1948-02-20

[Stage Direction]
Hon. MILTON F. GREGG (Minister of Veterans Affairs) moved the first reading of Bill No. 60 (from the senate) to amend the Veterans Insurance Act.
Motion agreed to and bill read the first time.


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Bill No. 61, for the relief of Simone Boily Whitelaw.-Mr. Mavbank.
Bill No. 62, for the relief of Ernest Alfred Coker.-Mr. Maybank.
Bill No. 63, for the relief of Clarence William Henry Hodgson-Mr. Maybank.
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Business of the House
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Bill No. 64, for the relief of Vera May Paulson Ward.-Mr. Maybank.
Bill No. 65, for the relief of Ruth Ethel Attwood MeVicar.-.Mr. Maybank.
Bill No. 66, for the relief of Henry George Halsey.-Mr. Maybank.
Bill No. 67, for the relief of George Crosby-Wilson Gray.-Mr. Maybank.
Bill No. 68, for the relief of Joseph David Ernest Paul Maysenhoelder.-Mr. Maybank.
Bill No. 69, for the relief of Myrtle Macdonald Heale Daniluk.-Mr. Maybank.
Bill No. 70, for the relief of Robert Grincill Barnet Jones.-Mr. Maybank.
Bill No. 71, for the relief of Gertrude ' Katherine Margolis Bird.-Mr. Maybank.
Bill No. 72, for the relief of Cecilia Maud Wood Marshall.-Mr. Maybank.
Bill No. 73, for the relief of Beatrice Doris Haggerty Goodier.-Mr. Maybank.
Bill No. 74, for the relief of Joyce Knowles Ledoux.-Mr. Maybank.
Bill No. 75, for the relief of Robert Ernest Beadie.-Mr. Maybank.
Bill No. 76, for the relief of Grace Davis Park Parr.-Mr. Maybank.
Bill No. 77, for the relief of Jeanne Crete Benoit.-Mr. Maybank.
Bill No. 78, for the relief of Sarah Cummings Menzies Carlin.-Mr. Maybank.
Bill No. 79, for the relief of Annie Golden-berg Schulman.-Mr. Maybank.
Bill No. 80, for the relief of Clarice Jean Field Campbell.-Mr. Maybank.
Bill No. 81, for the relief of Georgina Claire Williscroft Bovard-Mr. Maybank.
Bill No. 82, for the relief of Saul Jack Costin. -Mr. Maybank.
Bill No. 83, for the relief of Mary Shore Bernstein.-Mr. Maybank.
Bill No. 84, for the relief of Saul Ettinger.- Mr. Maybank.
Bill No. 85, for the relief of Lloyd Arthur Davies.-Mr. Maybank.

Right Hon. W. L. MACKENZIE KING (Prime Minister):: I might say just a word, Mr. Speaker, about the resolution respecting the setting up of a special committee to consider with His Honour the report that was laid on the table of the house with regard to procedure. If there is no desire to debate it, it might pass immediately. That would enable the committee to function immediately. If, however, there is likely to be a debate on the resolution, it had better stand until later.


Mr. JOHN BRACKEN (Leader of the Opposition):: We on this side of the house are prepared to support the resolution in all except one of its details. The leader of the official opposition will be unable to act, but in his place I suggest the hon. member for Peel (Mr. Graydon). I support the resolution and ask that the change I have suggested be made later on. We think the proposal is a good one. We shall do all we can to improve the procedure of the house through this effort.


Mr. ANGUS MacINNIS (Vancouver East):: We have no desire, Mr. Speaker, to debate this matter at the present time. As the leaders of parties are busier than ordinary members, the leader of this group may not be able to act at all times either.
Mr. SOLON E. LOW (Peace River) : We do not wish to debate the resolution. I suggest to the Prime Minister that he proceed.


William Lyon Mackenzie King: That a special committee, consisting of Mr. Speaker, Messrs. St. Laurent, Claxton, Bracken' Coldwell and Low be appointed to consider the report on the procedure of the House of Commons of Canada laid on the table of the house December 5, 1947, and to report to the house thereon.
It is understood that when this motion carries, substitutions will be made for one or more of the names that appear in the motion.


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Motion agreed to.
Hon. LIONEL CHEVRIER (Minister of Transport) moved:: That the name of Mr. Graydon be substituted for that of Mr. Bracken on the special committee appointed to consider the procedure of the House of Commons.


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Motion agreed to.


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Right Hon. W. L. MACKENZIE KING
(Prime Minister): This might be an appropriate moment to mention, if the house will permit me to do so, Mr. Speaker, that in the event of the proceedings of this session not being concluded on or about the end of the month of June, the government has decided to ask and will ask for an adjournment of parliament over the months of July and August, to resume in September.
Mr. GRAYDON:: May I ask the Prime Minister if there is any special reason for the adjournment that he would like to divulge to the house?


William Lyon Mackenzie King: It is much in the public interest.

Inquiries oj the Ministry



HARBOUR COMMISSIONS


[Stage Direction]
Hon. DOUGLAS ABBOTT (Minister of Finance) moved that the house go into committee at the next sitting to consider the following resolution:
That it is expedient to present a bill to provide for the refunding of certain debentures of the New Westminster harbour commission; the government guarantee of substituted securities therefor, and the making of loans out of the consolidated revenue fund to redeem securities that may be refunded.
He said:	His Excellency the Governor
General, having been made acquainted with the subject matter of this resolution, recommends it to the consideration of the house.
Motion agreed to.


Mr. ALISTAIR STEWART (Winnipeg North):: I should like to direct a question to the Minister of Labour. Can he give the house any information as to the dismissal of workers by the Robert Simpson Company in Toronto and their replacement by British workers hired by the same company in the United Kingdom?


Hon. HUMPHREY MITCHELL (Minister of Labour):: I have had inquiries made and the assurance is given by a director of the Robert Simpson Company Limited, under whose jurisdiction the personnel department falls, that not one employee has been dismissed to make places for others hired in the United Kingdom or who have been taken on from amongst those recently arriving from the United Kingdom. There was a report that a painter employed by the firm had been dismissed to provide a job for a British immigrant. I am informed that the man was dismissed because he was not capable, and that officials of the union to which this man belonged are quite satisfied as to this.
Might I say this, Mr. Speaker, moving as we are into a period when immigration will accelerate, I hope that nothing that is said or done in this house will re-create the conditions we experienced when I first came to Canada-"No Scotsmen or Englishmen need apply."



CANADIAN ARMY


Mr. J. A. ROSS (Souris):: I should like to direct a question to the Minister of National Defence. In view of the answer given the hon. member from Nanaimo on Wednesday, February 18, that Canadian soldiers who fought in the Pacific did not receive the special Pacific pay while those in training in the United States did, will the government now grant this Pacific pay to the survivors of Hong Kong?


Hon. BROOKE CLAXTON (Minister of National Defence):: I should say, Mr. Speaker, that this question was given most serious and sympathetic consideration immediately after the survivors of Hong Kong returned to Canada. At that time representations were made to the government by a number of members, among whom were the hon. member for Spadina (Mr. Croll) and the hon. member for Essex West (Mr. Brown). Later on questions were asked which resulted in an order for return being made on May 28, 1946, when the matter was again re-examined. An answer was also given this week. In view of the fact that the Pacific rate of pay was made applicable only to members of the Pacific force, it is felt that it would not be justifiable to extend it to those who served in that theatre under quite different conditions and at an earlier date.


Gordon Graydon: Under terrible conditions.


Mr. G. R. PEARKES (Nanaimo):: I wish to ask a question which is supplementary to the one asked by the hon. member for Souris (Mr. Ross). Can those men who served in No. 1 special wireless group in the Pacific be considered eligible for the Pacific pay? If not, would the minister, in order to avoid any misunderstanding, change the name "Pacific pay" to "American pay"?


Brooke Claxton: I believe the question just asked by my hon. friend has been raised on the defence estimates and on a number of other occasions, and there is no change in the answer then given.



HOUSING


Mr. H. G. ARCHIBALD (Skeena):: I should like to ask a question of the Minister of Finance. Is it the government's intention
Inquiries of the Ministry

wherever it occupies the position of landlord to raise rents in all parts of Canada? If not in all parts, where?


Hon. DOUGLAS ABBOTT (Minister of Finance):: So far as I know the government has given no consideration to the question raised by the hon. member.



INCOME TAX


[Stage Direction]
On the orders of the day:
Hon. J. J. McCANN (Minister of National Revenue):: Yesterday the hon. member for Dauphin (Mr. Zaplitny) asked this question.
Has the minister received any representations from the Manitoba teachers' society, or teachers' organizations in other provinces, in connection with deductions from taxable income of expenses incurred while taking summer school courses? If so, is the minister prepared to give consideration to their request?
I promised to give an answer today. According to my office I was correct when I said no representations had been received from the Manitoba teachers' organization, but we have received representations from other teachers' organizations, the Ontario teachers' association and the Canadian federation of teachers' associations. The answer given them, which still holds, is that expenses incurred in attending conventions are not a deductible expense for income tax purposes.	.


Mr. ZAPLITNY:: The minister refers to expenses incurred in attending conventions. My question had to do with expenses in connection with summer school courses. I am not sure whether the minister understood me.


James Joseph McCann: The same decision applies.



VETERANS AFFAIRS


[Stage Direction]
On the orders of the day:
Hon. MILTON F. GREGG (Minister of Veterans Affairs): On Monday last I promised that by the end of this week I would give a progress report on the preparation of legislation affecting veterans affairs. As will be noted, the resolution dealing with amendments to the Pension Act is in Voters and Proceedings today and will be on the order paper Monday. A similar resolution dealing with war veterans allowances will follow very shortly thereafter.

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On the orders of the day:
Mr. DONALD M. FLEMING (Eglinton): May I ask the minister if he is now in a position to answer the question submitted to him on January 27 last? It appears at page 591 of Hansard as follows:
In view' of the revelations in the public accounts committee last summer iin connection with the administration of the Veterans Land Act, will the minister be prepared to submit this question to the public accounts committee before the ultimatum issued by the department is pressed . . . ?
The minister indicated that he would consider the point and answer it later. The following day, January 28, the question was repeated at page 637 of Hansard, as follows:
Is the minister in a position now' to answer the question I asked him yesterday w'ith reference to submitting this whole question'-
That was the Veterans Land Act administration.
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to the public accounts committee or a royal commission ?
The minister answered:
I am not in a position to answer that today.
Will the minister indicate when the house may expect an answer to this question?
Mr. GREGG:: As soon as possible.



HONG KONG


[Stage Direction]
On the orders of the day:
William Lyon Mackenzie King: Some days ago my hon. friend the leader of the opposition (Mr. Bracken) asked me about the tabling of the evidence taken by the Hong Kong commission, and I replied that before giving an answer as to what the government might decide to do in that matter I wished to communicate with the British government in order to obtain their views. A little later I will be glad to give the house the views of the British government on the matter, but I wish to show the leader of the opposition a cable I have received in reply before I make a public statement. The communication was received only yesterday, so I have not been able to bring its receipt to the attention of the house before today.


Gordon Graydon: May I ask the Prime Minister if his remarks with respect to the

Foreign Exchange Conservation
Hong Kong evidence apply equally to the letter written by Premier Drew, about which there has been some discussion in the house?


William Lyon Mackenzie King: I should think it would, but I would have to re-read the letter of Premier Drew to make sure whether it contains references to parts of the evidence to which the British government takes exception to publicity being given.



FOREIGN EXCHANGE CONSERVATION


[Stage Direction]
The house resumed from Tuesday, February 17, consideration in committee of Bill No. 3, respecting emergency measures for the conservation of Canadian foreign exchange resources - Mr. Abbott - Mr. Macdonald (Brantford City) in the chair.
On schedule I.
Customs tariff-87. Vegetables, fresh, in their natural state: asparagus, green beans, Brussels sprouts, cabbage, carrots, beets, n.o.p., cauliflower, egg-plant, celery, cucumbers, lettuce, parsley, green peas, rhubarb, spinach, tomatoes, watercress, whitloof, endive, and fresh vegetables, n.o.p.
Mr. CRUICKSHANK:: I have not taken any part in this debate, but now I want to ask the minister a question. I am not particularly worried whether Toronto or Moose Jaw can secure celery or lettuce or some of these other things right now, but the people of my riding are particularly interested in whether they are going to be protected from dumping if they grow these vegetables and fruits. This matter has been brought up already by some Ontario members, and I believe by the hon. member for Kamloops. We all know what has happened in the past, under all governments. Pears, for instance have been brought into Canada in order to keep up prices in Washington. Peaches have been dumped in our province for the same reason. As far as the minister can give us an assurance, we would like to know that this will not be permitted in future. We would also be interested if the minister could give us some idea of the length of time we will continue under the present program. In British Columbia we can produce all the cabbages necessary for the whole of Canada, but that will require expensive equipment, such as sprayers, planting machines, and so on. We cannot go to that expense unless we are sure how long the program will last. So I should like to know just how far the minister can go
on behalf of the government in giving us an outline of the situation at the present time.


Douglas Charles Abbott: As the committee knows, a number of hon. members have raised this question and have asked whether I could give any assurance as to the length of time during which these restrictions are likely to be in force. The hon. member for Fraser Valley discussed that question with me, and I have been giving a good deal of thought to it. As I have said on other occasions, these import restrictions on fresh fruits and vegetables are intended to be temporary. They are put on as a necessary measure to conserve exchange, and the government would not feel justified in continuing them beyond the period of time when our exchange position makes it necessary. Therefore it is the policy of the government to relax and remove the restrictions as soon as the exchange position justifies that action. In other words the government is not prepared to retain these measures indefinitely as a protection to the fruit and vegetable industry. The permanent and continuing degree of protection to the industry is provided. of course, in the existing customs tariff.
I realize, however, that the growers of these fruits and vegetables are placed in a difficult position with respect to planning increases in production; and while I am conscious of the risks and dangers of trying to make predictions, as I said before, I think I can go this far. As I now see the situation and as I now view the prospects of our exchange position I think it is highly improbable that a complete removal of these restrictions with respect to fresh fruits and vegetables will occur much before the end of this calendar year, and it may be that some degree of restriction will continue into the early part of 1949. As far as possible it would be the government's intention not to remove or relax these import controls at a time when that action would have serious or disastrous effects on the marketing of Canadian produce. But I cannot bind the government to any unconditional guarantee that no produce grown in Canada in 1948 will have to face any competition from imported goods. As I said nearly three months ago, the government intends to relax restrictions on basic or essential items such as cabbages, carrots, potatoes and onions when it becomes clear that Canadian supplies are nearing exhaustion.


Mr. FARQUHAR:: May I ask the minister why our Canadian growers of vegetables cannot compete successfully with United States growers without tariff protection?
5849-92i
Foreign Exchange Conservation


Douglas Charles Abbott: I do not know; I imagine they can. I suppose what the hon. member for Algoma East has in mind is that there might be dumping, or something of that sort. But I do not see any reason why our growers cannot compete with American growers.


George Alexander Cruickshank: I wish to make it perfectly clear that the farmers of the Fraser valley can compete. We do not want protection; but neither do we want dumping in our province.


Mr. REID:: One of the reasons we feel we cannot compete is that in the country to the south of us on account of climatic conditions they can grow two or three crops. I know of districts where they are growing three crops of vegetables each year. Crop after crop is taken off; because of the warm weather and irrigation facilities the people in those areas can grow those crops and flood our market. That is one of the reasons why we in British Columbia cannot compete.


George Randolph Pearkes: I cannot help expressing some surprise at the minister's statement. On numerous occasions hon. members on this side of the house have asked the minister for a statement as to how long these restrictions are to be kept on. I have asked the minister three times, and he has refused to give me an answer. But the moment a back bencher from his own party gets up the minister is only too pleased to reply, and to supply the information. I imagine that is because of the speech made last night by the hon. member for Vancouver South, when he urged that there should be a cabinet minister from British Columbia. May I extend my congratulations to the hon. member for Fraser Valley if he is to be the appointee.


Douglas Charles Abbott: I always like to answer questions from anyone, but particularly from the hon. member for Fraser Valley. However, I believe my hon. friend will recall that I did preface what I had to say with the statement that this question had been raised by a number of members.


Mr. POULIOT:: Mr. Chairman, I have some figures respecting Canadian exports of fresh vegetables to the United States in the twelve months ended October 31, 1947. Those figures are as follows:
Item	Value
Onions	
$	15,059Potatoes (except	seed)	
2,577,91?Turnips	
2,064,336Other vegetables	
257,540Total	
$4,914,848
It will be noted that the chief exports of fresh vegetables from Canada to the United 
States were of onions, potatoes and turnips. This figure is to be subtracted from $16,894,871, which is the total of Canadian imports from the United States of fresh vegetables during the twelve months period ended October 31, 1947.
I asked for these figures from the bureau of statistics in November of last year so that I might know the exact position when the minister made his statement. I believe they reveal the true picture of what happened in the preceding twelve months. It will be noted that some of the vegetables which appear in tariff item 87 are not mentioned particularly. I refer to the de luxe varieties such as Brussels sprouts, eggplant, parsley, watercress, whitloof and endive. These vegetables must be included, to a value of $864,000.
The complete list of imports of fresh vegetables from the United States for the twelve months ended October 31, 1947, is as follows:
Item	Value
Asparagus	 $	483,133
Beans, green	 506,949
Beets	 146,281
Cabbage	 954,552
Carrots	 1,228,252
Cauliflower	 436,266
Celery	 2,453,501
Cucumbers	 331,112
Lettuce	 2,931468
Mushrooms	 7,290
Onions	 673,565
Peas, green	 170,530
Potatoes, sweet	 589,883
Potatoes, n.o.p	 1,182.181
*Spinach	 333,758
Tomatoes	 3,601,767
Other vegetables	 864,683
Total	 $16,894,871
This means that with total imports of $16,894,871 and total exports of $4,914,848 we have a difference of about $12,000,000, or about one dollar per capita of our population.
Total imports from the United States entered for consumption in Canada during that period were valued at $1,953,742,000. This is the trade of Canada with the United States during the twelve months ended October 31, 1947. Exports of Canadian produce during the same period were valued at $1,008,494,457 and exports of foreign produce at $22,500,000. If we subtract the total of exports from the total of imports we find that the unfavourable balance of trade with the United States during the twelve months ended October 31, 1947, was $942 million odd. The unfavourable balance in respect of vegetables is only $12,000,000, a small amount compared with the total unfavourable balance. The largest import item is tomatoes, which totalled $3,601,767. The next is lettuce, $2,931,168; then celery, $2,453,501 and then

Foreign Exchange Conservation
potatoes, n.o.p., which I assume would cover fresh potatoes, $1,182,181. Then the next item is carrots, $1,228,252.
During the war we were told to eat more vegetables. Considerable propaganda was put out to the effect that we should eat more vegetables, that they were good for health. They were recommended for the young and the old. The production of vegetables is not an easy matter in most parts of this country during a large part of the year and therefore we have to import from the United States. Vegetables are necessary to provide a well balanced diet, and I do not see why we should deprive ourselves of these vegetables from the south when they are supposed to be so good for all. It would not interfere with the farmers to permit them to come in. At the present time farmers do pretty well with the production of vegetables. They have their own markets and many of them can vegetables during the summer for consumption during the hard months of the year. Does it mean that simply because these items have been included it is impossible to change them? If it is impossible to change them, why discuss them?
I know the minister is a reasonable man and if something is submitted to him it may be possible to convince him that it should be changed. If, as the minister has said, this is a temporary measure, why does he insist on keeping it in force? The result will be that farmers in some parts of the country will try to raise these vegetables. If the minister was in earnest when he said that this measure was temporary then those people will be greatly disappointed when the legislation is no longer in force. They think that they will have the Canadian market during the winter, but there are some difficulties in their path.
One difficulty in having fresh vegetables grown in British Columbia sold in the east during the winter is the high air freight rates. If those vegetables could be sent to the east in refrigerator cars where they would be kept in good condition at ordinary freight rates, it would be possible for the farmers of British Columbia to increase their production of fresh vegetables. We in the east know how delicious are the apples of British Columbia during the winter, but they are most expensive. There again it is a question of freight rates.
Is it necessary to insist so much on a matter which could be settled amicably and would be for the benefit of the country? It seems to me that it should be possible to convince our farmers in a reasonable and commonsense way that this is a condition which has existed
for a long time; that it will not ruin the country to bring in vegetables from the United States to an amount of nearly $17,000,000 when we export vegetables to that country to an amount of nearly $5,000,000.
Someone said that the $180,000,000 which would be needed for Newfoundland was just peanuts. The amount involved in the importation of vegetables is around $15,000,000, only about one-twelfth the amount. I hope the minister will reconsider this matter. If we are to go through a period of austerity I would recall to him that those who take the vows of poverty exist on a vegetarian diet. They are austere people. We see them going around barefooted asking for alms. They live on vegetables because vegetables are the food of the poor. Why not let these vegetables come in? It would involve an amount which is trifling when compared with the unfavourable balance of trade with the United States. Besides that it would be good for the health of the Canadian people.
I am not going to press the matter further. I have given these figures in the hope that the minister will understand. I am quite sure he does. It is possible to disagree with him at times and have good reasons for doing so. It is possible to improve this bill and that is why it is before the committee. I agree entirely with the suggestion made by the hon. member for Winnipeg North Centre.
This is not a party question. It is not a case of one group gaining a victory over the minister. It is simply a discussion by plain men who want to make the best of it. If we have to wait until the farmers in other parts of Canada are able to produce the vegetables we are now importing we shall have nothing in the meantime. I cannot understand this austerity when we cannot eat vegetables although all the store counters are loaded with candies, chocolates, fancy biscuits, and the like. I leave it to the minister in the hope that he will make the right decision in the matter.


Douglas Charles Abbott: May I say just a word in reply to the hon. member for Temiscouata? I think the figures which he has quoted are substantially accurate. There is no question of depriving the Canadian people of fresh vegetables; it is simply a question of excluding during the winter months certain fresh vegetables, notably lettuce, tomatoes, green beans and the like.
It is true that the savings on vegetables are only about $17,000,000, but included in our total import figures are a great many items which it is virtually impossible to exclude,

Foreign Exchange Conservation
ouch things as fuel, coal and the like. In this list of prohibitions the fresh fruit and vegetable item is by far the largest single item. My hon. friend is not a Scotsman but he has probably heard that many a mickle makes a muckle, and that applies in this case. Total imports of fresh fruit and vegetables are close to S70,000,000, and we estimate that the savings in the excluded class and those under quota will be approximately $40,000,000. That is an appreciable figure, and an important one in our attempts to solve this balance of payments problem.
I am sure there are ample supplies of good canned vegetables in Canada. Neither I nor my family have found difficulty yet in obtaining them. Supplies are ample at present of green cabbages, which are being admitted under quota, and I gave the assurance some three months ago that the four main vegetables, potatoes, onions, carrots and cabbages, when domestic supplies became low would be allowed to be imported by relaxing the restrictions.
I have a memorandum here from the Department of National Health and Welfare as to the relative nutritional values of various vegetables. It is dated February 2, and it might be well to put it on record. It is as follows:
The following classification is essentially the the same as one prepared in 1&42 by the advisory committee on nutrition to the foods administration, on which our Doctor Pett and Miss Speers served. This rating was set up to have a wider use than simply with imported vegetables.
Here is the rating, under the headings, Important, Desirable, and Limited Importance:
Important:	Potatoes; root vegetables, especially carrots and turnips; green vegetables, especially cabbage, spinach and Brussels sprouts, but not including lettuce; peas and beans (dried); canned tomatoes.
It will be noted there is no mention of fresh tomatoes. It goes on;
Desirable: Beans, green or wax; fresh canned tomato juice; canned peas.
Limited Importance: Pickles, relishes, sauces, vegetable juices, and vegetables (fresh or canned) not named above.
I repeat what I said before: I am satisfied there will be no shortage of vegetables in Canada this winter. There will be limited or no supplies of some fresh vegetables, notably lettuce, and to some extent imported tomatoes, but I am sure that the health of the Canadian people will not suffer as a result of these restrictions. I must point out to the committee that- these vegetables form the largest single item in this list of prohibitions. I do not feel that we should entirely elim-

mate that item from the list. It may be possible to provide some relaxation through larger quotas when the need arises, but I feel that this item of fresh fruits and vegetables should not be excluded from the schedule.


Mr. SMITH (Calgary West):: The minister mentioned the matter of health. I told him two or three days ago that I had had communications from persons suffering from two types of illness, high blood pressure and diabetes, and that I had been informed that for these illnesses fresh vegetables, lettuce, tomatoes and so on, were required. That has been my information. The minister said he would consult the Minister of National Health and Welfare, who is here. Is he in a position to tell me whether or not the information I have been given is correct? I look at it in two ways. If it is correct, something might be done. If it is not correct, a statement might ease the minds of those who are affected.


Douglas Charles Abbott: A general statement to that effect would be incorrect. There have been a few permits issued1 in special cases for special conditions which existed, but one cannot lay down a general rule that lettuce is necessary for this particular condition or that tomatoes are necessary for that.


Arthur Leroy Smith: May I ask if the two types of illness I have mentioned are included in the cases where special permits have been granted?


Douglas Charles Abbott: I am told that it would not be generally true of diabetes and high blood pressure, but sometimes there are special complications in respect to those and other types of illness.


Arthur Leroy Smith: I conclude, then, that one person with some complications might apply for a permit to import, which would be entirely useless because as an individual he could not import lettuce from California or Texas.


Douglas Charles Abbott: There have been three or four cases in which special permits have been granted, based on a medical certificate.


Arthur Leroy Smith: Granted to individuals?


Douglas Charles Abbott: Yes.


Arthur Leroy Smith: And they import their own requirements?


Douglas Charles Abbott: I suppose they would do it through a dealer.


Arthur Leroy Smith: 
Mr. KNOWLES:: The hon. member for Calgary West seems to think this government moves in a strange and mysterious way its wonders to perform. However, I am glad we have the support of the hon. member for Temiscouata in our opposition to this ban on fresh vegetables, and I hope he will be able to gather further support on that side of the house.


Jean-François Pouliot: It is a friendly opposition.


Stanley Howard Knowles: As long as you stand up and vote against this ban it is perfectly all right with us if you smile while you are doing it.	-
I doubt whether members of the committee are much impressed by the statement the minister has read about the effects of these various vegetables on health. The very fact that he has just admitted to the hon. member for Calgary West that there are some diseases for the alleviation of which certain vegetables are needed to the extent that their importation is permitted raises the whole question whether the lack of these things will involve the risk of certain diseases occurring. In this day and age we are concerned with health in a preventive way as well as in corrective medicine, and I strongly urge that we are making a mistake if we trifle in this way with the health of our Canadian people. I shall not go into these arguments at any further length because we went into them the other night when the matter was before the committee. But I do wish to say a few other things arising out of exchanges that took place earlier this afternoon.
I noticed that when the hon. member for Algoma East expressed his desire that we avoid a policy of protection, at least four or five members on the Liberal side of the house applauded that sentiment. In other words, the ideal of freedom of trade has not entirely died within the Liberal party.
Apart from that, Mr. Chairman, I ask hon. members to consider the terrible state of uncertainty into which this whole thing is thrown by the kind of announcement the minister made this afternoon. He was asked some time ago from this side of the house how long these restrictions would last, and he said he could not say. Today he gave a tentative answer to the member for Fraser Valley which sounded something like in terms of a year. That is not long enough to be protection in the sense that it would enable the fruit and vegetable growers in Canada to change their methods behind such a protective wall, but on the other hand it is long enough to have rhe effect of denying these essential
foods to our people. It throws both producer and consumer in Canada into a state of great uncertainty. It seems to me that the only answer to this thing is to look at it in terms of health, and when it come to that I think we should take no chances but do what we know to be best in the long run for the health of the people we represent.
When from this group an amendment was moved to another clause in the bill having to do with the non-discriminatory provision, the Minister of Finance not only argued against it on his own behalf but stated emphatically the government's opposition to the measure. He gave as one of his reasons the fear that it would offend the United States if we were to pass the amendment moved at that time by the hon. member for Kindersley. This is not in that category. There is no danger of giving offence to the United States if we delete item 87 from the schedule.


Douglas Charles Abbott: We would lose a lot of exchange, though.


Stanley Howard Knowles: Well, there are other items upon which that exchange might be picked up. But some of us are not convinced that this is the best way to overcome our shortage of United States dollars. We have to accept the government's wish to go ahead with the program. The minister did admit that there were details we could discuss in committee and I feel that this is one that we should not pass over quickly. I have already pointed out that although the minister has argued against it he has not stated that the government will stand or fall by this item, and I respectfully submit to him that this is a case where he might say to members on his own side of the house as well as to those on this side that they might vote as they feel like voting on the item. In other words, let us have a free vote and see if we cannot get an expression, not on the basis of official statements which the minister may receive from one department or another, but on the basis of what we know that the housewives in Canada want. I strongly urge that there be a free vote on item 87.


Douglas Charles Abbott: My hon. friend may urge that hon. members vote as they please, but the government's responsibility under this measure is to see that we save vital exchange needed to pay for essential imports from the United States, and my submission is that the vegetables that- are being excluded are not as essential as some other things.


The CHAIRMAN:: Shall item 87 carry?


Some hon. MEMBERS:: No.
Item agreed to: yeas, 43; nays, 23.
Items 89 . 90e, and 91 agreed to.
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Customs tariff-92. Fruits, fresh, in their natural state:	apricots, cherries, cranberries,
peaches, pears, plums or prunes, strawberies, raspberries, loganberries, berries, edible, n.o.p., quinces, nectarines.


William Ross Macdonald: Shall the item carry?


Stanley Howard Knowles: On division.
Item agreed to on division.
Items 94, 95 and 95a agreed to.
Customs tariff-96. Fruits, fresh, in -their natural state, n.o.p.


William Ross Macdonald: Shall the item carry?


Stanley Howard Knowles: On division.
Item agreed to on division.
Items 96a, 97, 99b, 99d, ex 99e, 99g, 104a, 105, 108, ex 109, 110 and 123a, agreed to.
Customs tariff-124, 125, 126, 127, 128, ex 123, ex 133. Oysters.


Mr. McLURE:: What was the value of oyster imports from the United States for 1947 or for 1946?


Douglas Charles Abbott: Oysters, shelled, in bulk $430,000; oysters, shelled, not canned, $17,000; oysters in the shell $1,000-these are round figures-making a total of about $450,000.


[Stage Direction]
Items agreed to.
Customs tariff-136. Turtles.
George Alexander Cruickshank: What are turtles used for?


Douglas Charles Abbott: I understand they are used to make soup, but I would not be sure.


Mr. BENTLEY:: What was the value of the imports?


Douglas Charles Abbott: 

Item agreed to.
Items 138, 139, 143, 143a, 152c, ex 179, ex 180, and 181a agreed to.
Customs tariff-ex 184d, ex 169, ex 176, ex 171, ex 181a.
Periodical publications, unbound or paper bound, consisting largely of fiction- or printed matter of a similar character, including detective, sex, western, and alleged true or confession stories, -and publications, unbound or paper bound, commonly known as comics, but not including bona fide supplements used with newspapers.
Provided, that the decision of the Minister of National Revenue as to whether or not any publication is included in the foregoing description shall be final and conclusive.


Mr. KNIGHT:: I should like to have an assurance from the minister for the record that no books that may be called legitimate are in this particular list.


Douglas Charles Abbott: No.
[The Chairman.]


Robert Ross (Roy) Knight: I think the government might well consider, in reference to the whole question of the importation of books of an educational type, whether it is justified in taking money at all through the importation of books intended for the dissemination of knowledge. Now that we know that legitimate books are not included and that this is aimed against a certain type of periodicals, I should like in passing to commend the government department concerned for having shown a sense of humour, for it speaks of certain periodicals "commonly known as comics". I shall have more to say about this another time. I notice on page 1 of the reprint the following:
No person shall import or attempt to import into Canada any goods listed or of the classes described in schedules I, II or III except in accordance with a permit issued by -the minister . . .
The minister here is, I presume, the Minister of Finance. On page 8 the responsibility is switched to the Minister of National Revenue.
Provided, that the decision of the Minister of National Revenue -as to whether or not any publication is included in the foregoing description shall be final and conclusive.


Douglas Charles Abbott: That is administrative. It is his officers who are enforcing it and he decides whether the publication is a pulp magazine, to use the common description.


Robert Ross (Roy) Knight: That is what I want to say a word or two about. I am under no illusion that the Minister of National Revenue personally will examine these periodicals.


James Joseph McCann: We have a staff.


Robert Ross (Roy) Knight: I have no great confidence in the system of censorship which is now used by the dominion government and I say that not without some reason; and if I am not more enlightened on the subject than I am now, I may say that it is the fault of the ministry themselves, because not long ago I addressed to them certain questions in regard to censorship in Canada and while I have an order for a return, the return has not yet come through. During the last session I asked some questions regarding the whole matter of censorship and I was left very much in the dark.
I have not here the answers to those questions, and such answers as I received were most uncommunicative. I asked who was the official responsible ultimately for the censorship of books being imported into Canada. Incidentally I made a good deal of research into the matter of censorhip and I shall report on that on another occasion. I do not wish to hold up this item now. But as I say, I have no great confidence in the matter; and

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if I have no confidence it is the fault of the minister or of the department concerned. When I asked, for instance, who was ultimately responsible for censorship in this country, I was given a gentleman's name. I had asked with regard to qualifications by way of education and experience. I was told that this gentleman who was then in charge of censorship in Canada, and had been for some time, was merely a temporary officer. This gentleman was interviewed by the press, and I have the press clippings in my file upstairs. His conception of the whole matter of censorship was quite casual. I think censorship is important, but apparently he did not think so. He said that he was merely a temporary employee and that a permanent official would be appointed in due course. One of the questions which I asked the other day was whether the appointment was now on a temporary or a permanent basis. I have yet to receive an answer. I am looking forward to it with interest. In his interview with the press, this gentleman-


Douglas Charles Abbott: I do not want to interrupt my hon. friend, and perhaps he should finish his remarks, but the matter he is discussing really has nothing to do with this bill. It comes under the Department of National Revenue.


Robert Ross (Roy) Knight: I realize that.


Stanley Howard Knowles: On the point of order, there is a paragraph in the item itself which says:
Provided that the decision of the Minister of National Revenue as to whether or not any publication is included in the foregoing description shall be final and- conclusive.
The minister admitted that it was an administrative matter. The Minister of National Revenue interjected that he had a staff for this. Surely the item permits discussion of censorship.


William Ross Macdonald: I think the hon. member should be allowed to continue.


Robert Ross (Roy) Knight: That was, of course, the reason I quoted the paragraph on page 8 before I began my remarks; I expected just such an objection as that which has been raised by the Minister of Finance.
But to return to my story-and I shall make it short, as I realize there will be a better opportunity later to discuss it-the gentleman quite casually took his duties as a censor. I have clippings of an interview he had with representatives of the press. The report of the interview appeared, among other places, in the Regina Leader-Post. He said that he did not consider-I presume with my
questions in the back of his head-that any great education or any particular qualifications were necessary to performance of the duties of censorship-imagine that I	As a
matter of fact he said anybody could tell a bad book. I presume he thought you could smell it; I do not know whether he used that expression or not.
Personally I think this whole question of censorship should be aired. The department in charge of it should be freer with its information, because if some of us look upon censorship as something which is being kept in the dark, it is certainly not our fault when we cannot obtain the necessary light. I shall not get into an argument here as to whether oensorship is too severe or too lenient. I think both descriptions apply, and because of the inefficiency of those who are doing the job, I think that proper background, education and training are necessary.


Douglas Charles Abbott: This prohibition contained in schedule I, together with item 1201 in schedule C of the Customs Tariff, are the only provisions with respect to the entry of published matter. Item 1201 or a corresponding item has been in the customs tariff since confederation, I think, and it provides, under the heading of prohibited goods:
Books, printed paper, drawings, paintings, prints, photographs or representations of any kind treasonable or seditious, or of an immoral or indecent character.
I understand that the official in the Department of National Revenue in charge of applying these provisions is known as the examiner of publications.


Mr. HANSELL:: I should like to say just a word on this item and it is one of commendation, in a sense. For a good many years I have been interested in the type of literature that comes into Canada, and I find now that for perhaps the first time in actual legislation there is set out the prohibition of certain types of literature.


Douglas Charles Abbott: It is not the first time. It was done under the War Exchange Conservation Act. This is the second time.


Ernest George Hansell: Well, if it is the second time I stand corrected. But twenty-five or thirty years ago some of us became alarmed at the type of literature that was beginning to flood Canada from other countries, particularly the United States. I recall that resolutions were sent to the prime minister; as a matter of fact I believe the present Prime Minister was prime minister at that time. T happened to be secretary of a ministerial
143S
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association which sent those resolutions in. I believe I addressed the resolutions to the present Prime Minister.


Douglas Charles Abbott: If it was within the last twenty-five years, you did.


Ernest George Hansell: So the subject is not a new one. I compliment the minister upon including those items as ones to be prohibited under this bill. There is one sad feature about this; it was the necessity for conserving United States dollar exchange that brought this matter to the attention of the government. They are prohibiting this literature from entry into Canada, not particularly because it is undesirable but because they need United States dollars. That is the sad thing. But I commend the minister's action because I believe the government has some responsibility with respect to the morals of this country. I have often heard it said that when it conies to morals it is the responsibility of the home, the school and the church. But you cannot tag on to the home, the school and the church the responsibility of keeping undesirable literature out of this country. I have never yet known a home that has deliberately subscribed to certain types of comic magazines, sex stories, or photogravure literature, for the purpose of bettering the home. I have never known a school or church to have its library packed with that sort of literature. If anything, they want to keep it out. The only authorities who can do this happen to be governmental authorities. Recently I have been quite alarmed at the tremendous flood of certain types of pulp magazines, story books and comics that have been on sale on most of our news stands. They seem to have multiplied in recent years. My own boy likes to read the comics; and as a matter of fact I have no objection to good, wholesome comic magazines. I was a cartoonist myself a good many years ago. I never became very sueess-ful, though I did create a comic strip which I thought should have made me a millionaire, but other people had different ideas about it. I am all for good clean comic books. When I was a boy I used to read the old country Comic Cuts and Chips. That was good clean stuff, but the stuff you get today is not so clean. My own boy brings them home. I object, but what can you do? I noticed on the cover of one comic entitled "Joe Palooka" the statement to the effect that it had a daily circulation of some two million readers. That is quite a lot of palooka.
I like to read a good deal. I think any member of parliament has to read a good deal in order to keep up with the times. Just last

fall I happened to be in a department store and wandered through to the book department to see what might be new on the newsstand. I was struck with the literature that was on just one rack alone. I was so struck with the titles that I took out my pencil and wrote them down. I would ask any hon. member if these titles suggest that we are guarding and preserving the morals of our young people. You can buy any of these books for twenty-five cents. Here are the titles; I have neither added to nor taken away from them. All these and no others were in this one rack:
The New iSin
Overture to Death
Sealed Room Murder
The Unfortunate Murderer
And Death Came Too
The Noose
Murder Gone Mad
The Vanishing Corpse
Something Nasty in the Wood Shed
Dead on the Track
Painted for the Kill
The Cross-eyed Bear Murders
Death Every Sunday
The Frightened Stiff
The Straw IStaek Murders
A Homicide for Hannah
The Plague Court Murders
Death on the Nile
Georgeous Ghoul Murder Case
The League of Frightened Men
Coffin for One
Prescription for Murder
Blood Money
Holiday Homicide
Death from a Top Hat
Man Who Killed Goliath
The Creeps
Case of Constant Suicides Murders' of Scandal House Dance of Death
Murder Wears a Mummer's Mask Murder for the Asking Death in the Back Seat A Talent for Murder Murder in the Mist The Cat Saw Murder Corpse in the Wax Works Poison for One
The Corpse in the Green Pyjamas Murder at Midnight
There was one other book in the midst of them all; the title was "Policeman's Holiday." That is the sort of thing flooding the country today and, I suggest, polluting the minds of our young people. I am not going to read a lot of other names of comic magazines, but if I had my way I would not permit one comic strip to be published that had a gun in it.


Mr. BLACKMORE:: Were all those books published in the United States?


Ernest George Hansell: I cannot say as to that.

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William Ross Macdonald: Order. Of course a discussion with respect to anything published in Canada would not be in order. At the present time we are dealing with Bill No. 3, which is entitled an emergency measure for the conservation of Canadian foreign exchange resources. No doubt There is a great deal of merit in what the hon. member is saying, but I doubt if it would be in order at the present time. So I would ask him to direct his remarks to the item under consideration.
Mr. HANSEI.L: Well, Mr. Chairman, I cannot sa}' how many of these particular magazines were published in Canada, because this measure was not before us last fall and I did not take a note of these books just for that purpose. I do say, however, that many magazines similar to those I have mentioned, and perhaps many of those whose titles I read, are published in the United States. I also say that almost every comic magazine in Canada today is published in the United States, if not printed there, because we do not have any comic strips originating in Canada.


Mr. JOHNSTON:: Only on the other side of the house.


Ernest George Hansell: I say if I had my way I would do away with every magazine that had a gun in it. If I had my way I would do away with every magazine or photogravure publication or comic strip that had any drinking in it. I would do away with all that, because we cannot permit that stuff to infiltrate the minds of our young people and expect to bring into existence a great and wholesome nation. I am not the only one who thinks along these lines. I know there are on record today in the office of some minister of the Crown resolutions coming from parent-teacher associations, home and school associations and other organizations interested in the welfare of our young people, protesting this type of literature.
I shall conclude by simply saying that this is a measure designed to conserve United States dollars. Am I to conclude that the administration are more interested in saving dollars than they are in saving the morals of our country? This is more or less an emergency measure. What will happen when this legislation runs out? Are these magazines and comic supplements to be allowed into the *country then? Let us make this permanent. Let us raise our voices against this sort of thing. The hon. member for Kootenay West mentioned motion pictures the other day, and I am with him on that. These things are [DOT]demoralizing, and we might as well wake up
to that fact. I am not making that statement because of my profession. I am saying it because I am a father and a member of parliament, and we have some responsibility in respect to the civilization we are trying to build here in Canada.


Robert Ross (Roy) Knight: In view of what the hon. member who has just spoken has said, I should like to add one further word. He has taken the position, I believe, that censorship is too lenient. As I said before, I do not wish to enter into that discussion, nor shall I do so. But I am concerned with the fact that censorship ought to be efficient. I do not believe the various customs officers stationed at different points across the country are qualified to deal with this matter, nor could we expect them to be so qualified. I do know that in cases of doubt the material is sent to a central point where a man who has the ultimate responsibility must make a decision with respect to it. I did say, however, that the gentleman who had that responsibility during the last session of parliament was not as efficient as he should have been.
I am almost in total agreement with what the hon. member has just said with respect to pornographic material. But I must point out that, on the other hand, I believe many legitimate books are refused entry into this country because of the ignorance of the people who have the censoring of them. There is a great difference between certain novels and certain books which, through their very nature, if they are to be true to life, are bound to be realistic. There is a difference, however between the genuinely written and realistic novel and one that is deliberately pornographic for the purpose of making sales, by appealing to depraved tastes. I believe that inefficiency in censorship works both ways. Not only does it allow to come in material which should be kept out, but it also keeps out much material which should be allowed to come in.


Mr. MAODONNELL (Muskoka-Ontario):: I have been so much interested in the remarks just made that I should like to add one further word. We all recognize that censorship is a very difficult procedure. It has to be handled wisely, because we must recognize that there is an infinite variety of opinions in the matter. But I do not believe there are two opinions in the house as to what we find when we go to some of the public newsstands. When we see what is in them we know that the system is wrong, and that it must have an evil influence. If any good can
Foreign Exchange Conservation

come out of this evil bill, or if this can possibly be the occasion of setting up some system-and it has to be a wise system, not rigid and unthinking; I recognize that-I should hope it might come now. But surely we can do a better job than anyone of us must agree has been done when we look at a newsstand today.


Thomas Reid: Can the minister give the committee the value of these magazines and books imported into Canada? My information-and it may be wrong-is that we can ban the importation into Canada of comics and western stories; but I am told that the firms which control the books in the United States get around the regulations by sending the plates into Canada and having the books and magazines printed in this country.


Douglas Charles Abbott: It is almost impossible to give an accurate estimate because all periodical publications are included in the one group. They total something in the neighbourhood of S12,000,000. A rough estimate as to the value of those included in this prohibited group, which is substantially identical with the publication in the War Exchange Conservation Act, is about 82,000,000. However, I give that figure only as an estimate.


Mr. MacNICOL:: May I say at the outset that I heartily agree with most of what has been said about the type of literature being sold. However, a large number of corner stores in all cities have been making a living from selling literature of this kind. I made an investigation by calling on about ten cigar stores which have been selling this type of literature. I asked them what the prohibition of the importation of such literature as they had on their shelves would do to their businesses. The usual answer was that they made about $25 a week from the sale of it, and they felt that the prohibition would hit them pretty hard.
What have we to offer in place of the literature on the prohibited list? Can anything be done to encourage the importation of better literature from the old country so that the cigar stores on the corner may continue to make a living? If we prevent their selling this kind of reading material-a procedure with which we agree-is there any effort made to give something in its place so that they will be able to continue to make a living? After all, $25 is an important item to a small cigar store.


Douglas Charles Abbott: If the higher class of reading material is not prohibited, then it is not subject to duty; and possibly the fact of pro-

hibiting the importation of these western and sex stories and comic books may tend to raise the reading standards of the public. So that the cigar stores will be able to sell more copies of the Ladies Home Journal.


[Stage Direction]
Items agreed to. .
Customs tariff-ex 192; ex 198; ex 199.
Tarred paper and prepared roofings (including shingles), sheathing, insulation (not including fibreglass), building board, chipboard, news-board, strawboard, testboard, corrugated board, and all other similar boards manufactured wholly or in part of vegetable fibres (not including electrie insulation board, shoe board, automobile board, bookbinders' board and press-board) ; bristol board, artists' board, photograph mounting board, picture matting board and showcard . board; flock coated board or paper; wax coated paper; blotting paper not printed.
James MacKerras Macdonnell: I have a request to make of the minister with respect to this item. It has to do with the words "not including fibreglass", as tney appear in the second line of the item. The minister may recall the speech made by the hon. member for London on this matter and, as he "was unable to be here today, he asked me to request that the words "or Kimsul" be inserted after the word "fibreglass". I am informed that this will not involve any additional United States dollars, but that Kimsul would merely bring in a quantity of insulation, as well as the fibreglass.
In other words, I understand that these items are in competition. Kimsul in made by the well-known firm of Kimberly-Clark, which has large investments in this country. As the situation now stands, it will mean that their competitors can import while they cannot. Perhaps the Minister of Trade and Commerce could answer.


Mr. HOWE:: The difference is, I believe, that the fibreglass people have a plant at Sarnia, almost completed, which will produce fibreglass in this country, wholly of Canadian material. It was thought that in the circumstances, since it is only a month or two until production will start, it was only fair not to destroy the fibreglass market in the meantime. This does not apply to the other product.
If the Kimberly-Clark people care to manufacture their product in Canada within a reasonable time, a similar consideration could be given. However, the latter product at the present time is a trade import, and unessential.


James MacKerras Macdonnell: Surely the answer is that until the other plant comes into production they ought to be treated equally. The minister has already the power to make the change. After all, the

Foreign Exchange Conservation
Kimberly-Clark people deserve proper consideration from us, because they have large investments here. Sometimes there are delays beyond those which were anticipated. Why would it not be fair to put them both on the same level?


Clarence Decatur Howe: This bill is designed to save United States dollars, and the best way to do that is to stop unnecessary imports. The product cannot be admitted because they are friends of ours, or nice people.


Douglas Charles Abbott: Another point has been brought to my attention, and that is that there is a technical requirement for fibreglass which does not apply to Kimsul. Fibreglass is an essential insulating material for the making of domestic refrigerators, while Kimsul is not. Kimsul is not designed for use in that form. Therefore, for the month or two until the Canadian plant is in operation the import of some quantity of fibreglass would be necessaiy.


James MacKerras Macdonnell: Answering the Minister of Trade and Commerce, I am suggesting that at the moment there would be no saving because this new company is not yet in operation. My request was that they should be put on a level during the time when imports had to be made. I am remembering also that, under the wide powers reserved, this could be changed by executive action. Therefore, on that point my request still stands.
Then, as to the suitability, I am informed that Kimsul has been tested and found to be of the highest quality. I am also informed that they are both used for the insulating of refrigerators, but that Kimsul is being used in the Tillsonburg-Delhi area for the insulating of tobacco kilns. It has been found that this is the only type of insulation which can be used for that purpose. I am putting that forward as evidence of its usefulness, and I am putting forward also the request that as regards saving United States dollars it is still fifty-fifty.


Douglas Charles Abbott: The hon. member for London has been discussing this matter with the head of the emergency import control division and it is still under consideration. If a case can be made out for some relaxation for a temporary period, of course it will be done. However, for the reasons which I have given I do not think we can exempt it from the general prohibition contained in this tariff item.


[Stage Direction]
Item agreed to.
Items 192b and 192c agreed to.
Customs tariff-ex 193. Paper sacks or bags of all kinds, printed or not (but not including those made from twisted paper).
Mr. CHARLTON:: Would this item cover paper sacks used for the packaging of commercial fertilizer?


Douglas Charles Abbott: I am informed that it probably would, but I shall have to get further information on that. If multi-walled bags come under this item, then I am inclined to think it would.


John Alpheus Charlton: I should like to have the assurance of the minister that there will be no recurrence of what has happened in the past when bags were very scarce in the spring at a time when the heavy run of fertilizer is on.


Douglas Charles Abbott: I am informed that the production of this type of bag in Canada has gone up rapidly and that there should not be any shortage as has existed in the past.


Winfield Chester Scott McLure: Are the moisture-proof
bags used for the shipment of potatoes manufactured in Canada? In the past few years there has been a change in the method of shipping different commodities, especially potatoes. Potatoes are now being put up in five, seven, ten and fifteen pound packages made out of moisture-proof paper. Most of this has come in from the United States, although recently it may be manufactured in Canada.


Douglas Charles Abbott: I cannot answer my hon. friend directly, but I can say that we have had no complaint of shortages of the 15-pound bags to which he has referred. I think it can be taken for granted that there is an adequate supply in Canada. However, I will take a note of his remarks and look into it in order to see what the situation is.


[Stage Direction]
Item agreed to.
Items 194 and 195 agreed to.
Customs tariff-ex 197, ex 197b, ex 198', ex 199, ex 181 and ex 509.
Towels, napkins, table covers, tray covers and doilies, of paper; fancy shelf and lace papers; paper handkerchiefs; facial tissues and toilet paper, including such materials in jumbo rolls; cups, dishes or plates, forks, spoons, and drinking straws, made of paper, cardboard, or of vegetable fibres; paper envelopes; correspondence and printed letterhead papers, not including plain unprinted typewriter or copying papers; creped tissue paper and manufactures thereof; wrapping paper (including box covering paper and wrappers) printed, embossed or otherwise decorated; Christmas seals, stickers, tags and enclosure cards, printed, embossed or otherwise decorated; card and other games, score reckoners, score pads, tallies and place cards of paper or cardboard, festivity, carnival
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[Stage Direction]
and celebration supplies and decorations of paper or cardboard, including costumes, hats, caps, headbands, masks, horns, serpentines and confetti; gummed paper; blank books, photograph mounts manufactured from paper or paper board.
Mr. FLEMING:: This item covers towels, napkins, fancy doilies, paper handerchiefs, facial tisues, toilet paper and so on. While the figures given in connection with these items, to be found on pages 1340 and 1341 of Hansard, may not seem large in the aggregate, I want to bring before the committee the situation of some importers who have opened up importing businesses since the war to bring in doilies and other paper products from the United Kingdom. Reference to the tables will show that sizeable amounts of these articles are coming in from non-scheduled countries. If my information is correct a substantial part of those importations is from the United Kingdom. For instance, if you look at page 1340 of Hansard, the fourth line from the bottom, you will find that in the case of tissue wrapping paper, during the six months-
Mr. ABBOTT; That is mostly Swedish paper.


Donald Methuen Fleming: The importers I am referring to are dealing in doilies and paper products of that kind.


Douglas Charles Abbott: There were a few fancy doilies and that sort of thing coming in from the United Kingdom.


Donald Methuen Fleming: I do not wish to repeat at this stage what was said the other night with regard to excluding the products of the non-scheduled countries; I do not think there is any justification for that, but in a case of this kind I ask if the minister will give the committee some assurance that he will be prepared to grant permits. Surely we do not want to do anything to hurt Canadian importers or British producers of goods of this kind, or, for that matter, of any kind?


Douglas Charles Abbott: We will look into it. If they are on the purely prohibited list, they will have to stay there, but it may be possible to transfer them to the quota list.


Donald Methuen Fleming: I urge the minister to give consideration to that. For the life of me I can see no reason why they should be in the first schedule. I am speaking now with respect to paper products produced in the United Kingdom.


Douglas Charles Abbott: As my hon. friend will have seen from the table which I gave the other day, these items constitute a total importation

of about $7,500,000. The individual items may be relatively small but in toto it is a rather large item. Large quantities, particularly of paper napkins, match cases, doilies and so on, come from the United States. I know we have some nice ones out at the house which we were given at Christmas and which have our name on them and all the rest of it. They came from the United States.


Donald Methuen Fleming: I am not quarreling at the moment with the exclusion of United States products; I am simply dealing with the problem faced by the Canadian importer and the British producer.


Mr. ROSS (St. Paul's) :: I have a case in mind of a man who spent considerable money in September, 1946, to arrange for the sole agency for the importation of Christmas cards from a high-class gallery. This man has spent a good deal of money in working up business, but now these cards are banned from Great Britain. His order may not amount to more than $10,000, but that would help to pay for some of the wheat that Great Britain is buying from us. This man is a veteran of the first war, an amputation case. He has the agency for one line of goods from Great Britain which he can still bring in, but the one line is not sufficient. If he were permitted to bring in the two lines he could make a living out of it and pay his overhead. If these high-class Christmas cards are banned he will have to fold up the other business. In that other business about $50,000 worth of articles can be brought in at the present time, but that is not in itself sufficient to carry the two. The other business is the more profitable, and between the two of them he could make a go of it. He is a war veteran and an amputation case. He has spent a lot of money and owes the bank money, and with this prohibition he will simply have to fold up his business and Canada will lose the benefit of importations from Great Britain which would help to pay for some of the wheat and other things Britain is buying from us. This is a vast list; it does not seem to me right to lump all these articles together, and particularly I protest against banning these things from Great Britain when there is no necessity for it. Cannot this banning of high-class Christmas cards be reviewed by the minister with a view to allowing them entry into the country?


Douglas Charles Abbott: I will take a note of my hon. friend's representations.


Mr. MERRITT:: I have information that all stamp collectors' accessories are banned under

Foreign Exchange Conservation
schedule I, not by direction, but by being included in other items, one of which is the blanket item. I have had correspondence with the minister's department and it is suggested that stamp albums themselves are not banned, but that information does not correspond with the advice of the collector of customs in Vancouver. The articles consist of hinges, tweezers, watermark detectors, perforation gauges, et- cetera, the. dollar and pound sterling value of which would be very 6mall. I suggest that it might be possible to take out of this blanket item, either by ministerial discretion or at the end of the schedule, these small items of philatelic accessories.


Douglas Charles Abbott: I shall be glad to look into that and see what we can do.


Charles Cecil Ingersoll Merritt: I should1 like to make another request concerning a previous item which passed when I was not in the house. Two veterans in Vancouver have, since the war, established themselves in the business of importing cut flowers from the United States. These two veterans have invested not only their own capital but their gratuities and re-establishment credits in the business. They were, of course, counselled by D.V.A., and no doubt had their blessing on going into the business. They find that they cannot carry on during the winter unless they can get their normal supplies from the United States. I know that the minister would not admit cut flowers as a general rule, but I point out to him that under the veterans legislation there was such a thing as an "awaiting returns" benefit, and by analogy with that principle it seems to me that the minister could treat such cases of veterans who will be put right out of business as hardship cases. I refer to the matter now because I am informed that under schedule I in a case like this it has not been the custom for the minister to exercise any discretion in favour of a business, but this particular case does seem a hard one. The veterans have invested their capital and reestablishment credits and gratuities in the business, and have had the advice of D.V.A.; and they now are faced, not by intention, of course, but through the operation of the schedule, with the loss of their gratuities and benefits. In a case like that, the minister might see his way, perhaps on the recommendation of the Minister of Veterans Affairs and his certificate that it was a proper case, to exercise his discretion on the ground of hardship to enable such a firm to remain in business.


Douglas Charles Abbott: I shall be very glad to look into that ease. Perhaps I might be permitted
to express surprise that there should ever be a shortage of cut flowers in Vancouver. I did not think it would be necessary to import flowers from the United States into British Columbia.


Douglas Gooderham Ross: If I might refer again to the case I mentioned, this man incurred heavy expenses to purchase stock for his business. Is there no chance of relief for him? Is he simply to be told that nothing can be done?


Douglas Charles Abbott: I shall have to look into the case to which my hon. friend refers, but if the articles which the man uses in his business are on the prohibited list and he cannot obtain them in Canada, that is all there is to it. But I would have to see what the circumstances are.


Douglas Gooderham Ross: It has nothing to do with United States dollars. That is the point I am trying to make.


Mr. TIMMINS:: Line 7 of this item reads:
. . . correspondence and printed letterhead papers, not including plain unprinted typewriter or copying papers.
What is the significance of the last words "not. including plain unprinted typewriter or copying papers"? Why is that omitted from the schedule? Where do we get that particular material? Is it something we cannot make in Canada? What amount of money is involved? From what country or countries does it come?


Douglas Charles Abbott: I do not know that I can give my hon. friend a complete answer at once. I am told that the purpose was to allow the importation of essential types of paper which might be in short supply. I can look into the matter and give my hon. friend a more detailed answer later perhaps.


[Stage Direction]
Item agreed to.
Customs tariff-247. Liquid fillers, anti-corrosive and anti-fouling paints, and ground and liquid paints, n.o.p.
Mr. ADA  MSON@: These items, I understand, have a very particular purpose in connection with painting the hulls of wooden boats, and in some harbours on the great lakes I believe a graphite non-fouling base is used. Can the minister say whether this material is manufactured in Canada?


Douglas Charles Abbott: Some of these, I understand, are not, and I am informed that we are giving quite a number of permits in the case of paints of this type which are considered important and are not manufactured in Canada.
Foreign Exchange Conservation


Mr. NICHOLSON:: I notice that imports from non-scheduled countries have increased a good deal as compared with the period prior to the war. What percentage do we get from the United Kingdom, and will this affect greatly the United Kingdom position?


Douglas Charles Abbott: The average before the war was $48,000 and, in the base period, only $28,000. Imports from the scheduled countries amount to $969,000.


[Stage Direction]
Item agreed to.
Items 247, 248, 249 and 251 agreed to.
Customs tariff-ex 257. _ Writing ink, but not including drafting, artists' or instrument ink.
John Ritchie MacNicol: Why is artists' instrument
ink included here?


Douglas Charles Abbott: I am told that we make some of these types of ink; but there are some technical types that we have to import, and since the item was not a large one, it was felt better to exclude all from the prohibition.


Mr. ADAMSON:: Would this include the special ink used for the fountain pen known as Parker 51, which is made only in the United Slates?


Douglas Charles Abbott: It is banned, but I am told that such ink is made here. I am using some at the moment.


[Stage Direction]
Item agreed to.
Customs tariff-ex 271. Lubricating oils composed wholly or in part of petroleum, in containers of less than 25 imperial gallons each.
John Ritchie MacNicol: When the minister gave his address in November there was a hubbub around the country about lubricating oils. Has that been straightened out?


Douglas Charles Abbott: Yes.


Thomas John Bentley: Why is this just in containers of less than 25 imperial gallons each?


Douglas Charles Abbott: It is less expensive to bring in the larger containers.	-


Thomas John Bentley: It is a protection for the wholesale people here.


Douglas Charles Abbott: No. The small container is quite expensive. We use far more United States dollars to bring in oil in 25 gallon containers than to bring it in in tank cars.


[Stage Direction]
Item agreed to.
Customs tariff-ex 272. Refined petroleum jellies and oils, for toilet, medicinal, edible, or similar purposes, in containers of less than 25 imperial gallons each or of less than 250 pounds each in weight, including the -weight of the container.
Agar Rodney Adamson: I do not see it here, but I assume that transformer oil is not on the banned list. I do not think it is made in Canada. It is a special and expensive type of oil.


Douglas Charles Abbott: I cannot say offhand whether transformer oils are included in this category. If it is banned and not available in Canada, special permits are issued for it.


[Stage Direction]
Item agreed to. -
Items ex 272a and 323 agreed to.
Customs t-ariff-ex 326(i). Decanters- and machine-made tumblers of glass, not cut nor decorated, n.o.p.
Harold Aberdeen Watson Timmins: What is the significance of "tumblers of glass not cut nor decorated"? There used to be a good deal of hypocrisy about bringing in tumblers, and if they had the slightest mark -on them they were supposed to be decorated'. What is the significance in dollars and cents in the difference between tumblers of glass decorated and tumblers of glass not decorated?


Douglas Charles Abbott: It is a result of the tariff designation. Machine-made tumblers of glass, not cut or decorated, are banned and the ones cut or decorated are on the quota list, because the cut glass is mostly European or from the United Kingdom.


Harold Aberdeen Watson Timmins: I suppose "not otherwise provided" means that they will be on the quota list.


Douglas Charles Abbott: They are on the quota list in schedule II in order that glass from Czechoslovakia and the United Kingdom may come in.


[Stage Direction]
Item agreed to.
Items 326g, 354a and 354b agreed to.
Customs tariff-ex 362c. Nickel-plated or electro-plated cutlery and table flatware.
Mr. THATCHER:: During the war years it was very hard to obtain this type of merchandise, and I was wondering whether the minister has any assurance that Canadian manufacturers can supply the demand. I believe a great deal came from the United States and England prior to this bill.


Douglas Charles Abbott: There were heavy importations from the United' States. We believe there will be reasonably adequate supplies. The import figures last year, as hon. members will see from the table on Hansard, were well over $3,000,000 in electro-plated ware and over $2,000,000 in nickel-plated ware, n.o.p.

Foreign Exchange Conservation


James MacKerras Macdonnell: When the minister says "we believe," is that an act of faith? We are told that faith without works is dead.


Douglas Charles Abbott: We shall have to follow the good old process of trial and error and if there are shortages steps will have to be taken, but in the meantime we believe we are justified in putting this in to provide a substantial saving of United1 States dollars.


Mr. LOW:: Are British manufacturers getting in a position to supply any appreciable quantity of the demand?


Douglas Charles Abbott: I cannot say offhand.


Solon Earl Low: In recent years I have not seen a great deal of Sheffield cutlery in this country.


Douglas Charles Abbott: I am informed that the main British interest is in item 362 in the quota group.
Item' agreed to.
Customs tariff-ex 414. Typewriters.


Agar Rodney Adamson: Are our manufacturers in Canada able to take care of the Canadian demand in respect of typewriters? Do we export at all?


Douglas Charles Abbott: We have a letter from one manufacturer here saying that he is looking into the possibility of exporting to the United States. I infer, therefore, that the local manufacture of typewriters is adequate.


[Stage Direction]
Item agreed to.
Item ex 414a agreed to.
Customs tariff-ex 414c. Adding machines.
Agar Rodney Adamson: Does this include merely adding machines, or will it cover calculating machines and the complicated machines of the International Business Machines Company, which there would be no real reason for manufacturing in Canada?


Douglas Charles Abbott: This deals with adding machines.


Agar Rodney Adamson: And these other machines will be allowed in?


Douglas Charles Abbott: That is correct.
Customs tariff-415a. Refrigerators, domestic or store, completely equipped or not.


Mr. WRIGHT:: We had a discussion on section 3 of the bill, and I believe the minister admitted that as regards oil burning refrigerators there was discrimination against certain groups in the country who could not obtain automatic refrigeration from any other source. Since that time, I have made further inquiries
and I find that refrigerators of this particular type are not made in the soft-currency countries. As a matter of fact, I believe there is one firm making them in the United States. Previously there had been three firms engaged in the business; but since it is a more or less diminishing business and as electricity becomes more widely distributed, refrigerators of this type are not used. There is no chance whatever of a branch factory being established in Canada. Under these circumstances I think there is a good case for leniency on the part of the minister in this matter of allowing this particular type of refrigerator into Canada. Farmers are not the only ones affected. There are a large number of tourist and other camps throughout Canada where other types of refrigerators are expensive or difficult to obtain. I am, therefore, going to move that this item 415a be amended by adding after the word "not" the following words: "but not including
oil-burning refrigerators". That is seconded by Mr. Nicholson. I think the minister might give some serious consideration to this matter. I do not think it involves a large expenditure of United States dollars, but I believe it means a great deal to people living in areas where electricity is not available.


Douglas Charles Abbott: The other evening I promised my hon. friend that I would look into the whole situation and give it sympathetic consideration. That undertaking still stands. I am afraid that I cannot agree to the removal of the prohibition. After I have looked into the matter, it may be well that we could place it under a reasonable quota; but I do not think the entry of this type of refrigerator should be completely without restriction. For that reason and for that reason alone, I cannot now accept the amendment which is made. But I will give it consideration and see if they can be transferred to the quota list.


Percy Ellis Wright: I would be prepared to withdraw my amendment if the minister is prepared to say they will be placed under quota.


Douglas Charles Abbott: I cannot give that undertaking. I cannot say what the importations are or what it involves in terms of United States dollars. That is my test in regard to these matters. The responsibility I have is to see that our already dangerously low reserves of United States dollars are conserved. Until I am satisfied that I can justify allowing items of this kind in, and know to what extent it can be done, I do not want to give a formal undertaking. The most I can say is, as I said to my hon. friend the other night, that I will give the matter careful and sympathetic consideration.

Foreign Exchange Conservation


Mr. McKAY:: Has the minister the figures to indicate what the importations were?


Douglas Charles Abbott: No. I tried to find out, but the customs figures do not break down, under this tariff item, the figures as between ordinary refrigerators and others. I think it was indicated by some hon. gentleman-perhaps it was the hon. member for Melfort-that these would probably all come in through one or two ports. I am going to look into the matter and see if we can get any accurate data on the extent of importations. But it was only the other day that this matter was brought to my attention, and I have not yet had time to get that information.


Percy Ellis Wright: Under these circumstances, if the minister is prepared to give it sympathetic consideration-and I am sure he will;
I know he does not in this bill want to discriminate against any particular group in the country or any particular area-I shall be prepared to withdraw my amendment.


Douglas Charles Abbott: I thank my hon. friend.
Amendment withdrawn.


[Stage Direction]
Item agreed to.
Customs tariff-ex 415b. Washing machines, domestic, with or without motive power incorporated therein.
Wilbert Ross Thatcher: I understand that certain United States washing machine companies have branches in Canada. If this bill goes through, does it mean that those branches will not be able to get washing machines under any circumstances?


Douglas Charles Abbott: They can get parts. There will not be any restriction of imports of parts under schedule III.


Wilbert Ross Thatcher: There is no intention of the minister working out some sort of quota as he has done with regard to automobiles?


Douglas Charles Abbott: The production of washing machines is reasonably adequate. I do not think we need to import washing machines. Those which were imported were the more luxurious type, if I may say so, without mentioning the names and giving advertising to the particular brands. I am informed that the domestic production of ordinary washing machines, electric and otherwise, is adequate. For instance, last year there were produced in Canada approximately 133,300 machines as against importations of some 33,000.


Wilbert Ross Thatcher: I can tell the minister that, while the supply of electric machines may be adequate, with regard to gas engine machines for farm use there is still nowhere
[Mr. Abbott.l
near the supply to meet the demand. My point was that apparently some of these branches will have to close up, and there are veterans and others who have started up agencies with them.


Douglas Charles Abbott: With regard to non-electric machines, there were 1,069 imported and 21,500 made in Canada. How many of those are gasoline operated I do not know, but the figures are twenty to one.


[Stage Direction]
Item agreed to.
Mr. HODGSON:: I should like to revert to item 414 for a moment, on refrigerators.


The DEPUTY CHAIRMAN:: Is it the pleasure of the committee to do that?


Douglas Charles Abbott: Yes, I suppose so, although these are long schedules, and I do not want too much of it. We agreed to take up the schedules item by item.


Clayton Wesley Hodgson: I intended to get back in before the item was reached. A curling club in Lindsay has a refrigeration plant-


Douglas Charles Abbott: Item 414 refers to typewriters.


Clayton Wesley Hodgson: Item 415a, then.


Douglas Charles Abbott: Yes.


Clayton Wesley Hodgson: Part of this plant was delivered before this measure came into force and part of it was not.


Douglas Charles Abbott: This sounds to me as though it were a problem that would come under schedule III. Is it a curling club refrigeration plant?


Clayton Wesley Hodgson: Yes.


Douglas Charles Abbott: Item 415a refers only to refrigerators, domestic or store, completely equipped or not. I do not think it refers to curling clubs.


Clayton Wesley Hodgson: It will come up later on in the same bill?


Douglas Charles Abbott: Yes.
Item ex 415c agreed to.
Customs tariff ex 415d-'Sewing machines, domestic, with or without motive power incorporated therein.


Wilbert Ross Thatcher: I understand that there is only one manufacturer of sewing machines in Canada. I also understand that, since this embargo went on, prices have started to go up. Has the minister any assurance from that company that it will not take advantage of lack of competition?

Foreign Exchange Conservation


Douglas Charles Abbott: I have not been in touch with the company at all. I have not any such assurance. I am informed that production in 1945 is approximately at pre-war level. We shall have to keep an eye on it and see that they do not exploit the situation.


Alexander Malcolm Nicholson: Will the minister indicate what the policy of the government would be if this company did boost prices? Also, if the supply was not adequate, what consideration would be given to encouraging imports from the United Kingdom? I understand that from non-scheduled countries last year we had a sizeable total of imports of sewing machines. That is a type of machine which I think the British manufacturers could make and supply if there were some encouragement.


Douglas Charles Abbott: That is the sort of thing we would have on quota. If the supply situation in Canada were short, and it were felt that it was necessary to bring more in and that the expenditure of United States dollars would justify it, then they would be moved from the prohibited list to the quota list or perhaps removed entirely. There is flexibility in this. One cannot make the act more rigid, but it can be made less onerous.


James MacKerras Macdonnell: That matter might be considered by the prices committee.
Mr. LOW": The minister would not hesitate, would he, to allow sewing machines in from the LTnited Kingdom in case we found ourselves short in Canada?


Douglas Charles Abbott: I think we would do everything possible to see that there was no shortage of sewing machines.


Agar Rodney Adamson: Is Switzerland one of the hard-currency countries?


Douglas Charles Abbott: Switzerland is one of the hardest currency countries in the world.


[Stage Direction]
Item agreed to.
Customs tariff-ex 427. Outboard motors.
James MacKerras Macdonnell: WTill the minister let me know if I am right in thinking that the subsequent item 440a, pleasure boats, has been maintained in some form?


Douglas Charles Abbott: Not on the prohibited list. There have been changes made in the related bill concerning excise tax, but there has been no change in the prohibition of the import of pleasure boats.


[Stage Direction]
Item agreed to.
Custom tariff-ex 427h. Motion picture projectors for use with films less than one and one-eighth of an inch in width, with or without sound equipment, and motion picture screens adapted for use therewith.
Eric Bowness McKay: Are any of these movie projectors manufactured in Canada? I am a little bit concerned about this particular restriction for this reason. I know some schools are using machines which take films certainly smaller than one and one-eighth inches in width. I believe it is 16-millimeter film.


Douglas Charles Abbott: I am told that there is a special item which gives free entry to educational material including projection machines and that it would not be affected by this tariff item.


Eric Bowness McKay: Has there been an amendment to. this item?


Douglas Charles Abbott: No; there is another tariff item, 696, which covers projectors of this kind used for educational purposes.


Eric Bowness McKay: In the first part of my question I think I asked whether or not any o: these projectors were manufactured in Canada


Douglas Charles Abbott: Some are, I am told.


Percy Ellis Wright: There are a number of these machines in Canada, and I suppose repair parts will be allowed in?


Douglas Charles Abbott: That is true.


[Stage Direction]
Item agreed to.
Item 432b agreed to.
Customs tariff-ex 433. Baths, bathtubs, basins, closets, lavatories, urinals, sinks and laundry tubs of iron or steel, coated or not.
Harold Aberdeen Watson Timmins: Has the minister taken into consideration the fact that during the war there was a bottleneck, which still exists, in respect of bathtubs and sinks? During the war we could not get enough steel to manufacture them. The situation is better now, but certainly it is not cured; and if w'e are to have any all-out housing program in Canada it seems to me that we are being a little short-sighted here. Further than that, we used to get a quantity of these articles from Scotland, and apparently we are also cutting ourselves off from that market.


Douglas Charles Abbott: A new plant is coming into production very shortly, as my hon. friend probably knows, and I have been assured by my colleague the Minister of Trade and Commerce that there is no objection to including these articles in the prohibited list.
144S
Foreign Exchange Conservation


Agar Rodney Adamson: Can the minister say anything about the shortage? It was only last year that plumbing fixtures were the extreme bottleneck in all building, and one had to get a priority to obtain them at all. Has the situation eased to that extent?


Douglas Charles Abbott: There have been shortages of pipe and some other things but not shortages of bathtubs, I am told; and production is steadily increasing.


[Stage Direction]
Item agreed to.
Customs tariff-ex 440a. Pleasure boats of all kinds.
Mr. GIBSON (Comox-Alberni):: I wonder if this would include second-hand pleasure boats which might be bought in the United States. Might we not have to leave room for considerable latitude in interpretation by the customs authorities as to what is a pleasure boat? It is quite conceivable that a pleasure boat there might be brought here and converted into a commercial vessel.


Douglas Charles Abbott: Probably it would have to be registered. Tourists can bring in their own pleasure vessels, but this does include secondhand vessels as well as new ones.


John Lambert Gibson: Would
some discretion be left with the customs authorities?


Douglas Charles Abbott: That would have to be dealt with by the customs authorities, of course, as to what constituted a pleasure boat.


John Lambert Gibson: But it
might be purchased as a pleasure craft and converted.


Douglas Charles Abbott: If the customs people were satisfied that would be done I presume it would be admitted.


John Lambert Gibson: (Comox-Alberni): It is also possible that a commercial vessel might be bought over there and converted to a pleasure craft here. I should think a great deal of discretion would have to be given the authorities.


Douglas Charles Abbott: We could not help that, I am afraid. If it were brought in as a commercial vessel and converted into a pleasure boat I do not think we could do much about it.


James MacKerras Macdonnell: But suppose it were the other way around. Suppose it were brought in here to be used for business purposes?


Douglas Charles Abbott: They would apply for a permit to bring in the boat as a commercial 
vessel. Hon. members will appreciate that this item is intended to exclude the wide range of gasoline launches that are used at summer resorts, and so on, some of which are pretty expensive.
Mr. PEARIvES: Did I understand the minister to say this would not affect tourists coming in?


Douglas Charles Abbott: That is so. They may bring in their own boats.


[Stage Direction]
Item agreed to.
Customs tariff-ex 443. Apparatus designed for cooking or for heating buildings (not including parts).
Thomas John Bentley: I am not going to make another speech such as I made the other day, but I am stall interested in propane gas stoves. I think they should be allowed in, and I am led to believe that they can be obtained in some of the soft currency countries. For that reason I am going to move, seconded by the hon. member for Humboldt, that item 443 be amended by striking out the words "for cooking or."


Douglas Charles Abbott: I must give my hon. friend the same answer as I gave the hon. member for Melfort. The other night I promised him that we would take a look at this item in view of his representations and see whether it might be possible to place a quota on these stoves. But I cannot agree to an amendment which takes them out of the operation of the act entirely; and I am not prepared to say what the quota should be until we have had a chance to look into the matter.


Thomas John Bentley: I want to point out to the minister that these can be manufactured and at present are being manufactured in the soft currency countries. Consequently I am not asking the minister to accept something which might involve the expenditure of United States dollars. By this amendment I am simply asking that he ease up a little on the non-discriminatory clause as it applies to this item, and let the soft currency countries such as Great Britain ship in these goods.


Douglas Charles Abbott: W'e cannot make special exceptions to the non-discriminatory principle. We must either adopt the principle of nondiscrimination or not adopt it, and that point has been settled by the house. So, as I say, the most I can do is promise to give the matter of propane gas stoves serious consideration, to see whether it is possible to place them under quota. I think my hon. friend did indicate-and this agrees with my own information-that it should be possible also to produce these stoves in Canada.

Foreign Exchange Conservation


Thomas John Bentley: That is right. With that assurance from the minister, and since it would only bring on a long fight which would not do anyone any good if I pressed my amendment, I withdraw the amendment.


Douglas Charles Abbott: I thank my hon. friend.
Amendment withdrawn.


James MacKerras Macdonnell: This item reads "not including parts". Does that mean there is no limit on the number or variety of parts that may be imported?


Douglas Charles Abbott: The explanation is that a knocked-down stove would not be allowed in, but parts for these stoves, or for any others, are all covered under schedule III, in the same tariff item. My hon. friend will find the item at page 31. It reads:
Parts for the production of apparatus designed for cooking or for heating buildings:
(1)	For	coal	or	wood(2)	For	gas(3)	For	electricity(4)	For	oil(5)	N.o.p.
Parts come in, and that is why the phrase *"not including parts" is in this item. They come under schedule III, which means, in effect, they they will be allowed in substantially without restriction.


[Stage Direction]
Item agreed to.
Customs tariff-444b. Lamp shades, n.o.p., and shade holders.
Agar Rodney Adamson: Just as a matter of interest, what were our imports? It seems an extraordinary item to be prohibited.


Douglas Charles Abbott: Our imports from the
United States amounted to $106,000, and to $1,000 from non-scheduled countries.


[Stage Direction]
Item agreed to.
Items ex 445, ex 445a and ex 445b agreed to.
Customs tariff-ex 445d. Radio receiving sets and cabinets and chassis therefor.
Wilbert Ross Thatcher: Could the minister say how many of the radio sets which came into the country last year were brought in by commercial firms and how many were just radios that people brought in for themselves?


Douglas Charles Abbott: I am told that the great majority would come in through dealers and be sold in the ordinary way in the retail trade.


Wilbert Ross Thatcher: I believe today in
Canada radios are quite plentiful. Could the minister tell the committee whether, since they are plentiful here, our manufacturers under this new program are trying to export
radios to the United States? Are our manufacturers free to ship radios to the United States, or do the cartel arrangements prevent that?


Douglas Charles Abbott: I do not think the cartel arrangements prevent it. I am told we are shipping some to South America, to hard currency countries. But so far as I know we are not exporting any to the United States. It would be difficult for our manufacturers to compete in a large way in the United States, because of volume, and also because some of the parts would have to be brought in from the United States anyway. As a general rule, I believe our radio prices, even allowing for duties, have been somewhat higher than prices of similar radios in the United States.


John Lambert Gibson: How does this apply to radio-telephone receivers, such as marine equipment?


Douglas Charles Abbott: I am told that they are caught by the ban. They come within the definition; but permits are being given for remote lumber areas or for marine use, and that sort of thing.


Agar Rodney Adamson: Are frequency modulation sets and television sets being made in Canada?


Douglas Charles Abbott: I cannot answer that at the present time.


[Stage Direction]
Item agreed to.
Items ex 445e, ex 445i, ex 445j and 449 agreed to.
Customs tariff-451e et al. Slide, hookless or zipper fasteners and parts thereof.
James MacKerras Macdonnell: I am told there is not sufficient supply in Canada to meet the market requirements of zipper parts. Will the minister say if that is so? If so, why are they excluded? What is the amount involved?


Douglas Charles Abbott: I am told that $107,000 worth were imported last year from scheduled countries. In 1945, which is the latest figure available, there were three and a quarter million dollars worth produced in Canada, as against $105,000 worth imported, which appears to be a small ratio. Of course, if Canadian supplies were not adequate, it would be necessary to put them under quota. But the information we have is that the Canadian supply is adequate.


Harold Aberdeen Watson Timmins: Why are parts mentioned here?


Douglas Charles Abbott: I am told if the parts were not prohibited the prohibition would be completely valueless. They would bring in the parts and put them together here.
Foreign Exchange Conservation


James MacKerras Macdonnell: I have been informed by a responsible person that the supply was not adequate.


Douglas Charles Abbott: I shall look into the matter again. I gave my hon. friend an assurance that if supplies of essential materials were not adequate, it would be reconsidered.


Winfield Chester Scott McLure: I understand that since these zipper fasteners were invented in the United States, royalties are paid on all that are manufactured. Those royalties go to the patentee in the United States. Unless sufficient are not being manufactured, it is important that they should not be prohibited entirely.


Douglas Charles Abbott: Of course we would have to pay the royalty if they were manufactured here. The royalty would have to be paid to the United States patent holder. But that would be much cheaper, in terms of United States dollars, than in importing those fully manufactured in the United States.


[Stage Direction]
Item agreed to.
Douglas Charles Abbott: May we return to item 234, which was held over?
Customs tariff-234. Perfumery, including toilet preparations, non-alcoholic, viz., hair oils, tooth and other powders and washes, pomatums, pastes and all other perfumed preparations, n.o.p., used for the hair, mouth or skin.


Donald Methuen Fleming: I should like to thank the minister for holding this item over; I was in a committee meeting elsewhere when it was called. Will the minister consider transferring this item to another schedule, or dealing with it in such a way that it will not prevent the importation of French perfumes into Canada? I have in mind two young veterans of the Canadian armed forces who established themselves in business in Canada as importers of French perfumes, and other similar products such as face powders, hair lotions and brilliantines. I do not know that they are the the only ones who have done this. They had established connections with the French producers of these goods while serving in the forces and are in a position to carry on a business which would be useful in Canada, and would also help the French producers. Supplies of these materials are available in France.
It so happens that the two veterans about whom I am speaking, relying on the hope of establishing a good line of French perfumes, sank into their business all the wealth they had in the world, including their re-establishment grants. Now, with the virtually complete exclusion of French perfumes and similar products, not only are they faced with ruin,

but harm is being done to the good relations they had established with the French producers. This particular case has I believe, been brought to the attention of Mr. Taylor.
The partnership in question had hoped during the current year to import perfumes and other like materials to a value of not less than two million francs, and this is a serious matter for them. I am not speaking about perfumes from the Lhiited States, but rather perfumes from France, and I urge that special consideration be given to a case of this kind.


Douglas Charles Abbott: The committee will notice that this item relates only to non-alcoholic perfumes and preparations. Under this item goods to the value of only $9,000 were imported from France during the base period. Many of the French perfumes are alcoholic, and as such they come under tariff item 160, concerning which there is no prohibition. So that I believe it is fair to say that a substantial portion of the French perfumes are not prohibited.


Donald Methuen Fleming: There are two observations I should like to make. First, last year's statistics do not apply. These young men are just starting up, and the volume of business they did last year is not to be compared with the volume they had every reason to expect to do this year. Then, as to alcoholic content, I am told that if one wants to transform a non-alcoholic perfume into an alcoholic perfume it can be done by debasing the product through the addition of a portion of alcohol.
However, I do not think the point the minister makes covers this situation. The perfumes to which I am referring, and in the sale of which these young veterans were establishing themselves, are almost entirely non-alcoholic. They do not wish to adulterate their perfumes by the addition of alcohol so that they may be classified as having alcoholic content, simply to evade the provisions of the schedule. They propose to sell well-known and well-established brands of non-alcoholic French perfumes.


Douglas Charles Abbott: The difficulty here, as with other items, is that these non-alcoholic perfumes mostly come from the United States. Last year, over $400,000 worth was imported from the United States, only $8,000 worth from France and something like $70,000 worth from the United Kingdom. Unless we are prepared to revert to the discriminatory principle, we would have to let in a lot of these perfumes from the United States in order to let them in from France. In the case of the more expensire alcoholic perfumes, last year $80,000

Foreign Exchange Conservation
worth was imported from France as against only $6,000 from the United States. I never knew that the high-class perfumes contained alcohol until this debate came on.


Donald Methuen Fleming: I would urge the minister to regard this case as being one of exceptional hardship. This was to be a new business in Canada which would have been good for Canadians and for the French producers.


Douglas Charles Abbott: I will look into the circumstances of the case.


Donald Methuen Fleming: We should help to establish some lines of these well-known French brands in Canada and permit them to be sold here under their trade names.


Douglas Charles Abbott: I will look into the circumstances of the particular case.


Donald Methuen Fleming: It may be that there are not many cases of this kind, but the one I suggest is of such severe hardship that I think the minister might well deal with it as such.


John Horne Blackmore: Would the minister mind giving the basis for his conclusion as to the amount of perfumes that might be brought in from France in accordance with the non-discriminatory principle so that we can understand just what he is advocating?


Douglas Charles Abbott: There are two principal items dealing with perfumes. One is the nonalcoholic type which, I am told, is the cheaper perfume. In that case the major importations were from the United States and not from France. In the case of the more expensive perfumes which apparently contain alcohol, the principal importations were from France, with very little coming from the United States. The figures which I gave for the more expensive alcoholic perfumes were $82,000 from France as against only $6,000 from the United States.


John Horne Blackmore: Upon what does the minister base his reasoning in order to determine when importations from France are nondiscriminatory and when they are not?


Douglas Charles Abbott: We tried to take the items which would result in the greatest saving of United States dollars. That is the principle which has been followed.


John Horne Blackmore: Perhaps I am not making myself clear to the minister. How does the minister decide whether or not importations from any country are discriminatory'? At what point do they become discriminatory?


Douglas Charles Abbott: I do not know that I am following my hon. friend quite clearly. We
adopt the same principle so far as all countries are concerned. In other words, if we ban a product, it is banned from all countries. In selecting the articles to be banned we endeavoured, as I explained before, to select articles the major source of supply of which was hard currency countries. We endeavoured to let in those articles whose main source of supply was soft currency countries. That is the general principle we endeavoured to follow in selecting the item to go into either schedule I. the prohibited list, schedule II, the quota list, or to be left off entirely.


[Stage Direction]
Item agreed to.
Customs tariff-ex 462. Cameras, no-t including those for professional use.
Agar Rodney Adamson: I have been asked by a group of exhibitors who presumably have an amateur standing but who have done a great deal of exhibiting of photographs in public exhibitions, to inquire for further details about this item. They want to know whether the very expensive minitameras are excluded from Germany?


Douglas Charles Abbott: The situation is that all cameras, except professional cameras, are prohibited.


Agar Rodney Adamson: Everything is prohibited except what is used by the man who sets himself up as a professional photographer to take pictures?


Douglas Charles Abbott: That is correct.


John Ritchie MacNicol: Does that include moving picture cameras?


Douglas Charles Abbott: They are under schedule III,
yes.


[Stage Direction]
Item agreed to.
Item 465 agreed to.
Customs tariff-468. Bird, squirrel and rat cages, of wire, and metal parts thereof.
Agar Rodney Adamson: Here again I have received a request from a number of people in the business of raising canaries. They are finding great difficulty in getting cages which normally come from the United States. They have been refused permission to bring these in from the L'nited Kingdom. I did not know that the business of raising canaries was so important, but apparently there are a number of people engaged in this business.


Douglas Charles Abbott: I understand that they were banned during the war under the War Exchange Conservation Act, and moreover they could not be manufactured because they used metal. However, they are made in this country. I will consider my hon. friend's representations.

Foreign Exchange Conservation


John Horne Blackmore: Why are these cages not permitted to be brought in from England?


Douglas Charles Abbott: As I have said, we are adopting a non-discriminatory principle in the bill. An amendment was introduced, but it was voted down.


John Horne Blackmore: That is hardly consistent with what the minister said before. I gathered, when we were discussing perfumes, that the minister was admitting commodities from soft currency countries as far as possible.


Douglas Charles Abbott: We imported $56,000 worth of bird and squirrel cages from hard currency countries and only $12,000 worth from other countries.


Agar Rodney Adamson: This is most important to canary raisers.


Donald Methuen Fleming: One of the anomalies under this bill is that bird cages and swings are excluded, but not bird baths.


Douglas Charles Abbott: Bird cages cannot be
imported; I do not know about bird baths.


John Horne Blackmore: Do I understand that in the application of this remarkable nondiscriminatory principle, if we cut off importations from hard currency countries we automatically cut off importations from soft currency countries?


Douglas Charles Abbott: That is correct.


John Horne Blackmore: What is the base period that has been referred to?


Douglas Charles Abbott: That has been given several times but probably the hon. gentleman was not in his seat. The base period in connection with which I gave figures is the twelve months ended June 30, 1947.


Winfield Chester Scott McLure: I am surprised that they did not include fox cages.


Douglas Charles Abbott: We think too much of Prince Edward Island.


Winfield Chester Scott McLure: I believe they should be in. I should like to see the government have courage enough to exclude these things from coming into Canada. We can make better fox cages and, I believe, better rat cages than what we import, from the United States. I should like to see that put in there. Why should we import them when we can manufacture better articles ourselves? It is only a question of the government having the nerve to do it.


Douglas Charles Abbott: I am sure we could make a better and cheaper fox cage in Canada.


[Stage Direction]
Item agreed to.

Customs tariff-505a. Hardwood flooring, tongued and/or grooved, or jointed, viz: beech, birch, maple and oak.
Harold Aberdeen Watson Timmins: How much of this material comes in from the United States and how much money is involved?


Douglas Charles Abbott: The amount was $132,000 in the base period.


Harold Aberdeen Watson Timmins: What were the total
imports?


Douglas Charles Abbott: They amounted to $9,704,000; $8,753,000 from scheduled countries and $951,000 from non-scheduled countries.


Agar Rodney Adamson: Sweden mostly?


Douglas Charles Abbott: Tropical woods from Central America.


Harold Aberdeen Watson Timmins: Was $132,000 the amount of hardwood flooring imported from the United States?


Douglas Charles Abbott: Correct.


John Lambert Gibson: Is there any quota on hard woods from tropical countries to take care of shipbuilding requirements?


Douglas Charles Abbott: Special permits are being issued.


Agar Rodney Adamson: All these fancy woods such as mahogany, rosewood and so forth, afe now excluded?


Douglas Charles Abbott: On January 8, a circular was sent to importers of lumber and veneers setting out:
Until further notice the following species of lumber may be imported under special permit: teak, Australian gumwood, Australian ironbark, mahogany, Ponderosa pine, California sugar pine, Idaho white pine.


Harold Aberdeen Watson Timmins: Those are prohibited when the act goes through?


Douglas Charles Abbott: What I have read was a circular from the emergency import control division to importers of lumber and veneers. Although there is a general prohibition, permits will be issued in special cases. We can relax but we cannot make more onerous.


Mr. MENARY:: Does oak come under
that?


Douglas Charles Abbott: No. There is a small quota with respect to oak for certain purposes.


Wilbert Ross Thatcher: Do veneers used in the manufacture of furniture come under this?


Douglas Charles Abbott: Veneers as a whole are excluded.

Foreign Exchange Conservation


Harold Aberdeen Watson Timmins: What was the number of that circular?


Douglas Charles Abbott: It has no number but I will get a supply for circulation among the members. The customs people have a complete list of those who import these articles and a circular would be sent to all on the list. That has already been sent out.


James MacKerras Macdonnell: Are items 506a, 506b, 507, 507a, 507b, 507c and 507e standing?


Douglas Charles Abbott: Yes.


James MacKerras Macdonnell: They are all in the excluded list?


Douglas Charles Abbott: Yes.


James MacKerras Macdonnell: I thought the minister said a moment ago that discretion was being exercised and permits issued with regard to these. Am I correct?


Douglas Charles Abbott: In cases of particular hardship. If it is shown, for instance, that because of the lack of a small quantity of imported veneer finish, let us say, a piece of furniture, which is 99*%oo per cent of Canadian manufacture, the article cannot be finished, a special permit is granted.


Harold Aberdeen Watson Timmins: Will this be a continuing thing after the act is passed?


Douglas Charles Abbott: It has been worked1 out after long discussions with the furniture and lumber industries and, I am told, seems to be working satisfactorily.


Wilbert Ross Thatcher: Some permits have
already been issued?


Agar Rodney Adamson: What about piano manufacturers? They use a special kind of wood which, I understand, is not obtainable in Canada.


Douglas Charles Abbott: We have not heard from the piano manufacturers, but if they made submissions they would1 be considered.


Agar Rodney Adamson: We were all briefed by them.


Douglas Charles Abbott: That was about the excise tax.


Stanley Howard Knowles: If the minister has not already given the information, what in dollars do all these hardship permits amount to?


Douglas Charles Abbott: I gave that the other evening. Up to February 7 they amounted, in round figures, to $7,000,000. That is on Hansard.


[Stage Direction]
Item agreed to.
Customs tariff-507c. Plywood made of two or more layers of veneer or lumber of wood, glued or cemented together, but not further manufactured.
Winfield Chester Scott McLure: I understand that under this item pillars made from plywood1 and locked together with special machinery and then glued or cemented are prohibited entry. I received a letter today from a gentleman, an American, who is building a home in Canada, and he wanted to know if he could get in this country 25-foot columns .made from veneer and machined together. The house is to be of pure colonial design. I should like to know if those pillars are prohibited entry, because in Canada we manufacture only 12, 14 and 16-foot pillars. There is only one place where 24 and 26-foot pillars can be got, and that is Chicago. Could he receive a permit to bring in these pillars which are not manufactured1 in Canada?


Douglas Charles Abbott: They are banned-, but
whether he would qualify under the hardship provision because he could not get such pillars in Canada I could not say offhand. The case would have to be looked into on its merits.


[Stage Direction]
Item agreed to.
At six o'clock the committee took recess.
After Recess
The committee resumed at eight o'clock.
William Henry Golding: The next item is 507e. Shall the item carry?
Items 507e, 508, 512, and ex 506 et al agreed
to.
Customs tariff-ex 514. Coffins and caskets.


James MacKerras Macdonnell: Can the minister tell us the difference between coffins and caskets? I should like to know also whether there is any significance in the fact that immediately under this item "coffins and caskets" there appears the item "showcases of all kinds".


Douglas Charles Abbott: These are two separate items. I am not sure that I am clear as to the distinction between coffins and caskets. They are close to being synonymous. I shall have to consult the Oxford dictionary to see whether there is any real distinction.


George Randolph Pearkes: Occupied or unoccupied? Does that make a difference?


Douglas Charles Abbott: Curiously enough that question was raised by a conscientious customs officer at the border shortly after the restriction came into force and the point was referred to Ottawa for a decision.
Foreign Exchange Conservation


An hon. MEMBER:: What was the decision?


Douglas Charles Abbott: Unoccupied.
Item ex 515, 519, 519a, 597, and ex 597a. Agreed to.
Customs tariff-502, 603. Fur skins, wholly or partially dressed.


John Lambert Gibson: Will it be possible to send Canadian furs to the United States for treatment and bring them back? There might be privately owned seal skins coming under this category.


Douglas Charles Abbott: Permits have been given for furs to be sent to the United States and processed and returned to Canada.


Winfield Chester Scott McLure: Will there be permits for Alaska seal skins owned by the fisheries department and now being processed in the United States? Will there be permits for manufacturers here to get those in?


Douglas Charles Abbott: That matter, I am informed, has been raised in the last few days and is now under discussion with my colleague, the Minister of Fisheries, who is not here at the moment.


George Randolph Pearkes: And that will apply to next year's catch as well, the fur seals which are slaughtered on the Pribilof islands, and which are sent to the United States.


Douglas Charles Abbott: That is correct. Those are the seal skins under discussion at the moment.


George Randolph Pearkes: Where big game hunters kill hides, will they be permitted to have them cured in the United States and returned?


Douglas Charles Abbott: Not automatically, but I think permits would be issued in suitable cases. There would probably not be many of them.


[Stage Direction]
Item agreed to.
Item ex 618b agreed to.
Customs tariff-624 et al. Bead ornaments, and ornaments of alabaster, spar, amber, terra cotta, composition, or other material except china or porcelain-; fans of all kinds, statues and statuettes of any material other than porcelain or earthenware.
James MacKerras Macdonnell: Does item 624 not cover some of the items which are also in item 634 in schedule II? It has been suggested to me that there is overlapping there.


Douglas Charles Abbott: If anything is in schedule II it automatically overrides schedule I. If there is a conflict between an item in schedule II, which is under the quota, and an item in schedule I, which is a prohibited item, the item in schedule II overrides any possible interpretation bringing it within the item in schedule I.


Mr. HAZEN:: Where is the authority for that?


Douglas Charles Abbott: I have not at the moment the answer to that question, but I am told that the phrase in item 624 "other than porcelain or earthenware" takes out the great majority of items and those are included in the quota items under schedule II.


[Stage Direction]
Item agreed to.
Items 625, 629 and 647 agreed to.
Customs tariff-ex 648. Precious and semiprecious stones (other than diamonds) whether genuine or synthetic; pearls, whether genuine or cultured, and imitations and simulations thereof.
Eric Bowness McKay: Why' are diamonds omitted from this?


Douglas Charles Abbott: They all come directly or indirectly from non-scheduled soft-currency countries.


[Stage Direction]
Item agreed to.
Items ex 651, ex 655, ex 655a, ex 689a agreed to.
Customs tariff-ex 71. Synthetic casings for meat.
Mr. JACKMAN:: I wrote to the minister about synthetic casings for meat and I understood that eventually this would be put in the quota schedule. Is it in the quota schedule now?


Douglas Charles Abbott: It is banned, but in the provision with respect to hardship to an industry, a quota of $75,000 a month is being provided.


Harry Rutherford Jackman: It remains in -the
prohibited schedule?


Douglas Charles Abbott: That is correct, but a special quota of $75,000 a month is allowed under the hardship provision of section 4 of the act.


Harry Rutherford Jackman: I thought it was understood in a previous discussion that hardship cases were all of single occurrence, that they did not recur.


Douglas Charles Abbott: Not necessarily. They can relate to an industry or to an individual or to the Canadian public.


Harry Rutherford Jackman: For the sake of greater certainty, may I ask why this is not carried over to schedule II?


Douglas Charles Abbott: It does not fit into any recognized category. It is a new industry, and there is no record of performance pre-war on which one can base a quota in the normal way that quotas are established for schedule II.

Foreign Exchange Conservation


Stanley Howard Knowles: What are these casings for?


Douglas Charles Abbott: Sausages and bologna.


Stanley Howard Knowles: We have had a lot of that around here for some time. The minister speaks as though it is something new.


Douglas Charles Abbott: We used to have natural casings. These are synthetic casings.


Stanley Howard Knowles: It is still bologna.


Angus MacInnis: How did the minister fix
the quota if there was no way by which it could be fixed under schedule II?


George Alexander Cruickshank: Synthetic fixing.


Douglas Charles Abbott: I am told that it is based on a reasonable cut back from the experience of the last year or two. None of these things were imported during the peace period prior to the war, 1936-1939. It has just been fixed after examination into the imports during the last year or two just prior to now, and estimated as a reasonable cut back from those imports.


Mr. HARRIS (Danforth):: Will this quota be pro rata among importers and consumers?


Douglas Charles Abbott: Among importers.


Joseph Henry Harris: That is $75,000?


Douglas Charles Abbott: Yes.


Joseph Henry Harris: It will be pro rata?


Douglas Charles Abbott: Yes, pro rata among
importers.


[Stage Direction]
Item agreed to.
Items ex 362c, ex 427, and ex 446a agreed to.
Custom tariff-ex 703b. Goods enumerated elsewhere in schedules I and II, except goods to which paragraph (c) of subsection two of section three of this act applies.
Wilbert Ross Thatcher: Before we leave this item, I wish to ask the minister a question. I suppose there is an obvious answer, but I do not know what it is. Can the minister indicate why whiskeys from the United States were put on the banned) list?


Douglas Charles Abbott: The main reason is, as is probably well known to most hon. members, that virtually all of it comes from sterling area countries, and particularly from the United Kingdom.


Harry Rutherford Jackman: That is much too wide a statement.


Douglas Charles Abbott: We import practically none of that from the hard currency countries.
5849-93*


Stanley Howard Knowles: Has the minister any figures as to the amount we import from the United States?


Douglas Charles Abbott: Yes.


Harry Rutherford Jackman: Not very much. I would not worry about it.


Douglas Charles Abbott: The figures lost year to the end of November were about $2,000,000.. I am told that is mostly for blending and re-export hack to hard currency countries and compares with over $3,500,000 from the United Kingdom and $2,000,000 of other stuff from the United Kingdom, British Guiana, Barbados, Jamaica, Trinidad, Bahamas, Australia, Cuba, French West Indies, Mexico, Virgin islands and so on. The great majority came from soft currency countries.


[Stage Direction]
Item agreed to.
Douglas Charles Abbott: Before we proceed' with schedule II, perhaps as a matter of form I might ask one of my colleagues to move that schedule II as it was originally printed be deleted and be replaced by the following. The schedule is the one which is before the members of the committee in the reprinted bill, but as a matter of form this will regularize proceedings.
Mr. ST. LAURENT moved:
That schedule II of Bill 3 be deleted and attached schedule substituted:



SCHEDULE II

[Stage Direction]
In this schedule where a tariff item of schedule "A" to the Customs tariff is listed without being preceded by the word "ex" all goods included in that tariff item shall be deemed to be included in this schedule and where a tariff item is listed and preceded by the word "ex" only the goods described thereafter are deemed to be included in this schedule, and words and expressions in this schedule have the same meaning as in the schedules to the Customs Tariff.
Category 1-Fruits and Vegetables.
83.	Potatoes, as hereunder defined:
(a) In their natural state; (b) Dried, desiccated, or dehydrated; (e) Sweet potatoes in their natural state; (d) Sweet potatoes, n.o.p.
84.	Onions, in their natural state, including onions grown with tops, shallots, and onion sets.
93. Apples, fresh, in their natural state.
100.	Grape fruit, when imported from the place of growth by ship, direct to a Canadian port.
1'00'a. Grape fruit, n.o.p.
101.	Oranges, n.o.p.
101a. Lemons.
101b. Oranges, the produce of Palestine (when imported direct from the country of growth and production or from a country entitled to the benefits of the British preferential tariff) during the months of January, February, March and April.
102.	Limes.
Foreign Exchange Conservation
[Stage Direction]
152. Lime juice, fruit syrups and fruit juices, n.o.p.
152b. Orange juice, grapefruit juice, and blended orange and grapefruit juice, the product of the British West Indies, when imported direct from the country of production.
Category 2-Textiles.
523. Woven fabrics, wholly of cotton, not bleached, mercerized nor coloured, n.o.p., and seamless cotton bags.
523a. Woven fabrics, wholly of cotton, bleached or mercerized, not coloured, n.o.p.
523b. Woven fabrics, wholly of cotton, printed, dyed or coloured, n.o.p.
523c. Woven fabrics wholly of cotton, composed of yarns of counts of 100 or more, including all such fabrics in which the average of the count of warp and weft yarns is 100 or more.
523e. Woven fabrics wholly of cotton with cut pile, n.o.p.
523j. Shadow cretonnes, wholly of cotton, with printed warp and plain weft.
523k. Gabardines, wholly of cotton, with not less than 280 ends and picks of ply yarn per square inch.
5231. Woven fabrics, wholly of cotton, composed of yarns of counts of not less than 80 and not more than 99, including all such fabrics in which the average count of the warp and weft yarns is not less than 80 and not more than 99.
524a. Fabrics with cut weft pile, wholly of cotton or of cotton and synthetic textile fibres or filaments.
528.	White cotton bobinet, plain, in the web.
529.	Embroideries, lace, nets, nettings, bobinet, n.o.p., fringes and tassels, wholly of cotton.
529a. Lace and embroideries, wholly of cotton, not coloured, when imported for use exclusively by manufacturers in the manufacture of clothing, in their own factories.
530.	Lace and embroideries, wholly of cotton,
coloured, when imported for use exclusively by manufacturers in the manufacture of clothing, in their own factories.	_
531.	Knitted fabric wholly of cotton, in the web, imported by manufacturers of rubber boots and shoes for use exclusively in the manufacture of such articles in their own factories.
532.	Clothing, wearing apparel and articles made from woven fabrics, and all textile manufactures, wholly or partially manufactured, composed wholly of cotton, n.o.p.; fabrics wholly of cotton, coated or impregnated, n.o.p.
532a. Handkerchiefs, wholly of cotton.
532b. Woven fabric, wholly of cotton, for covering books.
541a. Woven fabrics, wholly of jute, n.o.p.
542. Woven fabrics, wholly or in part of vegetable fibres, and all such fabrics with cut pile, n.o.p.. not containing silk, synthetic textile fibres or filaments, nor wool.
542a. Woven or braided fabrics not exceeding twelve inches in width, wholly or in part of vegetable fibres, n.o.p., not to contain silk. Synthetic textile fibres or filaments, nor wool.
545. Lace and embroideries, wholly of flax, or of hemp, or of flax, hemp and cotton, not coloured, imported by manufacturers for use exclusively in the manufacture of clothing in their own factories.
	.
546. Articles made from fabrics, finished or unfinished, and all textile manufactures, wholly of jute, n.o.p.; fabrics wholly of iute, coated or impregnated, and jute fabric backed with paper.
548. Clothing, wearing apparel and articles, made from woven fabrics, and all textile manufactures, wholly or partially manufactured, composed wholly or in part of vegetable fibres but not containing wool, n.o.p.; fabrics coated or impregnated, composed wholly or in part of vegetable fibres but not containing silk, synthetic textile fibres or filaments, nor wool, n.o.p.
553.	Blankets of any material, not to include automobile rugs, steamer rugs, or similar articles.
554.	Woven fabrics, composed wholly or in chief part by weight of yarns of wool or hair, not exceeding in weight six ounces to the square yard, n.o.p., when imported in the gray or unfinished condition, for the purpose of being dyed or finished in Canada.
554a. Woven fabrics, consisting of cotton warps with wefts of lustre wool, mohair or alpaca, generally known as lustres or Italian linings, n.o,p.
554b. Woven fabrics composed wholly or in part of yarns of wool or hair, n.o.p.
554c. Woven fabrics, composed wholly or in chief part by weight of yarns of wool or hair, not exceeding in weight four ounces to the square yard, when imported in the gray or unfinished condition, for the purpose of being dyed or finished in Canada.
554d. Woven or braided fabrics not exceeding twelve inches in width, whether with cut pile or not, wholly or in part of wool, the hair of the camel, alpaca, goat or other like animal.
554f. Woven fabrics, composed wholly or in part of yarns of wool or hair, commonly known as billiard cloth.
555.	Clothing, wearing apparel and articles made from woven fabrics, and all textile manufactures, wholly or partially manufactured, composed wholly or in part of wool or similar animal fibres, but of which the component of chief value is not silk nor synthetic textile fibres or filaments, n.o.p.; fabrics, coated or impregnated, composed wholly or in part of yarns of wool or hair, but not containing silk nor synthetic textile fibres or filaments, n.o.p.
560a. Woven fabrics wholly or in part of silk, not to contain wool, not including fabrics in chief part by weight of synthetic textile fibres or filaments, n.o.p.
560b. Woven fabrics, wholly of silk, twenty-six inches in width, or less, n.o.p.
560c. Woven fabrics with cut pile, whether or not coated or impregnated, wholly or in part of silk or synthetic textile fibres or filaments, but not containing wool, n.o.p.
561.	Woven fabrics wholly or in part of synthetic textile fibres or filaments, not to contain wool, not including fabrics in chief part by weight of silk, n.o.p.
561a. Fabrics, coated or impregnated, n.o.p.: (i) Composed wholly or in part of silk; (ii) Composed wholly or in part of synthetic textile fibres or filaments, but not containing silk.
562.	Woven fabrics not exceeding tweOve inches in width generally known as "ribbons", whether with cut pile or not, wholly or in part of silk but not containing wool.

Foreign Exchange Conservation
562a. Woven fabrics not exceeding twelve inches in width, generally known as "ribbons", whether with cut pile or not, wholly or in part of synthetic textile fibres or filaments, but not containing silk nor wool.
564.	Woven fabrics, of a kind not made in Canada, wholly, or in chief part, by weight, of silk or of synthetic textile fibres or filaments, or both, imported in the web in lengths of not less than five yards each by manufacturers of neckties, scarves, or mufflers, for use exclusively in the manufacture of such articles in their own factories.
564a. Irish poplin, composed wholly of silk and wool, not exceeding twenty-five inches in width, imported in the web in lengths of not less than five yards each, under such regulations as the minister may prescribe, by manufacturers of neckties, scarves or muffleTS for use exclusively in the manufacture of such articles in their own factories.
565.	Embroideries, lace, braids, cords, chenille, gimp, fringes and tassels, whether containing tinsel or not, nets, nettings and bobinet, n.o.p.
566.	Plaited or braided lines and cords, nonelastic, whether of tubular or of solid construction, not exceeding one inch in circumference, wholly or in chief part !by weight of vegetable fibres.
567.	Clothing, wearing apparel and articles, made from woven fabrics and all textile manufactures, wholly or partially manufactured, n.o.p., of which silk is the component of chief value.
567a. Clothing, wearing apparel and articles, made from woven fabrics and all textile manufactures, wholly or partially manufactured, n.o.p., of which the component of chief value is synthetic textile fibres or filaments.
568.	Knitted garments, knitted underwear and knited goods, n.o.p.
568a, Socks and stockings: (i) of wool; (ii) n.o.p.
569(i). Hats, hoods and shapes of fur felt or of wool-and-fur felt, under such regulations as the minister may prescribe.
569(ii). Hats, hoods and shapes of wool felt.
569(iii). Hoods and shapes, knitted, crocheted, plaited or woven in a single piece, and hoods and shapes of braid, not sewn, under such regulations as the minister may prescribe.
569 (iv). Hoods and shapes, n.o.p.
569 (v). Hats, n.o.p.
569a (i). Berets of wool, knitted and fulled.
569a(ii). Caps, bonnets and berets, n.o.p., under such regulations as the minister may prescribe.
569c. Hat braids, of a class or kind not made in Canada, whether woven, knitted or plaited, not exceeding six inches in width, imported for use exclusively in the manufacture of hat bodies or shapes, but not for use in the ornamentation or trimming of such bodies or shapes, under regulations prescribed by the minister.
569d. Woven fabrics, not exceeding two inches in width, made with unserrated selvages, generally known as single, double or four shot corded ribbon, imported by the manufacturers of men's hats for use exclusively in their own factories in making the bands for, or in binding the edges of, men's hats only.
570.	Mats, door or carriage, other than metal, n.o.p.
571.	Carpeting, rugs, mats and matting of straw, hemp, flax tow, jute or paper; carpet lining and stair pads.
571a(i). Mats with cut pile, of cocoa fibre.
571a(ii). Mats, n.o.p., rugs, carpeting and matting of cocoa fibre.
572.	Oriental and imitation oriental rugs or carpets and carpeting, carpets and rugs, n.o.p.
573.	Enamelled carriage, floor, shelf and table oilcloth, linoleum, and cork matting or carpets.
574a. Webbing, with strands of rubber interwoven, or braided therein, not exceeding twelve inches in width, n.o.p.; round elastic braid.
576. Window shades, mounted on rollers.
578. Regalia, badges and belts of all kinds, n.o.p.
619a. Rubber clothing and clothing made from water-proofed cotton fabrics.
818. Woven fabrics, wholly of cotton, bleached, when imported by manufacturers of handkerchiefs. for use exclusively in the manufacture of handkerchiefs wholly of cotton, in their own factories.
844. Woven fabrics, wholly of cotton, when imported by manufacturers of cotton bags for use exclusively in the manufacture of cotton bags in their own factories.
Category 3-Leather, leather products and related goods.
568b. Gloves and mitts of all kinds, n.o.p.
568c. Women's dress gloves of kid, elbow length.
604.	Belting leather in butts or bends; and all leather further finished than tanned, n.o.p.
604a. Crust oil leather, for use in manufacturing chamois leather.
604b. Sole leather.
605.	Leather produced from East India tanned kip, uncoloured or coloured other than black, when imported for use exclusively in lining boots and shoes; genuine reptile leathers.
605a. Genuine pig leathers and genuine Morocco leathers, so-called roller leathers.
606.	Leather produced from East India tanned kip, n.o.p.
607.	Leather, when imported by manufacturers of gloves or leather clothing, for use exclusively in manufacturing gloves or leather clothing, in their own factories.
607 Pt. 2'. Leather, consisting of beef-cattle hides, horse-hides or sheep-skins, but not including suedes, Cabrettas, Spanish capes or African capes, when imported by manufacturers of gloves or leather clothing, for use exclusively in manufacturing gloves or leather clothing in their own factories.
607a. Leather, not further finished than tanned, in whole hides, in grains, or splits, when imported by manufacturers of upholstering leathers, for use exclusively in the manufacture of upholstering leathers, in their own factories.
608.	Leather not further finished than tanned, and skins, n.o.p.
608a. East India kip leather, not further finished than tanned, for use in Canadian manufactures.
Foreign Exchange Conservation
[Stage Direction]
608b. Sheepskin and goatskin leather, not further finished than tanned, when imported by tanners for processing in their own factories.
611. Boots and shoes, pegged or wire fastened, with unstitched soles close edged.
611a. Boots, shoes, slippers and insoles of any material, n.o.p.
611b. Leather garments, lined or unlined.
617. Rubber boots and shoes.
622.	Trunks, valises, hat boxes, carpet bags, tool bags, and baskets of all kinds, n.o.p.
623.	Musical instrument eases and fancy cases or boxes of all kinds, portfolios and fancy writing desks, satchels, reticules, card cases, purses, pocket-books, fly books and parte thereof.
Category 4-Miscellaneous.
228. Soap powders, powered soap, mineral soap, and soap, n.o.p.
230. Castile soap.
252. Shoe blacking; shoemakers' ink; shoe, harness and leather dressing, and knife or other polish or composition, n.o.p.
326. (ii) Opal glassware, glass tableware, cut glassware and illuminating glassware, n.o.p.
326e. Articles of glass, not plate or sheet, designed to be cut or mounted; articles of glassware, when imported by manufacturers of silverware to be used in receptacles made of or electro-plated with precious metals or to be equipped with tops made of or electro-plated with precious metals, in their own factories.
362. Articles consisting wholly or in part of sterling or other silverware, n.o.p.; manufactures of gold or silver, n.o.p.
366.	Watches of all kinds.
366a. Watch actions and movements, finished or unfinished.
367.	Watch cases, and parts thereof, finished or unfinished.
368.	Clocks, time recorders, clock movements, clockwork mechanisms, and clock cases.
429. Cutlery of iron or steel, plated or not: (a) Knife blades or blanks, and table forks of iron or steel, in the rough, not handled, ground nor otherwise manufactured; spoon blanks of iron or steel, not further manufactured than stamped to shape; blanks, of iron or steel, for scissors and shears, in the rough, not ground nor otherwise manufactured; (b) Table knives and table forks; (c) Penknives, jack-knives and pocket knives of all kinds; (d) Knives, n.o.p.; (e) Spoons; (f) Scissors and shears, n.o.p.; (g) Razor blades; razors and complete parts thereof.
440j. Trawls, trawling spoons, fly hooks, sinkers, swivels, sportsmen's fishing reels, bait, hooks, and fishing tackle, n.o.p.
441. Guns, rifles, including air guns and air rifles not being toys; muskets, cannons, pistols, revolvers, or other firearms, n.o.p.; cartridge cases, cartridges, primers, percussion caps, wads or other ammunition, n.o.p.; bayonets, swords, fencing foils and masks; gun or pistol covers or cases, game bags, loading tools and cartridge belts of any material.
441e. Guns and rifles of a class or kind not made in Canada.
450. Skates of all kinds, roller or other, and parts thereof.

511. Walking sticks and walking canes, of all kinds; golf clubs and finished parts thereof; skis; racquets and racquet frames and baseball bats; balls of all kinds for use in sports, games or athletics, n.o.p.
511b. Fishing rods.
518. Billiard tables, with or without pockets, and bagatelle and other game tables or boards, cues, balls, cue-racks and cue-tips.
624a(i). Dolls; toys of all kinds, n.o.p.
624a(ii). Mechanical toys of metal.
624a (iii). Juvenile construction sets of metal or rubber, consisting of various stampings, punched or moulded, and connections therefor; parts of the foregoing.
634. Feathers and manufactures of feathers, n.o.p.; artificial feathers, fruits, grains, leaves and flowers suitable for ornamenting hats.
652. Toilet or dressing combs, n.o.p.; fancy combs, not being jewelry.
656. Tobacco pipes of all kinds, pipe mounts, cigar and cigarette cases, cigar and cigarette holders, and cases for the same, smokers' sets and cases therefor, and tobacco pouches.
Category 5-Prepared Foods.
17. Cheese.
20.	Cocoa paste or "liquor" and chocolate paste or "liquor", not sweetened.
20a. Butter produced from the cocoa bean.
21.	Cocoa paste or "liquor" and chocolate paste or "liquor", sweetened.
23. Preparations of cocoa or chocolate, n.o.p., and eoirfectionery, coated with or containing chocolate.
25a. Coffee, extract of, n.o.p., and substitutes thereof of all kinds.
26. Coffee, roasted or ground, and all imitations thereof and substitutes therefor, including acorn nuts, n.o.p.
29. Coffee, green, n.o.p. (not imported direct from the country of growth and production).
34. Mustard, ground.
44. Condensed coffee with milk.
85.	Mushrooms and truffles, fresh, dried or otherwise preserved.
90a. Vegetables, dried, desiccated, or dehydrated, including vegetable flour, n.o.p.
90b. Vegetables, pickled or preserved in salt, brine, oil, or in any other manner, n.o.p.
90c. Vegetable juices, liquid mustards, soy and vegetable sauces of all kinds. *
90d. Vegetable pastes and hash and all similar products composed of vegetables and meat or fish, or both, n.o.p.
103,	104. Fruits preserved in brandy, or
preserved in other spirits.
105c. Fruits and nuts, pickled or preserved in salt, brine, oil or any other manner, n.o.p.
105d. Jellies, jams, marmalades, preserves, fruit butters and condensed mince meats.
105e. Fruits and peels, crystallized, glace, candied or drained; cherries and other fruits of creme de menthe, maraschino or other flavour.
106.	Fruits, prepared, in air-tight cans or other air-tight containers.
107.	Preserved ginger.

Foreign Exchange Conservation
140.	Syrups and molasses of all kinds, the product of the sugar-cane or beet, n.o.p., and all imitations thereof or substitutes therefor.
141.	Sugar candy and confectionery, n.o.p., including sweetened gums, candied popcorn, candied nuts, flavouring powders, custard powders, jelly powders, sweetmeats, sweetened breads, cakes, pies, puddings and all other confections containing sugar.
Stanley Howard Knowles: We shall deal with them
item by item?


Douglas Charles Abbott: Yes. We are calling them item by item. This is just to replace the schedule as originally printed.


[Stage Direction]
Motion agreed to.
Items 83, 84, and 93, agreed to.
Customs tariff-4i00. Grape fruit, when imported from the place of growth by ship, direct to a Canadian port.
Stanley Howard Knowles: Can the minister give us some figures now about these several items at once? I have reference to the items dealing with citrus fruits.


Douglas Charles Abbott: Yes. Does my hon. friend wish to know the basis on which the quota is established? I assumed that was his point.


Stanley Howard Knowles: Yes.


Douglas Charles Abbott: Taking this item of grapefruit, fresh, pre-war, imports were $1,202,000 from scheduled countries and $112,000 from non-scheduled countries, or a total of $1,314,000. In the twelve months ended June 30, 1947, imports of grapefruit, fresh, from scheduled countries were $3,761,000; from non-scheduled countries, $38,000, or a total of $3,799,000. I might give the committee the principal items, grapefruit and oranges. As to oranges, average imports, 1937-39, from scheduled countries, $5,996,000; from non-scheduled countries, $534,000, or a total of $6,530,000. In the twelve months ended June 30, 1947, there was a total of $21,072,000 from scheduled countries and $16,000 from non-scheduled countries, or a total of $21,088,000.


Stanley Howard Knowles: Has the quota been
arrived at?


Douglas Charles Abbott: Yes.


Stanley Howard Knowles: What is it?


Douglas Charles Abbott: The quota is fifty per cent of the imports during the twelve months ended June 30, 1947.


Mr. HATFIELD:: In dollar value?


Douglas Charles Abbott: In dollar value. So that the quota would amount to roughly $10,500,000 for oranges, and roughly close to $2,000,000 for grapefruit.


William Henry Golding: Shall the
item carry?


Stanley Howard Knowles: On division,


Harry Rutherford Jackman: May I ask this question in regard to the fixing of quotas? Is that the formula which is applied all through or just to fruits and vegetables, or have you a separate formula for separate items or separate quotas?


Douglas Charles Abbott: There is a different formula for each quota category. Fruits and vegetables are in category one. Their quota is fifty per cent. That applies to all the items in that.


Heber Harold Hatfield: I should like to ask if all the quotas are based on the value or on the quantity?


Douglas Charles Abbott: They are all based on the dollar value.
Item agreed to on division.
Item 100a agreed to.
Item 101 agreed to on division.
Items 101a, 101b, 102 and 152 agreed to.
Customs tariff-152b. Orange juice, grapefruit juice, and blended orange and grapefruit juice, the product of the British West Indies, when imported direct from the country of production.


Harry Rutherford Jackman: As far as one can judge from reading what appears in the press, no one has experienced a shortage of these citrus fruits. If that is correct as a fact, how is it so if we are getting in only fifty per cent of what we were getting in before?


Douglas Charles Abbott: That is quite simple. There was a large crop of citrus fruit in the United States this year and prices are much lower. As a result, the physical quantity imported, although representing only fifty per cent of the value last year, so far has not been very far short of the quantity, and the price has been satisfactory up to the present time. Incidentally the importers are transferring a portion of their dollar collected from lemons into oranges and grapefruit, a more popular variety of fruit, and getting lemons from Italy.


[Stage Direction]
Item agreed to.
Customs tariff-523. Woven fabrics, wholly of cotton, not bleached, mercerized nor coloured, n.o.p., and seamless cotton bags.
James MacKerras Macdonnell: I want to ask a general question with regard to this textile category, but first I want to ask an even more general question with regard to the production of cotton. I understand that
Foreign Exchange Conservation

years ago-notably in 1938 and 1939-we bought a good deal of cotton in Brazil. What is the situation today? What are the possibilities of substituting Brazilian cotton for United States cotton, thereby saving dollars?


Douglas Charles Abbott: Well, there is quite a pronounced trend that way now. Taking the figures for the eleven months ending November, 1947, in round figures we got $5,000,000 worth of cotton from Brazil and $7,800,000 from Mexico as against $39,000,000 worth from the United States. I do not know what the possibilities may be of expanding those Brazilian purchases, but obviously our chief source of supply must continue to be the United States.


James MacKerras Macdonnell: Could the minister let us know what relative amounts were purchased ten years ago, say in 1935 or 1936?


Douglas Charles Abbott: I have not those figures here, but perhaps I could get them.


James MacKerras Macdonnell: Could we have them later in the evening? I would be very much interested in seeing them.


Douglas Charles Abbott: I have not those figures now. I am sorry; I did not anticipate we would want figures quite so far back.


James MacKerras Macdonnell: I think they would be relevant to the question. Perhaps the minister could have one of his officials get them during the evening, maybe within the next hour or so. It seems to me that it would be of interest to know if the percentage was much larger ten years ago and, if so, why it was larger and what the possibilities are now.


Douglas Charles Abbott: Whether we could get all that information this evening is a little hard to say. One would have to find out what production conditions are in Brazil and where they are selling their crop. They may be interested in selling it in some other section of the world where they can get United States dollars. However, I will see if I can get the figures.


Harry Rutherford Jackman: Would the minister give the formula as we come to the various categories?


Douglas Charles Abbott: Yes. The formula is 400 per cent of pre-war, which works out at 32 per cent of last year's imports, and therefore 32 per cent is the figure which is allowed the individual importer, to determine his dollar quota for the current year.


James MacKerras Macdonnell: I understand that a great deal of the imports in category 2, textiles, are really raw materials. I did not take that in at first; I thought they were things which were brought in and sold over the counter. I understand, however, that a very large quantity indeed of these imports are raw materials, and that they are used for further manufacturing. I think that raises an important question. I am advised that, as they are treated now, they are dealt with automatically ; that no regard is taken to the effect on this industry or that industry. While the minister will realize with what pain I suggest that any additional power should be given to his colleague-and perhaps I should preface this by saying the minister has admitted we are in such a mess that all the ordinary rules of sensible conduct have to be thrown overboard -I am seriously asking whether these amounts, which I understand are very large, which come in under category 2 and are dealt with in what is represented to me as an entirely automatic way, really should not be in schedule III, and whether the same considerations the Minister of Trade and Commerce is going to use in reference to the items contained therein, that is to say the effect on this industry or that industry, should be taken into account. First of all, I should like to ask the minister if my information is correct, that being in schedule II and being on the quota they will be dealt with by the department which administers them practically in an automatic manner, and that the considerations which I suggest are important will not be taken into account. If that is so, I would ask him whether he does not agree that these other considerations should be applied.


Douglas Charles Abbott: The situation is that all raw cotton and all cotton yarns are free; there is no prohibition. All other textiles are under quota. It is quite true, as my hon. friend suggests, that a very large proportion of these textiles are what might be described as semi-processed. It is also correct to say that the quota is determined more or less automatically, on the basis of imports during the preceding year-it is a dollar quota-and the importer is free to select the particular type of textile he will bring in, within his quota. I mentioned in connection with one of the very broad discretionary powers granted- to me under section 6 of the bill, which I said I was sorry had to be in those broad terms, that one reason was to enable the minister administering schedule II to impose a special condition in connection with any particular quota holder if, for instance, he were using up all his dollar quota to bring in certain luxury products. I think

Foreign Exchange Conservation
I cited chenille bedspreads instead of material for overalls, or that sort of thing. It may be, as my hon. friend suggests, that experience will demonstrate that it would be desirable to transfer some items from schedule II to schedule III. If that is the case, by virtue of an amendment which was put in when the bill was being considered' in committee, at any time we can move any item from schedule II to schedule III. And it is pointed' out to me that most of these fabrics are also sold over the counter as well, in larger and smaller quantities.


James MacKerras Macdonnell: Notwithstanding whiat the minister has said as to the powers reserved and what can be done, I suggest that there is an immediate problem of substantial size, and I wonder if it could not be dealt with now by the definite transfer of some of these items, perhaps all that come in as raw or semi-raw material, to schedule III. It is pointed out to me that putting them on a quota works a very great hardship on a considerable number of people who have recently gone into business, and I am assured that, tas in other industries, many of them are returned men.
There is one entirely fortuitous situation which I am told has worked great hardship. It is said that, actually not by law but by custom and practice, there' has been a quota here in Canada for the last six or seven years, and that a good many of the people going into business in these small textile establishments found they could not get supplies here in Canada, because the supply houses in this country had their lists of customers and1 could not take on more; and I am told that these new businesses have had to rely solely on United States supplies. It is quite obvious that if they have been relying solely on United' States supplies a quota of 32 per cent is no good to them.
I am also told-though perhaps this is irrelevant to the immediate argument, but at any rate it is incidental to it, and it is an unfortunate thing-that there has sprung up a mushroom lot of wholesalers who flourished greatly, to my regret, during the war, and who now apparently are reappearing. They are on the quotas. They have worked themselves in as intermediaries and they are to be found again, getting in between and making use of the quotas they had during the war to feather their own nests in these new circumstances. For that reason again I am asking-and I hope there may be others in the house who will be sufficiently interested in this to take part in the argument, if they agree-whether this should not be handled in some different way, because to me it seems that this situa-5849-94
tion will work great hardship on the smaller people, those who were not in business in 1940 or 1941, when the informal Canadian quotas were established. .


Douglas Charles Abbott: They did not have to be in business in 1940 or 1941; only at the end of June, 1947.


James MacKerras Macdonnell: I am afraid I have not made my point clear.
I	quite realize that to get on the quota under the schedule, the quota which is now being effected by the government, anyone who was in business in June, 1947, is eligible. I am suggesting, however, that there was an effective though informal quota system in effect in Canada prior to 1947. The minister's assistant will know whether or not that is true; but I am assured by competent people that it is the case and for that reason you have this very great hardship on the people who are placed under this strict quota* system. If that is so, I suggest that the very existence of that quota will make their position impossible, and that an entirely different set of considerations might be applied in the cases where these come in as raw materials.
I confess I was under an entire misapprehension as to schedule II. I thought schedule
II	was not a raw materials schedule. I thought it consisted merely of merchants' goods.


Douglas Charles Abbott: It is not really raw materials; it is semi-processed.


James MacKerras Macdonnell: It is raw materials for those carrying on the production of finished garments. I understand that the figure is about $30,000,000.


Douglas Charles Abbott: Yes. In the base period,
imports from scheduled countries amounted to $10,301,000 and, from non-scheduled countries, $30,591,000, making a total of $40,892,000. Those figures are to be found at page 1303 of Hansard.


James MacKerras Macdonnell: I hope I have made my point, and that the minister will take it seriously; because, as I say, it seems to me that the effect of this quota is something which I do not believe was intended. The effect of it appears to be that it will deal a body blow to a very considerable number of people who are now just getting their feet under them in business. I know that was not intended.


Douglas Charles Abbott: The effect of this quota is to put great pressure upon buyers to try to get textile imports from the United Kingdom. That is just what was intended. That is one of the main purposes as to why this quota
Foreign Exchange Conservation

was fixed on its present basis. I have tried to bring that out several times in the course of discussion on the bill.
It is very easy to get textiles in the United States. It is easy to see them. It is easy to see samples and, incidentally, prices have been very attractive. But under existing conditions we are extremely anxious that Canadian importers should see what the British have to offer, and should try to get their textiles in the United Kingdom, as they used to do in 1940. That is why these quotas have been fixed on the basis indicated, or that is largely the reason. We believe that it will now have the effect of putting great pressure upon importers, such as those to whom my hon. friend referred, to scrounge around to see if they cannot get British textiles instead of American. That is the purpose of putting the quota on this basis.
If they cannot get British textiles, then we shall have to see what happens-if they are essential. But we are anxious to have it work as I have suggested, and this has been designed and drawn on that basis, namely, that there should be a real incentive on the textile importers to find out what the British have to sell.


James MacKerras Macdonnell: I am not disagreeing with that at all.


Douglas Charles Abbott: I know my hon. friend is not.


James MacKerras Macdonnell: I wish to make that clear, because my argument was not suggesting necessarily that a single extra dollar's worth of United States goods should come in. However, it was suggested that the basis upon which they are at present allocated seems to be working a great hardship on a great many people. But a different test-a test which the minister agrees will not be applied in the department where it is now being considered, and where it will be dealt with automatically-should be applied, and that is the test of keeping people in business. And that is the test which the Minister of Trade and Commerce is going to apply, and which I think the minister will agree is a very desirable test in this case.


Douglas Charles Abbott: That is an important point. The British are trying to send us about ten times the yardage they sent us last year in cotton textiles. These quotas are, as I say, designed to enable them, to do that. As I said to the committee the other night, there is no effective quota restriction for the time being so far as British textiles are concerned. There is an extremely effective one so far as United States textiles are concerned. Believe me, if I

were a textiles importer, with these quotas as they are, I Would be scrounging around pretty hard to try to find what British textiles I could get. And that is what we are trying to have them do.


James MacKerras Macdonnell: I wish to point out on the strength of the argument I make, that my information is that by reason of this system two manufacturers of overalls have had to close down due to the automatic application of this rule. I suggest that if they were in the hands of the Minister of Trade and Commerce, considering their position-and I am embarrassed when I make this observation; nevertheless I make it -if the Minister of Trade and Commerce were in the position of considering this industry which, presumably, he wishes to keep together, and not only keep it in existence but have it prosper we might reach a very different result indeed.


Douglas Charles Abbott: This is the position of any textile importer today; any textile importer can get, first, 32 per cent of his United States imports lost year. Second, he can get at least all that he was able to get in Canada and, third, all that he can get from non-scheduled countries, which means the United Kingdom, Italy, France and any of the other countries which produce textiles. That is open to every textile merchant in this country. I am told that Canadian buyer groups are now in the United Kingdom actually buying British textiles.


James MacKerras Macdonnell: I do not want to be tiresome about this matter, but I wish to point out that all the minister has said sounds very well and I know it is all true. But it does not affect at all the cases I am talking about. It does not. do a single thing for the small man just getting started, who has not been able to get in Canada what the minister has said he was entitled to, and should get in Canada. But the fact is that many of them were getting nothing. Therefore that man is now expected to carry on with the 32 per cent, and he cannot do so.


Agar Rodney Adamson: I should like to ask the minister about the special cotton fabric used in the manufacture of automotive tires. I understand that this is one of the highest grades of cotton bought. I know they used to buy the very highest grade of Sea Island cotton and the very highest grade of long staple Egyptian cotton. What effect will these schedules have on these goods?


Clarence Decatur Howe: They are using rayon now.

Foreign Exchange Conservation


Douglas Charles Abbott: The position at the present time is that interim permits have been issued to anyone requiring an amount from the United States until importers can explore the possibility of obtaining supplies in the United Kingdom.


Agar Rodney Adamson: Does this material, this long staple cotton, come in as a twill or as a yarn, or does it come in as a fabric?


Douglas Charles Abbott: I am told that it is described as tire cord fabric.


[Stage Direction]
Item agreed to.
Items 623a, 523b, 523c, 523e, 523j, 523k, 5231, 524a, 528, 529, 529a, 530, 531, 532, 532a and 532b agreed to.
Customs tariff-541a. Woven fabrics, wholly of jute, n.o.p.
Agar Rodney Adamson: I understand that jute was primarily a substance for bag making, concerning which we had some discussion this afternoon. It is fabricated almost entirely in Scotland, of East Indian raw materials. Will the minister say what percentage we get from the United States and scheduled countries?


Douglas Charles Abbott: I will get those figures. Let me say that this is a comparatively small item. Woven fabrics, wholly of jute, unbleached and not coloured are still on the free list, under item 541. Item 541a refers to woven fabrics wholly of jute, but most of the items come under item 541. This is not a large item. In the base period we imported $40,000 worth from scheduled countries. But the big item is the one to which I referred earlier.


Agar Rodney Adamson: That is the material used to make sacks and bags.


Douglas Charles Abbott: Yes.


[Stage Direction]
Item agreed to.
Items 542, 542a, 545, 546, and 548 agreed to.
Customs tariff-553. Blankets of any material, not to include automobile rugs, steamer rugs, or similar articles.
Douglas King Hazen: Why are automobile rugs or similar articles excluded?


Douglas Charles Abbott: Nearly all these items come from the United Kingdom. They are a separate item as well.


[Stage Direction]
Item agreed to.
Items 554, 554a, 554b, 554c, 554d and 554f agreed to.
Customs tariff-555. Clothing, wearing apparel and articles made from woven fabrics, -and all textile manufactures, wholly or partially manufactured, composed wholly or in part
5849-94J
of wool or similar animal fibres, but of which the component of chief value is not silk nor synthetic textile fibres or filaments, n.o.p.; fabrics, coated or impregnated, composed wholly or in part of yarns of wool or hair, but not containing silk nor synthetic textile fibres or filaments, n.o.p.
Agar Rodney Adamson: This is a general item which takes in practically all clothing of wool and silk. What came in from the scheduled countries and what from	non-scheduled
countries?


Douglas Charles Abbott: This is a very large item. Women's and children's outer garments, $1,295,000 from scheduled countries-I am speaking of the base period-and $900,000 from non-scheduled countries, or a total of $2,195,000. Clothing, wearing apparel, n.o.p., $112,000 from scheduled countries and $225,000 from non-scheduled countries. Vests, pants and overcoats, $126,000 from scheduled countries and $607,000 from non-scheduled countries. Travelling rugs, $43,000, all from non-scheduled countries. Wool manufactures n.o.p., $127,000 from scheduled countries and $46,000 from non-scheduled countries. Wool fabrics, coated or impregnated, $17,000 from scheduled countries and $1,000 from non-scheduled countries. It is a large item, but the main part is women's and children's clothing.


[Stage Direction]
Item agreed to.
Items 560a, 560b, 560c, 561 and 561a agreed to.	[DOT]
Customs tariff-562. Woven fabrics not exceeding 12 inches in width generally known as "ribbons," whether with cut pile or not, wholly or in part of silk but not containing wool.
Mr. MACDONNELL (Muskoka-Ontario)" What is the significance of narrowing the width to not exceeding 12 inches?
Douglas Charles Abbott: I am told that if it is over 12 inches it becomes a fabric. This is covering materials in the ribbon category and it is just a technical way in which the item has been drawn.


[Stage Direction]
Item agreed to.
Items 562a, 564, 564a, 565, 566, 567, and 567a agreed to.
Customs tariff-568. Knitted garments, knitted underwear and knitted goods, n.o.p.
Agar Rodney Adamson: Will the minister give us a breakdown of this item, which I gather is another major item?


Douglas Charles Abbott: The amounts may not be large in some of the categories, but the large item is cotton knitted underwear, of which
Foreign Exchange Conservation

we imported $1,702,000 from scheduled countries and only $199,000 from non-scheduled countries. Knitted silk fabrics, $2,000 from scheduled countries and none from non-scheduled countries. Knitted silk underwear, $8,000 from non-scheduled countries. Knitted wool fabrics, $765,000 from scheduled countries and $151,000 from non-scheduled countries. Knitted wool underwear, $62,000 from scheduled countries and $420,000 from non-scheduled countries. Knitted artificial silk fabrics, $2,361,000 from scheduled countries and $298,000 from non-scheduled countries. Knitted artificial silk underwear, $682,000 from scheduled countries and $164,000 from non-scheduled1 countries. Knitted garments, n.op., $2,473,000 from scheduled countries and $1,629,000 from non-scheduled countries. Knitted goods, n.o.p., $92,000 from scheduled and $1,000 from non-scheduled countries.


Agar Rodney Adamson: The total of this item runs to about $20,000,000?


Douglas Charles Abbott: It would run to between $8,000,000 and $10,000,000.


Agar Rodney Adamson: One item is $6,000,000.


Douglas Charles Abbott: The largest item is $2,400,000; there is another one of $2,300,000 and another one of $1,700,000. I am speaking of imports from scheduled countries.


Donald Methuen Fleming: On Tuesday night the Minister of Finance was good enough to place on Hansard statistics with respect to schedule I, and I am wondering if he would be good enough to do the same thing with respect to schedule II. It would have been much better if we could have had the information from which he is reading.


Douglas Charles Abbott: I am told that categories 1, 2, 3 and 5 are reasonably accurate. What I have before me are the work sheets. Category 4 has not been revised. This is the quota schedule and perhaps this had better not be put on Hansard as it is. As I have indicated, these figures are taken from statistics published by the dominion bureau of statistics. I could have this schedule checked and brought up to date, particularly to make sure that category 4 is accurate. My officials tell me that these work sheets from which I am giving the committee this information are approximately correct, but they would need to be checked before being placed on Hansard.


Donald Methuen Fleming: Would it be possible to do that in time to have it included in the Hansard record of this debate?


Douglas Charles Abbott: I am told that the figures are accurate as they appear here, but there

have been certain amendments which have not been put in. It would probably take twenty-four hours to prepare that information. Even if it were not possible to have it ready before the end of this debate I feel sure the committee would consent to have it included as an appendix to Hansard while we are still discussing the emergency measures.


Donald Methuen Fleming: It would be useful to have it there as a matter of record.


Douglas Charles Abbott: I think it would.


Donald Methuen Fleming: I realize that the information is available in another form but it means searching out each individual item.


Douglas Charles Abbott: We shall have these figures brought u,p to date and placed on Hansard as soon as available.


[Stage Direction]
Item agreed to.
Customs tariff-569a (i). Berets of wool, knitted and fulled.
James MacKerras Macdonnell: What amount is involved in this item of berets?


Douglas Charles Abbott: From scheduled countries $1,000, and non-scheduled $14,000. All these items under item 569 might well be included under one item, but in the customs tariff they are split into several items. I am told that this is a French treaty item.


Donald Methuen Fleming: Quotas were part and parcel of P.C. 4678. Under this measure the particular percentage is not part of the act. The power is simply exercised by the minister to set the percentages.


Douglas Charles Abbott: By order in council, the same as was the case with P.C. 4678. It has to be done by regulation through order in council.


Donald Methuen Fleming: That is the point I am coming at. I have no doubt the committee understands that the whole percentage basis of the schedule could be changed overnight.


Douglas Charles Abbott: Quite so.


Donald Methuen Fleming: Will the minister say if, in the light of changing circumstances, there is any likelihood of the government changing the whole percentage basis on which we are proceeding?


Douglas Charles Abbott: Of course that would depend on circumstances. As conditions improve, it would be possible to change the percentage figures. Frankly I do not contemplate that these initial percentages will be changed in the immediate future. They were arrived at after a great deal of study of trade statistics

Foreign Exchange Conservation
and I would say that, as a general rule, it is unlikely that these quota percentages will be changed in the near future.


Winfield Chester Scott McLure: I notice that several of these items contain the phrase "under regulations prescribed by the minister". Which minister is that?


Douglas Charles Abbott: This language is taken from the customs tariff items.


Winfield Chester Scott McLure: Would it be the Minister of Finance or the Minister of National Revenue?


Douglas Charles Abbott: That particular question would come under the Minister of National Revenue, who administers the customs tariff.


James MacKerras Macdonnell: Would the minister explain why in category 2 the quota is 32 per cent, and in category 3, 68 per cent?


Douglas Charles Abbott: I will give that explanation although I have given it before. The quotas are 200 per cent of pre-war, except category 2, which is textiles, where the quota is 400 per cent. The particular percentage, 28, 32, 42, 50, 68, as the case may be, is the proportion which the total quotas thus arrived at bear to the imports of last year.


James MacKerras Macdonnell: I am afraid I have not quite grasped it yet. Could the minister put it differently, getting it down to present times instead of giving us these percentages based on multiplying and dividing? Could he give us the percentage which it represents of, say last year's business?


Douglas Charles Abbott: The textile companies can import 32 per cent of the textiles they imported from the United States last year, and they are free to import as much as they can get from non-scheduled countries. In other words, our United States imports of textiles are cut down by about two-thirds.


James MacKerras Macdonnell: Do I understand that it is about 32 per cent of what they got last year?


Douglas Charles Abbott: Yes.


James MacKerras Macdonnell: Then why is it considered desirable to let the textile people have only 32 per cent and the leather people 68 per cent?


Douglas Charles Abbott: The	textile people are
allowed a quota of 400 per cent of pre-war. In most other cases it is only 200 per cent of pre-war.


James MacKerras Macdonnell: I am sorry to be so dense. The minister agrees that the really interesting thing from
the point of view of 1948 is not what was going on ten years ago. A more illuminating comparison would be with what was going on last year, and I ask why was it considered desirable that the textile people should get only one-third of what they got last year while the leather people get twice as much.


Douglas Charles Abbott: Because we are trying to save United States dollars, and the pattern of our imports has changed from pre-war. Pre-war we used to import far more textiles from the United Kingdom than from the United States, but because Britain was at war we were driven to buying textiles in the United States. Now, because of exchange difficulties, and because we would like to go back to our traditional market abroad, the quotas were framed to cut down drastically our textile imports from the United States and allow the greatest freedom to import textiles from the United Kingdom in the hope of re-establishing the traditional pre-war pattern of textile imports.


James MacKerras Macdonnell: I am grateful to the minister for accomplishing the impossible-he has made me understand.


Agar Rodney Adamson: The minister said just now that there was a tremendous supply of United States textiles at a very attractive price, and by inference the United Kingdom price -was not so attractive. Even if we had no dollar exchange difficulties I would be in great sympathy with the minister in trying to channel our trade to the United Kingdom. Unless we are prepared to buy textiles from the United Kingdom, our whole economy and the whole trade position of the world will get into an awful mess, so that it is an excellent thing to encourage our trade with Britain. It is only fair to the United Kingdom that our textile trade with them be re-established; and it is up to us, other things being equal, or even if they are not equal, to do what we can to establish that industry. But the minister mentioned that United States prices were extremely attractive.


Douglas Charles Abbott: I do not think I said "extremely".


Agar Rodney Adamson: And by inference the United Kingdom price was not so attractive.


Douglas Charles Abbott: I am told that British textiles of standard lines are getting to be pretty well priced. United States textile prices are higher than our textile prices, and I am told that United Kingdom prices of standard lines are getting well into line and that they are

Foreign Exchange Conservation
trying to export to us ten times as much in the textile category as they did last year. I hope they succeed.


Agar Rodney Adamson: What did they export to us last year?


Douglas Charles Abbott: In cotton, which is an important field, they gave us 8,000,000 yards last year and they Lope to give us 80,000,000 this year.


Agar Rodney Adamson: Any idea of the dollar value?


Douglas Charles Abbott: I am afraid I do not have it.


Harry Rutherford Jackman: We on this side understand why the percentage is fixed as it is in the case of textiles, because in the result the quota as applied to United Kingdom exporters will be as much as they will be lucky enough to meet. But would the minister be good enough to answer the other half of the question of my colleague the hon. member for Muskoka-Ontario about leather goods, which have a 68 per cent quota? We understand one-half of the matter, but because of our lack of background knowledge we do not understand the 68 per cent, as in the case of textiles. Will the minister give an answer as in the case of textiles?


Douglas Charles Abbott: In 1947, for the twelve months ended December, all textile items from the United Kingdom were $91,235,809. I have not the breakdown as between wool and cotton.


Agar Rodney Adamson: It is not particularly important to get the breakdown between wool and cotton, because the industry as a whole must be considered.


Jean-François Pouliot: When we look at the advertisements of the big stores in the newspapers we see prices of imported British goods which I for one do not understand. I should like to know how it is that these goods are so expensive. I cannot understand why prices are mostly prohibitive, and how we can save United States dollars by spending so much more money to buy these goods. I find it extraordinary. A good hat costs $15-a soft felt hat-when imported from the United Kingdom, and other goods correspondingly. Textiles are most expensive. How is the [DOT]Canadian economy to buy goods that are so much higher than normal prices?


Douglas Charles Abbott: As regards leather goods and rubber goods, the quota percentage there is 68 per cent, and that is arrived at in this way. Pre-war imports in 1937-39, from scheduled countries, $3,398,000. Imports from

scheduled countries, base period 1946-47, were $9,739,000. Twice 200 per cent of $3,398,000, or $6,000,000 odd, is 68 per cent of the last year's figure, so that there is a direct relationship there. You take 200 per cent of your pre-war average and establish the percentage which that dollar figure represents of last year's imports, and that percentage is the quota for the past year.


Mr. JAENICKE:: And that percentage
quota may differ with each commodity?


Douglas Charles Abbott: It has the effect of tending to re-establish the pattern of trade as it existed pre-war.


Jean-François Pouliot: I would ask the minister, who is always so courteous and obliging, to tell me something in answer to my question about high prices of imported goods when there is little duty on them.


Douglas Charles Abbott: What kind of goods?


Jean-François Pouliot: Take a hat, for example. My hon. friend knows that a good hat such as we paid $7 and $8 for before, an imported British or French hat, now costs $15. How is it that when the pound is so low and the franc has been devalued, we in Canada have to pay so much for these imported goods? That is the first part of the question. The second part is this: where is the economy when we spend twice as much to pay for these goods?


Douglas Charles Abbott: I do not know that I can give a satisfactory answer to that. I suppose the reason that the price of the English or the French hat is higher is that there has been a greater increase in costs, including wages, in those countries than there has been here. It is so long since I bought a hat that I do not know about the prices. One was given to me last year by a grateful constituent, so that I have not had to buy a hat for some time, but I have no doubt that they do cost $15. As to the second part of the question, the advantage in buying goods from non-scheduled countries, if such goods are at a competitive price, is that they do not involve the expenditure of United States dollars which we need badly, while we are fairly well supplied with sterling or francs as the case may be.


Harry Rutherford Jackman: Would the minister be willing to add to those reasons the fact that the pound is much too high in relation to the Canadian dollar?


Douglas Charles Abbott: That is a matter on which we do not need to express an opinion.

Foreign Exchange Conservation


Jean-François Pouliot: We should make hats with pounds. They would be much cheaper.


James MacKerras Macdonnell: In view of the minister's statement, I think it might be well to ask this question. Take quotas with scheduled countries. It may not be very practical; but suppose it were possible, by reason of a three-cornered arrangement, to buy goods beyond the quota say from Switzerland, without the use of hard currency, would there be an objection to that?


Jean-François Pouliot: The hon. gentleman, who is a financier of fame, knows very well that at the present time the currency of Switzerland ranks top high, and moreover it is at a premium. That is one country in the world where the United States dollar is not worth 100 cents. It is not at par but below par. Let us discuss this question of trade in an effort to understand the matter. I still come back to my point that our trade with the United States is real trade, that our trade with Switzerland would be real trade, but our trade with many other countries will not be real trade unless we permit barter, and it is impossible to practise that method if the government intervenes. It might be between two governments, between two individuals, and between two companies, but it cannot be done between two individuals when the government intervenes, and that is the reason for our difficulty with Great Britain. It is due to the fact that the government of Great Britain is the obstacle in the way of trade with that country, just as the United States dollar is the obstacle in the way of our trade with that country.


Thomas John Bentley: I know what the hon. member is trying to say, but he is not right.


Jean-François Pouliot: Opinions are free, but my hon. friend did not agreee with me at the time we were supplying money to buy these things. I thought that process was entirely wrong. He was then full of conviction as he is now, but he was entirely wrong and unfortunately I was right. I do not say that to boast that I am always right, but I remember my hon. friend has been wrong much oftener than I have been, especially in this matter.


Agar Rodney Adamson: Before we leave textiles I
have one question to ask the minister. I gather from the fact that we imported $91,000,000 worth last year from the United Kingdom, that our imports from the United Kingdom will be expected to run at the staggering figure of $900 million, or nearly a billion dollars. Can the economy of Canada absorb a billion dollars worth of textiles?


Douglas Charles Abbott: The figure I was mentioning of ten times was in cotton yardage. That is a a class of import that we are particularly short of here in Canada, and the ratio I referred to of ten times last year was in cotton yardage. We are doing fairly well on wool textiles- suitings and that sort of thing.


Agar Rodney Adamson: We shall be able to get a suit next year?


Douglas Charles Abbott: I hope so.


James MacKerras Macdonnell: Although I am timid of engaging the hon. member for Temiscouata, nevertheless I will not allow what he said to divert the minister from answering my question. I agree with the hon. member from Temiscouata about the currency of Switzerland, but I made clear that my question was based on the supposition that, by some three-cornered arrangement, there might be a case we could get Swiss goods with sterling.


Douglas Charles Abbott: It is an interesting suggestion. I have been answering so many questions here today that my brain is not clicking now as clearly as it might.


Thomas John Bentley: I want to make something clear to the hon. member for Temiscouata, if that is possible. I want to agree with him when he says that when governments interfere with barter, it makes things difficult. With that part of his statement I agree. But I do not agree with his statement that the British government is to blame for what is going on now under this bill. This government in Canada is to blame for applying the non-discrimination clauses of the Geneva trade agreements when dealing with these restrictions, not the British government.


Jean-François Pouliot: Well, I am not going to argue at full length about this, because I would be discussing the principle of the bill. I have been called to order too often and supposedly for discussing the principle of it. I will wait for some other time to do so again. I will tell my hon. friend that it is unfortunate that members who do not belong to the C.C.F. group know the dealings of the present British government better than they themselves do, although they are their own kin. I know very well that they belong to the same family and this is why they try to protect them; they would never admit that the British government is wrong. I will say that if Churchill has been right once, it was when he called them a bunch of incompetents, and I will laud again the Minister of Reconstruction and Supply
Foreign Exchange Conservation

(Mr. Howe) for having denounced them all, although I have great respect for Mr. Attlee personally.


[Stage Direction]
Item agreed to.
Items 569 (ii),	569(iii),	569 (iv),	569 (v),
569a (i) and 569a(ii) agreed to.
Customs tariff 569c. Hat braids, of a class or kind not made in Canada, whether woven, knitted or plaited, not exceeding six inches in width, imported for use exclusively in the manufacture of hat bodies or shapes, but not for use in the ornamentation or trimming of such bodies or shapes, under regulations prescribed by the minister.
George Alexander Cruickshank: I have a question. The hon. member for Muskoka-Ontario overlooked this.


James MacKerras Macdonnell: I greatly appreciate the hon. member's help.


George Alexander Cruickshank: I am sure the hon. member needs it. This item reads in part: "hat braids, of a class or kind not made in Canada". Does that include braid for the brass hats we have to listen to here at Ottawa?


[Stage Direction]
Item agreed to.
Customs tariff-57tt. Mats, door or carriage, other than metal, n.o.p.
Mr. IIARKNESS:: As a matter of interest, I see this item mentions mats, door or carriage, other than metal, n.o.p. Then in item 573 we find mention of enamelled carriage, floor, shelf and table oilcloth, linoleum and cork matting or carpets. Would the minister tell us what these carriage mats and enamelled carriage mats are?


Douglas Charles Abbott: I am afraid I cannot give any definite answer. It is an item which has been in the customs tariff for some time.


Douglas Scott Harkness: I would suggest that these things are a bit of an anachronism and they were brought out in the days of sixty years ago when carriages were quite a common item. Possibly that should be looked into to make it apply to automobiles.


Douglas Charles Abbott: People may not have carriages out in Alberta but we still have them in the eastern townships.


[Stage Direction]
Item agreed to.
Items 571 and 571a agreed to.
Customs tariff-572. Oriental and imitation oriental rugs or carpets and carpeting, carpets and rugs, n.o.p.
Agar Rodney Adamson: Surely we are not likely to get many oriental rugs from scheduled countries?


Douglas Charles Abbott: This is under quota.


Agar Rodney Adamson: Yes, even under quota.


Douglas Charles Abbott: Curiously enough we got $371,000 from scheduled countries in the base period and $3,299,000 from non-scheduled
countries.


Harry Rutherford Jackman: They must have come from Cairo, Tennessee.


[Stage Direction]
Item agreed to.
Items 573, 574a and 576 agreed to.
Customs tariff-578. Regalia, badges and belts of all kinds, n.o.p.
James MacKerras Macdonnell: I am now speaking on behalf of the hon. member for Fraser Valley, and I want to know about regalia and things of that kind.


Stanley Howard Knowles: That is for the Liberal convention in August.


John Lambert Gibson: That is for Orangemen.


Douglas Charles Abbott: There is plenty of production of Liberal regalia in Canada. We do not need to go outside the country for that.


[Stage Direction]
Item agreed to.
Items 619a, 818 and 844 agreed to.
Customs tariff-568b. Gloves and mitts of all kinds, n.o.p.
Agar Rodney Adamson: Before the minister discusses this, I should like to have one clarification of the differentiation between leather and textiles. As I understand it with regard to leather, sixty-eight per cent of the prewar quota is allowed under the quota.


Douglas Charles Abbott: The same percentageexactly; 200 per cent of the pre-war average-is 68 per cent of imports last year in the base period. That is the percentage we are allowing.


Agar Rodney Adamson: And that goes for textiles?'


Douglas Charles Abbott: No. In textiles, 400 per cent, of pre-war is 32 per cent of last year.


Agar Rodney Adamson: And it is based on the 1947 figure?


Douglas Charles Abbott: Taking textiles now, 400 per cent of the 1936-39 average is 32 per cent of last year's actual imports for the year ended June 30, 1947.


Agar Rodney Adamson: Of textiles?


Douglas Charles Abbott: Textiles.


Agar Rodney Adamson: And 200 per cent for leather?


Douglas Charles Abbott: Two hundred per cent of the 1936-39 average for leather goods is 68 per cent of last year's imports.

Foreign Exchange Conservation


Agar Rodney Adamson: Therefore the textiles get a much larger quota?


Douglas Charles Abbott: Well, it depends; 400 per cent gives 32 per cent, and 200 per cent gives 68 per cent.


John Lambert Gibson: Very
simple.


[Stage Direction]
Item agreed to.
Customs tariff-568c. Women's dress gloves of kid, elbow length.
George Alexander Cruickshank: Why are these just elbow length? Is that the new look, or what is it?


[Stage Direction]
Item agreed to. .
Items 604, 604a and 604b agreed to.
Customs tariff-605. Leather produced from East India tanned kip, uncoloured or coloured other than black, when imparted for use exclusively in lining boots and shoes; genuine reptile leathers.
Mr. MACDONNELL (Muskoka-Ontario); Will the minister give a little information on that interesting item?
Douglas Charles Abbott: Yes, that is a tariff item. What explanation would my hon. friend like?


James MacKerras Macdonnell: East India.


Douglas Charles Abbott: That is the type of leather. Item 605 is a small item. Imports were $87,000 last year, all from non-scheduled countries.


[Stage Direction]
Item agreed to.
Item 605a agreed to.
Customs tariff-606. Leather produced from East India tanned kip, n.o.p.
Mr. LENNARD:: As a matter of information, what is tanned kip?


Douglas Charles Abbott: Well, I am not an expert on leather, but I am told it is the leather used for lining shoes.


[Stage Direction]
Item agreed to.
Items 607, 607 part 2, 607a, 608, 608a and 608b agreed to.
Customs tariff-611. Boots and shoes, pegged or wire fastened, with unstitched soles close edged.
Agar Rodney Adamson: This item, together with the next two, covers most kinds of boots and shoes we normally wear. Would the minister give some breakdown of the imports from scheduled and non-scheduled countries? This is another question that has come up recently in the cost of living discussion going on in
another place, and it might be of interest to have some idea of prices from scheduled1 and non-scheduled1 countries, just to compare them with our own prices.


Douglas Charles Abbott: Well, imports, taking boots and shoes together, in the base period 1946-47 were one million pairs, while domestic production was over forty million pairs. In dollar value item 611 is negligible, only $1,000 from non-scheduled countries. Canvas shoes, rubber soles, $13,000 from scheduled countries and none from non-scheduled. Men's boots and shoes, $617,000 from scheduled1 countries and $415,000 from non-scheduled1 countries Women's boots and shoes, $2,668,000 from scheduled countries and only $176,000 from non-scheduled countries. Children's boots and shoes, $65,000 from scheduled countries and $26,000 from non-scheduled countries. Boots and shoes, felt uppers, $19,000 from scheduled countries, $129,000 from non-scheduled countries. Boots and shoes, not otherwise provided for, $394,000 from scheduled countries and $26,000 from non-scheduled countries. Insoles of all kinds, $21,000 from scheduled countries and $1,000 from non-scheduled countries.


Agar Rodney Adamson: Then I take it that the big item is the importation of women's shoes from the United States?


Douglas Charles Abbott: That is correct; that is the biggest single item.


Agar Rodney Adamson: And it amounts to
$2,668,000?


Douglas Charles Abbott: Yes.


Agar Rodney Adamson: And we are cutting that down to what?


Douglas Charles Abbott: Sixty-eight per cent.


Agar Rodney Adamson: We are cutting 68 per cent off that?


Douglas Charles Abbott: No, we would cut off 32 per cent. We would allow in 68 per cent and would make a reduction of 32 per cent, or roughly one-third.


Agar Rodney Adamson: Then we can still expect an importation of women's shoes from the United States amounting to approximately $1,500,000 or $2,000,000?


Douglas Charles Abbott: Something over a million and a half dollars, I would think, if they do not spend their money on something else. You see, the quota of the shoe importer will be a global quota for women's shoes, men's shoes and what have you. He can decide whether he will spend his dollar quota for women's shoes or men's shoes or some other item.
Foreign Exchange Conservation


Agar Rodney Adamson: But our experience 'has been that women's shoes are the big item we import from the United States?


Douglas Charles Abbott: But remember, the dollar figure covers the whole of category 3, dealing with leather products and related goods. I would think that my hon. friend is right, and that most of it would be used for women's shoes.


Agar Rodney Adamson: The total in this shoe category runs to what?


Douglas Charles Abbott: The total import of women's shoes was $2,668,000, but that is included in a greater amount. The dollar quota is 68 per cent of the importations during the last year, and if the importer brought in shoes last year he can switch over to something else this year, as long as it comes within the same category.


Agar Rodney Adamson: But what I am driving at is that, as far as I can see, this is an item we shall have- great difficulty in breaking down, because of the peculiar shape of women's feet in North America. Apparently English shoes for women will not fit the feet of American or Canadian women, so it appears to me that this will be one of the items we shall have great difficulty cutting anything from, because of the peculiarities which the minister probably knows as much about as I do.


Douglas Charles Abbott: No; women's shoes are a closed book to me, but the overwhelming proportion of women's shoes worn in Canada are made in Canada.


[Stage Direction]
Item agreed to.
Items 611a, 611b, 617, 622, 623, 228. 230, 252, 32G(ii), 326e, 362 and) 366 agreed to.
Customs tariff-366a. Watch actions and movements, finished or unfinished.
Agar Rodney Adamson: I understand that the majority of watches, even the cheapest ones, can be manufactured or imported and sold in Canada at competitive prices, with Swiss movements; and since Switzerland is essentially the most prescribed country, what is the situation with regard to watches, and are we, by this schedule and this tariff item, likely to run into a shortage of watches?


Douglas Charles Abbott: Well, it is difficult to say. There should not be a shortage of watches. Here again the quota is a category quota, and importers of watches may well switch from some of these other miscellaneous items to watches, if there is a greater turnover than in such things as trawls, trawling spoons, fly hooks, sinkers and so on.


Agar Rodney Adamson: A jeweler would not carry fish hooks, or at least I would hope not.


Douglas Charles Abbott: Of course watches are a fairly durable product, if you are careful. I have one here that is a good deal older than I am, and we shall just have to try to keep the old ones going for a year or two, I think.


Agar Rodney Adamson: The minister is more careful than I am. What would be the percentage of watches imported as compared with watches manufactured in Canada? That is really the figure I was trying to get from the minister.


Douglas Charles Abbott: I have not those figures available. I am told that comparatively few watches are wholly made in Canada.


Harry Rutherford Jackman: They are assembled here.


Douglas Charles Abbott: Yes, they are assembled here and some very expensive watches are made here, but I believe the majority are imported.


Harry Rutherford Jackman: In reading this bill, where would one find whether Switzerland was a scheduled or non-scheduled country?


Douglas Charles Abbott: One would not. That will be determined by regulation. Under the order in council which is now in effect the scheduled countries are designated, and that will be done in the regulation which will be prepared before this act is proclaimed.


Harry Rutherford Jackman: There is no hint in the bill as to any section which will set out scheduled or non-scheduled countries.


Douglas Charles Abbott: It will be done under section 5.


Harry Rutherford Jackman: And a country can be removed from the scheduled to the non-scheduled bracket?


Douglas Charles Abbott: By regulation, yes.


Harry Rutherford Jackman: And I presume that, since Swiss currency is at a premium over American, that is a scheduled country.


Douglas Charles Abbott: It is at present under the order in council which is now in effect, and it will continue to be so under the regulations adopted under this act.


[Stage Direction]
Item agreed to.
Items 367 and 368 agreed to.
Customs tariff-429. Cutlery of iron or steel, plated or not:
(a) Knife blades or blanks, and table forks of iron or steel, in the rough, not handled, gTound nor otherwise manufactured; spoon blanks of iron or steel, not further manufactured than stamped to shape; blanks, of iron or steel, for scissors and shears, in the rough, not ground nor otherwise manufactured; (b) table knives and table forks; (c) penknives, jack-knives and

Foreign Exchange Conservation
pocket knives of all kinds; (d) knives, n.o.p.; (e) spoons; (£) scissors and shears, n.o.p.; (g) Tazor blades; razors and complete parts thereof.
Douglas Scott Harkness: I have a personal question with respect to paragraph (g) which deals with razor blades. I use a Gillette razor, and the only type of blade that is satisfactory is what is known as the Gillette thin blade, which is not made in Canada. It is made only in the United States. Is there a quota on that item?
Mr. ST. LAURENT; It it now made in Canada. I had the same query, and I got some made in Canada which are just as good as those I had before.
Mr. ABBOTT; There is a quota of 42 per cent on them, for men who have tough beards, like my hon. friend.
Mr. ADAMSON; Does the Secretary of State for External Affairs say that the golden blade, the thin Gillette blade, is now made in Canada.
Mr. ST. LAURENT: Yes.
Mr. ADAMSON; I could not buy any the other day.
Mr. ST. LAURENT: It will give me the greatest of pleasure to send my hon. friend a package. He will then find where they are made.
Mr. HARKNESS; I was going to ask the minister where he could buy them, because I have not been able to get them.


Douglas Charles Abbott: The hon. member for York West will divvy up with you.


[Stage Direction]
Item agreed to.
Customs tariff-440j. Trawls, trawling spoons, fly hooks, sinkers1, swivels, sportsmen's fishing reels, bait, hooks, and fishing tackle, n.o.p.
Douglas King Hazen: What percentage of 1947 imports are allowed under this item?


Douglas Charles Abbott: Under this category it is 42 per cent.


Douglas King Hazen: Are fly hooks made in Canada; if so, where?


Douglas Charles Abbott: I am told they are, yes; but I have not the figures.


[Stage Direction]
Item agreed to.
Customs tariff-441. Guns, rifles, including air guns and air rifles not being toys; muskets, cannons, pistols, revolvers, or other firearms, n.o.p.; cartridge cases, cartridges, primeTS, percussion caps, wads or other ammunition, n.o.p.; bayonets, swords, fencing foils and masks; gun or pistol covers or cases, game bags, loading tools and cartridge belts of any material.
Douglas Scott Harkness: How many cannons
have we imported into Canada in the last year?


Douglas Charles Abbott: I have not the importation figure.


Douglas Scott Harkness: Where do they come from?


Douglas Charles Abbott: I have not the figures, but I think the quantities have been very much limited.


[Stage Direction]
Item agreed to.
Items 441e and 450 agreed to.
Customs tariff-511. Walking sticks and walking canes, of all kinds; golf clubs and finished parts thereof; skis; racquets and racquet frames and baseball bats; balls of all kinds for use in sports, games or 'athletics, n.o.p.
Douglas Scott Harkness: This item refers to "balls of all kinds, for use in sports, games or athletics", and perhaps this would be the proper time to refer again to the matter discussed some time ago at some length by the hon. member for Calgary West, when the bill was in an earlier stage, and where he referred particularly to the Alberta Billiard Supply Company. At that time, after the matter had been discussed at some length, I asked the minister if consideration would be given to assigning a quota to this company, the only Canadian company actively engaged in the billiard supply and bowling ball business. The question at issue was that of a quota on bowling balls for them.
A large American company, Brunswick-Balke-Collender Company is permitted to import these bowling balls; but because this company is a new business, it was not to get a quota. Has the minister given consideration to the matter, and could he say anything about assigning a quota to the company which, I repeat, is the only Canadian company in the business? It is a small concern and is in danger of being pushed out of business by this large United States company, due to the fact that the small Canadian concern cannot get a quota.


Douglas Charles Abbott: I have given consideration to it. This concern went into business only after July 1. It was in business for only a month or two before this regulation came in. As such, of course, it is not eligible for quota. The only people who are eligible are those who were importing during the base period ended June 30, 1947.
As I pointed out the other night, there is a special exception for returned soldiers, but unfortunately this company is only half owned by a veteran, the other half, I am told, being
Foreign Exchange Conservation

owned by his brother-in-law, who is not a veteran. While I have every sympathy in the circumstances, after careful consideration it was felt that exception could not be made in this case.


Douglas Scott Harkness: When this discussion was up before, I asked the minister if consideration would be given to this company as a new company, because it was only half veteran-owned. When this legislation was introduced a question was asked and the minister assured the house at that time that consideration would be given to new businesses. New businesses, in spite of the fact that they had not been importing goods in the period immediately prior to the imposition of the regulations, would be given a quota. The same would apply, of course, to veterans who had established new businesses.
It is quite true, as the minister has just said, that this business is only half veteran-owned, the other half being owned by his brother-in-law. But if this veteran is to be cut off, because the business is not entirely veteran-owned, I think he should at least be given consideration on the ground that it is a new business. It should certainly be given consideration on that ground because, as I say, it is the only Canadian company in this business. These people are trying to build up an industry in Canada. The effect of this quota as it is working at the present time, so far as I can see, will be to put these people out of business and to give the entire business to a large United States concern operating a subsidiary in this country.
Surely this legislation should be flexible enough to look after the needs of a small company at that time. Surely it is not to be ground down so rigidly that a small Canadian company just getting into operation when these regulations came into force will be forced out of business, in favour of a large United States concern, just because the regulation happens to read, "must have been in business before this date" or "must have had a quota", or something else.
I would ask the minister to give the matter serious consideration, on the basis, as I say, of a new business, rather than from the point of view of the red tape of regulations which have been laid down governing this matter.


Douglas Charles Abbott: We discussed this matter thoroughly the other night. This is a new business, it is true. Provision is not made and cannot be made in these regulations for giving everyone who is in a new business after June 30 a quota. The system would be impossible to work. You must establish a date-line,

and the date-line for those who were entitled to a quota applies to those who were in business prior to June 30, 1947. There has been one exception, and that is, we have reserved a special place for veterans.
We have got along in this country for seventy-five or eighty years without this importing firm bringing in bowling balls from the United States. They only want to do business as importers. They are not making bowling balls and, sympathetic as I am for their position, it is comparable with that of a great many others in new businesses across the country who got into business as importers after July 1, 1947.
Unfortunately, under the existing circumstances, they have to find a source of imports other than from the United States. As I say, we went into this case thoroughly. It was discussed the other night. I have examined it again since that time and I can only say, with reluctance but with firmness, that it is not possible to give this firm a quota under these regulations.


Douglas Scott Harkness: I submit with respect, that the minister does not yet understand this case.


Douglas Charles Abbott: Well, if I do not I have had the greatest opportunity to learn it, from stem to gudgeon.


Douglas Scott Harkness: I know the minister has had a lot of correspondence on it. Nevertheless I think he does not yet understand. He seems to think that this is purely an importing business, that it is only importing billiard and bowling balls. That is not so. It is essentially a manufacturing firm. It is manufacturing billiard tables, billiard cues and billiard racks. It is manufacturing bowling alleys. As a necessary part of its billiard and bowling alley manufacturing business it must have bowling balls and billiard balls to supply its customers. The minister seems to think all that is concerned here is a little company which has started up to import balls from the United States or from whereever it can get them, and this only within recent times. But that is not the case. This is a manufacturing company which actually has about thirty-five people working for it, chiefly artificers, cabinet makers and people of that sort. It is a frightful thing to deny these people their source of supply.


Douglas Charles Abbott: I told the hon. member for Calgary East the other night that hard cases make bad law. When you try to make exceptions to a thing like this you get into trouble. I have been criticized here for having this legislation drawn in such a way as to

Foreign Exchange Conservation
allow a reasonable degree of flexibility to be exercised in appropriate cases, but unfortunately this is not one of them.


Agar Rodney Adamson: I have a case in mind of a company owned by three brothers who are veterans and another brother who is not. This case is still before the minister or the department. What is the criterion or standard that is applied in the case of the ownership of a firm by a veteran? What percentage must be owned by a veteran before it is considered to be a hard case?


Douglas Charles Abbott: It is not a hard case; it is a veteran's case. The rule one has to take is that it shall be wholly owned by veterans or wholly owned, with the exception of the necessary directors' qualifying shares in the case of an incorporated company. It a veteran owns a company as an individual, or if two or three veterans own a company, well and good. If it is a limited company and one or more veterans hold all the shares of the company, with the exception of the directors' qualifying shares, then that company will be eligible as a veterans' company and entitled to a special quota.


Agar Rodney Adamson: In this case three of the brothers are veterans and one is not.


Douglas Charles Abbott: If they wish to get the quota I think in that case the fourth brother had better withdraw for the time being and let the other three brothers own the company.


John Alpheus Charlton: I notice that this item covers walking sticks, golf clubs, but what about bows and arrows?


Douglas Charles Abbott: They are not included in this tariff item. I do not know where they are covered.


John Alpheus Charlton: Are they to be allowed in?


Douglas Charles Abbott: They may be. This is item 511 in the quota schedule and bows and arrow's are not included.


John Alpheus Charlton: Are they included in schedule II?


Douglas Charles Abbott: I shall have to check and see. If my hon. friend is especially interested I shall give an answer a little later on.


An hon. MEMBER:: Refer it to the Indian committee.


Douglas Charles Abbott: I shall have the schedule checked and give my hon. friend an answer.
<524a.
(i)	Dolls; toys of all kinds, n.o.p.
(ii)	Mechanical toys of metal.
(iii)	Juvenile construction sets of metal or rubber, consisting of various stampings, punched or moulded, and connections therefor; parts of the foregoing.


[Stage Direction]
Item agreed to.
Items 511b and 518 agreed to.
Customs tariff-
Donald Methuen Fleming: The first part of this item covers "dolls, toys of all kinds; n.o.p." The minister has been using the expression "scheduled" and "non-scheduled countries" and, in so doing, he is using the language of P.C. 4678, because there is no such expression in this bill.


Douglas Charles Abbott: That was done simply for purposes of explanation.


Donald Methuen Fleming: I am not quarreling with that; that was just by way of preface to what I am about to say. Under P.C. 4678 the non-scheduled countries are all countries other than scheduled countries. Is the governing period with respect to toys of all kinds the pre-war period or the past twelve months? I am thinking particularly of Germany and Japan, which were former sources of supply for toys. I am interested in knowing what the position in the next year or two will be with respect to the importation of toys from these former enemy countries.


Douglas Charles Abbott: I do not know that I can say what the prospects are. Importations during the base period were mainly from scheduled countries, the big item being toys, n.o.p.


Donald Methuen Fleming: What is the base period?


Douglas Charles Abbott: The twelve months ended June 30, 1947.


Donald Methuen Fleming: Then I do not suppose there would be any from Japan?


Douglas Charles Abbott: Yes, there were substantial imports from non-scheduled1 countries. The importation of toys, n.o.p. from non-scheduled countries amounted to $497,000, while the total was $2,273,000 from scheduled countries. That made a total of almost $3,000,000 of toys, n.o.p. Then there were other subsidiary items of dolls, mechanical toys and juvenile construction sets. In the case of mechanical toys the importations during the base period from non-scheduled countries amounted to $357,000, and only $331,000 from scheduled countries. The pre-war pattern was somewhat different, although there again the preponderance of imports was from the scheduled countries rather than from non-scheduled countries.


Donald Methuen Fleming: I suppose that in the base period the principal source of supply in the case of non-scheduled countries was the United Kingdom, but I am thinking particularly of Germany and Japan.
Foreign Exchange Conservation


Douglas Charles Abbott: During the calendar year it was the major source of supply. There were importations of $460,000 from the United Kingdom' with a comparatively small amount from the other countries, principally from France.


Donald Methuen Fleming: Was there any from Germany and Japan?


Douglas Charles Abbott: Yes, about $6,500.


[Stage Direction]
Item agreed to.
Customs tariff-634. Feathers and manufactures of feathers, n.o.p.; artificial feathers, fruits, grains, leaves and flowers suitable for ornamenting hats.
Harry Rutherford Jackman: These are the specialty items, and undoubtedly in the pre-war the main supply was the old country. The minister has said that the quota is 42 per cent of the base period, which is the twelve months ending June 30, 1947, or 200 per cent of pre-war imports. I presume the philosophy of the department is to take as much as we can in the way of imports from the United Kingdom?


Douglas Charles Abbott: That is correct; from the soft currency countries.


Harry Rutherford Jackman: Why is the figure fixed as low as 42 per cent of last year, or 200 per cent of the pre-war period? I am looking at items such as cutlery, guns and tobacco pipes. Tobacco pipes are more than twice as expensive as they used to be. Will the minister explain why this low figure has been used?


Douglas Charles Abbott: As I have said before, there is really no effective operation of the quota with respect to non-scheduled countries. Forty-two per cent operates as a restriction on the scheduled countries but, so far as the non-scheduled countries are concerned, there is really no practical restrictive effect.


Harry Rutherford Jackman: I understood that this was so in the case of textiles.


Douglas Charles Abbott: It is true in the case of these items as well.


Harry Rutherford Jackman: Does the minister feel, from his study of the tobacco pipe item, that we shall not be able to import 42 per cent in dollar value of the base period, or 200 per cent of the pre-war pattern?


Douglas Charles Abbott: I am told that, under the quota as set here, the United Kingdom can increase its exports to Canada by 50 per cent and still be below 200 per cent of pre-war.


Harry Rutherford Jackman: May I ask a general question? I notice that a criticism was made

of the labour government in Great Britain that, whereas a large proportion of British imports had come from hard currency countries, a relatively small proportion of the exports from the United Kingdom had gone to hard currency countries. Is it not possible that those exports can be shipped to hard currency countries in larger proportion, so that we can expect to get more in than some of these quotas allow for? How do we know we can get only such a small amount of pipes sent in as the minister said?


Douglas Charles Abbott: It is not within my province, of course, but I understand that the United Kingdom government are endeavouring to direct exports to hard currency countries as far as possible.


Harry Rutherford Jackman: What I want to know is the basis of the department's estimates. The department says that we cannot get more than 50 per cent increase in pipes over last year. Have there been discussions with the British board of trade in the United Kingdom, or is that a figure pulled out of the air? What is the basis for it?


Douglas Charles Abbott: There have been general discussions with the British trade officials here. The figure of 50 per cent was not pulled out of the air. As you say, the British could increase by 50 per cent before they would get up to their quota limit.


Harry Rutherford Jackman: Have there been discussions with the British officials?


Douglas Charles Abbott: Yes, with the British high commissioner and the British trade commissioner.


[Stage Direction]
Item agreed to.
Customs tariff-17. Cheese.
James MacKerras Macdonnell: I want to ask a general question on this item. We do not produce a good many of the articles in this category 5. Are the quotas so arranged that these goods will come in freely from non-scheduled countries?


Douglas Charles Abbott: That was the primary purpose of adding category 5, which, as the committee will appreciate, was not included in the original order in council imposing the quota restrictions. Category 5 was arrived at for the purpose of facilitating export to Canada of certain prepared foods which come mainly from soft currency countries, including the United Kingdom and Australia.

Foreign Exchange Conservation


James MacKerras Macdonnell: I see items for cocoa paste and preparations of cocoa. Do the items cover all species of cocoa?


Douglas Charles Abbott: They do not include cocoa beans.


James MacKerras Macdonnell: Why not? What is the situation in regard to that?


Douglas Charles Abbott: There is no quota.


Agar Rodney Adamson: Surely none of these products come from scheduled countries.


Douglas Charles Abbott: Most of them.


Agar Rodney Adamson: The cocoa bean comes from the Gold coast.


Douglas Charles Abbott: There is no restriction on cocoa beans. Cocoa paste, chocolate paste, and so forth, are prepared foods.


[Stage Direction]
Item agreed to.
Customs tariff-20a. Butter produced from the cocoa bean.
George Alexander Cruickshank: Could margarine slip in under this item?


Douglas Charles Abbott: I am informed that it cannot.


George Alexander Cruickshank: That is definite?


Douglas Charles Abbott: Yes.


[Stage Direction]
Item agreed to.
Customs tariff-26. Coffee, roasted or ground, and all imitations thereof and substitutes therefor, including acorn nuts, n.o.p.
Agar Rodney Adamson: This is the coffee item I asked the minister about the night before last. All coffee is, I understand, imported and sold through the coffee exchange.


Douglas Charles Abbott: It may be bought through the exchange, but the great majority of this coffee is, I am informed, shipped direct from the country of origin.


James MacKerras Macdonnell: There is no quota on it?


Douglas Charles Abbott: No.


[Stage Direction]
Item agreed to.
Customs tariff-9€ia. Vegetables, dried, desiccated, or dehydrated, including vegetable flour, n.o.p.
Heber Harold Hatfield: What does vegetable flour consist of? From what vegetable is it made?


Douglas Charles Abbott: The soya bean largely.


[Stage Direction]
Item agreed to.
Customs tariff-90c. Vegetable juices, liquid mustards, soy and vegetable sauces of all kinds.
Frank Exton Lennard: When vegetable oils were under quota and rather scarce, manufacturers of mayonnaise and oil dressings in Canada were unable to secure the oil to manufacture these dressings and they had to resort to nonoil dressings as a substitute. About a year ago, with the restrictions still on, manufacturers of many United States well-known brands of oil mayonnaise and dressings were able to ship quantities of their finished product under brand names into Canada and flood our markets at a time when our Canadian manufacturers could not manufacture these lines. Are they restricted under this item or under any other item?


Douglas Charles Abbott: I do not think so. This does not relate to vegetable oils but to vegetable juices, like celery juice.


Agar Rodney Adamson: But not citrus fruit juice?


Douglas Charles Abbott: No. That is under schedule II, category 1.


Agar Rodney Adamson: Citrus fruits include such things as oranges, lemons and grapefruit juice?


Douglas Charles Abbott: And lime juice.


Agar Rodney Adamson: I thought there was a special category for limes a little further down.


Douglas Charles Abbott: Lime juice, syrups and fruit juices come in under item 152, which we have passed.


Agar Rodney Adamson: They are treated the same as vegetable juices?


Douglas Charles Abbott: They are under category 1 and under quota.


Agar Rodney Adamson: Orange juice gets more favourable consideration?


Douglas Charles Abbott: No; the same percentage 50 per cent. It includes orange juice, lime juice, grapefruit juice, blended orange and grapefruit juice.


Agar Rodney Adamson: The other vegetable juices are on a quota of 28 per cent?


Douglas Charles Abbott: That is right.


Agar Rodney Adamson: With regard to items 103 to 141, these are luxury items such as preserved ginger, crystallized fruits and peels, glace fruits. What are the percentages for these luxury items?


Douglas Charles Abbott: Everything in this category is 28 per cent. These articles come mainly from the United Kingdom, Australia and
Foreign Exchange Conservation

France, all soft currency countries. Candied fruits come from France. Jellies, jams, marmalade and preserves come from the United Kingdom. The quota is 28 per cent, the same ratio 200 per cent of pre-war.


Agar Rodney Adamson: We are trying to encourage this trade.


Douglas Charles Abbott: Yes, this whole category was set up primarily for the purpose of stimulating trade with soft currency countries.


Heber Harold Hatfield: Are molasses allowed in from the British West Indies?


Douglas Charles Abbott: There are no restrictions on that.


George Randolph Pearkes: I have been asked by one of the women's institutes whether there are sufficient safeguards for carrot juice which, I understand, is used as infants' food. Would that come in under this?


Douglas Charles Abbott: It could be imported under this, but carrot juice is largely produced in Canada. We have a substantial production, but in addition it could come in under quota.


[Stage Direction]
Item agreed to.
Items 103, 104, and 105c agreed to.
Customs tariff-lOod. Jellies, jams, marmalades, preserves, fruit butters and condensed mince meats.
George Alexander Cruickshank: I am of a suspicious nature. Fruit butters would not contain margarine?


Douglas Charles Abbott: No.


[Stage Direction]
Item agreed to.
Items 105e, 106, 107, 140, 141 agreed to.
William Ross Macdonald: Shall schedule II carry?


Wilbert Ross Thatcher: Before this schedule carries, I wish to ask the minister whether he has considered putting in this schedule an item which appears in schedule III, namely, American films. I should like to know whether he has considered such a step as a means of saving United States dollars? When he answers that question will he also say how much we have spent on such films?


Douglas Charles Abbott: Films are under schedule III, and I am waiting impatiently to allow the Minister of Trade and Commerce to take on.


Wilbert Ross Thatcher: I am wondering why they cannot be put into schedule II. In schedule II there is a quota, but in schedule III there is not.


Douglas Charles Abbott: That is correct. After due consideration it was felt that for the time being it was better to put films under schedule III, under special permit.


Agar Rodney Adamson: During the currency crisis in the United Kingdom some years ago, a regulation was made whereby the United Kingdom allowed certain imports under the stipulation that the exporter would accept payments in pounds. Has that possibility been considered by the government, whereby a man importing would accept payment in Canadian dollars?


Douglas Charles Abbott: That sort of thing has been considered, but we are staying away from blocked accounts and a multiple currency system. That is the chief objection in resisting an arrangement of that sort.
Schedule II agreed to.


Douglas Charles Abbott: Before we go on to schedule III. perhaps I had better move:
That schedule III of Bill 3 be deleted and that there be substituted therefor schedule III as it appears in the reprint of the bill now before the committee.


[Stage Direction]
Amendment agreed to.
Schedule III
In this schedule where a tariff item of schedule "A" to the customs tariff is listed without being preceded by the word "ex" all goods included in that tariff item shall be deemed to be included in this schedule and where a tariff item is listed and preceded by the word "ex" only the goods described thereafter are deemed to be included in this schedule, and words and expressions in this schedule have the same meaning as in the schedules to the customs tariff
Customs tariff-ex 238a. Cinematograph or moving picture film negatives one and one-eighth of an inch in width or over.
Harry Rutherford Jackman: How much went out during the last period in payment for motion picture films?


Clarence Decatur Howe: The figure is between
$10,000,000 and $11,000,000; that is to say, royalties that went out last year.


Harry Rutherford Jackman: On the use of United States films?


Clarence Decatur Howe: Yes.


Harry Rutherford Jackman: And I suppose certain royalties went out on the lease of British and French films.


Clarence Decatur Howe: Yes. I am sorry I have not the figures because my officers are not here, but it is about $10,000,000 in respect of United States films and a million or so dollars on others.

Foreign Exchange Conservation


Harry Rutherford Jackman: Why are films included in schedule III and not in either of the previous schedules? The first two schedules have to do with consumer goods, whereas the items under schedule III are producer goods, and yet we find cinematograph or moving picture films under schedule III. Once the film is shown, surely its usefulness is gone. It is not like a structure. What is the reason for this classification?


Clarence Decatur Howe: It was thought that simply to ration United States films would not be a satisfactory solution. After all, there are other ways of meeting the situation which perhaps would be more profitable in Canada. At the moment extensive negotiations are going on between the government of Canada and the entire moving picture industry of Hollywood, and I hope that within the next two or three weeks I shall be able to report a favourable transaction whereby we shall obtain a substantial return in publicity for Canada and possibly some more concrete returns as well. It is difficult to discuss a transaction that is being negotiated, but I assure the committee that the government is not overlooking the possibility of a quid pro quo for the right of the industry to take that money out of the country.


Harry Rutherford Jackman: The sum of ten or eleven million dollars was a substantial outgo, and one in excess of the total amount we spent for cabbages, carrots, lettuce and beets from the United States. There may be a reason for it.


Douglas Charles Abbott: It is not in excess of all fresh vegetables.


Harry Rutherford Jackman: I am sure that a great many people in Canada would rather spend a part of their valuable United States funds on fresh vegetables, which are more beneficial. I should like the minister to say whether the amount which was spent last year in royalties to United States film producers is likely to be exceeded. Is there a limit to it? Having regard to the constructive nature of the deal he is making, I would suggest that he had better hurry, because the Ontario government had a radio program on one Saturday afternoon, or one in which they participated and a considerable account of it was given. There was fire in the studio. I hope the minister will tell the committee just what is there. I do not want to spoil his deal; but it seems to me that, so much publicity having been given to it already, it would be well that he should tell us something about it. I should dislike to see the government of our friend, the Hon. George Drew, get all the credit for
it and see the right hon. gentleman's government left out. I suggest that he hasten and make his announcement as he did in regard to the 4,000 houses for rental in Toronto.


Clarence Decatur Howe: My friend the comedian. Very funny.


Harry Rutherford Jackman: Not nearly as funny as you.


Wilbert Ross Thatcher: Is the government considering putting these films under quota at all?


Clarence Decatur Howe: That is not the line we are pursuing at the moment. We believe that the moving picture industry can do a job for Canada in return for the privilege of showing films here and taking out royalties. As regards the transaction, I may say that we are pleased with the progress we are making, but we are in the middle of negotiations and are not able to explain it at the moment. Of course we all like to make sacrifices that impose hardships upon others.
Personally I do not go to the movies very often. In fact I have not been inside a movie house in two years, and I assume from what my hon. friend said, although I should not like to misquote him, that he does not go often either. But a great many people in this country like to go to movies; therefore, if we can get a quid pro quo in some other way than by cutting down movie films, it 6eems the logical thing to do.


Harry Rutherford Jackman: I should think the only quid pro quo that would interest us under this present bill would be a quid pro quo in United States dollars. Are we to get in United States dollars on the other end of the transaction, or are we still to be faced with a net outgo of $10,000,000 or $11,000,000 of United States exchange we would otherwise have? Is that fair?


Clarence Decatur Howe: I shall be glad to announce the transaction when we have it completed'.


James MacKerras Macdonnell: I want to return to the discussion of two or three days ago when we were discussing the clauses of the bill and when we asked the minister for certain information as to how he intends to work the permit system. Since then, I am glad to say he has given us his regulations with regard to the automobile industry, which I have read and which I hope he will allow me to say sound sensible. But I wish to raise the broader question. We have an idea in connection with the quotas. I suppose there was a certain amount in mind1. Those who framed the quotas knew exactly how much United States funds would be used
Foreign Exchange Conservation

to satisfy the quotas, or approximately so. I should like to ask whether, under schedule III, there is any amount to which the minister is working, or whether he is just going to use his discretion as to what looks like a good transaction or otherwise. In other words, is there any ceiling on the amount of United States exchange he intends to use? Perhaps the minister might answer that, and theq. I have another question.


Clarence Decatur Howe: It is difficult to set a definite amount of United- States exchange that may be used for capital goods. It depends wholly on the level of activity. For example, if for any reason there is a slump in building, the quota of United States exchange would be a great deal less than it would be if we had an active building year. I do not think we could predict that with any great certainty for the entire year. I will give an example. The preliminary estimate of the saving in the automobile industry was $35,000,000.


James MacKerras Macdonnell: Will the minister permit me one question?


Clarence Decatur Howe: Yes.
Mr: MACDONNELL (Muskoka-Ontario): That would be a good illustration if the minister would just tell us how he arrives at that figure.


Clarence Decatur Howe: That was an estimate of the experts who made the original plans; the interdepartmental committee that set up certain objectives. Perhaps the Minister of Finance has told you the objectives for schedules I and II.


James MacKerras Macdonnell: Fes.


Clarence Decatur Howe: The objective for schedule III was a much more indefinite item, but the quota for automobiles was $35,000,000. The schedule which my hon. friend has in his hand is estimated by the analysts to represent a saving of $75,000,000 a year, which is much more than the original quota. We study an industry; we see what the possibilities are; we see what the needs and apparent necessities of the country are; and if the country goes a bit short, that is not a cause for worry. We are endeavouring to get the maximum saving we can secure, which is, I think, the fairest way to explain our method of approach.


James MacKerras Macdonnell: That would be admirable if it were not for the fact that we are thrown into this whole difficulty because we are short of United States dollars. But it seems to me that what the minister says, however reasonable it sounds, leaves my question still unanswered.
[Mt. M-acdonnell (Muskoka-Ontario.]
Surely there must be some figure to which the minister is working. Let us take his regulations in the motorcar industry. He attributes $7,500,000 to imports from non-scheduled countries. I think that is right.


Clarence Decatur Howe: That does not represent
United States dollars.


James MacKerras Macdonnell: No; that is right. Then he has regulations. Perhaps I might read them. It will not take a minute, and it will show how they are made up. A manufacturer is allowed to bring in an amount figured as follows:
(i)	an amount of $230 (being approximately 75 per cent of the average foreign currency content of vehicles produced in Canada) multiplied by the number of vehicles produced by him in Canada during the basic period for domestic use.


Clarence Decatur Howe: That $230 is seventy-five per cent.


James MacKerras Macdonnell: I thought I said1 that, or read that. Then the manufacturer is allowed to bring in:
(ii)	-an amount of $307 (being 1O0 per cent of the average foreign currency content of vehicles produced in Canada (multiplied by the number of vehicles produced by him in Canada during the basic period for export.
In other words, he gets three-quarters for bis domestic manufacture, three-quarters of the foreign content cost, and 100 per cent for those for export. I think I understand1 the reason. He gets:
(iii)	iSeventy-five per cent of the cost of service and repair parts and accessories imported by him during the basic period as reported by him; and
(iv)	Fifty-five per cent of the amount by which his exports during 1948 exceed 90 per cent of his exports of similar products during the basic period.
I wish the minister would explain that fourth one which I do not fully understand. In the second place, and much more important, I wish the minister would say whether there is any amount to which he is working in the motorcar industry-and then we can go on to others-or whether he is merely exercising a discretion as to what amount of money he thinks can wisely be spent. As I say, if there were no question of United States exchange, that might be one thing. But we are short of United States exchange. I want to know whether there is any figure which the minister is expected to abide by, or if he has any ceiling he is working to. Will he answer that now?	*


Clarence Decatur Howe: The motorcar industry is a perfect example. The estimates of savings were placed at a figure of $35,000,000 on the automobile industry.

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James MacKerras Macdonnell: How is that arrived at?


Clarence Decatur Howe: The actual schedule which my hon. friend has in his hand shows, as he has just told us, how it is arrived at. It represents a saving of about $75,000,000.
Mr. MA'CDONNELL (Muskoka-Ontario): As the nigger says, "Them two things don't paralyze."


Clarence Decatur Howe: How is that?


James MacKerras Macdonnell: The minister said he is getting an actual saving of $75,000,000.


Clarence Decatur Howe: Yes.


James MacKerras Macdonnell: When he started out he was to get a saving of $35,000,000.


Clarence Decatur Howe: No, I did not say that.


James MacKerras Macdonnell: Then tell me what you did say. It sounded like that to me.


Clarence Decatur Howe: I said it was a preliminary estimate. My hon. friend wants to know the obj ective.


James MacKerras Macdonnell: Yes.


Clarence Decatur Howe: All right. We made up a preliminary estimate which we said would be our objective.


James MacKerras Macdonnell: All right. I said this was what you started out with.


Clarence Decatur Howe: I just estimated $35,000,000. Is
that clear?


James MacKerras Macdonnell: I think so.


Clarence Decatur Howe: That is a preliminary estimate. You are sure that is clear now?


James MacKerras Macdonnell: Yes, I think so.


Clarence Decatur Howe: I have told you that four times already. I just wanted to be sure you understood it.


James MacKerras Macdonnell: I understand that.


Clarence Decatur Howe: When we worked out our formula, that was different; that was the actual working out of the formula. When we got the formula and got it according to the industry and got it in force, we then made an estimate of the savings that would result from the formula and so arrived at $75,000,000.


James MacKerras Macdonnell: I would have thought it was a poor job.


Clarence Decatur Howe: I am glad you understand it.


James MacKerras Macdonnell: You corrected me, but I was saying exactly what you had said. However, let us not argue about that. The fact is that you are over 100 per cent wrong, so that does not seem so good. You still have not answered my question-which I think you will answer before we are through-and it is this. I still have not any answer as to how you got this figure of $35,000,000, which you started out with and which you multiplied by more than two.


Clarence Decatur Howe: That figure is now obsolete. Let us forget about it.


James MacKerras Macdonnell: Oh, no. As I told the minister the other day, I know he regards these questions as a waste of his time.


Clarence Decatur Howe: Only some phases of them.


James MacKerras Macdonnell: We are entitled to have them answered, and I think we shall have those answers in the end, with patience. What I want to know now is how you arrived at the figure of $35,000,000. Did you just pick it out of the air? Was it just a bright thought you had one day, and then did you later have another bright thought and find it should be $75,000,000?


Clarence Decatur Howe: That was the preliminary view.


James MacKerras Macdonnell: You have told me that three times.


Clarence Decatur Howe: Sit right down, please, until I am through; then perhaps we shall understand each other. Don't get excited. The evening is young yet, you know. Perhaps if you sit there you will get the answer much quicker.


Stanley Howard Knowles: Before this gets too serious, Mr. Chairman, I suggest that hon. members on both sides address the Chair.


Clarence Decatur Howe: Well, Mr. Chairman, I am trying to explain a very simple matter to a very difficult subject over there. To get back to the question, we undertook to close a gap of something like a billion dollars per annum. We thought we could close a certain part of the gap by cutting down imports; in other words, through restrictions. We thought we could close the rest of it over a period of time by stimulating and diverting exports. We set a certain figure for the saving in imports. My hon. friend is going to ask me what that

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figure was. I do not remember, so he need not ask me. It is not very important, anyway. That was the objective, and it was made up of a great number of items. Then we endeavoured to get at least the saving that was estimated, and naturally we tried to do even a bit better. As we got down to individual items and came to discuss them with the manufacturers, we have been able to do at least as well as we anticipated so far, and in some cases very much better. If we can do better we are not bound by the first idea we had, as my hon. friend thinks we should be. He thinks it is a very bad job if you are not bound by something you thought you could do a few months ago, but we take that chance and just do the best we can.


James MacKerras Macdonnell: For the first time I think the minister is beginning to make a start at answering my question.


Clarence Decatur Howe: You understand that, do you?


James MacKerras Macdonnell: Oh, yes, I do; and if we stay at it long enough I think we may both understand.


Douglas Charles Abbott: The minister was stating the obvious.


James MacKerras Macdonnell: The Minister of Trade and Commerce can look after himself, so just leave it to him. Well, with considerable difficulty we have reached the point where the minister admits there was an objective, and he has told us they were able to do 100 per cent better than the objective they had in connection with the motorcar industry, so it would seem to me that it was a very poor objective to begin with, but we shall let that pass. However, we still do not have the slightest idea of how that objective was arrived at. You just told us you thought it would be a good idea to tiy to save 135,000,000. Would you' tell us what the imports were last year; and do not tell me they are on record somewhere, because I would like them now.


Douglas Charles Abbott: That question has been answered two or three times.


Clarence Decatur Howe: The three companies that manufacture in Canada imported about $71,000,000 in parts.


Agar Rodney Adamson: That is, complete cars and parts?


Clarence Decatur Howe: No, just parts. Just calm down, now; your specialty is gold, you know. Is that clear; does that answer the question?

Now I suppose you want the value of the imported cars; is that right? Is that of interest, too?


James MacKerras Macdonnell: I want to know just how you arrived at this $35,000,000 you were going to save. I assume there was some kind of plan in this; I am
giving you that much credit.


Clarence Decatur Howe: We were just saying-


The ACTING CHAIRMAN (Mr. Bra-dette):: I would ask hon. members to maintain the decorum of the chamber and address the Chair, even in asking questions.


James MacKerras Macdonnell: I beg your pardon, Mr. Chairman; I thought I was doing so.


Clarence Decatur Howe: I was advised by my legal friend sitting beside me that I was being cross-examined by probably the least expert cross-examiner who ever sat in the house, but I told him the excuse was that you were not a cross-examiner but a banker. However, we shall get on. Imports of finished cars, in addition to the $71,000,000, were about $41,000,000; that is, imports from hard currency countries.


James MacKerras Macdonnell: I understand from the minister, if my addition is good-and if it is not he will correct me-that the total was about $112,000,000?


Clarence Decatur Howe: Yes, about that.


James MacKerras Macdonnell: Then you set out to cut it down by $35,000,000?


Clarence Decatur Howe: Yes.


James MacKerras Macdonnell: And I understand it was cut down by $75,000,000?


Clarence Decatur Howe: I have not mentioned the exports there.


James MacKerras Macdonnell: I am quite ready to let the minister take his time in telling the story, but we want to have it.


Clarence Decatur Howe: Of course there are also the earnings from exports to which I have just referred. I put all this on Hansard somewhere, but it is a little difficult to gather it together from memory. I thought I could pick a few figures from the air which were not bad, but to take the exports and add in the earnings is a little difficult. I shall be glad to get the analysis, however, and show where the saving of $75,000,000 arises.

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James MacKerras Macdonnell: I would remind the minister that this is at least the third time he has said he has not the figures here. The point is that the minister does not take the trouble to come here prepared to answer our legitimate questions, so we will just stay here and keep asking questions, though he will be annoyed and -perhaps we shall be annoyed too.


Mr. PROBE:: Yesterday the hon. member for Maple Creek coined, I think inadvertently, the word "mathemagician". As I listened to the .Minister of Trade and Commerce and the hon. member for Muskoka-Ontario discussing this item, which deals with moving [DOT]picture film negatives, and then get involved in statistics concerning automobiles-


Clarence Decatur Howe: I was just going to ask what item we were on.


John Oliver Probe: -I believe they are both "mathemagicians." I should like to ask a simple question on the item, and I would appreciate a simple answer, if the minister can give it to me. This item, which involves the import of films from scheduled countries amounting to some ten or twelve million dollars, according to the minister, I presume takes into consideration the fact that there are imports from non-scheduled countries. Is this item in schedule III to make it possible to secure an adequate influx of British films to Canada, which I presume were not in great abundance or great demand in Canada during the period prior to 1939? Could the minister give us the picture as to what effect this will have on the British film industry and also on the United States film industry, because I believe that is what the hon. member for Muskoka-Ontario started to get at.


James MacKerras Macdonnell: I have not got into the films yet at all.


John Oliver Probe: But that is what we are all trying to get at.


Clarence Decatur Howe: It is not the present intention to interfere with the distribution of films in Canada. British films come here freely. They have their own distribution in their own theatres, as the United States films have; and films continue to come in as in the past. We are trying to get a reasonable offset for the drain of United States dollars resulting from the importation of United States films. As I say, I think that we are working out a transaction which will represent a reasonable quid pro quo. I am not able to announce it here, because all the details are not worked out; and to give part of the story might not be helpful in closing the transaction.


John Oliver Probe: In view of the fact that this is entirely in the minister's hands, I presume he is making provision to protect non-scheduled country exports to Canada. This refers to motion picture negatives which, I presume, are the commercial films. They are one and one-eighth inches in width.


Clarence Decatur Howe: Yes.


John Oliver Probe: That is the thing concerning which we should like some assurance.


Clarence Decatur Howe: We are not putting any obstacles in their way. We would, of course, welcome more British films. But all I can say. is that I do not know how much I can cultivate it. However, I am not putting any obstacles in their way.


John Oliver Probe: And with respect to the importation of United States films, the minister can assure the committee that it is proposed to attach certain conditions which will be beneficial to Canada?


Clarence Decatur Howe: Yes, that is right.


Harry Rutherford Jackman: In connection with the moving picture film business, it does seem strange that we went all through schedules I and II and that we purposely took the prewar pattern of trade and made it possible for Great Britain to send over as much in goods as she could, because they owed us lots of money and we needed their products. Now we come to films and we find that the government have not followed that formula at all. I think the committee is entitled to some of the reasoning behind this. We know that the United States film industry was very hard hit by the action of the United Kingdom, which had the same problem we had, namely the shortage of United States dollars. They cut United States films down drastically. But we followed the opposite course and put no limitation upon them at all.
It is hard to criticize too severely until we know what the quid pro quo is. However, I think we should point out some of the things that are in our minds at least. It does seem to some of us to savour of United States domination. The last thing the United States government wishes to do just now is to do anything to hurt the United States film industry to any greater extent than has been done by the United Kingdom restriction of imports of United States films.
I think the government should give some very good reason why we have followed such a different cotirse in respect to this one product, namely United States films, from the course we have followed in connection with
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every other product normally imported into this country. And because we are chronically short of United States dollars, even in normal times, it would seem to me that no harm would be occasioned if we were to give a little lift to the British film industry here at the present time as against the number of United States films which come in. They have the great advantage over British films because of our way of life and our being adjacent to the United States. And when we are doing everything we can, or making it possible for the British people to pay for the things we want to sell to them-for instance wheat, which we have no place else to sell-I think the committee should be given the reason why we differentiate so completely when it comes to films. Why do we make such a difference between films and other matters?


Clarence Decatur Howe: The film industry does not, in 'our opinion, lend itself to quotas.


Harry Rutherford Jackman: The United Kingdom did it.


Clarence Decatur Howe: They practically prohibited them by putting a 75 per cent tax on the receipts. And the result is that the United States industry stopped shipping. I have not noticed any indication that it has helped the British film industry one iota. In fact, they are talking about unemployment in the film industry; I was just reading about that tonight. However, if my hon. friend can suggest any way of helping the British films to come here, I shall be very glad to consider it. But I cannot think of any way, except to go over there and buy them, and bring them out. They are entirely free to come into this market.


Harry Rutherford Jackman: When you cannot eat lettuce you eat something else; when you cannot get United States films you receive British films.


Clarence Decatur Howe: Probably my hon. friend does not go very often to the moving pictures, but I understand that people do have their tastes in films. If we can give them what they want, the idea is not to impose unnecessary conditions on them. We will not disturb the habits of the film goers if we can get a quid pro quo which is equally valuable. I do not know why my hon. friend should object; be does not go to the movies.


Harry Rutherford Jackman: I did not say I do not go.


Clarence Decatur Howe: You talk like a man who does not.


Harry Rutherford Jackman: Oh, not at all. I always talk for the public interest.


Stanley Howard Knowles: The Minister of Trade and Commerce put up the argument that we should not disturb" the habits of film goers. This afternoon and the other night when we were arguing for the importation of fresh vegetables, and when we then did not want the habits of Canadians upset, we were told we had to save United States dollars.


Clarence Decatur Howe: My hon. friend left out just one word. I said "unnecessarily". I said if we can get a quid pro quo without disturbing it, then that is a better solution. When I speak of a quid pro quo I mean getting a very good share of value for that $10,000,000. I think perhaps in commercial value it might be close to $10,000,000. But I would rather have something valuable for the money, and give our people their films, than I would simply stop films and have no money to buy valuable things.


Stanley Howard Knowles: It is because we wanted something for them that we asked for fresh fruit and vegetables.


Angus MacInnis: I was just about to say what the hon. member for Winnipeg North Centre has just said. It is difficult to understand the policies of this government because there really does not seem to be very much rhyme or reason in what they do.
But what I rose to say was that the Minister of Trade and Commerce and the hon. member for Rosedale ought to see some films, and I would suggest that they should see British films. They are excellent. I am not a movie fan; but occasionally when I get tired listening to members of parliament I take in a movie.


George Alexander Cruickshank: Mickey Mouse?


Angus MacInnis: I would suggest that they should see some British films, and then they would be in a position to recommend them to their friends. In my opinion, those I have seen are far superior to the Hollywood brand.


Harry Rutherford Jackman: That is my contention.


James MacKerras Macdonnell: To get away from the movies. I should like to get back to real life for a moment.


Clarence Decatur Howe: May I ask what item we are discussing, and where the hon. member for Muskoka-Ontario gets his position.


James MacKerras Macdonnell: I will explain that.


Joseph-Arthur Bradette: We are discussing tariff item ex 238a, with respect to cinematograph or moving picture film negatives one and one-eighth of an inch in width or over.

Foreign Exchange Conservation


James MacKerras Macdonnell: May I be permitted to say a word? When we were discussing permits earlier in the bill, if I am not mistaken the Minister of Finance said that the proper place to discuss permits in general, as to the way they are being given, would be when we came to schedule III. I wish to see whether I am right or not in my understanding. I wish to discuss the general question of permits, and I understand that this is the place to do so.


Douglas Charles Abbott: It is all right if my hon. friend wishes to discuss permits. But if he wishes to discuss the figures on automobiles or machinery he should do so under the proper item.


James MacKerras Macdonnell: I shall bow to the ruling of the Chair. When we are talking about permits, first of all let us consider the subject. We are talking about the saving of United States dollars, and we are 'talking about this extraordinary procedure which we have to resort to, because of certain things which have happened; and we do not need to discuss them now. But one of the things which is essential in discussing these permits is to know how they are being used, and the whole basis upon which they are arrived' at.
When we were on schedules I and II the Minister of Finance very fairly and properly explained the basis upon which this is being done. I think it is nonsense for us to consider these items one by one when we have not had an explanation of the whole basis governing the giving of these permits. Now is the time for us to get figures from the minister as well as an explanation as to how this is worked out. The other night I brought up the question to the minister, and he explained to us that he had made regulations in connection with the automobile industry. I have those regulations; I have read them and' I was bold enough to say to the minister that they read pretty sensibly. But I wanted' to know and still want to know-if this is not the right place to get it, we can get it some place else-and I suggest that now is the time to find out whether there is any rhyme or reason to this system under which permits are being given. The minister has made it very difficult. After a couple of Slips of memory, he finally got down to the point where he explained what they bad in the automobile industry. He has never told us how they worked it out. He just told us that was 105 per cent up. I am never very much impressed by people who figure out this sort of thing themselves. They always try to make it easy for themselves.


Clarence Decatur Howe: Item 438a covens automobiles. If my hon. friend can exercise his patience that long I shall be prepared to give him all the data he is now asking for. But in the meantime I wish he would not talk about automobiles.


James MacKerras Macdonnell: I am talking about permits.


Joseph-Arthur Bradette: Are you speaking on the point of order raised by the minister?


James MacKerras Macdonnell: I am speaking on the point of order raised by the minister. I am talking about permits and I used automobiles merely as an illustration. I want an explanation from the minister of how the whole business of permits under schedule III is approached. Has he an objective that he is working for? He has told us more or less that he has one in the automobile industry, and I want to know what his other objectives are. I want to know the amount of United States exchange he is allowing himself in connection with the steel industry, the motor industry and other industries. I want to know what figure we are dealing with. We are dealing with hundreds of millions of the money of the people of Canada. What the minister is trying to do is to juggle this thing along and have it left so that we have not the slightest idea of what figure he has in mind, and so that- there will be nothing in the world that we can hold him to later on. I ask you Mr. Chairman, to rule that this is a proper time to discuss the basis of the permits under schedule III and that there is no other time to discuss it.


Joseph-Arthur Bradette: I must rule that the question of permits would come up under schedule III, but at the same time the discussion of permits would have to be generalized in connection with the single item. We are discussing item ex 238a, and it would be in order to discuss permits for cinematograph or moving picture films and nothing else. There will be an opportunity of speaking about permits for automobiles later on. That is my ruling.
Mr. MACDONNELL .(Muskoka-Ontario): I bow to your ruling, but I think it will complicate matters. It means that under each item we have to ask the minister what his objective is in the matter of United States exchange and how he is getting along with it. I think it will waste a lot of time but I bow to your ruling.


Clarence Decatur Howe: May I say generally about permits that I have absolutely no authority

Foreign Exchange Conservation
to issue any permit, because the official opposition has kept rolling this bill over since the middle of January and not putting me in a position of authority whereby I can issue permits. If this bill passes, then I can begin issuing permits, but if you ask me now about permits I must say that I am not doing any business.


Alexander Malcolm Nicholson: I am sure that, on reflection, the minister will want to withdraw those remarks. If he intends to blame the opposition-


An hon. MEMBER:: He said the official opposition.


Alexander Malcolm Nicholson: The minister cannot blame any member of the opposition for the government's failure to formulate and enunciate a clear policy.


Joseph-Arthur Bradette: Again I must remind hon. members that we are on item 238a. Shall the item carry?


Harry Rutherford Jackman: No.


Donald Methuen Fleming: I want to say something about the minister's last remark. Mr. Chairman, you purported to call us back to a particular item, and then the minister made certain remarks which constitute a grave reflection on one side of the house. If the remarks of those of us who want to say something by way of correcting the minister are ruled out of order, then certainly you should have ruled the minister out of order before he made remarks of that kind.
I should like to recall, for the benefit of the minister, certain facts which obviously he has forgotten in connection with the matter of bringing into effect the provisions of schedule III or the permit set-up under this whole scheme. When we were here in December the minister announced to the house that there would be some delay with respect to the whole permit system, that he was not going to bring it into effect until February 1. Then, in due course there was another announcement deferring the date. Those announcements had absolutely nothing to do with the passing of the bill; the minister gave quite different reasons for his action at that time. What he is now trying to do is to use something that has nothing whatever to do with this present issue before the committee, to drag that out as a red herring to cover up the fact that this whole program is such that the government does not know what it is doing or where it is going.


Douglas Charles Abbott: Do not take yourself too
seriously.


Clarence Decatur Howe: Sit down, my boy.


An hon. MEMBER:: Sit down, you are too young.


Donald Methuen Fleming: Any more of those slapstick remarks from the ministerial benches will not contribute anything either to the decorum of the chamber or to the celerity of the proceedings.


Douglas Charles Abbott: Well put.


Donald Methuen Fleming: When the Minister of Reconstruction and Supply, Trade and Commerce and everything else, the jack of all trades in the cabinet-


An hon. MEMBER:: Order.


Donald Methuen Fleming: -undertakes to make remarks intended to disparage those in the house who do not happen to have his years-


Douglas Charles Abbott: Shame.


Donald Methuen Fleming: I want to say to him that I think references of that kind do not reflect any credit on him. There are a great many people sitting around him, younger men, who are not getting the chance they should in this house, simply because those who occupy the treasury benches do all the talking and do not give the young men behind them a chance to show their real ability.


Joseph-Arthur Bradette: I would ask members of the committee to come down to earth and consider the item we have before us.


Donald Methuen Fleming: That can certainly be done if the ministers will refrain from these remarks with which they load up Hansard, simply because they sit beside the Hansard reporter. Remarks like that reflect no credit on the chamber or on the minister.


Mr. COTE (Matapedia-Matane):: On a point of order, I believe the hon. gentleman is exhausting his steam power. I do not think he has the right, under the rules of the house, to cast reflections on or to impute motives to a minister. He is saying that the minister does all the talking because he wants to crush or squash, or whatever the word is, the backbenchers behind him, who are actually all heartily behind the minister. I say that he is imputing motives to the minister which he has no right to do, and I ask the hon. member to retrieve and to withdraw his remarks.


Agar Rodney Adamson: Is it not a fact that the importation of British films is conditioned

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upon the ownership of theatres in Canada? Is the number of British films that we can bring in not strictly limited by the ownership of the outlets?


Clarence Decatur Howe: I would doubt that very much. I think if we got British films in proportion to British outlets as compared with United States owned outlets we would have far more British films. The Odeon people own almost as many theatres as Paramount and we do not get nearly as many British films.


Harold Aberdeen Watson Timmins: The minister holds the balance in connection with films coming from the United States.


Clarence Decatur Howe: No, I hold no balance. I do not disturb in the slightest the distribution of films.


Harold Aberdeen Watson Timmins: The minister must exercise some discretion.


Clarence Decatur Howe: Not a bit.


Harold Aberdeen Watson Timmins: How much is to be saved by the plan that is not yet in existence?


Clarence Decatur Howe: Not very much.


Harry Rutherford Jackman: If we are to have in the functioning of these various schedules what I might call side deals such as the Minister of Trade and Commerce suggests he is having with the United States movie industry, I would close by reminding the Minister of Finance that I gave him what I thought was a worthwhile side deal on how to trade cattle for cabbages, and I did not even get the courtesy of an answer from him.


Douglas Charles Abbott: Do not miss your train; Toronto needs you.


[Stage Direction]
Item agreed to.
Customs tariff-306. Marble, sawn or sand rubbed, not polished; granite, sawn; paving blocks of stone; flagstone and building stone, other than marble or granite, sawn on not more than two sides.
John Oliver Probe: I am interested in these four items dealing with building stone. I have had some communication, with the assistant to the Minister of Trade and Commerce with respect to importations of some of these items from Wisconsin, and I wish to express here my appreciation of the expeditious way in which they looked after that business.
But sometimes it so happens that when a substitute stone is available in Canada for a building, particularly a public building, the substitute does not fit into the architectural 5849-95	.
pattern, and consideration should be given to that feature, particularly when buildings still uncompleted have been a long time under construction prior to the introduction of this bill.
Would the minister indicate just how much money is involved in these four items for building stone? What were our imports prior to the war in the three-year period generally referred to from scheduled and non-scheduled countries? What was the amount imported in 1947 from the same source, and how much does the minister expect to save on these four items by whatever regulations he is about to adopt?


Clarence Decatur Howe: The figures are granite rough, $193,744, from the United States; $697 from Mexico, $3,350 from Italy. Granite sawn, $179,813, of which $71,663 came from the United States, and $90,691 from Sweden, which is also a hard currency country. Granite manufacture, $32,306. Marbie sawn, $104,585, chiefly from the United States, Marble for tombstones, $109,970. Marble manufacturers, $55,712. Those are the principal items, totaling around $1,000,000.


John Oliver Probe: The imports are larger than I expected. In general, we can develop substitutes for most of the items, but not for all of them. I presume the minister is prepared to give the assurance that, where a certain type of stone has been specified by the architects for a public building and it is not readily available in Canada, he will not hold up the building.


Clarence Decatur Howe: If the building is partly completed we would naturally co-operate, but we sincerely hope that large quantities of stone will not be used, because that is not the type of building we are trying to encourage. If limestone is used we would rather have the Canadian product used, but architects are apt to specify Indiana limestone.


John Ritchie MacNicol: A number of schools are now being built in Toronto, and the practice down through the years has been to use Indiana limestone. I understood the minister to give me the assurance the other day that there would be no prohibition of Indiana limestone being brought in to finish buildings.


Clarence Decatur Howe: I think the architect would' have to do a good deal of explaining why he could not use another stone or dispense with stone altogether. In any event, as I explained to my hon. friend, we realize that growing communities must have schools, and we are

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prepared to examine the projects and decide on the basis of the actual project what can and cannot be done.


John Ritchie MacNicol: A few days ago an official was here from Toronto and, I presume, discussed with the department the likelihood of their being able to obtain some kind of stone.


Clarence Decatur Howe: No, he did not mention stone. He talked about steel, and we said that if it was not more than three stories high, reinforced concrete could be used.


John Ritchie MacNicol: It would be foolish to
insist on a school already half built with one type of stone being finished with some other type of stone. The school would be an eyesore to the children. We do not want anything like that.
Item 306 stands.
Progress reported.



BUSINESS OF THE HOUSE

John Bracken: Would the minister indicate the business for Monday?


Douglas Charles Abbott: I shall ask the house to allow me to advance one stage a resolution standing in my name to amend the Farm Improvement Loans Act, which will expire at the end of this month, and if the house will agree we might even give the bill its second reading. It is not controversial. The amendment is merely to extend for a further period of three years the act, which has proved reasonably successful. When that is disposed of we shall proceed with Bill No. 3, with which we have been dealing this evening, and if, as I hope, we dispose of that we shall proceed in committee with the resolution relating to the excise tax portion of the emergency program.


[Stage Direction]
At eleven o'clock the house adjourned, without question put, pursuant to .standing order.
[Stage Direction]
Monday, February 23, 1948