 lbs.	10	11	01Dairy concentrate	6 lbs.	17	17	-Mixed hay 	80 lbs.	39	41	02Silage 	120 lbs.	24	27	03Labour 	2i hrs.	80	1 19	39Haulage	08	11	03Pasture	24	31	07Depreciation . ...	28	33	05Breeding	04	06	02Misc	13	16	03?2 76	?3 44	f 68Less Credits .	45	56	11Net Cost ....	$2 31	$2 S8	? 57
Average Net Cost of Producing Churning Cream Per Pound Butterfat (delivered basis)
For Sale to Creameries
In-
Item	Denom.	1943	1946	creasOats 	16 lbs.	$ 26	$ 27	$ 01Barley 	7 lbs	10	11	01Dairy concentrate	6 lbs.	17	17	-Mixed hay 	130 lbs.	64	66	02Silage 	140 lbs.	28	31	03Labour 	3 hrs.	96	1 38	42Haulage 	09	10	01Pasture	29	33	04Depreciation ....	40	46	06Breeding	04	06	02Misc	20	25	05Less Credits	$3 43 1 40	$4 10 $ 67 1 56 16	Xet Cost- 100 lbs. 3-4% Milk.	$2 03	?2 54 $ 51	
Net Cost-
Per Pound Butterfat.$ 60 $ 71
From this brief it is clear that in future the milk producers must receive higher prices for their products if present production is to be maintained, let alone increased. Each year one reads in the press of certain cheese factories in Ontario being closed or amalgamated, which means a further decrease in the production of cheese. I remember what was said in the house on February 27 by the Minister of Agriculture as to the price of cheese under the contracts, and I trust that the minis'' will make some statement soon as to the future price of cheese. In the county of Hastings and the surrounding district the price paid for cheese is at the place of pick-up by the railway company. This means the rural cheese factory has to pay the cost of hauling and delivering the cheese from the factory to the point of shipment. Yet I am advised that 
in other areas of Ontario the price paid is the same for the cheese picked up at the factory. Already this matter has been brought to the attention of the Minister of Agriculture, and I understood some correction was to be made. I hope the minister will announce some change before the cheese factories open next April.
A few days ago I asked the Minister of National Revenue (Mr. McCann) for a ruling by the deputy minister of taxation on whether or not the 1946 amendments in reference to cooperatives would apply to cheese factories. The reason for my question was that every cheese factory president has received notice from the inspector of income tax asking him to file certain returns and supply certain information in reference to the taxation of cooperatives and the payment of patronage dividends. Naturally I do. not know what ruling the deputy minister of taxation will give, but 'whatever his ruling may be, it will be of the utmost importance to the cheese factories concerned. An interpretation by the deputy minister that cheese factory companies are to be taxed will do more to decrease the production of cheese in Ontario than any other action the government might take.
I wish to concur in and approve the remarks made yesterday by the hon. member for Lincoln (Mr. Lockhart) in reference to the wartime prices and trade board. If I had any criticism of his remarks it would be that he was too mild in his treatment of this octopus that has wrapped its strangling arms around every retail activity in Canada. I submit that the general public in Canada are completely fed up with government control, along with the wartime prices and trade board which has long outlived any useful purpose it ever served. I ask why this board, at public expense, should have a network of spies, investigator's, prosecutors, persecutors, inspectors and officials of every kind spread over this country from coast to coast attempting to tell every individual how to run his own business, trying to tell him what he can do and what he cannot do. All this takes place in Canada, which is supposed to be a free country. Why should eveiy retail merchant in the province of Ontario be afflicted with these pests of inspectors, who invade their stores, who think nothing of taking a whole day of a merchant's time, checking prices, asking all sorts of absurd and ridiculous questions, insisting on the filling in of certain forms, asking for the production of invoices and every other sort of obnoxious procedure, and always with the threat of prosecution if any murmur is raised?

The Address-Mr. Gourd
These investigators always try to find at least one article without a price tag; then how they love to lodge a prosecution. As was well said by the hon. member for Lincoln yesterday, many of these officials had no previous experience in the work they are attempting to do, but armed with official authority they take delight in causing annoyance to our retail merchants. It is no wonder that yesterday the hon. member for Lincoln said that a little action with a shotgun would be in order. Surely we Canadians have enough sense and business ability to run our own affairs without having government officials constantly at our elbows, trying to tell us what to do and asking us to complete endless stupid forms and answer silly questions. As the hon. member suggested, let this horde of officials now in the employ of the wartime prices and trade board be put in the production line. If they had to go to work for a living you might find many of them on relief. Is it any wonder there is a black market in this country in almost every article that is in short supply? These black markets will continue until such time as the law of supply and demand operates, and it can operate only when production is increased. One of the most effective ways of having the law of supply and demand operate is to have all controls removed and throw the wartime prices and trade board, together with the czar who operates it, into the discard.
Surely at this late date the government must realize that no law can be enforced which has not the backing of the public, and certainly in my opinion the general public no longer support controls, nor do they wish the activities of the wartime prices and trade board to continue. Of course the thousands of employees of that board who now have cushy jobs and some measure of authority-and how these little officials love some authority-will want the board to continue indefinitely. The control of lumber is a typical example. In any county where there is considerable lumbering a black market has existed for months and years, and will continue to exist until the controls are removed. The government can hardly complain of the cooperation they received during the war from the Canadian lumber dealers' association and the retail lumber dealers' association. Surely, then, after this cooperation the government timber control officials must have some confidence in these organizations, so why not remove these timber controls?
In regard to veterans affairs I should like to mention only one matter; it has to do with veterans who are in receipt of pension and are attending university. These veterans who receive pensions do not receive their full
monthly educational grants of S60 for unmarried men and $80 for married men. This educational grant is the reestablishment credit due to the veteran. I would ask the minister why this grant should be cut down or reduced in any way. So far as I know, a veteran who takes up his reestablishment credit under the Veterans' Land Act, and who receives a pension, does not suffer any reduction in the amount he receives, nor does a veteran who takes up his reestablishment credit in any other manner receive a lesser amount on account of his pension.
In many instances the veteran who is not disabled and who is attending university is able to undertake certain work and thereby earn additional moneys. This opportunity is denied the veteran who is disabled. I hope the Minister of Veterans Affairs will in the near future do something to correct this injustice.


Mr. DAVID GOURD (Chapleau) (Translation) :: Mr. Speaker, as the representative
of one of the northeastern Quebec constituencies, I wish to congratulate the hon. member for Prince (Mr. MacNaught) on his excellent speech on the address in reply to the speech from the throne and on the interest he takes in his constituency and the country at large.
I must also compliment the new member for Richelieu-Vercheres (Mr. Cournoyer), the successor of the Hon. P. J. A. Cardin. Seeing the sincerity, the tact and the fluency of our young colleague, I have felt proud for the constituency of Richelieu-Vercheres and the whole country. The thirty-five years spent in the public service by his predecessor will not have been lost. His work will be continued; the new member has the required ability for assuming such a heavy succession.
Mr. Speaker, as I intend to tell about my constituency, Chapleau, its economic possibilities and its needs, may I be allowed to congratulate the government and the Hon. the Minister of Transport (Mr. Chevrier), on the foresight they have shown in deciding to build in my constituency a railroad branch line from Barraute to Kiask Falls. It is expected that the work, which has already started, will be completed about the end of 1947. Kiask Falls was a strategic choice, since it will be easy to extend that branch line toward the west, in the direction of the Har-ricana valley and toward the north-east, along the Bell river valley, as far as the Chibou-gamau district.
Mr. Speaker, while speaking in this house on July 24, 1946, I quoted figures to prove that if northwestern Quebec may
The Address-Mr. Gourd

be called a land of tomorrows it is first and above all a land of the present. Those statistics showed the contribution of that district to our peace-time and still more, I might say, to our war-time economy.
Pioneers of that district who, like myself, have witnessed the construction of the first Canadian National Railway line, which was completed in 1915, and the economic development that ensued, can easily visualize the progress that will result from the construction of this new branch line.
According to a report published by Mr. K. M. Ralston, mining engineer for the Canadian National Railways, the metal production of northwestern Quebec, at the end of 1945; was valued at more than $550 million. Agriculture, forestry, fur-trading [DOT] and the general development of natural resources previously undiscovered have accounted for the settlement and the prosperity of about 125,000 people in that area.
The region offers a geological formation extremely favourable to prospecting where already have been found and proved several ore deposits: gold at Flordin Mines, and Lakerose Mines wonderful finds in the Ope-wika region, gold and copper at Norbeau Mines, Obalski Mines, Consolidated Chiboug-amau and Opemiska.
One company has been granted a pulpwood limits estimated at 4,480,000 cords, which cover only part of the pulpwood area located between the Abitibi and Chibougamau districts.
Seven townships have been chosen for settlement purposes and it is expected that 1,700 families will settle on good land. It is estimated that this newly opened area provides 275,000 acres of tillable land which can provide a living for 15,000 inhabitants; we wish to stress the fact that west of the Kiask Falls, there are, in addition to the forest limits already granted, about 4,700,000 cords of pulpwood which ought to bring future settlers immediate benefits and thus help them through the first few years.
I pause here, Mr. Speaker, and urge the Dominion government to do everything in its power to persuade the provincial legislatures to adopt a policy which will help bring factories into the areas where they are tapping natural resources. In a district such as Abitibi, which depends mainly on mining, diversified sources of income are essential; a paper-pulp mill, had it been built, would have made them possible and would also have provided work.
In support of various suggestions with respect to taxation which I intend to put forth for the benefit of my constituency, I

shall take the liberty of quoting, for the information of the house, from "An Economic Survey of the Mining Industry in Northwestern Quebec" a report published thanks to the efforts of three economists and one lawyer:	Dr. O. J. Firestone, Dr. B. H.
Higgins, Dr. E. F. Beach and Mr. Jean-Joffre Gourd, of the Mines and Natural Resources section of the Montreal Board of Trade.
You will see on page 1 that our own Canadian government has stated boldly that "the central task of reconstruction must be to maintain a high and stable level of employment and income".
I quote from page 4-
It seems clear that postwar policy must be directed towards giving every reasonable incentive to private investment . . . There are various factors in Canadian economy that will make the achievement of a high level of private investment more difficult after this war than it was before the last one. In 1913, Canada came to the end of a period of enormous expansion, based on opening up the west and financed to a large extent by foreign capital. During the 20's, the last stages of this expansion of the west were completed, and, indeed, signs of retraction already appeared.
Then, on page 7-
It must not be thought from the foregoing account of Canadian economic problems that the outlook for Canada is necessarily gloomy. On the contrary, there are a number of factors of potential economic expansion.
Further, on page 8-
Most important perhaps, there is room in Canada for the development of new resources, especially in the Canadian north. The development of our northland, a development which must be based largely on mining resources but which rvould involve many forms of supplementary expansion, affords one possible field for investment that may prove comparable to economic expansion in the west as it was before 1914. Not only is the potential of our Lauren-tian shield still not fully realized (except, perhaps, by Canadian painters), but, as pointed out in the report of the advisory committee on reconstruction, one of the costs of war to Canada has been a depletion of her mineral resources. "There will be a serious time lag in mineral output which can only be shortened by systematic prospecting. It will also be necessary to make mining sufficiently attractive for private capital, and to this end your committee recommends that study be given to the taxation regulations at present in effect with a view to maximizing the ore production of our mines."
I quote from page 9-
From what has been said above, it would be apparent that the mining industry is a matter of peculiar concern for postwar economic policy. The mining industry of our northland, and all that goes with it in the way of building of new towns and transportation facilities, the opening of new agricultural districts, seems to represent our chief remaining frontier. If full employment is to be maintained with a minimum of unnecessary public spending, it is essential that the opportunities in this field be exploited to

The Address-Mr. Gourd
the full. Governments-dominion, provincial and local-can assist in this development in various ways.
First, by creating an environment in which investment for new development is reasonably attractive. Tax policy, especially with regard to treatment of depreciation and depletion, is one of the relevant items.
Second, governments can assist private investment by undertaking their share of the investment in community facilities, such as hospitals, schools, roads, railroads, landing strips, public utilities, and other traditional items of public investment necessary to make settlement of the area attractive to new workers.
On page 19-
The mining industry of Canada is surpassed in gross value of production only by manufacturing and agriculture. It is thus greater than forest industries, construction and electric power. The province of Quebec stands second to the province of Ontario in its contribution to the mining industry of the country, and during the past decade has been gaining on that leading province.
On page 27-
Summarizing the importance of mining as a field of employment, it can be said that the employment of one miner on the site will provide livelihood for 8-2 persons.
Finally, on page 28-
In summary, it can be said that there were 23,000 persons employed in the mining industry iu the province of Quebec in 1941, that the number employed in the industry has been increasing rapidly, and that this entails a large and increasing number of other people whose livelihood depends on the mining industry and in the earnings of the miners.
The last time I spoke in this house, I commended the government for having fought inflation, and I compared our prices with those of other countries, in order to show that our anti-inflation measures had been beneficial to our middle classes and the country at large. I offered some suggestions tending to complete rather than destroy what had already been done.
I suggested the steps to be taken in order to relieve industry during the crisis brought about by a decision to put our Canadian dollar on a par with the American dollar. I then forecast a considerable loss of metal for Canada unless steps were taken to encourage the production of low-grade ore and, in other cases, of low-yield ore. I also predicted-if nothing were done to prevent it-a stoppage of mining operations, as well as the loss of income derived from mining and other related industries, and so forth, the resulting drop in production as a whole considerably weakening our resistance to inflation. Fortunately the government took some steps in the right direction, and I wish to commend the Right Hon. Mr. Ilsley for what he did last year.
I sincerely wish that the government could meet all the needs of northwestern Quebec,
whose growth I have witnessed. I understand, however, that the government of a country as large as ours cannot fulfil all at once the needs of every constituency and every industry, just like the head of a family cannot, as much as he would like to, comply with all of his children's wishes. I can well understand therefore why the government is so wary of decontrol and of relieving the mining industry of its burdensome taxes.
In 1946, I submitted the following methods of relieving the mining industry and creating employment:
First, the paying of a bonus for the promotion of prospecting, exploration and development work, especially in connection with low-grade ore mines.
Second, the raising from 331 to 50 per cent, of the depletion or capital reimbursement allowances for all mines, as recommended by the Senate committee on natural resources.
Third, the raising of the depletion allowance over the 50 per cent level in the case of low-profit mines dealing with low-grade ores; the increase in this allowance being inversely proportional to the profit margin.
Of course, the word "bonus" must be taken here in its broadest -sense, and not in the sense of "subsidy".
Mr. Speaker, while the country's finances did not allow full implementation of my proposals, the government did pass certain measures such as I recommended, as instanced again by the statement in the house, two days ago, by the Hon. Minister of Finance (Mr. Abbott). Those measures were of material assistance in preventing the break-down I had feared in northwestern Quebec. There has been a considerable drop, however, in mining activities. I repeat here, that if companies are allowed to peter out in the promotion stage, Canada will be deprived, in the future, of its mining industry. Without our great promoters and prospectors of yesteryear, we would not now have our producing mines. It is well to recall this truth to the minds of certain producers of today who have forgotten or have never been cognizant of the beginnings of their companies.
I suggest the government now adopt measures along that line and I further submit that taxation of small salaries should be reduced to a level at least comparable to that of the United States, so that workers will be in a position to cope with the general rise in prices.
Mr. Speaker, as a sequence to my suggestion to the Board of Transport Commissioners, made in conformity with the numerous messages sent and resolutions passed by the various municipalities and public organizations
The Address-Mr. Gourd

of my constituency, may I point out to the house the necessity, for our country, of helping the essential lumber and pulpwood industries, by avoiding any increase in the transportation cost of our pulpwood and saw timber, even were a general increase in freight rates found necessary.
In conclusion, Mr. Speaker, I wish to call the attention of the house to a practice quite effective in promoting national unity, the principle of which was so well understood by the government when they appointed a satisfactory number of French-speaking ministers of the crown. I refer to the appointment of a number of French-speaking deputy ministers, more commensurate with the importance of the province of Quebec. Moreover, I should like to stress the importance, from the standpoint of national unity, of appointing heads of departments who can speak the language of the majority of citizens with whom they have to deal. I wish, in particular, to reiterate the suggestion I already made to the effect that a French-speaking superintendent be appointed at the Kapuskasing Experimental Farm for the one reason that the majority of the people whom this superintendent will deal with, including the citizens of my county, are French speaking.
In conclusion, may I renew the recommendation that Canada follow the example of every Christian nation by immediately appointing an ambassador to the Vatican.
(Text):


Mr. E. D. FULTON (Kamloops):: the history of certain cases to which I shall refer that if this principle is not followed a great deal of confusion and even grave injustices may result.
For instance, in the case of student veterans, to which reference has already been made, as the result of our not accepting the principle that a pension should be paid as of right and not allowed to be varied, veterans who are in receipt of disability pensions and who apply for educational benefits when attending university, lose part of their pension. I wish to illustrate this point by reference to a brief prepared by the student veterans' committee of McGill university, and of course, the principles which they discuss apply equally to universities in all provinces. On page 1 of their brief they make the following claim:
A pensioner of less than 80 per cent receives an amount equal to the training allowance, that is $60 per month, plus 40 per cent of his pension rate.
On page 2 they say:
In the above calculations, no consideration is given to the student pensioner's rank, although other pensioners receive an additional pension allowance for each rank above lieutenant. From the total sum of training allowance and portion of pension, the Canadian pension commission pays the pensioner his full pension (rank allowance included) and he receives the balance from the Department of Veterans Affairs. People are therefore unable to proclaim that pensioners are not receiving their full pension.
That is the argument which the department has put forward when charged with this fact. They say: "We do pay the full pension but we reduce the amount of the educational benefit."
I should now like to refer to the minutes of proceedings and evidence of the veterans affairs committee of Friday, November 30, 1945. The deputy minister of veterans affairs was giving evidence. This matter was being discussed, and on page 950 Mr. Woods made the following statement:
The same effect takes place in respect to a pensioner who goes to a training school, except that we established a ceiling which comprises the training allowances plus 40 per cent of his pension. In short, if his pension is $100 we give him his training allowance; his total income would be his training allowance plus 40 per cent of whatever his pension is.
In other words, actually the training allowance is paid in full and the pension is reduced to 40 per cent of what he would otherwise receive. Let us look at the practical result of this formula. Again referring to the McGill brief, we find the case of Private Deberry mentioned on page 3 :
Private Deberry was wounded in action in the summer of 1944. He was awarded a 15 per cent pension on being discharged from hospital,
[Mr. Fulton.1
and as he felt he did not need it, he bought a $3,000 endowment policy. When he later decided he wanted to go to Sir George William's college, Montreal, he was told he would not receive his full grant. He therefore had to cancel his insurance outright and forfeit the premiums he had already paid. Although his pension amounts to $1.1.25 a month, he would receive only $4.50 in addition to his college grant.
I shall now refer to the case of Gunner George Petrie:
Gunner George Petrie was seriously wounded at Zutfen, Holland, on the 15th of April, 1945. He is now a paraplegic-
That is, he is paralyzed from the waist down.
-and has also lost a good deal of the use of his hands. He is studying arts at McGill university, getting around in a wheel chair, and later hopes to become a lawyer. He spent all his army savings and then borrowed in order to purchase an automobile, which he now drives to college every day. He states that if it wasn't for the fact that he is able to live with his parents, he could not even consider taking training and would probably spend the rest of his life in an institution. He receives $75 pension, $30 training allowance, and $62.50 helplessness allowance a month, and loses $30 on account of the present regulations. When one considers that a paraplegic usually has to maintain a full-time servant, a ear (if he is taking training), and pay room and board, this total sum of $167.50 does not go very far.
The final case to which I should like to refer is that of Major J. A. L. Robichaud who was wounded on August 10, 1944, in the fighting for Falaise. Although he is a married man with the rank of major, he would receive exactly no dollars a month if he were to attend university, as he wants to do. The brief goes on to say:
It also seems ironical that because his rank was major, his helplessness allowance should be reduced to $32.50. as compared to George Petrie's $62.50.
What I have said establishes clearly, I think, that actually the disabled veteran who receives a pension for his disability loses part of his pension if he attends university and applies for the educational benefits. Surely if it were established that pension was payable as of right that result could not follow. If pension were payable as of right, there would be no reduction; if a disabled veteran wanted to attend university he would then be entitled also to the full amount of his educational benefit. The same thing applies in a more limited way to the case of the helplessness allowance.
I should like to refer to one more case which, I think, illustrates clearly the necessity of adopting this principle that a pension awarded for disability resulting from a wound should be paid as of right. I received a letter in the mail about a week ago. I

The Address-Mr. Fulton
should like to make it quite clear that I am not claiming that this particular pensioner will not receive satisfaction, because I referred the case to the department and am assured that it will receive sympathetic consideration. What I wish to show is that this case could never have arisen if the principle were fully established and accepted that pension is payable as of right.
The background of this case is that of an officer in the Seaforths who received a stomach wound which cut him up very badly indeed, to put it mildly. After a long period of hospitalization, he has eventually been able to get around and about. But I think all hon. members will appreciate that a man who was wounded in the stomach, particularly in the lower portion, is in a precarious condition. His health is generally very much below standard; although he may have spells when he is comparatively well, he is likely at any time to feel again the effects of his wound. In a case such as this more than in any other it becomes important to establish that the pension payable to him as a result of his disability shall be payable as of right, shall not be subject to review and reduction from time to time and then, later on, perhaps be restored to the original amount.
What happened in this case can be seen, I think, if I read some of the extracts from the letter written by this man. His case -was taken up and he was given 100 per cent pension. He says in his letter:
... as soon as the fuss had blown over, last July to be exact, my pension was reduced to eighty per cent. Rather ironically notice of the reduction was handed me while I was still in bed recovering from the operation I had had on the pelvic wound.
In other words, between the time of his review-at which time it was decided that his pension should be reduced-and the time when he received notification, his old symptoms had broken out again and he had actually had to go back to hospital to have an operation as a result of that wound. It was while he was still in bed recovering from that operation that he received notification that his pension would be reduced. He goes on to say:
Regarding the practice of steadily reducing one's pension, I feel that this policy is contrary in many respects to the whole purpose of a pension for the pensioner is left uncertain as to where he stands and being unable to count on its continuance all feeling of security disappears and plans for settling into a steady job have continually to be revised . . . With all the data they have amassed during the many occasions that I have been medically examined apart from the many months spent in hospital, it should not be necessary for me to appeal and go up again before yet another board ... I
fail to see why the benefit of the doubt should not be given to the pensioner instead of this everlasting gnawing and nibbling until he finally has no fight left in him and gives up in disgust.
Again I should like to say that I have hope that this particular case will be adjusted satisfactorily. The point I wish to make is that the situation which the pensioner has described and the feeling which he has expressed could never have arisen if the principle were adopted and adhered to that a pension awarded as a result of disability following from a wound received in action should be granted as of right, paid as of right, and should not be subject to any reduction or to constant review.


Walter Adam Tucker: I understood the hon. member to say that he took that case up with the department and is having it looked into.


Edmund Davie Fulton: Yes, I have hopes that this particular case will be satisfactorily adjusted. I refer to it because I feel that it affords a very good illustration of the point I am trying to make.
The third subject I should like to refer to this afternoon is that of the occupation army, with particular reference to its relationship to the field of foreign affairs. In view of the statements which have been made recently in the course of the debate on this subject, I think we should look closely at the history surrounding the formation and withdrawal of Canada's army of occupation, because the statement that our forces were withdrawn because they were kicked out is entirely at variance with the statements of two other cabinet ministers on this subject. In fact, the whole history of this matter is one of contradiction and of reluctance or inability to give information as to the policies behind first, the formation of the occupation army and, later, its withdrawal.
I take the time to refer to this matter because I think it is extremely important in the light of the background it forms to Canada's position in foreign affairs, particularly with respect to the representations which we have made that we should have a larger voice in the formation of the peace treaties, mainly the terms of peace with Germany and Austria. The house is familiar with the arguments which were put forward, and I shall refer to them in passing, to fill in the background to my remarks; they were to the effect that if we still had an army of occupation in Europe it would put us in a much stronger position when we come to demand that we shall have a voice in the settlement of these peace treaties, because we would be able to say, "We are taking part now in the policing of Europe and in the insurance that the fruits of victory, not
The Address-Mr. Fulton

only in terms of advantage to ourselves but in terms of the peace of the world, will follow. By maintaining an occupation army, we are showing a readiness to admit our obligations and we have therefore the right to have a voice in the settlement of those terms."
The history of this particular matter goes back to 1945, in the last session before the general election. I wish to refer to a statement which was made then by the Prime Minister (Mr. Mackenzie King). Speaking in the house on April 4, he said, as reported at page 433 of Hansard:
In Europe it is necessary not only to secure complete victory, but that achievement must be c cm firmed, and the continued maintenance of peace assured. Where needed, after the cessation of military operations, the inter-allied army will continue in occupation of Germany. The size of this force has been set to give continuing assurance that Germany will not be able to resist or evade the settlement which will be imposed on her.
The burden of maintaining this force will be shared among the allies and all will be appropriately represented.
From time to time, as progress is made, and as considerations of safety and security permit, reductions will be made in the size of this army of occupation.
I think that paragraph is important because it implies that the army might later be withdrawn; and I shall refer to that later in my remarks.
Mr. ST. LAURENT: Mr. Speaker, I do not like to interrupt the hon. member, but I would ask for your ruling on the question whether the subject matter of the debate on Monday can now be revived. On Monday we spent the whole day in discussing this matter. That debate having been concluded, I submit that the subject matter is not now open for further discussion in this debate on the address.


Edmund Davie Fulton: I can understand the
minister's reluctance to have this matter opened again-
Mr. ST. LAURENT:	I do not think the
hon. member means that. I asked you for a ruling, Mr. Speaker, as to whether the matter should now be reopened. That was not because of any reluctance to discuss it, but because of reluctance to have so much more time taken than the standing orders permit when there is urgent legislation that has to be considered. It might be very agreeable to stay here the year round and discuss these matters, but there are standing orders for the purpose of determining when and in what order of priority they can be dealt with. I suggest that, when one has been disposed of, it should not be reopened on another occasion.


Gordon Graydon: What is the minister
afraid of?
Mr. ST. LAURENT:	Nothing at all but
the loss of time.


Gordon Graydon: After all, the debate
was not concluded on Monday.


Edmund Davie Fulton: In regard to the point
of order, this particular subject was not discussed during the course of that debate. That is one point. The army of occupation was referred to, but the whole matter was not discussed. The second point is that this is the debate on the address in reply to the speech from the throne, and it is my understanding that any matter may be referred to during this debate. I also understand the rule of the house which forbids reference to a subject matter discussed in a particular previous debate during the same session, but I submit that, as long as I do not refer to remarks made during that debate, or quote passages from it, I am in order in discussing this particular aspect of Canada's foreign policy.


Mr. HANSELL:: Before you give your
ruling, Mr. Speaker, might I offer one observation which I think the Secretary of State for External Affairs (Mr. St. Laurent) has overlooked. When the motion was made on Monday for the adjournment of the house for the purpose of discussing a matter of urgent public importance, the motion was based upon the urgency of the matter. The house was adjourned, and that debate automatically died at eleven o'clock that night. If your ruling should be that we cannot discuss foreign policy on the speech from the throne, then you preclude from a discussion of that subject any hon. members who did not have an opportunity to discuss it last Monday. Our day is only six hours long. We have only six hours of debating time, and you cannot crowd 245 members into those six hours. So that while there may be some justification for suggesting to hon. members who had an opportunity to take part in that debate on Monday that they should not deal with the subject again, surely those of us who were not able to discuss it, because of the lack of time at our disposal, should be able to do so now.


Mr. GREEN:: Very serious questions are
raised by this point of order taken this afternoon by the Secretary of State for External Affairs. They have been dealt with largely by the hon. member for Kamloops (Mr. Fulton) whose speech is in question. I submit that the debate on the address in reply to the speech from the throne is wide

The Address-Mr. Fulton
open, and that we can discuss any subject. It so happens that at the present session certain priority was given other matters, but surely that should not alter the right of a member of thi3 house to discuss any question whatever during this debate.
The other point is this. If someone in the course of a speech, or in the course of an interjection, happens to bring up a matter that is not the subject of debate, surely it does not mean that from that time on, during the length of this session, that question cannot be discussed.
The hon. member for Kamloops has raised the question of the army of occupation. That was not the subject of the debate on Monday last; it merely came in incidentally. It was not the subject of the debate, nor was it the subject of the motion. Surely we are not to be prevented from speaking on the army of occupation because of what happened on Monday. If Your Honour rules against the hon. member for Kamloops I would point out that vou place a serious limitation on the rights of members of this house.


Gordon Graydon: On the point of order-


Some hon. MEMBERS:: Oh, oh.


Gordon Graydon: I know you won't like it, but you will have to take it. I believe there is much merit in the point raised by the hon. member for Macleod (Mr. Hansell), because, after all, if a motion for the adjournment of the house is going to restrict something like 235 members who did not have an opportunity of speaking in that particular debate, then I think it is a gross abuse of the rules of the house. I Should like to feel free, for instance, to speak on the Nova Scotia coal question if I so desire. If the point of order raised by the Secretary of State for External Affairs should be upheld, then definitely that subject would be barred, because the hon. member for Cape Breton South (Mr. Gillis) dealt with it under a motion similar to one I made on Monday. I hope Your Honour will not give in to the pressure of the government benches with respect to this, because I am only-


Some hon. MEMBERS:: Order.


William Ross Macdonald: Order. I do not believe the hon. member for Peel (Mr. Graydon) or any other hon. member should suggest that the Speaker would be influenced by pressure from any section of the house.


Gordon Graydon: I should think at least your mind ought to be open, and I am hoping to bring some pressure to bear right now. The pressure I want to bring to bear is to
prove my point, if possible, that, as far as the debate on Monday was concerned, to say it precluded any further discussion of these matters would certainly be putting the rest of the house in a strait jacket in regard to discussion of foreign affairs. I do not believe the government should hide behind the rules of the house in this matter. I believe it should be brought into the open and debated, because there does not seem to be a single reason why this rule should be invoked for this purpose at this time.


Mr. ADAMSON:: On Friday last the Minister of Finance (Mr. Abbott) dealt with the matter of gold taxation, and immediately afterward I spoke on exactly the same subject. If Your Honour should rule that the debate on the speech from the throne cannot include matters previously discussed, you then would be forced to rule that everything I said last Tuesday was out of order; and with all due deference, Mr. Speaker, that would be an intolerable situation.


William Ross Macdonald: In reply to the hon. member who has just spoken, may I say that the statement on gold was not made on any formal motion before the house, but was a statement made by the minister on the orders of the day.
With respect to the statement by the hon. member for Macleod that the debate had died-I believe that is what he said, though I am not sure of his exact words-I would refer him to page 9S7 of Hansard where I find:
Mr. Gordon Graydon (Peel):	Mr. Speaker,
in order to conform with the usual requirements contained in the rules I shall be glad to withdraw my motion.


Gordon Graydon: At the request of Mr. Speaker.


William Ross Macdonald: There is nothing to that effect in Hansard.


Gordon Graydon: If you were here, you would have seen that, yourself.


William Ross Macdonald: Order; Hansard does not record that Mr. Speaker-


Gordon Graydon: Hansard does not record all the things that take place, such as a nod from His Honour the Speaker.


Some hon. MEMBERS:: Order.


William Ross Macdonald: It is entirely improper for any hon. member to interrupt Mr. Speaker when he is addressing the house.
With regard to the point of order, I would refer hon. members to Beauchesne's, third edition, paragraph 245, which states:
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The Address-Mr. Fulton
It is a wholesome restraint upon members that they cannot revive a debate already concluded; and it would be little use in preventing the same question from being offered twice in the same session if, without being offered, its merits might be discussed again and again.
The matter came up on Monday on motion of the hon. member for Peel (Mr. Graydon). That was a definite motion. I am not going to rule that a discussion on external affairs is entirely out of order at this time; but I do think it is irregular to refer directly to what took place in that debate. However, in my opinion hon. members are free to discuss external affairs.


Howard Charles Green: May I ask Your Honour if an hon. member is free to discuss the army of occupation. That, of course, was not the subject of the debate on Monday.


William Ross Macdonald: When an hon. member is discussing that subject, I can give a ruling upon it. In the capacity of Mr. Speaker I should not give a ruling on what might come up in the house.


Howard Charles Green: Let the hon. member go ahead.


William Ross Macdonald: I will give rulings when questions arise.


Some hon. MEMBERS:: Go ahead.


Edmund Davie Fulton: Mr. Speaker, in keeping with your ruling I shall discuss certain aspects of this question to which reference was not made last Monday when the subject of foreign affairs was debated in the house. As has been pointed out, it so happens that during that debate reference was made to the specific question of the withdrawal of the army of occupation. That has raised in our minds the whole field connected with the army of occupation, and at this time I am trying to deal with the historical background of the matter. On that occasion no reference was made to the history.
I have just said that on April 4, 1945, the Prime Minister made a statement with regard to Canada's contributing to an occupation army, as reported at page 433 of Hansard, and I want to complete the quotation:
The quota which Canada has undertaken to maintain is modest having regard to our resources and to our direct interest in the maintaining and safeguarding of the peace of the world.
The only conclusion to which one can come on reading that statement, in the light of its context, is that the subject matter of the army of occupation had been discussed among the various allied powers, and that it had been decided that Canada would maintain an army of occupation which was modest and in

accordance with our resources. Everything was harmonious and, at least on the surface, all parties in agreement.
The next statement on the subject was made in 1945 by the then minister of national defence at the first session of this new parliament. I should point out that the Prime Minister's statement was made before San Francisco and before Potsdam, so that it might be suggested that the situation was changed by those two conferences. I think hon. members will agree, however, that the statement I am now about to read, made by the then minister of national defence after those conferences, certainly suggests that the situation was not changed by them.
Speaking in the house on October 30, 1945, the then minister of national defence, referring to our army of occupation, said:
Formally the commitment continues until March 31 of next year-
That is, March 31, 1946.
-but obviously it will not terminate on that day. I think we must proceed on the assumption that it will continue beyond that time.
Unless the minister was then speaking without some knowledge which was possessed by others of his cabinet colleagues, one is justified in assuming that it was government policy that the army of occupation would be maintained for a considerable period beyond March 31, 1946. The minister referred to it in terms of a commitment, and stated that the commitment would continue for some time beyond that day. This again supports the conclusion that it was a firm agreement and undertaking on the part of Canada to maintain this army of occupation.
The next statement was made by the Prime Minister on February 15, 1946. The then minister of national defence had said the commitment would continue beyond March 31, 1946. Up to this time it appears that everything was agreeable and all serene between the parties who were to contribute to the army of occupation. But on February 15, a month and a half before the commitment was to terminate, the Prime Minister made a press statement in which he said that-
. . . withdrawal from Germany of the Canadian troops in the occupation army would begin early in April, and that with the present shipping forecast all troops now in Germany should be back in Canada by September or October.
So that only some four months after the then minister of national defence had said our commitment would undoubtedly extend beyond March 31, the Prime Minister reversed that stand and said it had now been

The Address-Mr. Fulton
decided that even before the formal date of expiry of our commitments, our occupation army would be withdrawn.
However, there is still nothing in any of these statements which would support the suggestion that troops were either kicked out or left out of consideration for the army of occupation. This statement of the Prime Minister to which I have referred, read in the light of his previous statement with regard to agreement, is an entirely new decision. In the course of it he said:
Now that the greater part of the Canadian army has been repatriated the maintenance of a small occupation force thousands of miles from home has become increasingly difficult. Aside from the grave difficulties in certain aspects of administration, the overhead required to provide headquarters, services, amenities, etc., for the Canadian force is inevitably quite out of proportion to its size.
Reading those statements in their context, one would be justified in coming to the conclusion that it was a matter of domestic government policy, a decision arrived at in Canada without reference to any other powers, which determined the withdrawal of the Canadian force.
During the course of the session of 1946 further references were made to this subject. The hon. member for Nanaimo (Mr. Pearkes) placed on the ord\r paper a notice of motion for the production of certain papers. In discussion of the motion, he referred to statements wrhich were made in the British House of Commons regarding the withdrawal of the Canadian army of occupation. Those statements rvere referred to, and have been referred to on succeeding occasions.
We understand, Mr. Speaker, that the withdrawal of the Canadian force was a subject of communication between the Prime Minister of Great Britain and the Canadian government. Observations in the British House of Commons confirm this, and indicate that the Prime Minister of Great Britain asked the Canadian government to reconsider its decision to withdraw the army of occupation, and that comments were made to the effect that this was imposing upon the United Kingdom an additional burden and strain which, at that time, in view of their shortage of man-power, they were ill-equipped to discharge.
These papers have not yet been produced, although I understand the motion for their production has been reinstated on the order paper. But at the same time the existence of those statements, or the fact that they were made and that the correspondence took place, has not been denied, although it has been referred to several times and ample opportunity for denial has been given. When the hon. member for Nanaimo first placed his motion on the order paper the Prime Minister requested him not to press for the production of these papers because he said the request would have to be resisted.
I think the importance of this matter can be seen in the light of the observations made during the course of the debate on Monday. I realize that I am bound by the rules and I shall try to observe the letter of your ruling.


William Ross Macdonald: May I remind the hon. member that his time expired ten minutes ago. I have allowed him ten minutes in excess of his time because of the discussion which took place on the point of order. I think if I allow him another five minutes it should be sufficient.


Edmund Davie Fulton: I thank you for your generosity, Mr. Speaker, and, through you, the members of the house who have signified their concurrence in that generosity.
As I was saying, the manner in which this matter was referred to during the debate on Monday is the thing which is of paramount importance. I think all hon. members have in mind what was said and they remember the exchanges that took place, so it is not necessary for me to transgress the rules or to do any more than ask the house to remember what was said on that occasion.
I should like to point out what I think is important in connection with this matter. In the light of the statements made by the Prime Minister and other ministers to which I have referred, it is inconsistent, to say the least, to suggest that there was no room for our forces in Europe or that we were asked to withdraw them or that we were not given any place for them in the first instance. I submit that the statements made in answer to the questions which were asked did not give the complete and satisfactory explanation which one would hope would have been given in connection with a subject of this great importance. In view of the statements I have read, I think the recent statement which was made does not reflect what must have been the true position. I believe the statements which I have read substantiate clearly the fact that this decision to withdraw the troops was taken as a result of political and domestic considerations at home. It was taken by those who did not realize at that time the consequence which that decision would have in the light of our subsequent demands for a more effective and full voice at the peace table. To my mind, and certainly in the minds of hon. members of the official opposition, they do indicate that
The Address-Mr. L. Bertrand

Canada has not been consistent in her foreign policy and has not been consistent in her stand with regard to having a voice in the formulation of the peace treaties.
That is the seriousness of this question and that is what has led me to make these remarks. We feel it is essential that we should have a consistent and well defined foreign policy. I think the house and the country is entitled to a more complete and satisfactory explanation of the reason behind the decision to withdraw the occupation forces. In order that Canada's position in international relations may be maintained and may not be subjected almost to ridicule, it is in the interests of Canada that this position should be made clear so that we cannot be charged with inconsistency in our foreign policy.
As I have pointed out, there were three contradictory statements made by three presumably responsible ministers of the crown, the Prime Minister, the then Minister of National Defence and the Secretary of State for External Affairs. This house and this country would like to know which of those three statements was correct.


Mr. LIONEL BERTRAND (Terrebonne):: The imposing legislative programme included in the speech from the throne shows definitely, now that the war is over, that the government intends to rebuild the Canadian economy and to put back into work its peace-time economy. I am glad of this, together with the Canadians who think their country should, during peace time, hold among the united nations the rank which was granted to her by six years of collaboration in the cause of humanity.
During six years in this house measures dealing almost exclusively with war activities took up the whole time of the government and of the members. These strenuous years are now being followed by peace-time sessions, and the one we are now starting shows definitely that the government is directing all its efforts toward peace.
We won the war, but now we must win peace and we must maintain it. Indeed these conferences which are still being attended by the united nations in spite of differences of opinions brought about by the war, in spite of different civilizations and different national policies, reveal that the nations of the world will some day agree upon a form of unity which will give us peace and maintain it after the disorders caused by the last war. But if peace is to be universal, should it not first of all be established within each country? Canada, which has no territorial ambitions, wants universal peace, but in order to assure

the prestige she has so valiantly obtained should she not secure internal peace within her own boundaries?
When I say peace within a nation I mean order and quietness, progress and happiness, freedom and satisfaction. During all the war 5ur population accepted the sacrifices that were imposed upon it because it was the war; valiantly, day after day it carried the heavy burden of taxation. It accepted the heavy and boring series of restrictions, the hardness of numerous laws imposed by circumstances, but it never failed to believe that the end of the war would also bring calmer and most serene days, when work would be more plentiful, taxation less heavy and the national economy easier, a better standard of living; in other words, times where one could enjoy life, happiness and freedom to a greater extent. We all had the same dream and cherished the same hopes in order to safeguard our democratic system. These hopes should be materialized. I believe that this session is most important. Our population expects that the present parliament will materialize the hopes they have laid upon us.
During the whole war we joined forces in order to defeat enemies who intended to conquer the whole world. This threat has vanished, but we must still fight with different arms against the internal enemies of the nation. We now must secure the social defence of the country. Too many political creeds have sprung up, are still springing up and will keep on springing up, and, directly or indirectly, willingly or unwillingly, tend to destroy our present society. Their doctrines are being propagated in such a way that, unless we stop them, they will deeply anchor themselves. These propagandists, above all, are persistent. By a constant repetition of the same things in the same words they throw themselves body and soul into a programme for which they will fight like zealots. After they have hypnotized themselves, they hypnotize a group and then a crowd, and finally they create opinions which times or circumstances will not be able to destroy.
I do not need to say that in our country we shall have to check the development of these subversive opinions and of the people who advocate them. This last war created an alarming freedom and an indifferent opinion which is constantly increasing, a feeling of distrust against the established authorities, and even a natural tendency toward insubordination. Here in Canada democracy must prove by concrete facts and by positive proof, even by propaganda and by the elimination of the slightest abuses, that among all forms of

The Address-Mr. L. Bertrand
government it is still the one which answers best the aspirations of our own people. At present it is far easier to laud illusions than to defend actual facts. You might tell me that I should not attack freedom. I agree with that. But I also think governments are not free to tolerate trickery; during war time laws were enacted to rid us of our enemies; during peace time we shall have to take the same measures against these people who very often were bom elsewhere and endeavour to destroy the country which shelters them. We must protect the security of the state, we must protect our civil, religious and parliamentary institutions; furthermore we must secure to our population a maximum of protection, first of all by procuring for them sufficient work, and then social security.
Subversive doctrines, whether they be communism, socialism, or any other, arise out of dissatisfaction, unemployment and poverty. Some are advocating hatred against the happiness or prosperity of their neighbour, others the levelling of natural differences and the equality of our conditions. Others set up the poor against the rich, would like to do away with individual property and wealth, and stir up animosity among social classes; and from these doctrines and programmes others spring up which are more radical and more audacious in many points, and which sometimes appeal effectively to thousands of citizens. These different opinions, which differ only on the surface, sometimes converge and cause difficult times for a nation. If it is urgent to stop the breeding and expansion of doctrines which are inconsistent with our democratic and Christian principles, we must also kill the dreams they are advocating by enacting laws in conformity with the highest aspirations of our democratic principles, by maintaining a high rate of employment, creating employment when necessary, improving working conditions, bettering the fate of our agricultural classes, reducing taxation, removing useless restrictions, facilitating the purchase of individual property, giving impetus in all domains, suppressing causes of dissatisfaction by doing away with abuses.
We must also take advantage of the peace we have won, and no time could be more propitious than now to establish in every way the great Christian code of social security. I am in favour of social solidarity: the old age pension, pensions for the blind and for needy mothers, family allowances, unemployment insurance, workers' compensation, hygiene, agricultural loans, et cetera. All this proves that we care for the general welfare. This is not socialism but the carrying out of social duties, which is quite a different matter. We
can never go too far in the way of social security. Social security is a protection for a nation: it ensures peace and order; it prevents the disintegration of moral values, the only real power of society. During the war we did not shun any of our duties in order to save our institutions and even civilization, and I believe that a sound material order can be based only upon a strong moral order. Human measures never impoverished a nation. The great rule of charity, humanity and benevolence still remains the eternal guarantee of the success and progress of a nation.
Therefore I am happy to see that the government will amend the Old Age Pension Act. I am in favour of greater generosity toward our aged and destitute, and this is all the more necessary because today workers are retired at an earlier age than previously, and these people should not have to wait until they are seventy before they are granted a pension. In the speech from the throne the government also announced its intention of broadening its social security programme, and for this purpose to convene or consult the provinces. It is to be commended for this. I am also advocating grants to disabled and crippled people. The resolution I introduced for this purpose during the last session received the wholehearted support of this house. Once more I have put it on the order paper this year.
I will go even farther: I am in favour of insurance against disability and sickness. I believe our people should be protected against the risks of life, against insecurity and misfortune. If certain provinces do not wish to cooperate or contribute toward a higher rate of old age pension, toward grants to crippled and disabled persons, and toward the social programme which the government will soon bring forward and the greater cost of which will be borne by the federal government, then separate agreements should be made with those provinces which are in favour of these measures and, if necessary, this house should take the proper steps to enact the best social security programme. If some provinces wish to play politics with the misfortunes of the people, then they should assume their own responsibilities. We who sit in this house must aim at granting the poor, the modest and the unfortunate their right of well-being and freedom.
(Translation):
I shall always give my whole-hearted support to any social security measure. In my youth, I went through hard times. How many people have I met whom the hazards of life had
10S4
The Address-Mr. L. Bertrand

deprived of all means of support, and condemned to a miserable existence. I feel that in a country such as ours where we lead an easy life, spend money as a matter of course and have everything, even though we pay taxes, we have no right to remain unmoved by the hardships of the social body. To wage war and make sure of victory, the nation spent billions of dollars; can it refuse to devote a few hundred millions to foster happiness and suppress misery? The King government has to its credit splendid achievements in the field of social welfare, and it is planning to initiate new activities even this year. Thus, Canada will be sure that democracy will triumph over political theories which, fashioned for the personal ends of their originators, offer happiness at bargain prices; moreover, the nation is guaranteed peace and tranquillity, within the framework of democracy.
That is all I intended to say on the address in reply to the speech from the throne, but the Union of Electors put out a spiteful article about me, written by a chap named Corbeil who claims to be its chairman. This calls for a few comments on my part which must necessarily deal with the speech made in the house on February 4th by the hon. member for Pontiac (Mr. Caouette). The paper which published it from beginning to end also upbraided me, in the same edition, for sitting on this side of the house.
Newspaperman by trade and not by chance, I accept the challenge of the Union of Electors' president. In my profession, we like to cross swords, and we are not loath to defend ourselves when the occasion arises. I now avail myself of a wonderful opportunity of doing so.
In that newspaper, Mr. Corbeil writes:
Mr. Bertrand does not understand how Mr. Caouette can associate himself with members of Alberta's Social Credit party, who have supported an imperialistic policy regarding our flag, the war, and gifts to Great Britain. He no doubt confuses our group with a political party; he still does not grasp the idea of a member being responsible to his electors.
Can anyone be more stupid? When looking for an argument, the president of Quebec's Union of Electors publicly admits the Social Credit party's imperialism. Bravo! This fact warrants publication in all daily and weekly newspapers in the province. We are beginning to see behind the mask! The same issue carries the text of a speech delivered on February 4 by the hon. member for Pontiac, who states at page 122 of Hansard:
The programme of the Social Credit party tallies with the programme of the Electors' Union. That is why I sit with the members of the Social Credit party.

He has every right to make such a statement ; however, in so doing he showed his true political ties. I was awaiting that avowal, because to my knowledge, no member of the Union of Electors has had the courage to state openly that he belonged to the Social Credit party. We now know what party the Union of Electors supports. Its president admits the Social Credit's imperialism and the Union of Electors' sole representative avows his deep love for social credit. What a political liaison! The mask has now been removed.
The chairman of the Union of Electors is surprised to see me on the Liberal side. To kill two birds with one stone, let me refer to the same speech of the hon. member for Pontiac. He said:
I am quite at ease with the Social Credit group. I believe it is the only one which recognizes real freedom of the individual, which allows one of its members to hold opinions different from those of the leader and other members.
That is not correct. Throughout the war, I do not believe that a single member of the Conservative, C.C-F. or Social Credit parties ever fell out of line with his leader's ideas or party discipline, w'hile some of us did.


Mr. MICHAUD:: True.


Lionel Bertrand: Many
even opposed their own party on controversial topics, such as the plebiscite, gifts and loans, redistribution, etc. They have not gone to the other side and nobody has requested them to do so. I did not break faith either with myself or with my electors when, on various occasions, I held to my own personal views. I cherish my opinions, and nothing in the world can prevent me from voicing them in all sincerity. The Liberal party may have erred- for to err is human-but were it only for the fact that I found there freedom of thought and of speech I should be happy to belong to it once more. Besides, none of the leftist parties has yet shown, by its policy, tenets or position, that it can live up to my conception of a political ideal, especially to my wish to think first and foremost as an unhyphenated Canadian. I dislike imperialism. Social Credit is imperialistic to the core, I cannot sympathize with the Union of Electors because it is only the disguise Social Credit has chosen to assume in the province of Quebec.
Speaking for his party, my hon. friend claims allowances for the crippled and the disabled, and seems to give himself or his party credit for the suggestion. Let us, however, keep the record straight. I seek but to serve my constituents to the best of my ability. I

The Address-Mr. L. Bertrand
disclaim any wish to stand out or show off but, I must point out that, just as family allowances came as a result of a suggestion made in this house by the honourable member for Compton (Mr. Blanchette), the suggestion of allowances for the crippled and the disabled was originally made here, last session, by a man sitting on this side of the house, the member for Terrebonne. Nor was I merely claiming consideration for the crippled and disabled at 21 but for the disabled of all ages who, though without means of support, did not come under the social legislation then in force. All parties in the house supported my resolution. Besides, I am too firm a believer in this government's sense of social responsibility to doubt that it will soon enact legislation for the special benefit of the crippled and the disabled. I might add that all social measures implemented in Canada on a national basis, have been prepared and submitted by Liberal administrations.
The Union of Electors, alias Social Credit, have a platform that changes with the seasons. Last year, they were calling for tax exemption up to 83,000, while their supreme chief, in Ottawa, was asking for exemption up to $2,000. Last year, and this year again, they were sending us numberless letters asking that all controls be done away with, being of a mind with the Conservatives in this; popular sentiment must have changed, for now the Union of Electors are requesting municipalities to pass resolutions supporting the removal of controls, with the exception of rent control. Besides, the Union of Electors, while denying that they are a political party, play politics in the extreme and broadcast their programme of monthly old age pension allowances of $60 at 60 years of age; monthly allowances of $60 to the cripple and the invalid; monthly dividends of $20 to every citizen of the country. The hon. member for Pontiac, in his speech of February 4, repeats this programme word for word, and there is more, not satisfied with a speech, he wishes to have a debate on the matter and has placed on the Order paper a resolution requesting the implementation of this social programme, without increase in taxation.
I am in favour of all social security measures to help those who have been the victims of misfortune or sickness. With all my hon. colleagues, I am for increased old age pension allowances at an earlier age. This matter of old age pensions would have been settled last summer but for two provincial premiers, one of whom, Gromyko-like, left the meeting. For reasons of petty politics, they caused the failure of the federal-provincial conference.
The resolution of the hon. member for Pontiac and the programme of the Union of Electors border on Utopia and I might even say on election hysteria. In the February 24th issue of Le Droit Mr. Camille L'Heureux, a brilliant newspaperman, criticized the various features of that resolution which to his mind is nothing but a "demagogic chimera". And in a well-reasoned article from which I shall largely draw my arguments he showed quite conclusively that the proposed programme was ridiculous.
At six o'clock, the house took recess.
After Recess
The house resumed at eight o'clock.
(Translation):


Lionel Bertrand: Mr. Speaker, before the six o'clock recess I was saying that the resolution moved by the honourable member for Pontiac and the programme of the Union of Electors border on Utopia, and I might even say on election hysteria.


Mr. CAOUETTE:: What about the Liberal party's platform?


Lionel Bertrand: I live in Ste. Therese and if the honourable member for Pontiac wishes to answer me, I invite him to meet me there.


David Réal Caouette: I shall be there.


Lionel Bertrand: A brilliant newspaperman, Mr. Camille L'Heureux, commented in the February 24th issue of Le Droit upon the various features of that resolution, which to his mind is nothing but a "demagogic chimera". In a well-reasoned article from which I shall largely draw my arguments, he showed quite conclusively that the proposed programme was ridiculous.
La Frontiere, a weekly newspaper published in Rouyn, where, if I am not mistaken, the hon. member for Pontiac lives, and which is not always in sympathy with the government, describes the resolution as having the character of an election move, and it wonders that any member could in all seriousness put such a resolution on the order paper of the House of Commons.
The Union of Electors disseminates that plan without estimating what it would cost the country.
Twenty dollars a month for each citizen would mean $240 a year. Multiply that amount by our population of 12 million inhabitants and the annual expenditure will total some $2,880,000,000. Moreover, a grant of $60 a month to all those who have reached

The Address-Mr. L. Bertrand

the age of 60 and over is also contemplated. According to the 1941 census, there are in the country almost 1,200,000 people in that category. This plan would thus call for another annual expenditure of some $850,000,000.
There is more to come. Statistics are lacking on the number of cripples and invalids, but we are justified in estimating that a grant of $720 per annum to each one of them would cost the country several hundred million dollars.
In short, the Union of Electors would implement a four billion dollar a year programme while advocating that taxes be reduced and not increased.
That is a case of election hysteria, of demagogue chimera to quote Mr. L'Heureux once again. The Minister of Finance (Mr. Abbott) has just announced a two billion dollar budget for 1947-48, and the Union of Electors, with its extravagant programme, asks that it be raised to six billion dollars.


David Réal Caouette: It would benefit Canadians and not foreigners.


James Horace King: Order.


Lionel Bertrand: I repeat to the hon. member for Pontiac that I live in Ste-Therese and I invite him to submit his programme to our people.


An hon. MEMBER:: Lots of money for
war.


Lionel Bertrand: The position taken by the Social Credit party during the last war is well known.


David Réal Caouette: The Social Credit party did not take any stand.


An hon. MEMBER:: You have not heard
the hon. member for Lethbridge (Mr. Blackmore).


Mr. BOURGET:: He took different stands.


Lionel Bertrand: If it
ever came to pass, the burden of taxation saddled on Canada, which was considered to be the heaviest in the world during the war when our budget amounted yearly to three and a half billion dollars, would grow beyond measure; within ten years our indebtedness would rise to fifty billion dollars, while taxes would be a hundred times heavier than they were during the war.
The Social Credit party claim that their financial methods would settle the problem. Can people in their right senses be taken in by such statements? No. The people want old age pensions at an earlier age, allowances for the needy crippled and invalids, gradual reduction of taxes, continued employ-

ment and fair working conditions, opportunity for ownership, in short happiness within the framework of a sound and progressive economy.
The present situation is too serious for empty demagogy to be spreading illogical (ind misleading delusions in an attempt to cheat the public with ridiculous platforms. Destitution can be conquered. It is our duty to stamp it out. Unemployment can be warded off our national life. It is our duty to create employment where it is lacking. The people are anxious to shield theii families from insecurity and the hazards of existence. Let us pass appropriate social legislation. Above all, let the people breathe freely of the tranquillity, the contentment and the peace of our homeland. That is their wish. The people of my province dislike all those peddlers of happiness who pass on, never to return.
(Text):


Mr. E. B. McKAY (Weyburn):: Mr. Speaker, I wish at this time to touch on the question of freight rates generally and, in particular, to discuss their relationship to western Canada. Since the west is largely subservient to the railways as a transportation medium, the matter of freight rates is of paramount concern to the people of the prairies. Because of the application which has been submitted to the board of transport commissioners by the Canadian Railway Association for a thirty per cent increase in freight rates, I shall refrain from making any further reference to the application or the evidence which has been placed before the board for examination. There are, however, certain pertinent facts relating to the subject of freight rates which I should like to discuss at this time, and with your permission, Mr Speaker, I shall present them to the house in this debate.
It is because the imposition of higher freight rates will increase the cost of production for farmers and the cost of living for wage-earners in the west, that farm, business and consumer organizations in that area-and, I believe, in the maritime provinces as well- are vigorously and earnestly opposing any increase. I wish to add my voice in further protest against adding to the burden which the west and the maritimes feel they already bear in carrying more than their fair share of the operating expenses of the Canadian railway system. I think it is generally accepted that the railways have been faced with increased operating expenses. There have been some increases in wages, but they have certainly not been out of line with increased living costs. Certainly the wages of'

The Address-Mr. McKay
maintenance of way employees, when the onerous nature of their employment is considered, are still woefully inadequate. Material costs have also advanced, and these advances tend to elevate operating expenses. The freight tariffs now in effect are much the same as those operating twenty years ago. Even prior to the war, railway operating overhead had so increased that neither the Canadian Pacific railway nor the government-owned railways were on a paying basis. Only the enormous traffic of the war years enabled them to operate at a profit. When traffic returns to normal it is quite conceivable that, with the railways' methods of accounting, they may experience difficulty in showing an operating profit. Because of this contingency, one must consider the question of freight rates and the successful operation of our railway system as a major problem likely to affect the welfare of the whole dominion.
Prairie people now, as in the past-and I believe this also applies to maritimers-are quite prepared to assume their share of transportation costs. But for years westerners have felt that they have been harnessed with freight charges definitely out of line with the charges being made in central Canada. The central provinces benefit from competitive rates, the effect of water and highway transportation competing with the railways in that area. The general freight tariff structure on the prairies is fifteen per cent higher than for the central provinces, and in British Columbia it is sixteen per cent higher than for the prairies. A freight charge of $1 in Ontario becomes $1.15 on the western plains and $1.49 in the British Columbia region. During the nineteen and a half year period ending in 1925, the net earnings of the western lines were more than double those in the eastern region. According to figures released in the 1925-27 equalization of rates case, the Canadian Pacific Railway Company's net earnings in the western region were $520,000,000, while in the eastern region the net income of the same company was $241,000,000. The freight rate structure during those years was similar to that in effect today. These figures indicate that losses sustained in operations in central Canada were retrieved by increased profits in the west; in other words, profits on the western lines were being used to subsidize operations in eastern Canada. This discrimination in charges as between the east and the west-


James Horace King: I am sorry to interrupt the hon. member, but I should like to direct his attention to the memorandum I prepared 83106-70i
on this matter, which was read by the Deputy Speaker yesterday, and particularly to this paragraph:
In making this statement, I have not overlooked the fact that the only discussion excluded by the rule is the matter actually before the board of railway commissioners, namely an application by the railways for an increase in freight rates.
I would ask the hon. member to abide by the rule.


Mr. MacINNIS:: Mr. Speaker, I should like to draw your attention to the fact that, when rising to speak, the hon. member pointed out that he was not going to deal with the application now pending before the board, that he was merely dealing with the effect of the railway rates on the economy of Canada. I have been listening carefully and, as far as I could hear, that is what he has done.


Mr. REID:: On the point of order, Mr. Speaker, may I say that I have been listening attentively to the speech by the hon. member, and I do not believe he is touching at all upon the matter now before the board of transport commissioners. Grain is definitely left out of the appeal. The application before the board of transport commissioners has to do with everything but grain and coal, so I would respectfully suggest that when an hon. member discusses freight rates generally he is not dealing with the application at all.


Lionel Chevrier: I do not want to disagree with the hon. gentleman who has just spoken, and last evening I said clearly that I did not think any hon. member should be interrupted who wants to refer to freight rates generally. But in essence the hon. gentleman is discussing exactly what is before the board of transport commissioners today. He has referred to the discrimination alleged to exist between freight rates in the east and in the west. That is exactly what counsel have been arguing before the board. There can be no difficulty or doubt about that. I hope the hon. gentleman will understand that I do not want to interfere with free speech, but certainly there is no doubt in my own mind that what he is discussing is on all fours with the evidence given before the board.


Mr. MAYBANK:: Contrary to what the Minister of Transport has just said, I believe there is a great difference between what is going on before the transport board and what is being dealt with here tonight. That which is before the transport board I have in my hand, in the application of the railway association, and this is precisely what they are asking: The railway association applies under
The Address-Mr. McKay

section so-and-so for authority to make a general advance of thirty per cent. That is the only thing before the transport board, and that is the only thing one may not discuss here. The mere fact that counsel may mention something else before the board surely would not preclude a member of the House of Commons from mentioning the same thing here. If that were the case the only thing necessary to gag all members of parliament would be for some person, before some tribunal, in some matter under consideration by a judge, to present a certain argument. Immediately, to use a golfing term, a member of parliament would be stymied; he would not be able to deal with that matter at all. The sole question before the board is a thirty per cent increase and, I should suppose, any increase less than thirty per cent. But as long as one is not dealing with what the transport board is being asked to do, with a view to arguing the merits or demerits of it, then I submit that everything else with respect to freight rates is obviously in order.


Lionel Chevrier: My hon. friend is quite right when he says the sole issue before the board-


Some hon. MEMBERS:: Order.


Lionel Chevrier: I think I have the right to bring up this point, on the point o.f order. My hon. friend is quite right when he says *the sole application before the board is for an increase in freight rates. But surely my hon. friend knows that those who are asked to appear with respect to that application have the right to reply on other matters, and they have in their reply pleaded this particular matter of the discrimination which may exist as between certain parts of Canada, with respect to both freight rates generally and what are known as regional rates. That matter has been discussed and evidence has been submitted. That is the point I am making, and I add that, in effect, that is what the hon. gentleman is discussing.


Mr. COLD  WELL@: May I just submit that the matter of discrimination as between east and west does not constitute any part of the application to the board itself. The application is for a thirty per cent increase across the board. Consequently I suggest that hon. members, regardless of the point under discussion at the present time, should be permitted to discuss anything affecting their constituencies, with the sole exception of the actual application, which does not involve the matter mentioned by the minister. Supposing counsel brings forward some other consideration extraneous to the actual application, as
IMr. Maybank.]
the hon. member for Winnipeg South Centre (Mr. Maybank) suggested a few moments ago. That should not preclude a member of this house from discussing everything but the thirty per cent increase.


Walter Adam Tucker: I wish to sajr a word. Surely it is not to be held in this parliament that rates which are a matter of public knowledge, which must be filed and which are available to everyone, cannot be referred to by making the statement that western Canada is being discriminated against in the matter of freight rates. Surely it will not be held that we cannot refer to these rates, which are public knowledge and public property, just because they have been referred to by the board of transport commissioners. Those things, after all are a matter of public record. Surely the mere fact that they are being discussed before the board of transport commissioners does not prevent our laying the facts before parliament


James Horace King: I would call the attention oi the house to the fact that I did not say the hon. member was out of order. I called his attention to the fact that he should be careful because he was on the borderline. Hon. members will understand that it is the duty of Mr. Speaker to ask them to abide by the rules; he has no choice but to do that. After hearing the hon. members who spoke a few seconds ago on the point of order, and since it would appear that some who have had wide experience disagree in the matter of discussing a point of this kind, hon. members will realize the difficulty facing Mr. Speaker when he must decide as to whether a matter should or should not be discussed. I would insist, however, that hon. members be kind enough to cooperate with the Chair in order that the debate may stay within the rules of the house.


Eric Bowness McKay: Thank you, Mr. Speaker. Incidentally. I have not mentioned the thirty per cent increase, and I do not propose to do so. I left off with a reference to a certain discrimination in charges which exists between the east and the west and which has been exposed in several investigations. However nothing has been done wholly to remove the discrimination. Costs of operation have increased on all railway lines, east and west; it has been general across Canada. If these increased costs must be met by increased carrying charges, which I definitely question, the increase should be fairly apportioned and . placed where it rightly belongs. Rates should be equitable and not excessive for any part of Canada.

The Address-Mr. McKay
When speaking in Saint John, New Brunswick, on November 25, 1946, Mr. D. C. Coleman, the retired president of the Canadian Pacific Railway Company, was quoted in the Telegraph-Journal as having said:
Any producing or trading centre is entitled to the advantages of its geographical location and its proximity to markets, but that railway rates cannot fairly be adjusted to relieve a centre of its geographical disadvantages.
If the word "areas" had been substituted for "centre" in this statement the east would be entitled to low rates resulting from water, highway and United States railway competition. But Mr. Coleman did not use the word "areas", because, by his doing so, the western provinces would be entitled to lower rates on account of the unchallengeable advantages of their location. Density of traffic, flat terrain which cuts operating expenses, and long hauls favour low rates for the prairies. Lack of water and highway competition on the plains, however, maintain rates at the maximum, and profits realized in that area go to make up losses in revenue in the central regions of Canada.
I say that because lower charges are forced upon the railways in central parts of Canada on account of the competition from other carriers. It has been repeatedly stated in the press that the suggested increase in rates would return $84 million in revenue to the railways. That is the sum of $7 million each month taken from the pockets of westerners and maritimers to assist the railways to operate more profitably. I say "westerners and maritimers" since other modes of transportation in central Canada will protect consumers there. In the west-and I must be pardoned for speaking from the western viewpoint, since I am more familiar with the situation there,-wholesalers, producers and manufacturers maintain that, under present freight rates in relation to present prices, their margin of profit is not large. They maintain that any increase in freight rates would certainly have to be followed by an authorization from the wartime prices and trade board for commodity price increases which would be added to consumer prices. Thus any increase in carrying charges, either now or in the future, is of vital concern to every farmer and wage-earner in the - west. The farmer will realize less income from the products he sells and, in turn, will find the costs of consumer goods considerably higher. The cost of living for all will appreciably increase.
A survey conducted by the Leader-Post of Regina, which in this instance rendered a service to everyone in the west, reveals that butter and poultry producers would suffer a loss of revenue exceeding $1 million yearly.
Increased charges for farm machinery would range upwards of a quarter of a million dollars a year. Live stock producers would have to pay out half a million dollars more in freight charges. Housewives would find their monthly store bills up at least five per cent. Hardware and lumber prices, already high, would climb substantially, and prove a further deterrent to prospective building.
In Regina alone it is estimated that building costs would increase by at least $100,000 a year. Prospective buyers of automobiles and trucks would have an average of $30 added to the price of each vehicle. Furniture, clothing and electrical appliances will all cost the consumer more. Wholesale grocers in the same city state that canned goods would carry an additional freight charge of forty-one cents per 100 pounds; and sugar, which has a rate of $1.41 per 100 pounds would be increased to $1.84 for the same quantity.
A few months ago an increase of thirteen cents an hour for steel workers was considered by Mr. Donald Gordon, chairman of the wartime prices and trade board, as likely to break the price ceiling, and was, in general effect, inflationary. So far, to my knowledge, there has been no comment offered by Mr. Gordon with regard to the effect of a general freight rate increase on the price structure of the country. If an increase of thirteen cents an hour to a few thousand steel workers is. in effect, inflationary, one must assume that increased freight charges which will increase commodity prices will make the holding of the price control line exceedingly difficult. Therefore any increase in freight charges contains a threat to the welfare of Canadians in all parts of the country.
There should be no attempt to be unfair to the railways. On the other hand, if an over-all increase in freight rates is discriminatory in effect it may have dangerous consequences. The imposition of an unfair and unwieldy freight structure upon any region of Canada can well develop an anti-confederation attitude. This has manifested itself on several occasions, both in the maritimes and in the west. This, of course, is to be avoided. All Canadians must remember that confederation should be based on equality and that economic discrimination against any area in the dominion may create separatist sentiments. I suggest that now is the opportune time to examine the whole freight rate structure so as to remove existing inequalities. Now is the time to set up a royal commission, if you will, to investigate thoroughly all charges of discrimination which have been levelled against the railways by western and other organiza-
The Address-Mr. McKay

tions. I submit that, until this whole matter is ironed out to the satisfaction of both the west and the maritimes, no body is in any position to appraise the need for a general increase in railway rates of any kind.
I have already referred to the accounting system employed by the railways; but, leaving that for the moment, I wish to draw the attention of the house to another situation. The war years brought enormous industrial development to this nation. Even though we are now at peace, there continues to be an increased income from trade. It is to be hoped that this improved state in our economy will provide much more revenue for our transportation system than in pre-war days.
Again referring to the accounting systems of the railways, I question the method which makes heavy charges against operations to provide huge reserves. It was reported in the Toronto Daily Star of January 3, 1947, that Canadian Pacific reserves had increased to $332 million by the end of 1945, and this after paying dividends for 1944 and 1945 of almost $42 million. Moreover, according to the bulletin "Railways of Canada 1945", issued by the Department of Trade and Commerce, the depreciation reserves, deferred maintenance and other contingencies funds of the combined railways of Canada had reached the huge total of $493,963,000 by the close of 1945. It may be safely assumed that these figures are substantially higher today. This fact should be carefully considered when one is examining the financial position of our railways.
In so far as the Canadian National Railways is concerned, one must view with alarm the enormous overhead of this railway. The government railway has never had an opportunity to operate on the right side of the ledger except during war time, and that situation has not been owing to inadequacy of either passenger or freight revenue. If adjustments were made to the capital structure under which this system labours I question very much if there would be any demand from this source for an increase in rates of any kind. The Canadian National Railways was organized from bankrupt, privately owned lines with impossible capital debts. No railway in America carries the burden of debt which the government-operated railway bears. No privately operated railroad anywhere would have assumed the liabilities foisted upon the national system by past federal administrations. Generosity, presumably to friends of governments then in power, apparently dictated the policies of those days.
fMr. McKay.]
The bondholders and shareholders were in most cases well provided for. Now, when deficits occur because of an unwieldy and unfair debt overhead, all Canadians are forced to contribute to the bondholders of defunct private enterprise railways, either through raids on the public treasury or by increased railway carrying charges.
The first railway to fail was the Grand Trunk Pacific, which was followed by the Canadian Northern and others. The accumulated debt of these bankrupt privately owned roads amounted to well over $1,200 million. No one has yet explained why these bankrupt enterprises were not taken over at face value, at so many cents on the dollar. There should have been a revaluation of stock as would have been done in private business.
While the hodgepodge of privately constructed railways was being integrated into an efficient national system, the United States railways were undergoing a reorganization of a different kind. Many United States railways went into the hands of receivers and debts were reduced as much as fifty per cent. No such financial reorganization occurred with the government railways with the consequence that prior to the war this system was unable to meet the interest charges on its more than a billion dollar debt.
Some relief was granted in 1937, it is true, when the Capital Revision Act wiped out loans granted by the government to meet operating deficits. Previously such loans were added to capital debt. The same act changed government loans for capital purposes prior to 1932 to equity capital which meant that interest was paid by the Canadian National only in years of declared surplus. Even with these adjustments, interest charges were still twenty-eight per cent of gross revenue, while the Canadian Pacific rates were seventeen per cent, and that of class 1 United States railways was sixteen per cent. There was obviously no attempt to place the government railway on a comparative basis with any other railway. It seems apparent that, unless the government writes down the Canadian National Railways capital debt structure, this railway cannot ever be profitably operated, regardless of freight and other rates charged. I appeal to the government to assume directly some of the liabilities charged against the Canadian National Railwas's so that the system may have a square deal. If this adjustment is not made the state operated railways are handicapped so as to preclude a proper comparison with railways operating under

The Address-Mr. Merritt
private ownership. The efficiency of operating personnel is defeated by unreasonable and unfair overhead.
Included in the national system is the Intercolonial railway which serves the maritimes. Just a brief word about this railway. The Intercolonial railway was built for political rather than for economic reasons. It was intended to cement the maritimes into the confederation block and to be as far removed from the United States border as was feasible. This may have served a strategic purpose a half century ago, but it created a long freight haul to and from the maritimes. The alleviation from excessively high freight rates over this route received some consideration in the 1927 Maritime Freight Rates Act. The effect of this legislation should have been to place the maritime areas on an equal footing with central Canada. However, the application of maximum charges set forth in the act still militates against the provinces down by the sea. Central Canada has efficient highway competition which forces charges down below the maximum permitted; therefore the differential existing prior to 1927 is, in effect, practically unchanged.
May I commend to the government the facts just presented. In order to appreciate thoroughly the effects of the present rate structure and the possibility of an increase to the west and the maritimes, a careful study should be made of all facts pertaining thereto. An examination of the effects of the whole freight rate structure upon our economic life should be ascertained. It is my opinion that freight rates for essential goods should be held to a minimum. Moreover, there must not be regional discrimination. Should periods occur when operating expenses exceed revenues the nation as a whole should be responsible for the deficits. All parts of Canada should assume a part of that burden if it should occur. The future welfare of Canada as a nation might well be at stake if rates are to vary in different parts of the country. Moreover, it is time that the railways' dependence on the west for top operating revenue stopped. Until now the west has carried the major load in providing the railways with profits. Easterners, when apprised of this truth, will, I am sure, join with us in demanding that the federal government assume responsibility for an equalization of the freight rate burden, so that the extremities of this nation, the western provinces on the one hand and the maritimes on the other, may receive the square deal to which they are entitled.


Mr. C. C. I. MERRITT (Vancouver-Bur-rard):: Mr. Speaker, in this debate we are discussing an amendment expressing want of confidence in this government, and I am sorry that I do not see in the house tonight many ministerial targets for my remarks. I shall have to content myself with my good friend the Minister of Veterans Affairs (Mr. Mackenzie), for whom I have a special message this evening.
First, however, I wish to make a short reference to the withdrawal of the Canadian army of occupation from Europe and to the bearing of that on the amendment which has been moved by my leader.
This afternoon we heard quoted the statement of the Prime Minister (Mr. Mackenzie King) in 1945, when he said that the army of occupation as then planned was modest, having regard to our direct interest in world peace. With that statement in mind, Mr. Speaker, I say to you that the withdrawal of that force can only mean that Canada ceased to contribute to the discharge of her direct responsibility which goes with that direct interest. The reason given at the time was administrative difficulties. I wish to say to the house and particularly to the government that that reason fooled no one at the time and it fools no one now. There would not have been a reference to this matter from this side of the house had it not been for the attempt to base this withdrawal on a question of principle. I think that attempt was exploded by the hon. member for Kamloops (Mr. Fulton) this afternoon, if indeed it needed exploding, because actually I think it blew back on him who attempted to put it forward.
What are the facts and the very simple facts? At the end of the war we had in Europe an army of occupation, consisting of approximately one division. It included many long-service men, men who had fought through most of the fighting and who were being kept, for the time being, in that army of occupation against their will. It is obvious that the government could not have left those men over there doing that duty when there were short-service men at home. It is obvious too that this government would not send replacements over to take the place of these long-service men. That is the beginning and the end of the mystery of the army of occupation. That was the administrative difficulty and I say to you tonight, Mr. Speaker, that it was a difficulty of political expediency and that only, and it is no use trying to make out anything else.
I wish to say to the government, too, and particularly to the Minister of National
The Address-Mr. Merritt

Defence (Mr. Claxton), who, I am sorry, is not in his seat at the moment, that in his recently expressed concern for the hearth and home of the Canadian soldier I believe he misjudges young Canadians. The young Canadian soldier does not like separation from his home. Who does? Nobody does. But the interest of all the young men of this country is in the future of their country first and in the future of their sons and their sons' sons, and it is not in any temporary disagreeable circumstances that they must put up with if they are to lead Canada on to the great future that is undoubtedly before us as a nation. I say to the government, with all the seriousness at my command, that if the absence of a few young men in Canada's service from Canada now would make any contribution to the cause of world peace in the future many young Canadians would go to the ends of the earth and stay there if this government had the fortitude to ask them so to do. If it comes to a choice between principle and expediency there never has been much doubt in the minds of the Canadian people what course this government would take.
Take national defence, for instance. On February 12 in this house, the Prime Minister reiterated the pledge he gave to President Roosevelt and indeed to the Canadian people that there was an obligation on Canada to do everything in her power to defend herself from attack from without and to prevent any aggressor from moving across Canadian soil against our great neighbour to the south. Contrast that statement of our obligation with the provision which this government has made for national defence.
Take management-labour relations. The whole history of management-labour relations under this government has been one of inability to attempt -to enforce the law as it stood at any one time, again because of the political inexpediency of so doing. Or take the socialist legislation of which we have seen many an example during this session. Is this really a Liberal party opposite us, Mr. Speaker? That is what I think many people in Canada want to know. These are some of the reasons why we lack confidence in this government.
Take housing, and I wish to devote the rest of my remarks to that subject. We had a statement from the Minister of Reconstruction (Mr. Howe) on housing early in this debate, and I desire to congratulate him and the Minister of Veterans Affairs (Mr. Mackenzie) on being the only two ministers who have made statements of government policy since we assembled here in January, although much time has been taken up by members on this

side asking for such statements. The Minister of Reconstruction at least made a statement, and he took great pride in the fact that there had been built in Canada last year 60,000 houses and that his target for 1947 was 80,000. He can take what comfort he likes out of that, but to do so looks to me very much like pulling oneself up by one's bootstraps. Simply to meet this self-imposed quota will not do very much to house the people in this country who need homes so badly. What has been the government's policy of which they are so proud and which was to produce 60,060 houses? The priority system has been a joke. Less than twenty per cent of the houses built in Canada have been built with priority assistance. Large industrial orders have taken most of the remainder of the building material that has been produced. The private builder has had to scramble to get any material and yet he has built over eighty per cent of Canada's houses. Shortly put, that is the result of the government's housing policy.
I wish to test that by two further facts. I hold in my hand an extract of the Maclean building reports, as quoted in the Financial Post. It shows that in the ten months of 1946, up to November 1, the proportion of residential building in 1946 as compared with non-residential building has fallen 15-1 per cent since 1945. That is a pretty good gauge of what the housing policy of this government has brought about. For three years before the war the proportion of housing to industrial production has been over fifty per cent, and this year it has dropped to 39'6 per cent. Then again, testing it by the same report on the total construction contracts awarded in Canada, I find that engineering contracts increased 212 per cent over 1945; commercial and industrial contracts increased 123-5 per cent over 1945; industrial contracts increased 102-7 per cent over 1945 and, if you please, residential construction contracts awarded increased 8-9 per cent. That will give the house some idea of the way in which this government distributes building material.
Even if there were completed the 60,000 houses in 1946, in my own city of Vancouver in the twelve months of 1946 there were actually fewer houses completed than were completed in 1945. That took place in a city which is growing faster than any other city in Canada and which has a housing shortage that I have every reason to believe is the worst in the country. We built fewer houses in 1946 than we did in 1945.
I now turn to the question of stimulation of building material which was the real job of the government, instead of fooling around with

The Address-Mr. Merritt
priorities and things like that. What has happened? Last April the Minister of Reconstruction and Supply took over the job of stimulating building material. We had been asking him to do so for a year but it had not been done. However he started a year late, and I believe he has worked hard. What did he find he had to do in order to stimulate building material? He has had to give price reliefs from the price ceiling; he has had to give incentive subsidies to get increased production; he has had to reverse the taxation policy by giving double depreciation; he has had to make loans for capital development. The people presumably have been taxed so hard that they have not the money for that purpose. He has had to give guaranteed markets to some firms before they had confidence enough in the government's policies to increase their output. And after a great newspaper campaign he finally got around-and I think this was a year and a half late-to pulling down the Debert camp and other big camps and distributing that building material where it should have gone a long time before. Despite taking these heroic measures to stimulate the building materials-and certainly I consider reversing the government's policy an heroic measure-what is the fact now? We have heard from Vancouver and Toronto in the last two days that there is an acute shortage of nails and that houses cannot be finished because of that.
The production of nails in 1946 was down fifteen per cent over 1945, despite the government's attempt to stimulate the market. I know hon. gentlemen opposite will say that there was a big steel strike last year. That is true, and it was the chief cause of the diminution in the production of nails. But whose responsibility is it for good management-labour relations if it is not the responsibility of the government? Anyone who sat on the industrial committee last year knows that strike could have been settled at 13J cents an hour, or whatever figure it was settled at, on the first day of the strike. If the government was going to reverse its policy and go over the ten cent limit it was not necessary to keep the steel workers out for eighty days and thereby slow down the production of nails. That is a simple answer to that shortage. I hope that the people of Canada who are suffering from a shortage of nails will know it stems back to the weak policy of the government in dealing with a great management-labour problem.
There is one more thing I wish to add on the general subject of housing, and that has to do with low-rent housing. In the minister's 83166-71
statement earlier in the debate, he laid down the policy of the government as opposed to the introduction of low-rent housing. By that I mean municipal corporations assisted by both provincial and dominion governments bringing about low rental housing for those in the low-income groups and to those living in slum dwellings. I wish to say to the government that if that is their policy it is completely unrealistic.
I hold in my hand a voluminous report of the Vancouver Housing Association which made a detailed and intelligent survey in my own city before the war and brought it up to date in 1945. They have no doubts about the need for low rental housing for the lower income group. There are very few social, public or municipal bodies in the country, except this government, which have any doubts on that score. Knowing conditions as I do in my own city and constituency, I say the minister's suggestion that we can get along under the "filtering up" process is so unrealistic as to be unworthy of a man whom I consider to be realistic.
Finally, I wish to turn to the question which has been discussed several times in the house, and particularly yesterday and today, namely the administration of housing under the Veterans Land Act, the small holdings. There is no question that the way in which the small holdings project or progiamme has developed in Canada in the last two years amounts to a public scandal.
In this debate we have heard from the hon. member for Lambton West (Mr. Murphy), who has told us about the Sarnia and Windsor houses; we have heard the minister; we have heard from the hon. member from Nanaimo (Mr. Pearkes) with regard to the Braefoot subdivision; we have heard from the hon. member for Souris (Mr. Ross) and the hon. member for Portage la Prairie (Mr. Miller) about the Charleswood project, and yesterday we heard about the wartime housing project in the Louth subdivision near St. Catharines. I wish to call the attention of the house to the fact that the conditions in all of these subdivisions across the country are the same. In every case there is bad workmanship; in every case drainage apparently has not been thought of at all; in every case there has been bad material delivered to the job and apparently also in one case short material. In every case the veteran has ended up with being charged an excessive cost for the work which was done, and a cost which was very much over what he was led to believe, by the government pamphlets, he would be charged for one of these houses.

The Address-Mr. Merritt

I just wish to add my little song to that of the other members on this side of the house. I have an example from Lulu island near Vancouver, in the Veterans Land Act subdivision there, which I have called to the attention of the minister. This was the case of a veteran who was wounded overseas, who has a wife and child and whose wife was expecting another. Last June he bought his house and the contract price was $5,861.22. This winter he has had to vacate his house. There were eight inches of water under it. His septic tank was leaking and flooding the land. Two houses away, the whole top of a septic tank simply floated off, and brought about such a condition in the area that the veteran had to vacate and go into the town. His wife went to stay with her parents and he went to stay with his, both of them sleeping on couches in the living room.


Ian Alistair Mackenzie: May I interrupt my hon. friend for a second? I do not wish to interfere with the theme of his speech, but he realizes that when he wrote me about that case, I took it up with the authorities under the Veterans Land Act. They visited that particular house and found conditions different from the way in which my hon. friend now describes them.


Charles Cecil Ingersoll Merritt: Yes, I am well aware that the director of the Veterans Land Act took up this case. The minister was kind enough to send me the report, which suggested that the flooding conditions were not serious; and I answered the minister on that score.
I have in my hand two photographs. I wish that Hansard were an illustrated document, but I will try to illustrate to the house what these photographs show. One of them shows "the back of the house which I have." You can see the reflections of two telephone poles in the water and the water is covered with ripples, there being on this day quite a wind. I would not call that just dampness, and I doubt if the house would. Then I have another photograph, which is of "my next door neighbour's place, and it was nearly as bad as my own." There you can see not only the reflection of the telephone pole but the reflection of the whole house in the water; and you can trace perfectly clearly in the water the reflection of a ladder which lies against the side of the house and which may have been used to climb from the boat into the house. Those are serious conditions, and are not such as could warrant the director's characterization of this situation as being not serious. It seems to me that anyone who does

not live in such a place should at least withhold comment on the "relative" seriousness of the flooding of one's basement.


Walter Adam Tucker: Is the hon. member referring to the city of Vancouver when he says "live in such a place"?


Some hon. MEMBERS:: Oh, oh.


Charles Cecil Ingersoll Merritt: As a matter of fact, although I do not see what it has to do with the discussion, I am referring to a Veterans Land Act project situated, not in the city of Vancouver but outside the city limits, which is under the direct responsibility of the department of the minister to whom my hon. friend who has just spoken is the parliamentary assistant.	-


Ian Alistair Mackenzie: Who took the photographs? Where did they come from?


Charles Cecil Ingersoll Merritt: The photographs came from the man himself.


Ian Alistair Mackenzie: The man about whom the hon. member wrote to me?


Charles Cecil Ingersoll Merritt: Yes. I received them just today, which I consider very fortunate.
'Mr. ROWE: You might send the minister a copy.


Charles Cecil Ingersoll Merritt: I will send them over
to the minister. I just outlined that case to show that there is hardly a place in Canada where these same conditions do not exist.
I now wish to refer to the minister's speech. He ended up yesterday by referring to our main interest in the veterans. He made promises to repair the damage and expressed his desire for the cooperation of all members of the house and the hope that we would be satisfied with his frankness with us yesterday. I can assure him of the cooperation of every member of this party. We raise this matter only because it must be raised and must be settled, and he has our full cooperation. We appreciate his frankness. We know that the minister personally has every good wish toward the veterans and would do anything in his power to assist their cause; but those good wishes are not enough and the minister's speech is not enough. We need results as well as good wishes with respect to these Veterans Land Act projects.
I am now going to outline some of the results we hope to attain before we stop talking about these matters. We want the following assurances from the minister, from the point of view of the veteran. First, we want to be assured that all these houses will be put back in proper repair. I think he has given us that assurance. We want

The Address-Mr. Merritt
to be assured further that the drainage problem will be attacked immediately and successfully and not at the cost of any of the veterans on any of these projects. Those are the first things upon which we want the most positive assurances. We do not want to wait, as one correspondent of mine suggested, ten years before a municipality can get certain pumps and thereby drain the low-lying land. We want these houses fixed so that the men can live in them now. We want the most energetic steps taken at once.
Second, we want the assurance-and this is particularly important-that no veteran who has a house in bad repair or with bad drainage is called upon to sign a contract until he has satisfied himself that the house has been repaired so that he can keep it as his home and be proud of it in the future. This is a most important point, because it is my information that in the Charleswood project veterans have been given until May 1 to sign these contracts for these houses, even although they are not fully repaired, or else they must vacate. That attitude on the part of the officials of the minister's department, if it is correctly described, is not, I think, the one the minister himself would adopt toward any veteran. So we want that matter looked into and an assurance given us that that kind of thing will not occur. There have been other cases of pressure by officers of the Veterans Land Act division of the minister's department, pressure to sign up originally, pressure to hurry up and make a choice. We have much evidence of that kind of thing, and we want the minister to look personally into the question of what pressure is being put upon these veterans.


Ian Alistair Mackenzie: By the departmtent?


Charles Cecil Ingersoll Merritt: By the departmental officials. so that, as some of us believe, the shortcomings of the people who administer this scheme might thereby be minimized.
I wish to make particular reference to the remarks of the director, in the case I referred to the minister. In addition to suggesting that this "lake" was not seriously flooding, he also suggested that perhaps the veteran had acted with too great haste in accepting this house, and that, after all, the veteran had not been able to provide himself with a house from any other source. If that is the attitude of the director I say I believe it is the duty of the minister to have that attitude corrected. The veteran has no responsibility whatever for the fact that he is without housing accommodation. It is not his fault that he cannot get a house on his own resources, and that 83166-71i
sort of statement does not give me confidence in the eventual happy settlement of these difficulties under this administration.


Ian Alistair Mackenzie: With reference to the pressure mentioned by my hon. friend, would he be good enough to send me any cases which have come to his attention? I have received" none up to the present time, and I should be glad to have them.


Charles Cecil Ingersoll Merritt: Yes, I shall be very glad to do so; I have some here. It seems to be thought by some of the officials of this department that, as to these veterans who have flooded or badly constructed houses, the principle of caveat emptor applies; that these veterans, having bought the houses, must take them as they are and suffer the consequences. I want to say to the minister that in the circumstances in which this small holdings scheme under the land act was born and introduced to the veterans who came back from overseas, there is a great responsibility on the government, as I think the Minister of Veterans Affairs appreciates, to lean over backwards in seeing to it that these veterans get every possible break, and even more breaks than they would have been given in an ordinary commercial contract. The very fact that they were contracting with the government which said it owed them such an obligation was likely to make them less careful in regard to the business details; and if a house was recommended to them by a government official, many of these men would not think it necessary to make any inquiries themselves before signing up. I think there is a great paternal obligation on the government to people settled in these subdivisions.


Walter Adam Tucker: Would the hon. member not admit that any of these cases which have been brought to the attention of the department have been looked into right away and rectified if at all possible?


Charles Cecil Ingersoll Merritt: Yes; I want to assure the minister and his parliamentary assistant that I personally have had every courtesy from both hon. gentlemen in regard to these matters, but I am talking of the way things sift down across this wide country; and it does appear to me that there is need to jack up the administration under the Veterans' Land Act. My goodness, it is perfectly clear to everybody that there is a need for this. Bad workmanship; floods; choice of location-these are not the results that flow from competent management.
There is a third assurance we want from the minister; that is, that the excessive costs of these homes will not have to be borne by
The Address-Mr. Merritt

the veterans. As to that I wish first to refer to the resolution of the veterans affairs committee contained in its final report of July 25 of last year; it is recommendation No. 2, on page 6:
That the government give consideration to the introduction of a bill to amend the Veterans' Land Act, 1942, to provide that the total cost of all homes over six thousand dollars presently constructed or in actual process of construction under the small holdings scheme be subsidized twenty-three and one-third per cent.
I hope we may be assured by the minister that effect will be given to this recommendation now. Then I want to ask the minister to see to it that a revaluation is made of all these damaged and flooded houses. I say these houses were built on a cost plus management fee basis; that they are now damaged goods, and that you cannot expect to get cost plus fixed fees for damaged goods. Even if they are repaired, in many cases they will not be as suitable for the veteran as they would have been otherwise. Each house should be revalued to make sure the veteran is not called upon to pay more than he should for it.
I want to make the second point, that in this revaluation any consequential damage which has been suffered by the purchaser through no fault of his own should be taken into account in fixing the final price. To mention again the case I referred to the minister, in order to give him my idea of consequential damage, that veteran went on the land last summer, ploughed it and paid for the ploughing. His wife bought curtains, carpets and so on to fit that house, together with many other household accessories that go only with the house in which you are living, as many hon. members know. These are consequential damages, for which that man should be reimbursed. In the case in point the veteran concerned is now being given a wartime house and his deposit on the house under the Veterans' Land Act has been returned, so that his case is dead except as an example, but for this consequential damage. In his new wartime house, however, he has lost the value of his ploughing, his curtains and so on, and is suffering considerable inconvenience for which, under a commercial contract, he would be reimbursed. I think that should be taken into account in the revaluation. It is not as though caveat emptor applied; it is not as though he knew the house was going to be flooded. On the facts as related to me he did not know that. The local officials knew it, however, because, when the house was being built the previous winter, men could not get in to work on the place for several days,

and all the neighbours were surprised when this man moved into the place. Apparently that was a disability within the knowledge of the department and not within the knowledge of the veteran, so that I do not believe he should suffer for that.
From the point of view of the taxpayer, hon. members on this side of the house would like certain requirements met. The first is that all necessary repairs shall be done at the expense of the contractors. The minister said that was being looked into. I understand that in most government contracts there is a "sound workmanship" clause. It seems to me the things we have heard about cannot be considered sound workmanship, and must be in breach of contract. The general public should not be called upon to pay for those repairs. Then, by order in council last year, with the approval of the veterans affairs committee, $1,000,000 was applied to this project. We should like to know whether that floated away with the top of the septic tank, or what happened to it, and why it has not reduced the cost to the veterans.


Ian Alistair Mackenzie: I may say that part of it, in any event, has been carefully and prudently expended.


Charles Cecil Ingersoll Merritt: I simply suggest that we should like to know.
Then I believe we should cut out these cost plus fixed fee contracts, and I shall give my reason for that. I have a case here of one of the Braefoot houses, which was worked out at a cost per square foot of $8.14. Last summer, in the debate on housing, the Minister of Reconstruction and Supply gave the National Housing Act figure as $4.20 per square foot, with an increase of ten per cent last year. So that apparently under the National Housing Act, in calculating lending value, one is allowed $4.62 per square foot and this house cost $8.14 per square foot. 1 had some figures from Vancouver for private housing at $6 per square foot. I believe 1 have said enough to show what is wrong with a cost plus management fee contract.
What we want is that the government shall not simply say, "Oh it was very hard; we could not get good materials; we could not get good workmen." They had good materials to make munitions of war; they had good workmen to make munitions of war. I am sorry to say I cannot accept that excuse for the bad workmanship in these projects. Good inspection-the inspection upon which the government insists under the National Housing Act-would have obviated every bit of this.

The Address-Mr. Maybank
A letter from the hon. member for Nanaimo (Mr. Pearkes) in September, 1945, called the danger of bad drainage to the attention of the department. Therefore there could have been no reason why that was not properly looked after. I believe the taxpayers should know that any sum of money they have to pay, which is not paid by the contractors, is the responsibility of the government.
I realize I have only a short time left to speak, but with the time at my disposal I would refer to the suggestion for a royal commission. The minister has said that a royal commission would do no good because it would keep people waiting for a year to have repairs done. We do not want a royal commission before the repairs are done; we want that to go ahead at top speed. But what we do want a royal commission to do is to see that these financial adjustments, of which I have spoken, are carried out, and to see that the mess in connection with these projects does not fall on the veteran, and that it does not fall on the taxpayers any more than it must.
My final word is this, that against the failures of this government in housing, labour relations, foreign affairs, tax reductions and many other things which hon. members have mentioned, the Prime Minister (Mr. Mackenzie King) in this debate took pride in the fact that forty per cent of the voters of Canada voted for his party and government during the recent by-election. I say to him, Mr. Speaker, that it is high time we got rid of a government which prides itself on forty per cent efficiency.


Ralph Maybank: Mr. Speaker, I am glad that this evening and on other occasions the question of freight rates, in a general way, has been discussed. And in a "general" way I also wish to enter into discussion of the freight rate structure of the country, from the viewpoint of its being "generally" an inequitable structure.
It is true I may have occasion to remark something about an application which is now before the transport board. But any reference to the application before the board is, as authors so often say in their introductory words in books, purely coincidental.


Lionel Chevrier: Obiler dictum.


Ralph Maybank: I would repeat what the Minister of Transport (Mr. Chevrier) has said, that he hopes that all such remarks will be obiter dicta-and I believe that means in the nature of an aside or asides. I suppose any references I would make would be obiter dicta.
So that at least the Minister of Transport and I start out in complete agreement at the present time, although some little time back we were in disagreement on a point of order.
But before touching upon the freight rates question, I wish to make one other remark- but shortly-upon a different subject. My first observation shall be to compliment and congratulate the government upon the agreements thus far made relating to interprovincial and intergovernmental settlement of finances. I believe the government is to be highly complimented upon the progress it has thus far been able to make.
I have been reading the speech from the throne from Queen's Park, and there would appear to be some disagreement in that quarter as to the adequacy of the proposals of the dominion government. But whether they agree with the adequacy of the proposals or not, I think people in all provinces must realize that some changes had to be made in the financial set-up in Canada, and the load placed upon the provinces having the opportunity to get the wherewithal to carry the load. I believe all must realize that the poorer provinces could not carry their load; and this is particularly true in my own province which, from a tax collector's point of view, is too poor to go ahead with such developments as are necessary and to effect necessary social amenities, although it does create a great deal of wealth. But from the point of view of the tax collector, and including only direct taxation, it must be regarded as a poor province. For that reason, and because a settlement greatly beneficial to it was made possible, I believe the government is entitled to great credit.
But when paying tribute to the government for a job well done, I do not want to overlook one man who played a great part in these dominion-provincial negotiations and whose work in no small measure contributed to their success. I refer to the Hon. Stuart Garson, premier of Manitoba. I have sometimes thought he was the most far-sighted of any of those who gathered about the table. I do not press that comparison; but he certainly was clear-sighted, patient, conciliatory and resourceful in negotiating for his province. And, above all, he was sincere-and that is important. He was sincere in trying to work out something that would be for the benefit of all Canada, while working especially for his own province. It is my belief that he is responsible for a large measure of the success attained.
But now, just when we have concluded satisfactory interim agreements which will put the
The Address-Mr. Maybank

provinces upon a better situation henceforward, we in western Canada face a serious threat to our economy, and I believe the same is true of the maritimes. However I speak more particularly with respect to the prairies.
A special endeavour is being made by certain agencies in the country to place an additional tax on the backs of the people of western Canada. It is a scheme peculiarly designed to tax them, and only them; and if it succeeds it will go far to undo a great deal of the good that has been accomplished in the proposals contained in the agreements I have mentioned.
Mr. Speaker, I know that the difficulty of determining a point of order in the house with reference to a discussion of freight rates is extremely difficult. I am, and I think all hon. members are, deeply sensible of the hard position you have to fill. I am-and I believe this view is shared by all other hon. members- keenly sensible of the excellent manner in which you discharge your function as Speaker in endeavouring to keep us within the limits laid down by the rules. Certainly I do not wish to offend against the ruling handed down by Your Honour through Mr. Deputy Speaker last night in relation to this subject. If I do mention the proposals before the transport board I wish you to know now that it is done only for the purpose of leading up to a conclusion and recommendation I have to make, and independent of what happens to be before a court at the present time.
I had occasion a little earlier this evening to discuss the exact case that is before the board, and I would recall to you that the case before the board is expressed in these words-I am leaving out certain interconnected words in order to get it more clearly-"the railway association applies under section 325 and certain other sections for authority to make an advance of thirty per cent in tolls and rates." That is the only question before the transport board. There is nothing before that board at the present time about grain rates because I think it is made clear that since grain rates are statutory, they do not come within the purview of the jurisdiction of the board. So they could be discussed. By the same token, increases of thirty-one per cent or thirty-five per cent or ninety-two per cent are not before the board. All that is before the board is a thirty per cent increase, a very narrow sort of application-a narrow field from which we must keep away.
I should like to introduce with this comment what I am going to say. Sometimes, when one is discussing what will be the effect of a judgment, he does not need to enter into a discussion as to what the judgment ought to be.

You may discuss the effect of a judgment without saying anything about the merits or demerits of the arguments pro and con which lead up to the judgment. If there were a murder trial going on in Ottawa I feel that we would agree that we should not discuss the merits of the case for the prosecution or for the defence. Whether the accused should be convicted or not is something that we would feel we had no right to discuss. But the effect of being found guilty and hanged is that after you are hanged you are dead. There would be no prohibition upon our discussing the effect of hanging.
With reference to this freight rate application, I may say that, while all the railroads are making it, I think it can be viewed chiefly as a Canadian Pacific application. Most of the railroads with the exception of the Canadian National are small, but the Canadian National situation is not important in connection with freight rate making. That is a point that I may develop a little later. It is something which has been pretty well accepted over the years in rate-making circles, that the Canadian National and its needs are not to be taken as the criteria. So one may say that this is pretty well a Canadian Pacific proposition.


Mr. SMITH (Calgary West):: You are not serious about that?


Ralph Maybank: I am quite serious. It
will be recalled that the application has been made not to raise certain uneconomic rates, not to seek an increase by having cost saving schemes made effective; it is simply an application that everything be raised thirty per cent. I think, in regard to coal, a specific figure is asked for. By reason of the inequitable situation in which we find ourselves today in connection with the rate structure, a demand of that kind is levelled particularly at western Canada. There can be no doubt that the allowance of such an increase will be permissive. I do not say what the judgment of the board ought to be, but I do say that, in the event of a judgment permitting the increase, the railroads ought to take counsel together and with the government before they put it into effect. I suggest that such a remark is apt in the case because the Canadian National Railways is our own creature. Before the Canadian National Railways actually increases rates, there ought tfi be a conference to consider the effect of that raise before they take advantage of any judgment that may be rendered in their favour. I do not speak as to the merits of the judgment itself, but the railroads, particu-

The Address-Mr. Maybank
larly the one which is ours, ought to consider the situation carefully before taking advantage of any judgment.
I have said that, by reason of the inequitable system under which we labour at the present time with rates as they are, any change will necessarily bear rather heavily upon us in western Canada. Some other speakers have already pointed this out. If the railroads have the power at any time to raise rates, they will not raise them in central Canada but will raise them in western Canada. I do not suggest by this statement, any moral obliquity on the part of the Canadian railways; it is simply a matter of fact that when it is possible to raise rates by reason of a judgment they raise them in western Canada because western Canada is a natural monopoly. The contrary holds Lrue here in the east. There is no monopoly, there is water competition, and there is good truck competition here.
If any person has any doubt about this I ask him to note what has appeared in the newspapers, and then I think he will be convinced that what I am saying is correct. The newspapers do not report any person appearing before the transport board at the present time for either Ontario or Quebec, although an application is being made for an increase "straight across the board".


Thomas Reid: That is significant.


Ralph Maybank: It is most significant
and I thank the hon. member for New Westminster for adding a punch to what I was saying. It is most significant that people should be faced with an apparent thirty per cent increase and not care. Since I have been interrupted by a Scotsman, helpfully I admit, I am reminded of what happened in Glasgow.


Thomas Reid: I got my Canadian papers
the other week.


Ralph Maybank: They say that you
cannot take the breeks off a highlander, and I do not think you can take the Scotch away from a Scotsman even though you give him Canadian citizenship papers.


Thomas Reid: I rise to a point of order;
I am a Canadian.


Arthur Leroy Smith: I think it
is a point of privilege.


Ralph Maybank: I agree that the hon. member is a Canadian, and a very good one. However I know he will not take umbrage in being reminded that until a short time ago he was Scotch. As I was saying, the action taken by the governments of Ontario and
Quebec reminds me of the people of Glasgow. They had a municipal railway in Glasgow and the city fathers raised the rates. There was no protest. The city fathers raised the rates again, and still there was no protest. The city fathers raised the rates again, and there was no protest. After a short time, despite the fact there had been no protest, the city fathers lowered the rates one notch. Then there was a protest. All the citizens of Glasgow came forward complaining bitterly of the reduction and demanding that the rate should be put back at the high spot in order that they might save more money by walking.
Here in the central provinces the position is like that. It does not make any difference whether the rates are raised or not because the people would save money by not using the railroads, and so the companies will not do it. There cannot be any doubt, on the other hand, that any threat of this sort is a gun aimed at western Canada and, if permission to increase is granted, the gun will go off. Moreover, we are at the present time in the position of having, on the whole, about a fifteen per cent higher level of freight rates in western Canada than exists in central Canada, and so far as British Columbia is concerned the level is about twenty-five per cent higher; so that any increase which is granted, say thirty-one per cent, would be thirty-one per cent on SI in the central provinces, thirty-one per cent on SI.15 on the prairies, and thirty-one per cent on SI .25 farther west, and whereas we have already an inequitable system, the same percentage applied to different bases would naturally increase the discrimination, which is something that, as we look ahead, causes a great deal of concern.
I know a certain business institution in Manitoba with an annual freight bill, on outgoing goods, of SI,250,000 and, on incoming products, about S400.000, or a total of about $1,650,000. Half a million dollars added to that would be a great addition to the expense of doing business. Its competitor at the present time, a large competitor in the central provinces, has a freight bill which compares with the Manitoba company's bill as six compares with twelve. If the increase is granted you have in the one case a percentage increase on twelve and in the other case an increase on six. You see the great disparity that at once occurs, and that applies on everything. It is so with a pound of rice; it is so with a binder; it is so with a tractor, with a pair of shoes and a pair of shoe laces. It applies to everything. I do not know of anything that could be more inflationary than a freight rate increase. Suppose that by reason of trans-
The Address-Mr. Maybank

portation costs the cost of an article increases by one cent. In small towns, particularly mining towns, the retailer will naturally nearly always add a nickel to the price of the goods, and when that is done on every single article that people are using the effect is very inflationary indeed.
I do not think any person has yet adequately presented the difficulties in which the railroads find themselves, and I am not adequately presenting their difficulties. I am willing to take on faith that the railroads will need some kind of relief. The only point which I should like all members of the house and all people in the country to consider is just what sort of relief ought to be granted.
There is one thing I should like to warn against. Some of the protagonists for the railroads, in saying that they need some relief, would attempt to make out of their position a sort of wage claim. I know one advocate of the Canadian Pacific Railway Company, speaking at a public meeting somewhere, indicated that the freight rate question was just a wage claim. Frankly, I regard that sort of propaganda with a good deal of suspicion. I am not forgetting that the Canadian Pacific Railway Company was the only employer that did not deal generously with its employees who got tangled up in the 1919 general strike, and I am not forgetting that every effort to get them to act in the same manner as other employers was fruitless. I am not forgetting that, when they were asked to acquiesce and assist in a general inquiry into the position they had taken with respect to their employees, they turned a deaf ear to that request. The request was made by the Minister of Labour of this government (Mr. Mitchell) but the C.P.R. would have none of it, and so, when they talk about their needs in terms of the needs of their workmen, I cannot help viewing their propaganda with a good deal of suspicion.
I have dealt already with the general inequity that exists in freight rates in the country, and I wish to sav that there are a good many reasons why the prairie provinces, and British Columbia too, should not be paying to the railroad economy of Canada more than they have already, over the years, been paying. I was reminded this afternoon by a right hon. gentleman of this house that our freight rate structure has never been scientifically devised. Like Topsy it has just growed. One time a long time ago a rate was fixed and that rate became the datum. I am sure the Minister of Transport will agree with me that they used that one rate as a datum,

and from that moved on to another rate. We have never really had a scientific investigation of our freight rate structure.


Thomas Reid: All the traffic would bear.


Ralph Maybank: For a long time-and this was borne out by the statements of the hon. member for Lisgar (Mr. Winkler) a night or so ago-it would indeed appear that the charges were often levied on the basis of what they could get the shipper to pay; in other words, on whatever the traffic would bear. I think the rates should be set basically on the costs of doing business and if, when the rates have been fixed in that way, taking into consideration all things, some part of the country cannot get railroad service on the rates so levied, some method of relief must be worked out because, being the political entity that we are, we must see that decent railroad service is provided everywhere. But the first consideration should be the cost of doing business.
It costs a good deal less to operate a railroad in western Canada than it does anywhere else. This was brought out most clearly in hearings before the board in the 1920's. I shall have something to say a little later about the need of using stale figures in presenting an argument in this house. In 1925, 1926 and 1927 and perhaps some other years, the province of Manitoba was represented by H. J. Symington, K.C., in various hearings. He is now president of Trans-Canada Air Lines and a director of the Canadian National Railways. Under a searching examination, resulting from years of research and a natural acumen and aptitude for this sort of inquiry, he brought out a great many facts respecting our railroad problem, particularly as it relates to western Canada. Those inquiries showed that western Canada supplied to the railroads the major part of their net revenue. It did then and it does now. I made extensive notes of the transcript of proceedings taken at that time. I do not mean that I did it at that time; I have done it since. For example, in February, 1927, Mr. Lloyd, who was then assistant comptroller of the Canadian Pacific Railway Company, gave evidence. He said that in five years the net earnings of the railway for eastern Canada were $76 million, and in the same period in the west the earnings were $146 million. Incidentally he said that he could not think of any operating factor that was unfavourable to western Canada in a comparison of the value of the two sections.
Reference is often made to the low freight rate in western Canada on grain and flour under the Crowsnest pass statute. Mr. Lloyd said at that time that, despite these

The Address-Mr. Maybank
rates being low, they were highly profitable. A little later, Mr. Neal, who is now president of the Canadian Pacific Railway Company, said that he agreed substantially with everything that Mr. Lloyd said. He said that the Manitoba district, which runs from the head of the lakes to Broadview, Saskatchewan, was the most profitable district in the Dominion of Canada. He said that every comparison showed it to be nearest to the ideal. He also said that western Canada-that is the larger section from the lake head to the Pacific coast -was more favourable from a railwayman's point of view than the eastern part. He said that in the last four months of the year the Canadian Pacific Railway Company had moved fifty-two per cent of its total freight; that in those four months the earnings of the road were S26 million as against S15 million over the whole eight months before, and that this favourable factor was due to the western freight traffic which, as hon. members will understand, begins in the last four months of the year. He showed that the out-of-pocket expenses of the railway had been $52 million and the movement of revenue tons of freight for that amount of money had been 637,000, and that in September these revenue tons were increased two and a half times to a figure of 1,501,111 revenue tons, but the expenses went up only one million dollars. That was a case of the west paying dividends in a big way.
George Stephen, assistant freight traffic manager at that time, indicated that he was in agreement with all that had been said. From him it was learned that in 1925 the out-of-pocket railroad costs for the east were $31 million, and in the west they were $34 million; but for that difference of only $3 million there was a vastly greater amount handled in the west. For that slight difference in cost in the two sections he said they moved 8-7 billion tons in western Canada as against four billion tons in eastern Canada.
Mr. Symington also caused Mr. Stephen to show that the large net earnings over the years came from its profitable western business. The greatest proportion in earnings occurred in the last four months of 1921. Fifty per cent of the net came in the last four months. In 1922, sixty-one per cent came in that period; in the next year 65-8 per cent; in 1924 they got 59-5 per cent, and in 1925 they got 63-6 per cent. That is the story all down through the years as far as the figures carry. The earnings have been in the last four months by reason of western traffic. In other words, the west has been paying dividends in a big way over these years, despite the fact that costs have always been very
much less in carrying that business. In a period of twenty years there were $240 million of net revenue obtained in eastern Canada and $500 million obtained in western Canada.
Not only is it a fact, according to these figures, that western Canada has kept the railroad going with net revenues, but in practically every department the cost of operations was less there. We have a great many geographical disadvantages, being a long distance from tidewater being perhaps the chief, but we do have one great advantage of flat country, greater ease of building a railroad, greater ease of operating a railroad, and that is the only advantage the prairies have. An increase in freight rates tends to take away that one advantage. If other parts of the country cannot support a railroad, and1 yet a railroad is needed there, there ought to be some more equitable way of seeing that the service is given, something more equitable than imposing costs upon us who are already much more than paying our way.
In 1927 the operating costs of the Manitoba district were less than anywhere else. Mr. Lloyd said that the density of traffic out there was greater than anywhere else and that tended to reduce costs. That has always increased in favour of the west from that day on. He said that the average tons of revenue freight per loaded car mile and average tons per train mile, and the average haul were all factors more favourable in the west than in the east. He said that loadings were heavier and the average length of the train greater. Since that day, the length of the freight train has greatly increased. I know that of my own knowledge. I see trains going by now with a hundred cars. That is much more than in the years that I have mentioned. Even one hundred empty cars then was a very unusual train. The trains I see going by now are made up of cars, not of 30-ton or 40-ton capacity, but of 50-ton capacity. It is a common thing to see a hundred of them. That is the situation in western Canada. The disparity of the 1920's is greater still today. At that time the average train in western Canada consisted of 48-02 cars and, in eastern Canada, 29-20. That situation has obtained all through the years except-
Mr. SMITH (Calgary West); Does that cover the mountain section?


Ralph Maybank: The greater of the two figures I gave covers the Manitoba division. It would be somewhat less if you take in Calgary West. My recollection is-I am speaking now from memory only-that, over the
The Address-Mr. Maybank

whole, the average of western Canada was about thirty-nine as against twenty-nine in the east.


Thomas Reid: It would obtain on the Canadian National all the way through.


Ralph Maybank: I appreciate that on the Canadian National there might not be any change at all because the gradients are very much better. The witness whom I was quoting was Mr. George Stephen of the Canadian Pacific Railway Company. Naturally they would be Canadian Pacific Railway Company figures.


Arthur Leroy Smith: Is somebody suggesting that they take trains over the Yel-lowhead pass as they do on the prairies?


Thomas Reid: The grades on the Canadian National are the lowest of all Canada.


Arthur Leroy Smith: I know that.


William Ross Macdonald: Order.


Ralph Maybank: I did not get that last question, but even had I got it I might not have been able to answer it; in the second place, it may not have been desirable from the point of view of the time which would be involved in doing so.


Arthur Leroy Smith: For which I am grateful.


Ralph Maybank: There is one thing about the hon. member for Calgary West; he is always very frank. When he desires to thank any person he always does it in such a nice way, and we all love him.
A further piece of evidence showed that there were 173,000,000 freight car miles for the year in Manitoba as against 99,000,000 in Ontario.
Now, then, I did remark somewhat earlier, and somebody questioned it, that the Canadian National was not to be taken as a criterion in rate making. I believe I can indicate to the house that that is so, and I believe it is generally accepted as being the case. I believe Mr. Vaughan admitted that not very long ago in a public address. I have a large number of clippings and I am quite sure that Mr. Vaughan's statement to that effect is among them, but anyway I am quite sure it is a fact. That railroad is made up of a considerable number of lines which were built for one reason or another, very often not for economic or financial reasons. One great stretch was built for purely political reasons in connection with confederation. A whole collection of lame ducks were all shoved together and called a system. All the debts were heaped up on the new organization; and 
everybody knows the fixed charges of the Canadian National Railways are far beyond the ability of the system to pay. If the Canadian National Railways were in the United States under the interstate commerce commission it would have been run through the wringer long ago.


Mr. JACKMAN:: Your party does not agree with that.


Ralph Maybank: The Soo line of the Canadian Pacific was run through the wringer long ago and of course its fixed charges when it came out were nothing like what they were when it went in.
But if the Canadian National Railways were to be considered, the story its figures would tell as respects costs and revenue in western Canada as against those in eastern Canada would foe substantially the same as that of the Canadian Pacific Railway. That railroad in 1927 handled twice as many gross tons and had twice the revenue traffic in the west as it had in the east. On one formula one might say, if it had twice as much traffic, it ought to have a cost of twice as much, but the fact is quite otherwise. The total cost in eastern Canada for a certain amount of traffic was $101,740,000 and the total cost in western Canada was $102,220,000. That is very close to an equation, although twice as much revenue traffic was handled in the west by the Canadian National as in the east. Superintendence costs in the west were only a little higher than in the east; dispatching costs were actually less; station employees were only a little higher in cost; yardmasters and clerks were actually less; yardmen and trainmen were just on a par. I have a statement which sets forth in figures actually what all these costs were; if the house would permit it, I would place it upon Hansard, since it would probably take too long to read.


William Ross Macdonald: Has the hon. member the unanimous consent of the house to place the statement on Hansard?


Some hon. MEMBERS:: Agreed.


William Ross Macdonald: I must inform the hon. member that his time has expired.


An hon. MEMBER:: Put the rest on Hansard.


Mr. CRUICKSHANK:: The Canadian
Pacific over there have been interrupting all the time.


Ralph Maybank: Mr. Speaker, I have no wish to impose on the house, but I should be glad of the opportunity to complete the record, if I may be allowed to do so.

The Address-Mr. Maybank


William Ross Macdonald: With the unanimous consent of the house the hon. member may continue for a few minutes.


Ralph Maybank: Thank you.


Mr. MacNICOL:: He does not waste much time, so that we shall give him a little extra.


Ralph Maybank: The statement follows:
National railway handles twice as many gross tons or twice the traffic in the west as in the east. On one formula it ought to cost twice as much. Figures 1921 to 1925 are as follows, i.e., the aggregate in those years
	East	West
Superintendence 	5,348,000	5,910,000Dispatching 	3,200,000	2,300,000Station employees 	26,000,000	27,000,000Yardmasters and clerks	2,187,000	2,403,000Yardmen and trainmen..	7,600,000	7,058,000Yard enginemen	5,000,000	4,000,000.Locomotives 	8,380,000	6,000,000Train enginemen 	18,000,000	20,000,000Engine house expense ...	6,700,000	7,300,000Trainmen 	19,325,000	20,549,000Total	101,740,000 102,220,000
A system which allows of additional taxes being levied on a community which is so well paying its way at relatively low cost is not an equitable system. That is the point which I want to have well understood.
1 should like now to comment, for just a few minutes, upon the necessity there has been tonight for me to use figures of 1927, which are as I remarked, stale figures. The only reason I have presented them to the house is my confidence that they still represent the situation, although they understate the case for western Canada. The reason one must use stale figures in dealing with the costs and revenues in various sections of the country is this. About the time the facts which I have presented to the house were obtained from the railway companies, the railway companies stopped keeping their books as they had been doing and began to keep them in such a way as would prevent them ever again from being able quickly to make such a disclosure. They found out that, if they kept their books in the manner in which they had been accustomed to keep them, the same use could be made out of their figures as Mr. Symington made of them in 1927. The Canadian National Railways, the Canadian Pacific Railway Company, and, I suppose, all other railroads, stopped keeping their books in such a way as quickly to give a break-down of their revenues and their costs. Consequently, as the years have gone on we have not been able to obtain the information we used to be able to obtain. I say that I do not look kindly upon the action of the Canadian National Railways
in working out what looks to me like a scheme of that sort. It seems to me that the Canadian National railway system, owned as it is by all the people of Canada, should be prepared at all times to give that information. We of western Canada and of the maritimes are Canadians too. It is no part of the business of an organization like the Canadian National Railways, owned by the people of Canada, so to behave as to make it difficult for some of the provinces to learn just what the true situation is with reference to that railroad.


Lionel Chevrier: The hon. gentleman
knows that the instructions are to give all the information?


Ralph Maybank: Yes, I know that, and
the Minister of Transport has been very good in that respect. The Minister of Transport has indicated that it is the view of the government they ought to give all that information, and I believe instructions or suggestions to that effect have gone forward. 1 want to give him full credit for that. But giving the information when you are cross-examined is an altogether different thing from laying all the information out in a set of statistics year by year. The cross-examiner cannot begin to get the information in the way he wants it when he has to drag it out piecemeal in a hearing. My complaint is that they have not kept themselves ready at all times to give this information and that they have not filed it somewhere. Of course 1 cannot refer to the way in which they acted before the transport board in this hearing; but if you have a picture in your mind of one person dragging another along by the nose, you may perhaps not be far wrong if you label one the C.P.R. and the other the C.N.R.


Arthur Leroy Smith: This is
with unanimous consent. When is it going to end?


George Alexander Cruickshank: You can't take it.


Ralph Maybank: I think the C.N.R. is likewise to be criticized in its insistence upon haste just as the C.P.R. is in calling for haste. I am now referring to what has been said publicly at various meetings here and there all across the country.


Harry Rutherford Jackman: Five minutes.


Ralph Maybank: "We need money; quickly give it to us" is the railway approach to this whole question. I have no time to state the extent to which both railroads have improved their position in the last five years, but I know the Canadian Pacific Railway Company
The Address-Mr. Maybank

over five or six years-let us say six years-had a net, after paying all their operating expenses, of $692 million; all they had to pay out of that were taxes and fixed charges, and some of those taxes would come back to them, being refundable. I know the shareholders' equity, if you might call it that, in the case of the Canadian National has greatly increased over the years. I say that, for the officials of these railroads to cry out for haste and that they are near death, is ridiculous, with such moneys as those either saved or put into capital improvements or something similar. They are not in extremis at all. Indeed, they are very much like the camel with a well-fattened hump. As everybody knows, the camel can live for quite a considerable time on his hump. There is no reason why there should be any such great speed.


Harry Rutherford Jackman: That is the dromedary to which the hon. member refers.


Ralph Maybank: I have said this much in reference-


Harry Rutherford Jackman: Time. You cannot go on forever.


Ralph Maybank: -to the general inequity there is at the present time in the freight structure. There is the fact that it has never been scientifically worked out at any time. I should like to remind the government that in the report of the Rowell-Sirois commission it was recommended that a full inquiry be made into this subject of our railway rate structure. I know that boards of trade of different places, including Edmonton, Calgary and other cities, together with large numbers of interested shippers, have made representations from time to time that there should be a general inquiry into the matter, with a view to working out an equitable system. So I suggest to the government that, no matter what may be the decision of the board of transport commissioners, the government should first suggest to the railroad which we own that increases should not be put into effect pending a further and fuller inquiry, and that the government should now begin to plan for such a general inquiry into the rate structure with a view to finally establishing a scientific system.
In closing, Mr. Speaker, I wish to thank you and the members of the house for having granted me extra time to conclude my remarks.


Arthur Leroy Smith: In the beginning, Mr. Speaker, may I make the frank confession that, in rising to speak in this debate, what I am about to give is a sort of shot-gun speech, largely because of the 
speech, if I may dignify it by that name, to which I have just listened. I believe counsel for the Canadian National Railways has done very well, but I intend to come to that matter and deal with it in detail in a moment.
Before doing so, I wish to refer to one or two other matters. I am glad that the Minister of Mines and Resources (Mr. Glen) is now in the house, because one subject I want to mention is of particular interest to him, and when I have finished I am sure he will be my strongest supporter. You know, sir, when one takes part in the debate on the address, of necessity one's speech must be made of bits and pieces, because these great, broad subjects have been so well covered by the great orators on all sides of the house, and I do not intend to thresh any of the old straw they have left.
I turn first to something which geographically is local, but which I believe is of tremendous interest to the w'hole country. I am sorry my old friend the hon. member for Fort William (Mr. Mclvor) is not in the house at the moment, because the other day I was so pleased at his reference to the amazing effort, achievement and accomplishment of Barbara Ann Scott. I have the good fortune to know that young woman, and the greater good fortune, perhaps, of having been rather a close friend of her mother and her late father who, as hon. members know, was badly shot up in the first great war and died still serving his country as secretary to the Department of Militia and Defence as it was then known. That incident-and "incident" is a poor expression for this girl's achievement- has done something for this country which perhaps we here at least do not appreciate sufficiently. It has turned interest to Canada with respect to winter games which otherwise we would never have had. My suggestion to the minister now is that, when the next Olympic games take place, two years from next year, Banff, on the eastern slope of the Rocky mountains, should be the site of the winter Olympics.


Some hon. MEMBERS:: Hear, hear.


Arthur Leroy Smith: Somone may say I must have had a good majority in Banff.
I did, and I hope I always shall. The point I have in mind-and I have ample authority for what I am going to say-is that nowhere else in the world, Switzerland, Austria or anywhere else, are there snow conditions for skiing and all the other events of that type-such as we have on the eastern slope of the mountains, right in the town of Banff, in our national park. And we own that place; the Dominion of Canada owns that park. No

The Address-Mr. A. L. Smith
private organization in the world is capable of staging the winter Olympics. I have visited Lake Placid, where they had the winter games the last time they were held on this continent. It is not even comparable with Banff. The minister is a Scotsman, though perhaps not from the same place as the hon. member for New Westminster (Mr. Reid). I know Scotsmen vary, and I say to him: do not let us be afraid of a little bit of expense. I have learned that the construction of the bobsled run costs the most money. That rather surprised me, but it is the simple fact. Can you not conceive, Mr. Speaker, that if we could get those Olympic games for this country, then the whole mountain area from Coleman clear up through Banff to Jasper would become a winter mecca for millions of people from whom-and I hate to put it on this basis-we would get revenue; dollars, United States dollars and all the other kinds of money people might have. The accommodation situation can be overcome.
I am sorry the hon. member for Winnipeg South Centre (Mr. Maybank) is not here at present, because I wanted to talk to him about these railways, but the C.P.R. hotel could be kept open in the winter, and nowhere in the world could they do better. I have authority for this statement, and my authority is the hon. member for York West (Mr. Adamson) who, though perhaps the house may not know it, is one of the best known of international skiers. That is a simpie fact; though I want you to observe, sir, that in speaking of him in that way I used the "k" pronunciation rather than the "h".
I leave that and come to something I wish to say to the Minister of Justice (Mr. Ilsley), and particularly to his predecessor in office. I think, in the appointment of judges we have embarked upon a procedure that drives at the whole integrity of our judicial system. I refer to the promotion of district, or as people in the east call them, county court judges to places on the supreme court bench. In Alberta three of the last four appointments were made in this way; it has been commenced in British Columbia, where two such appointments have been made, and now we have one in Saskatchewan. In all seriousness, I say that has made a politician of every district or county court judge in the whole of western Canada; that is what has been accomplished by that procedure. Let no one think I am saying one word against the men appointed. In my owm province I know the three men well; they are excellent men and good lawyers. But the system is being attacked. If we are to do things like that and have promotions, let us elect them as they do in the state courts of the United States. But when we give a man
a job on the bench, be it district or supreme court, let him know he has nothing more to expect anywhere, so that in probity and honour he will carry out his duties and we shall not have what I say is now the case, the suspicion that a man in a lower judicial position is seeking advancement for politicial reasons. That is all I wish to say on that point.
I now come to the business of freight rates, and I trust I may be as successful in skating around this thing as was the hon. member for Winnipeg South Centre. As a matter of fact, when it came to skating around those brittle edges, Barbara Ann Scott had nothing on him.
Let us look at this whole freight rates situation sensibly. But before I say anything more, may I say this: You, sir, and the house, will discount what I have to say in this regard. I have acted for both those railways in southern Alberta for over thirty years. I say that. And if, by that, you think I am prejudiced in my views, then I am afraid there is nothing I can do to help myself or to help you. But I intend to discuss something which ought not to have been raised here, and that is the advocacy of the C.N.R. position as opposed to that of the C.P.R., as outlined by the hon. member who preceded me. I act for both railways, and I think I therefore might be credited at least with fairness in what I have to say with respect to that.


Ralph Maybank: Rising to a point of order, I do not think the hon. member will object, but if there is any objection I will, of course, yield to him. My hon. friend, I am afraid, has misunderstood me. I did not intend to make a comparison of one with the other. I was only desiring to point out that, the nature of the two companies being different, one of them cannot be taken as a criterion in fixing rates. I did not mean to make any comparison between the two of them, either as to their excellence or otherwise. I do not know whether the hon. member thought I did. But I am sure he will be glad to have me point out that such was not the intention.


Arthur Leroy Smith: May I say that I am glad of the interruption and the explanation given. But he began his speech by saying this, that the present application before the railway board was in fact a C.P.R. and not a C.N.R. application.


Ralph Maybank: No, I did not say that.


Arthur Leroy Smith: It is quite untrue and thoroughly false.


William Ross Macdonald: Order.


Ralph Maybank: I did not say that.
The Address-Mr. A. L. Smith


William Ross Macdonald: I was not in the chair at the time the statement was made. But may I suggest to hon. members that any reference to the present application to the board of transport commissioners is entirely out of order, and if reference has been made it has been entirely irregular.
Yesterday I referred hon. members to the rules of the house. It is clear that the board of transport commissioners is a court of record, and that any reference to an application before a court of record, while the application is being heard, is out of order.


Ralph Maybank: Anyway, I did not say that.


Arthur Leroy Smith: May I say this to Your Honour, that I bow to your ruling, but I hope, being the good lawyer that you are, you will bear in mind this fact, that the board of transport commissioners being a court of record, the only thing which may not be discussed is the evidence and argument used before that board. Beyond that, the house is certainly wide open to go.


George Alexander Cruickshank: We will support you in that.


Arthur Leroy Smith: If I am wrong about that, I will bow to your ruling, sir, and I have no intention of discussing either the argument or the evidence heard before that court of record.


William Ross Macdonald: I cannot make a ruling different from that I have already made, which is that any reference to the application now being made before the board of transport commissioners is out of order. A general discussion on freight rates is, of course, in order. A discussion as to the discrepancy between the rates charged in the east and those charged in the west would be in order. A discussion of freight rates, as they affect the general economic conditions in our country, would be in order. But a discussion here of what is taking place before the board of transport commissioners is definitely out of order.


Arthur Leroy Smith: Then, sir, I think you force me into devious ways. I want to assure you that anything I say about freight rates is based purely on a suppositious case that some of us may have heard about, here or there.
However, dealing with this whole question of freight rates, to a large extent I want to agree with what was said by the hon. member who immediately preceded me. He said, in effect, that our whole freight rate structure just grew, like Topsy-and it did.

There is not any doubt about that. I know now that they use a new word, but the fact is that our whole structure is built on what the traffic will bear. It may be that I shall lose a couple of clients when I have finished this speech, but I intend to say what is in my mind.
Eor example, a couple of years ago I remember dealing with the Canadian National Railways with respect to freight points equally distant from Edmonton. One was Cadogan on the coal branch, and the other was Drum-heller. I was acting for a labour union which was protesting about both express and freight rates to Cadogan. It will be remembered that between Edson and Cadogan there is no highway. There the rates were substantially two to one. The reason given was that there was truck competition to Drumheller, whereas there was no truck competition to Cadogan.
Let no one think for a moment I am attempting to destroy anything. That condition arose through necessities which developed from year to year. We all know the effect of the Panama canal. We all know that these people from British Columbia, who have been complaining, had their rates to Vancouver cut when the Panama canal was built. We all know that you can ship cheaper from here to Vancouver than you can to Calgary.
It seems to me the Spokane decision in the United States is one which might well be adopted. In effect, it says that there shall be no greater charge on any line of railway for a short haul than for a long haul. I believe, if we followed that, many of our difficulties would be cured. And when I say that I am far from saying that, if I were to ship from here to Prescott-is that on the main line?


An hon. MEMBER:: No.


Arthur Leroy Smith: Well, I do not see our whip at the present time. I do not say that if I ship on the main line for only a few miles, having regard to handling charges and the like, I should simply take the rate to Vancouver, divide it and, having in mind that Prescott is sixty-five miles from here, or whatever it is, that I should pay that part of the rate. That would be utterly silly.
But I go along with the hon. member for Winnipeg South Centre; and go a little farther and say that no railroad in Canada knows what it costs them to haul a ton of freight from that end of the room to this end, or from here to Toronto, or any other place.
This just arose through the development of a country; and the freight rate structure was built on that basis. The hon. member for Winnipeg South Centre told us about a great

The Address-Mr. A. L. Smith
man called H. J. Symington who is now out of railroading and is making flour and flying aeroplanes around the country. And he overlooked myself. I appeared before the board on one occasion in Ottawa. I was endeavouring to find out what it cost to haul a ton of coal from Drumheller, first to North Bay and, second, to Toronto. My experts were not very expert, and I was left almost alone in the picture. The C.N.R. brought a gentleman from the United States of America, and that was the first time I had ever heard anyone described as a railway cost accountant. There were only six of them in the world at that time, and they had all been produced by the interstate commerce commission of the United States. That same gentleman today is vice-president of the Canadian National Railways, an able executive and a very fine man. We decided that we would exchange brief's beforehand. Mr. Flintoft of the Canadian Pacific and Alistair Fraser for the Canadian National were acting, so I said, "Yes, we will exchange briefs." I saw my expert and he said, "We cannot exchange." I asked why and he said, "Because ours is all wrong." So I was kind of on my own when we got before the railway commission.
I want to point out how they found the cost of hauling a ton of coal from there to Toronto. In that cost I found something which I think is highly amusing. The hon. member for Winnipeg South Centre, who knows a good deal about railroading and who is an expert on the 1919 strike, tells me-and I was glad to have him do so-of the change in the tonnage of cars and in the loads that engines can now pull. The railroad said that they had to ship these cars back to Drumheller empty. That is quite true; that is not even arguable, because practically all cars, in any event over ninety per cent of them go back to Fort William empty. One of the charges they showed in making up their costs of hauling a ton of my poor Alberta coal was the extra shaking their steel bridges would get by hauling the empties back over them. That is what you get in cost accounting when you try to find out what it costs to move a ton of this or that from here to there.
I think they have made considerable advance in the United States in their effort to find a more scientific basis for the haulage of freight. I agree entirely with the hon. member in that. It seems to me that the time has come when we might have a complete revision. The railway board has not authority to do this and the last time it was tried by the parties appearing before the dominion cabinet. I will admit that in those days the cabinet ministers were not the hard-worked gentlemen they
now are. They lived longer; in any event they seemed to get along. I remember the late Sidney B. Woods of Edmonton appeared for those of us out there, but what happened was that today you would have three ministers, and the next day you had three other ministers. There was no consistency or continuity ir the whole picture. I am not blaming the cabinet ministers at all, but we had no way of achieving that consistency or continuity.
I do not agree with the hon. member for Winnipeg South Centre when he said a moment ago that somebody had changed his method of bookkeeping to keep the facts from the Canadian people. I agree heartily with the Minister of Transport (Mr. Chevrier), who endeavoured to correct the hon. member with respect to that. Here is the picture in so [DOT] far as freight is concerned in this supposititious case which I have in mind. A railway is asking for a 100 per cent increase in its freight rates. Obviously that has nothing to do with a case where they are asking for only thirty per cent, and so I am within Your Honour's ruling. Perhaps I am outside your ruling, well outside.
What are the simple facts of this whole story? Granting that the railroads were not profiteering before, they cannot continue, without some additional revenue to pay the tremendous increases in wages that have been granted. Let me say for railway labour that that was done without a strike; it was done without a lot of nonsense; it was arrived at more or less by agreement. The railroads cannot do that and carry on unless they were profiteering before. I know how unpopular it is for me or anyone else to say in this House of Commons that the railways need more money to carry on. But I do say it, and I say it because I believe it. I mean it, and anybody who does not like it can just adopt his own course because I am adopting mine.
Whether the railway is given a 100 per cent increase or any other percentage, in my supposititious case, I do not care, but I know it needs revenue to meet the extra expenses. I also know everyone who has spoken over here and there knows that what we need to be concerned about is not so much a small increase in the revenue as the equalization of freight rates. All of us from the west will agree with that, and I am certain that no one in Ontario-what do you call these provinces, the middle provinces?


An hon. MEMBER:: The great provinces.


Arthur Leroy Smith: Some one says "the great provinces". That may be so, but some of their sons are not nearly as great
The Address-Mr. A. L. Smith

as the provinces. I have never known the provinces of Ontario and Quebec to refuse to accept a fair proposition. I do not think you can go to one line and say, "You have earned so much money." We know that certain railway lines lose money and yet, for our economy and for the convenience of our people, we insist that the railroads operate those lines. Those of us who live in certain parts of the west know perfectly well that, while we may be dissatisfied with the service we get, the service we are getting is not a paying one. But being a dominion undertaking, being a country like Canada, the fat must go with the lean, and so we have that situation.
I am coming now to the Canadian National. May I say that I have not been only their counsel but their solicitor. I am not getting wealthy out of it, because I telephoned my office yesterday and found that last year I got $300 from one company and $1120 from the other, and I think that was a disbursement. I just wanted to make my position plain. What we need is this: we should find out what revenue is necessary to carry on.
I am sure that every hon. member in this House of Commons will agree that we cannot have our railroads go broke. If they go, our whole economy is gone. There is no question about that. Let us be fair about this thing. Let us see if they need $2 or $10 or $10,000,000. Ten million is not very large. We ship that down to some of the coal mines in the district of the hon. member for Cape Breton South (Mr. Gillis) every year. No matter what it is, it is essential for our economy that they operate and operate profitably. May I agree with what has been said by my hon. friends to my left and by the hon. member for Winnipeg South Centre. We feel that we must pay our way, that we must keep these transportation systems operating, even though in a particular area it does not pay back all that the railroad puts in. We think we are entitled to equalization, and equalization will never be possible until we find the amount of revenue necessary for them to carry on.
The Canadian Pacific was the one who paid me $11.20.


An hon. MEMBER:: They overpaid you.


Arthur Leroy Smith: I think I had better find out what that was for. It must have been a disbursement, for I cannot imagine my working for as little as $11.20. What we need is equalization; let us be realistic about the matter. Let us realize that the railroads must have enough money to carry on. Let those of us who come from distant parts of the country, both the maritimes and in the west, suggest kindly but firmly that we

think that, even though here you are meeting truck competition, you still should bear your share, and that we should not bear the unequal burden which has been so forcibly and plainly put by my hon. friend who preceded me and by hon. members to my left.


Mr. H. G. ARCHIBALD (Skeena):: Mr. Speaker, the speech from the throne does not offend me, because I now realize that it was meant to be meaningless anyway. All that can be said about it is that it is a nebulous mass of verbiage with no content, a very poor legislative diet for the Canadian people. Its ineffectiveness can be surpassed only by the stand taken by the official opposition, whose intellectual bankruptcy has reached a point where they lack the faculty to disclose an alternative to the policies which they condemn.
This year has been described as year two of the atomic age, and in that respect highlights the fact that wre are living in an age of rapid change and crises. The storm warnings stand out clear and sharp. The agreed decision of the official representatives of seventeen governments at the preparatory' commission on world food proposals is that, unless the nations of the world undertake as part of their national policies a quick expansion in the production of food and goods, they will walk straight into a worse collapse than that of 1929 to 1932. The considered judgment of these representatives of seventeen governments, including those of the United Kingdom, the United States and Canada, is that, unless all nations increase consumption in an expanding economy, they' are heading for a disaster greater than that of 1929 to 1932. In the face of this, how has the Liberal government reacted? Is it pressing and leading this country into what could be economically called a dynamic economy? Perhaps it might be best described in these words:
Certainly that Liberalism which nearly a century ago moved men's hearts and minds towards ideas of freedom and social justice, towards the defence of ethical ideas and of trust in the people, has not died out. On the whole there is as much of the genuine product in the world today, perhaps more. But it has escaped from the bonds of party. It has entered into new forms and conceptions of human liberty on a world-wide scale. And nearly everywhere the parties that once embodied and expressed it, no longer do so adequately. Today, Liberal parties, if they exist at all, are fighting a rueful retreat which may not be their fault, but whatever the reason, the fact remains. There is a political moral in this and it would seem to be that in an ever-changing world parties which do not evolve new applications of their established principles find themselves superseded by those which do.

The Address-Mr. Archibald
Those are the words of an editorial in the Ottawa Citizen of February 6, under the ironic caption "Splendid Isolation".
This position of the present government was further emphasized by the Minister of Agriculture (Mr. Gardiner) when he stated that, if capital did not industrialize the west, the people would. That, coming from a cabinet minister representing a responsible government, shows a lamentable lack of leadership in the age in which we are living, with the necessities that are staring us in the face. Yes, we must accept new principles to avert catastrophe. It is useless to speak of adequate old age pensions, adequate health insurance, and a planned immigration policy unless we revitalize our economy to show the people that we can have continually higher standards of living along with a large increase in population. The law of diminishing returns has so caught up with us that private capital will no longer take the risks necessary to develop our frontiers on the colossal scale necessary to maintain a dynamic economy. History has shown us time and time again that nations which settle back into a, state of self-complacency are wiped out and obliterated by people who require more living room. This law of the jungle is still apparent in this world today; and all the plans of standardizing arms, establishing larger national defence organizations, et cetera, will be of no avail unless we can show that we are vital and alive by having a firm growing economy in which we have complete faith.
There was a time when this country was vital and alive. When I look back through the paper of 1910, I run across these headlines: "Telegraph Line to Stewart", "Railroad at Mile 45", "Sir Ernest Shackleton heads English Company to develop the falls of the Bulkley river for power project", "Company is ready to build road from Vancouver to Alaska and confers with Premier McBride", "Mining crews go into the Groundhog coal fields", and many similar ones.
No such headlines are in our paper today, but rather the very opposite. We live in fear of depression. The events of the past year or two should be a lesson to us. We read of terrific shortages in other countries caused by the crises of war or from the lack of development during the thirties. That could very well arise in this country in the immediate future, and yet no plans or no lead is given by the government of the day to avert this condition. We read1 that four million were unemployed in Great Britain because of a shortage of coal. We, too, have suffered from a shortage of coal just in the last year, but of course not
in the same proportion. But a shortage could arise again and be of far more drastic proportions. In 1939 we spent $45'5 million on the import of coal from the United States, and in 1946 we spent 8131-2 million on importing coal from the United States. Coal is the backbone of our industrial economy even yet. If our economy is to expand, the western regions must be industrialized, especially the west coast; yet the resources of coal, the very backbone of that industrialization programme, are being depleted to the vanishing point.
The Carroll commission on coal has this to say about the two main fields on Vancouver island:
Mining has been carried on in the Nanaimo field for more than fifty years and most of the known available coal has been recovered. Recent investigations of the geological survey indicate that the reserves in the area are only sufficient to allow operations to continue at the current levels of production for from ten to fifteen years. This is confirmed by the estimates of reserves submitted by the Canadian collieries, Dunsmuir Limited. The mines in the Cumberland area have also been worked extensively and all easily available coal has been mined.
That is the position of coal mining in the two main fields on the Pacific coast. There are other fields open for development within 150 miles of tide-water and that coal is anthracite, the only anthracite in any quantity west of Pennsylvania. I am referring to the Groundhog coal field of central British Columbia.
Mr. G. S. Malloch spent some time in the Groundhog field during 1912, for the federal Department of Mines, and he made a report which can be found in the sessional papers of 1912: 26 to 26A, No. 19. On page 87 of this volume, under the heading "Character of the Coal", Mr. Malloch had this to say:
The character of the coal differs essentially from any hitherto described. It is anthracite, non-coking, and contains exceptionally high percentage of moisture. In many cases, the coal has a resinous lustre which is usually found in lignitic coal, and very likely the high moisture produces this lustre.
While in the field, he investigated the properties of the Western Development Company, the British Columbia Anthracite Syndicate and the British Columbia Anthracite Company. These companies, at that time, had claims staked in this area. In this report he has detailed data on the various seams he investigated, width of seams, moisture content, ash, fixed carbon, et cetera. He also gives descriptions of the structural geology of the area, description of the coal out-croppings and a description of the routes which a railroad would have to take to enter the field.
In 1921, evidence was given before a special committee of the House of Commons at
The Address-Mr. Archibald

Ottawa, named to inquire into the fuel supply of Canada. This evidence was given -by Mr. J. G. Scott, an official of the B.C. Skeena Coal Company, controlling 34,000 acres of anthracite coal lands situated at Groundhog mountain, British Columbia, on the head waters of the Skeena river. In appealing for aid for the development of this coal field he had this to say at one point:
I think this is a national project which is well worth the attention of parliament and if it could be realized, and I am sure that it will be realized. I believe it will cause the reproduction in northern British Columbia of all such industries as are caused by or have resulted from the development of similar classes of coal in Pennsylvania.
There are three routes by which a railway may reach the field. First, a branch northward from Hazelton on the Canadian National Railways which would follow the valley of the Skeena river, a distance of about 150 miles. Second, a route for which an independent railway once had a charter, from the mouth of the Naas river on the Pacific coast a little north of Prince Rupert to the coal field, a distance of 180 miles. The dominion government voted a subsidy of 1640.000 in 1912 to the company which was going to build a railway on this route. Third, an alternative line could be built from the -Mice Arm or Stewart on the Portland canal, a distance that way of a little over 100 miles. These are the three routes by which this coal could be moved.
Mr. Scott, further in his evidence, pointed out that just prior to the 1914-18 war, he had correspondence with Lord Rhondda, the coal baron of Great Britain, about the Groundhog coal field. Lord Rhondda was so interested in this matter that he took an interest in the company, of which Mr. Scott was a member. With the outbreak of world war I, Lord Rhondda's interest was, of course, discontinued and he died shortly afterwards.
Mr. Scott, under questioning of Mr. Douglas, then a member of parliament for Cape Breton, revealed a -report of a Mr. Gustav Grossman, a Pennsylvania engineer, who examined the field. Mr. Grossman had this to say:
During my visit to the Groundhog mountain coal field from May until October, 1912, for the purpose of investigating its economic value as far as an exhaustive superficial examination and inspection of its various exploration workings could disclose, I also examined among others, holdings of your syndicate. Without going into details as to geology, transportation facilities, et cetera, a general synopsis of the merits of your property may be given as follows, forty-seven sections, 30,080 acres, situated 56 degrees, 45 minutes north latitude and 128 degrees -15 minutes west longitude, in the west portion of the Groundhog mountain coal field, a considerable portion of which is favourably located, and 
containing coal seams of superior quality and of workable dimensions. Number of workable seams uncovered, six, with an aggregate thickness of 28 feet. Quality of the coal, anthracite, very bright and hard and of excellent steaming quality, comparing favourably with the Pennsylvania product.
Mr. Scott, further in his evidence stated:
No extraordinary or unusual engineering difficulties will be encountered in the opening up of this property, which should be capable of producing a large daily tonnage of a superior quality of fuel and I would consider the development of this group of coal claims an inviting business proposition which should be attractive to investors. There is no coal mine in the Dominion of Canada which is of the same or similar quality as this, either in physical or economic properties, and so far no such coal has been discovered in commercial quantities in the dominion. Practically speaking, there is no anthracite west of Pennsylvania in the United States. Judging by the amount of Pennsylvania anthracite that is used in the United States and Canada, it may readily be seen what a gap in the coal supply in the west will be filled by the opening of this field. The smokeless character of this coal should open for it a large market in the coastal cities, where the smoke nuisance is prohibited. Its cleanliness for household use and its steady burning properties should bring it into general use for domestic purposes. In illustrating the comparative importance of such an area as this, it may be stated that this area alone probably contains as much coal, possibly ten times as much, as is found in all the present known coal areas in -the province of Nova Scotia.
Mr. Mackenzie, then member of parliament from Nova Scotia, had this to say on the latter's statement:
I am afraid that damns that report very badly. This is a hint to you that I am from Nova Scotia.
Mr. James McEvoy, geological and mining engineer, formerly a member of the staff of the geological survey of Ottawa, had this to say:
I have no doubt that a large market can be found for this coal and at good prices. The domestic market will be the most important at first and as the coal is practically smokeless and will not make dust and dirt all over a house, as the soft coals of the west invariably do, it will be self-advertising.
The quantity of coal in this great field has not been computed. Two experienced mining engineers who examined forty-seven square miles of the territory, owned by Quebec and London capitalists, estimated that on the
30,000	acres in question there were one billion, one hundred million tons of coal.
At the present time, all licences and leases have expired in this area. There are no existing alienations. Therefore a government which is increasingly becoming concerned with the lack of industrialization in the west could afford to survey this whole area for

Barbara Ann Scott
development of its coal resources, as well as other resources that could be tied in with the development of the coal field of this area.
Our economy under present conditions consists of a series of economic islands, each functioning within itself, but deprived of its full, measure of success, owing to the lack of a balanced over-all industrial policy. Instead of our economy expanding and developing toward the maximum self-sufficiency, we are drifting more and more toward becoming a colony of the United States. This tendency must be checked and I would urge the government, as one step away from this drift, to survey and open for development such resources as are found in the Groundhog coal field. It will save needless confusion and suffering when the time comes for us once again to wake ourselves from our lethargy.
This area, known as the Groundhog region, would be intersected by the highway from Hazelton to Whitehorse, which has caused so much international conjecture, in both military and civilian circles. This Hazelton project would give access and outlet to many billions of feet of merchantable spruce and hemlock and other timber suitable for lumber and also for mining props.
The coast range carries the same geological formation on its eastern flanks, as at the Premier mine above Stewart, on its western slope. There is room for and the probability of the discovery of several Premiers, as well as the coal field that I have mentioned, on these eastern flanks, which are at present inaccessible, or practically so. Laterals from the Hazelton route would give access and outlet. The benefits to the development of this area, both as to economic resources and means of transportation, would develop great industries on the coast, and the beneficial influence would be felt from Frisco to Vancouver to Nome.
The agricultural lands of the Naas river, with its soft, healthy climate, are eminently suitable for settlement. With mining and logging underway, there would be unlimited markets for all produce. This portion of road to the Yukon and Alaska, the Hazelton-White-horse project, is a big undertaking in itself, but it is a mere gateway to infinitely vaster possibilities.
On motion of Mr. Castleden the debate was adjourned.



CURLING


Mr. JOHN BRACKEN (Leader of the Opposition):: Mr. Speaker, before the house adjourns, may I be permitted to take just one minute. As a number of hon. members know,
there have been taking place in the city of Saint John during this week games for the curling championship of Canada. The last game took place today. The championship was won by a young man and his associates from an important city in a great province in the great country of Canada. The winner was Mr. Jimmy Welsh of Deer Lodge club, Winnipeg. I may add that he was successful in winning nine victories out of nine games played.


[Stage Direction]
At eleven o'clock the house adjourned, without question put, pursuant to standing order.
Friday, March 7, 1947