1948-04-20

OFFICIAL REPORT


[Stage Direction]
EDMOND CLOUTIER, C.M.G., B.A.. L.Ph., PRINTER TO THE KING'S MOST EXCELLENT MAJESTY CONTROLLER OF STATIONERY 1948
[Stage Direction]
Tuesday, April 20, 1948

Right Hon. J. L. ILSLEY (Minister of Justice):: Mr. Speaker, there are a few words which I should like to say to the house. The Prime Minister (Mr. Mackenzie King) has today reached another milestone in his remarkable career, and I am sure that the house would wish to give some recognition to the occasion.
It is no small achievement to have held the high office of prime minister, not only longer than any former prime minister of Canada, but also longer than anyone has held the office of prime minister in any country of the British empire.
What the Prime Minister has attained is a world record as the elected leader of a free nation. That such an achievement has been possible is of course a proof of his rare and impressive personal qualities. But it is also an indication of the stability of our people and of the completeness with which they have adapted British institutions to Canadian conditions.
My remarks, I need hardly say, are in no sense intended as a party manifestation. I would hope that my sentiments would be shared by all members of the house. But speaking on behalf of the Prime Minister's political supporters in the house, and I think I can also speak for his political supporters throughout the country, I count it a privilege to extend to him on this occasion our sincere congratulations.


Mr. J. R. MacNICOL (Davenport):: Mr. Speaker, there are indeed occasions when all partisanship can be laid to one side, and I think the present is an occasion on which we can all join in recognition of the very high distinction that has come to the right hon. the Prime Minister in the fact that he has held office as prime minister longer than any other prime minister in any of the British dominions or in the dear old motherland itself.
I understand that today the right hon. gentleman exceeds the long tenure of office of Sir Robert Walpole, whose portrait hangs among those of other famous men in the corridor leading to the restaurant on the sixth floor.
In my childhood we used to read a good deal about Sir Robert Walpole, and we were struck by the fact that he had held office for so long a time.
Today, Mr. Speaker, I feel very humble. My leader (Mr. Bracken) just a moment ago sent word asking me to speak after the right hon. the Minister of Justice. The Prime Minister and I have something in common, not shared by any others in this house. Our mothers were warm friends as girls in Toronto, and many a time I heard my own mother speak of the right hon. gentleman. It is therefore with great pleasure that I rise to voice the sentiments of this side of the house, in the official opposition, in congratulating the Prime Minister on the high distinction he has brought to Canada, in placing this country at the head of all other parts of the empire, including the old land itself, in his length of tenure of office as prime minister.
Personally I hope the Prime Minister will live for many years yet, and if he does retire, as he has intimated he will, I hope that in his days in private life he will be afforded the opportunity to write that which this country needs so much, his own memoirs; because, apart altogether from politics, those memoirs will cover a wide field and a long period, and will include those who went before the right hon. gentleman.
I felicitate the Prime Minister and wish him long life and good health.


Mr. M. J. COLDWELL (Rosetown-Biggar):: Mr. Speaker, we of the Co-operative Commonwealth Federation join in felicitation of the Prime Minister on this occasion. It is indeed a remarkable achievement to have been prime minister of this great country for approximately twenty-one years. It is just over two hundred years since Sir Robert Walpole relinquished the reins of office, having been in reality and in very truth the first prime minister of any country now included in this great commonwealth of nations which share a common democratic heritage and common parliamentary institutions.
Felicitations to Prime Minister

The Prime Minister has made a great contribution to the growing up, if I may put it that way, of this country; to the achievement of its maturity as a nation. Since the time he came into office at the end of the first world war, succeeding Sir Robert Borden, who had insisted on Canada signing the treaty of Versailles in its own right, he has witnessed and aided the growth of that nationhood of which we are all proud. While we remember Walpole as the first Prime Minister of Britain, the present Prime Minister of Canada will perhaps be remembered for many things, but one of them will be that, during his long term of office, Canada in very truth obtained recognition throughout the world as a sovereign nation.


Mr. J. H. BLACKMORE (Lethbridge):: It affords the members of the Social Credit group, Mr. Speaker, great pleasure to be able to join with the other members of the house in congratulating the Prime Minister on this day. We congratulate him on his achievements as Prime Minister. He has been called upon to stand at the head of affairs in this nation while we have been passing through trying times. What is yet ahead, no one can tell. He may yet be called upon to render great service to this nation. In case he should be, we wish him health, strength and good spirits, that he may be able to discharge any other responsibilities he may be called upon to assume.
( Translation):
Right Hon. L. S. ST. LAURENT (Secretary of State for External Affairs): Mr. Speaker, it will seem fitting, I am sure, that a Frenchspeaking voice should join with those we have just heard in extending to the Right Hon. Prime Minister (Mr. Mackenzie King) a tribute of admiration, affection, gratitude and warm wishes on this day when his term of office as leader of one of the Commonwealth states equals that of the prime minister who, before him, had headed one of these states longer than anyone else.
It is a fact worth recording because it illustrates not only the continuity of our prime minister's services but also the ease with which we adapt ourselves to the parliamentary system modelled on the long experience of Westminster:
The fathers of confederation gave us a constitution basically similar to that of the United Kingdom and, though our parliament has not yet existed a full 81 years, already one of its leaders has served as prime minister as long as any other in the several centuries since the foundation of the institution upon which our own is patterned.

We have indeed cause to rejoice over such a fact just as we have cause to rejoice over the opportunity we are given today of extending our congratulations to the one who, more than anyone else in our nation, has contributed with such constancy in investing our parliament with the stamp of dignity, of stability, and with such substantial pledges for the future.
(Text):


Mr. T. L. CHURCH (Broadview):: As a former head of the city of Toronto, Mr. Speaker, I wish to add a word of tribute to what has already been so well said by the others who have spoken today.
I think I have known the Prime Minister longer than almost any other person here in the house. I have always had a great deal of admiration and respect for him. I knew his father, who was a beloved professor in the law school when I attended it. I knew his mother, his father and all his family. I have always had a high regard for him personally, because of his kindness of heart to all his friends. I will say this about him. He has given a long life of able and brilliant service to our country. I am one of those in the house who has never allowed religion or politics to mix up with friendship.
I will always remember what his distinguished parents have done for this country. His grandfather was the first mayor of our city, in 1834. I was in Toronto the other day, and I may say that a large tablet is erected there marking his grandfather's grave. One of my last acts as head of the city was, I think, in December 1921. I remember his brother, who was a great member of the medical profession. His body arrived at the Union station, and as head of the city I accompanied it for burial. I have always remembered the kindness of heart of the Prime Minister.
Mr. JEAN-FRANCOIS POULIOT (Temis-couata): It is refreshing, Mr. Speaker, to hear such speeches as these on an occasion like this. Mr. King has been my only leader for a long time, and perhaps he will be my only one; I do not know about that. He has been my leader most of the time, to the extent that my conscience permitted me to follow him.
There is one thing that I find quite unusual, and it lies in the calling to mind of the length of time a man has been in office; the time has seemed to be so short. Mr. King is still so youthful looking that it is hard to believe he has been here longer than Walpole-who has been dead for a long time-was prime minister of Britain. I do not think it is fair to compare

Felicitations to Prime Minister
a living man who is in good health with a dead one. It is unjust to do that. But it can be said that everybody meant well.
The cabinet ministers spoke well. My good friend the hon. member for Davenport (Mr. MacNieol) made a moving speech. So did the hon. member for Broadview (Mr. Church); the leader of the C.C.E. party, and the member for Lethbridge (Mr. Blackmore) acting as leader of the Social Credit party, also spoke very well. I regret that we have not enough celebrations of this kind. We had one for Mr. King on the occasion of his birthday, and at the time of the unveiling of his picture in the House of Commons. On another occasion, when he left for a trip outside of Canada, we wished him godspeed; and on his return he was welcomed. But I think there should be celebrations like that for every member of the House of Commons. We have a gracious member amongst us, the hon. member for Qu'Appelle (Mrs. Strum). Why do we not join together in order to hold a celebration in her honour?
The spirit of the House of Commons is better today than it usually is. Why? Because politics have been forgotten for a time. That is a good thing. We are here together. We are in the same boat. I notice once more that Mr. King has some very good friends amongst his critics. Those who flatter him are not always his true friends. They may expect something, but he is too great a man to pay attention to flattery. I am sure that at times he appreciates criticism much more than flattery, because he must surely give the one who may criticize, the benefit of the doubt.
Now, sir, in the hope that you and all my colleagues will be honoured in turn on fine occasions like this, I offer my congratulations and good wishes to Mr. King, as this is a good precedent for other celebrations of the same kind to honour each one of our colleagues in turn.


Right Hon. W. L. MACKENZIE KING (Prime Minister):: Mr. Speaker, may I at once extend my good wishes to every hon. member of this house, and my warmest thanks for the generous expressions of good will to which I have listened this afternoon. I do not think I need say that it would be much easier and pleasanter for me to be extending congratulations tie hon. members in different parts of the house than to be attempting to acknowledge the kind words that have been extended to me. Nevertheless these occasions do come along. They have been coming much too rapidly of late; time has been flying by much too quickly. To have been able to retain over 5849-199J
many years the confidence and good will of those closest to one in public life is in itself something for which one should indeed be more than grateful. I should like hon. members to know that for their confidence, over so long period of time, I am indeed deeply grateful.
I thank very warmly my colleague the Minister of Justice (Mr. Ilsley) and my colleague the Secretary of State for External Affairs (Mr. St. Laurent) for what they have so kindly said on behalf of the members of the government, and the members of the party with which I have been associated during the greater part of my life. They need no words of acknowledgment, but rather would I express gratitude to them for what their lives and the lives of those on whose behalf they have spoken, have meant to mine; what the loyalty, the industry and the ability of those by whom, over the years, I have been surrounded in council has meant so far 'as my life is concerned in bringing this day to pass.
I thank most warmly all members of the Liberal party, those 'in this house and those outside it, who have given me their support, for having made possible the years of office it has been my privilege to enjoy.
Need I say, Mr. Speaker, that St has touched me not a little that words from hon. gentlemen of the official opposition should have come from two hon. members who have been not only close personal friends over many years, but who also have had close associations with those who have been nearest and dearest to me in my life. It has been, perhaps, a part of my misfortune that so much of my time in public life has been lived more or less alone. But that has only served to cause me to realize more deeply, than perhaps I otherwise would have, how much I owe in what there may have been by way of accomplishment to those whose example and whose lives have meant more than all else to mine. I thank the hon. member for Davenport (Mr. MacNieol) for his close friendship, and for his reference to the friendship of our mothers, before either of us was born. I also thank the hon. member for Broadview (Mr. Church), who has had close associations with members of our family in the past, for having spoken so generously of what that association has meant.
I need not say how deeply I appreciate the kindly sentiments expressed by my friend the leader of the Co-operative Commonwealth Federation (Mr. Coldwell) and those of my friend the hon. member for Lethbridge (Mr. Blackmore), who has spoken on behalf of the leader of the Social Credit party. To both

Felicitations to Prime Minister
I am deeply indebted for what they have so kindly said, and to their followers for the cordial manner in which they have responded to their expressions of good will. In passing, 1 should like to say to the hon. member for Lethbridge how much I regret the absence from the house through illness of the leader of the Social Credit party. I hope the hon. gentleman will express to his leader my good wishes, and my hope that he may speedily return to this house in health and strength.
To my friend the hon. member for Temis-couata (Mr. Pouliot), I also feel indebted for what he, too, has said. I appreciate the friendship I have shared with him, as I do the loyalty and friendship I have had in such full measure from all hon. members on this side of the house.
Mr. Speaker, I had been told that something might be said this afternoon to which I would be expected to reply. Not being too sure, feeling as I have during the past few days, that I might not omit what I most wished to say, I wrote out a word or two this morning which with the permission of the house I should like to read. It expresses what I feel most deeply about this particular moment, in relation to our parliament. I hope hon. members will believe that I speak in an impersonal way in seeking to convey what I feel to be the significance of this occasion.
It is well, I think, we should all have in mind just what has occasioned today's congratulations. To do so, at all events, will make it a little easier for me fittingly to acknowledge what others have found it possible to say. It will make clear, too, that it is to others I owe whatever merit there may be in the long years of office I have been privileged to enjoy. This is what I have written.
It is with a record-a sort of long distance record-in the matter of the time of holding high office in the state that our thoughts and our words are concerned for a moment this afternoon. If records are to be related to countries, then I am indeed happy that it has been my good fortune to be the one to win a record-an unequalled record, I am proud to say-which redounds to the credit of Canada.
What pleases me in equal measure is that a record achieved in our country, and in Canada's parliament, under our system of free, representative, responsible government, should be of great significance to the world today in the struggle we are witnessing between totalitarianism and democracy. The struggle today in many lands, and indeed it has become a

world struggle, is again the age-long one between freedom and tyranny, between democracy and totalitarianism. Today's record makes clear that to gain and to retain power in a free country, to help shape the policies of its government, it is not necessary that the head of a political party or of an administration should be either a superman or a dictator.
It has been well said that the symbol of democracy is the secret ballot; that the symbol of totalitarianism is the secret police. The record of which mention is being made today is attributable to the protection afforded the majority, by the secret ballot. Nowhere about this record is there the sinister shadow of a secret police. It signifies the opportunities which democracies afford to a man of average industry, intelligence and integrity, who is prepared to give his time to public service. It speaks volumes for what, in a democracy, is possible for the individual.
Now let me return to the spoken word. I need not say how grateful I am to have been spared in health and strength to enjoy an honour I had never sought, and to the possibility of which, until obliged to do so by the all too rapid passing of time, I had never so much as given a thought.
I am particularly proud to possess this honour at the instance of the people of Canada. I cannot say how grateful I am to mjr fellow citizens who have given me their confidence over so long a period of time. Nor can I say how much I owe to the loyalty and ability of those of my party who surround me today, and to those who through my years of office- totalling twenty-one years within two months from today-have given me such unfailing and devoted support. I have, too, very much in mind how much I owe to the officials and other members of our public service, and to the many friends without whose help over the years I could not have begun to meet the least of the obligations of my present position.
It is with mixed feelings indeed that I express my gratitude for the many evidences of good will of which I have been the recipient today, from within and without these halls of parliament, from many other parts of our country, and from friends in countries other than our own. I should find much greater satisfaction in the occasion were its emphasis upon years of office to which I might still look forward in this period of transition in the world's history, rather than so exclusively upon years that have flown by so quickly and are gone forever.
To me personally, however, this day is one of thankfulness. I am particularly thankful

Industrial Defence Board
that I have been spared to participate during so many years in the public life of our country, and to see the high place Canada has come to hold in the regard of other nations. I am thankful, too, that having been in office for so long a time, I have so many-I might almost say "any"-friends left. This is the more surprising, and may I add the more pleasing, in that I have had, of recent years, so little opportunity to see anything at all of many of my fellow members, or to share with them, inside or outside these halls of parliament, the personal and social contacts which are so all-important and so enjoyable.
May I say in conclusion that I rejoice above all at the opportunity public life has afforded me to render some service to my fellowmen. This service I trust through years to come may be helpful to many.



VETERANS AFFAIRS


[Stage Direction]
Third report of the special committee on veterans affairs.-Mr. Mutch.

Hon. LIONEL CHEVRIER (Minister of Transport) moved:: That the name of Mr. Halle be substituted for that of Mr. Baker on the special committee on veterans affairs.


[Stage Direction]
Motion agreed to.


Hon. HUMPHREY MITCHELL (Minister of Labour):: Mr. Speaker, I rise on a question of privilege. Yesterday I tabled orders and made a statement in the house to the effect that the interest rate on payments on government annuity contracts had been reduced from four to three per cent. I stated on that occasion:
These matters have effect as of the 19th day of April, 1948, but do not change existing contracts.
I notice in this morning's Globe and Mail of Toronto that, with respect to this matter, and referring to what I said, it states:
It would, he pointed out, affect contracts already in force.
This is entirely the opposite of what I did say; and I trust the Globe and Mail will make a correction for the benefit of its readers who have been purchasers of government annuities.
I am sorry also to have to refer to a report on this matter appearing in today's Montreal Gazette. This states that the change in interest
rates was forced by the representations of private business. That is not correct. I have not to my recollection met any of the business interests referred to in this matter-and I have been in the ministry for more than six and a half years.
The change was made, as I have stated, to bring the rate in line with that paid on government securities. The Gazette also reports alleged claims of private business that the government annuities scheme has been subsidized out of tax funds to the extent of $4,500,000 a year. This is a gross inaccuracy. The average annual mortality losses to the government in the past five years has been $400,000. The government pays the cost of administration of the annuities act. The average annual cost for the last five years was $437,000.



NATIONAL DEFENCE


Hon. BROOKE CLAXTON (Minister of National Defence):: Mr. Speaker, I have to announce the establishment of the industrial defence board, made today, and I now table a copy of P.C. 1739 creating the board, also a copy of P.C. 1740 giving the names of the chairman, vice-chairman, and members of the board representing industry.
As set out in the terms of reference, the primary purpose of the board is

To advise the government of Canada and the Minister of National Defence on all matters relating to the industrial war potential of Canada.
The members of the board representing industry are all men who gave notable service in connection with industrial organization during the second world war. One of the objects of our setting up the board is to ensure that the experience they gained will not be lost and will be the basis for future developments.
Their names are Messrs. H. J. Carmichael, C.M.G., Chairman; J. Edouard Simard, ViceChairman; G. R. Donald, O.B.E.; William Knoll; J. G. Notman; Clarence Wallace and William A. Wecker.
In addition the members of the board will include the chairman of the defence research board; the president of Canadian Arsenals Limited; the three principal supply officers of the armed forces of Canada; the deputy minister of national defence and the deputy minister of trade and commerce.
In a letter to Mr. Carmichael this morning I set out some of the matters which I thought
Inquiries oj the Ministry

should be given immediate attention. I table a copy of this letter. These matters include:
Examination of the various agencies concerned in planning and initiating procurement and production of war equipment in Canada so as to recommend a division of responsibilities which will ensure that these responsibilities are effectively met without overlapping.
Consideration of requirements in the light of plans and possible programs of the armed forces and the assessment of the capacity to make available the materials, manpower and manufacturing facilities that may be required, with special recommendations regarding materials, industry or plants which are regarded as essential and for which some special provision, should be made.
To assist in the work of organization, I have designated Colonel W. G. Denny, O.B.E., as acting executive secretary. Colonel Denny has held positions in connection with ordnance work during the war in Europe, as well as at home and in the United States.
It will be seen that one of the major jobs of the board will be to ensure effective co-operation between the armed forces and the various agencies operating in this field. I refer particularly to the newly organized Canadian Ordnance Association, representing industry.
In the last war Canada became a great arsenal of democracy. Should an emergency ever arise again our expectation is that this board will assist us in being prepared to ensure that Canada will play its full and necessary part in the preservation of freedom and in the defence of our country.



MINISTERIAL POWERS


[Stage Direction]
On the orders of the day:
Mr. J. G. DIEFENBAKER (Lake Centre):: Mr. Speaker, I should like to direct a question to the Minister of National Defence (Mr. Claxton), and offer it also for the edification of the Minister of Justice (Mr. Ilsley), in regard to a judgment handed down by Mr. Justice Angers. I would ask the Minister of National Defence whether, in view of the finding of the judge in this case that discretionary encroachment by certain ministers and deputy ministers will, if not curtailed, result in this country's being ruled by a dictatorial government, he will alter the order he made.


Brooke Claxton: Mr. Speaker, the hon. member did not give me notice of the question, and it is three years since I had anything to do with the case to which he has referred. I have a fairly clear recollection of it, however. and on the basis of that recollection

I should like to answer the hon. member's question and set him right about some of the assumptions he apparently has as the basis of his question.


John George Diefenbaker: I quoted from the judgment.


Brooke Claxton: This case concerns a veteran, Paul Belleau, who suffered a disability resulting from tuberculosis contracted at the end of the first great war. As a veteran he received treatment from the department of pensions and national health for a long period. I think he first came before the narcotics division of that department some time in the nineteen twenties, and some time in the nineteen thirties it was found that he was receiving, through prescriptions from his own physicians, thirty grains of morphine per day which I am advised made him the largest known single user of the 4,000 known addicts in Canada at that time.
The narcotics division of the department of pensions and national health was headed by Colonel Sharman, a man having a widely known reputation throughout the world for having made a great contribution in that field. Being entrusted by the then Minister of Pensions and National Health with the responsibility of the administration of the narcotics act he caused inquiries to be made to see why this huge quantity of morphine was being prescribed for this man. In consequence, over a long period of time, I think stretching up to fifteen years, there were discussions between this man and his doctors and those representing the department as to what could be done. As I say, there is no case of any doctor being allowed to prescribe such a dosage for an addict, at least so far as my information goes.
The officers of the department co-operated with this man's own doctors in working out a plan for his treatment and cure by a reduction of the dosage. On a number of occasions the doctors of the department, or those appointed to represent the department, saw the man's own doctors to work out the details. However, it was found on repeated occasions that the man would not co-operate, and still his doctor and those representing him wanted to obtain these huge doses.
In these circumstances and in consequence of events which took place long before I came into the Department of National Health and Welfare, but for which I am glad to assume responsibility, it was decided on the advice of no less than six or seven doctors, most of whom I saw myself, and after I had examined the record repeatedly, that the requests made by this man through his own physician shall

Inquiries oj the Ministry
not be met and that the ten grains per day which he was then receiving and which is a very heavy amount, should not be increased, with the authority of the department. If it were increased it would be confirming the fact that this man was being given morphine by government permission just because he was an addict and for no other reasons.
In those circumstances I refused to authorize that this morphine be given to this addict. When I say "this morphine" I am referring to the colossal dosage. But the officers of the department did co-operate with his own doctor, and I think the dosage was gradually reduced to something in the nature of four grains, which when I last heard of the case he was still receiving. That was done on the advice of his own doctors and in accordance with the terms of the narcotics act and the regulations passed under it.
Then with regard to the question raised in the judgment, the hon. member has surely read the plaintiff's assertions and the claims referred to, possibly in the press and possibly in the judgment. The case did not come to trial on the facts. It was tried on what we in Quebec call a demurrer, a point of law, to see whether there was any case in law to go before the court. The court held that on that point of law the action must be dismissed. The facts have never been brought before the court except in so far as they are asserted in the plaintiff's claim.
The facts are substantially as stated by myself from my memory. Having been entrusted with the responsibility for the administration of the narcotics act, and having regard to the dangerous character of the drugs administered and the possibility of any drugs given in large quantities being used improperly, I believe hon. members would feel that any discretion reposing in the minister who administered that act had been exercised properly on this occasion.



LABOUR CONDITIONS


[Stage Direction]
On the orders of the day:
Mr. CLARENCE GILLIS (Cape Breton South):: Mr. Speaker, may I be permitted to direct a question to the parliamentary assistant to the Minister of Reconstruction and Supply (Mr. Mcllraith) ? I am not by-passing -the minister, but I have been dealing with the parliamentary assistant in connection with this matter. My question arises from a telegram received from the director of the steelworkers union. Has the parliamentary assistant or
the minister been advised -that the Canadian Car plant at Amherst, Nova Scotia, may close permanently because of their inability to secure scrap material? Secondly, can he advise the house why only 165 tons of scrap have been delivered out of the 500 tons promised that plant in February?


Right Hon. C. D. HOWE (Minister of Reconstruction and Supply):: With the permission of the inquirer I refuse to be bypassed. The steel controller was no-t advised of any shortage of raw material at Amherst until after the plant had been closed down. Inquiries were then made as to why production was not coming from Amherst. We were then advised of a shortage of re-lay rails, which is the raw material for the plant.
Instructions were given that the first 500 tons of re-layers produced at Belleville were to be allocated to the Amherst plant and also that the first 500 tons of re-layers accumulated at Moncton were to be delivered to Amherst.
I might say that the Belleville re-layers ordinarily go to Burlington Steel Company but they are diverted to Amherst for the present.
Recent inquiries to the company indicate that while the plant has been closed extensive repairs have been made, and the management state that they have every intention of resuming operations. They report to us that they will in future be able -to operate on a more continuous basis -than has been the history of the plant previously.


Clarence Gillis: The plant is actually closed for repairs and not for lack of material?


Clarence Decatur Howe: The fact that no complaint reached the steel controller about lack of raw materials until after the plant had closed down would indicate to me that the plant was probably closed for repairs, or perhaps rebuilding.


Clarence Gillis: The company is kidding the ' employees.



BUSINESS OF THE HOUSE


[Stage Direction]
On the orders of the day:
Mr. J. H. HARRIS (Danforth):: I should like to direct a question to the Minister of Finance. The first item on the order paper under government notices of motion has to do with schedule V to the general agreement of tariffs and trade. When the order paper is cleared of that item we have just one more under the same heading. In the meantime this item has been on the order paper for four and
Inquiries of the Ministry

a half months. I think the Minister of Finance should inform the house why this order, which bears date December 5, is still on the order paper under government notices of motion, and how long it will remain there.


Hon. DOUGLAS ABBOTT (Minister of Finance):: Mr. Speaker, I cannot say just when it will be brought forward. I had not contemplated bringing it forward in any case until after the Geneva agreements, which are now before the banking and commerce committee, had proceeded further than they have so far done.



FOREIGN EXCHANGE


[Stage Direction]
On the orders of the day:
Mr. MAX CAMPBELL (The Battlefords):: Mr. Speaker, I wish to direct a question to the Minister of Finance. In view of our foreign exchange situation, can the minister tell the house what amounts of Canadian dollars are being converted into United States dollars by subsidiaries of United States corporations to meet their obligations in the United States?


Douglas Charles Abbott: That question, Mr. Speaker, I suggest is one which should be placed on the order paper, as it requires the obtaining of figures. My hon. friend was good enough to give me notice of it, and I have asked that the figures be prepared and hope to give him an answer tomorrow, but I cannot today.

REFERENCE TO PRESS REPORT AS TO PRODUCTION On the orders of the day:


Mr. G. K. FRASER (Peterborough West):: Mr. Speaker. On April 9 the Minister of Reconstruction and Supply said that the production of nails was increasing month by month, but the Globe and Mail this morning in its Ottawa Briefs says:
Nail production in February dropped' to 5,670 tons-


Mr. SPEAKER:: Order: I understood the hon. member was going to put a question.


Gordon Knapman Fraser: I am just going to put the question, Mr. Speaker, but will complete the quotation:
-compared with 6,854 the previous month.
I would ask the minister why there is a drop of 1,184 tons in the production of nails in February of this year as compared with
January, and what is the prospect of the production being increased. We cannot have houses built for veterans if nail production is dropping.


Clarence Decatur Howe: One reason for production in February being less than in January is that there are fewer working days in February.


Some hon. MEMBERS:: Oh!


Clarence Decatur Howe: My hon. friends, if they will watch production in a 31-day month as against a 28-day month, will see that that is a fact.


Mr. ROSS (Souris):: There were twenty-nine days in February this year.


Clarence Decatur Howe: I know, but the short month is the principal reason for the drop in production. The production of nails is limited by the amount of rod that can be supplied from the steel companies. We are stepping up rod production as fast as we can consistent with other demands. Generally speaking there has been a very sharp increase in the output of nails, and generally speaking there is no great shortage of nails in this country, even though it has been found impossible to keep all hardware stores supplied with nails. That is the plain fact. The apparent shortage is a matter of distribution. I know of no project in the country that is being seriously held up for the lack of nails.


Gordon Knapman Fraser: I do not agree with the minister's statement that fewer working days in February accounted for the drop in production.



HEALTH INSURANCE


[Stage Direction]
On the orders of the day:
Mr. STANLEY KNOWLES (Winnipeg North Centre):: Mr. Speaker, is the Prime Minister yet in a position to answer the question I asked him yesterday, of which I reminded him by notice this morning?


William Lyon Mackenzie King: Yes, Mr. Speaker. My hon. friend's question was as to whether health legislation would be introduced at the present session. The question has been under consideration by the cabinet off and on at different times since the beginning of the session. When legislation will be introduced will depend on the progress we make with other legislation now before the house.

Freight Rates
INQUIRY OF THE MINISTRY On the orders of the day:


Mr. J. H. FERGUSON (Simcoe North):: Mr. Speaker, there is a gathering in the city of Ottawa of most distinguished gentlemen from across Canada and may I suggest that the members of the government, if they are sincere in their requests for forgiveness for the gross mismanagement of the country's affairs, might go down there and join that party.



FREIGHT RATES-INCREASES ORDERED BY TRANSPORT BOARD-AMENDMENT, MR. COLDWELL- SUBAMENDMENT, MR. BRACKEN

[Stage Direction]
The house resumed from Thursday, April 15, consideration of the motion of Mr. Abbott for committee of supply, and the amendment thereto of Mr. Coldwell, and the amendment to the amendment of Mr. Bracken.
Mr. T. J. BENTLEY (Swift Current):: Mr. Speaker, when this debate was adjourned last Thursday evening I was pointing out some of the reasons why the railway companies found it necessary to seek an increase in freight rates in this country. One of the reasons I gave was the overcapitalization of at least the Canadian National Railways, and I cited some very good authority to substantiate my statement. I have one more piece of evidence to offer to the house in further substantiation of my statement, and that is the news report in this morning's papers that the president of the Canadian National Railways said that the Canadian National is paying $44,000,000 in interest charges every year, which is three times the amount of interest charges that the Canadian Pacific has to meet. That in itself is a potent reason why the railways should be revalued, particularly the Canadian National Railways, and written down to their actual cost. Then, as I said before, if there is a debt still due to the bondholders which is properly theirs, let it be serviced and paid by all the people of Canada, not by just some sections of this country.
I also pointed out that-one of the results of the judgment of the board of transport commissioners was to increase freight rates not simply by 21 per cent but by over 100 per cent on many small shipments because of the board's ruling that the railways could charge a 75 cents minimum on all less than carload lot shipments of less than 100 pounds. I also pointed out that because of that fact many private concerns in this country were taking advantage of the increase in freight rates to
add, for their own profit and benefit, the increased rates to the price of their goods, thus making the order in effect retroactive even though the judgment by no means gave any authority of that kind.
Now I want to give another reason why I think the railways of this country felt called upon to ask for an increase in freight rates, and it is this. There is entirely too much influence on the Canadian freight rate structure by the railroads in the country to the south of us, by our friends of the United States. I think in this as well as in many other matters there is entirely too much influence by Washington and allied interests down there on our whole Canadian economy. These two particular faults that I have mentioned may be laid at the door of all past governments that Canada has had. They do not necessarily have to be laid at the door of the government which is at present in power, although this government must take its full share of the blame. There are others to blame also.
There is one reason, however, why this government should undoubtedly be censured right now for what has taken place. Nowhere in the judgment do I find it stipulated that any single part of the 21 per cent increase in rates was earmarked for an increase in the wages or salaries of workers. When therefore my friends opposite accuse us of trying to prevent the railway workers from getting an increase in wages, they are simply shedding crocodile tears and using specious arguments. Had there been one word in the judgment indicating that a part of the increase was to be used for the purpose I have mentioned, it might have been easier for us to feel kindly, at least to the extent that such an increase was to be given to the workers.
The third reason why it is asked for is something which is directly attributable to this government, and that is the failure of the government to listen to the advice of this party since 1945 when we demanded the continuance of price controls in Canada into the days of peace at the level that had obtained in the days of war. The government refused to follow that course. Three years ago we found they were beginning to release controls, aided and abetted by their common law wife in this house, the Progressive Conservative party, which supports them on all measures of this kind, in the interest and to the profit of their own particular friends throughout the country. The releasing of the controls began at that time, and its continuance up to the present day has been the greatest single factor causing the board of transport commissioners to justify the increase granted.
3136
Freight Rates

Had these controls not been released, I am convinced that what has happened would not have happened, or at least it would not have been necessary even from the point of view of the railways.
I am going to suggest that even at this late date, twelve days after the rate went into effect, the government should still reconsider its position and immediately disallow this increase in freight rates. I have much evidence to support my contention, and it should be convincing to the government.
I have here a letter from the Edmonton chamber of commerce. It is a long letter and I will not read it all, but I wish to put on the record one paragraph which sets out their position clearly. It is dated April 13, 1948, and reads in part:
The chamber has been advocating, and still advocates, the appointment of a commission of the prestige and influence of the Rowell-Sirois commission, because the chamber feels the question of freight rates is the single most important matter facing the Canadian economy at the present time.


Mr. GIBSON (Comox-Albemi):: They were reflecting on the transport board?


Thomas John Bentley: They say in this letter that they are not, and neither am I. I am reflecting on the government, which my hon. and independent friend the member for Comox-Alberni supports on nearly every occasion.


Mr. COLD  WELL@: And this one.


An hon. MEMBER:: Shame.


Thomas John Bentley: Yes, shame.


John Lambert Gibson: Just enjoy yourself.


Thomas John Bentley: I have made no reflection on the board. It is not very often that I support chambers of commerce, but in this matter the whole west, and I am speaking as a member from the west, no matter what the political, economic or social views of the people there may be, is in agreement that this increase was unnecessary and unfair. The people there ask, as I do, that a complete investigation be made into the whole matter. I have quoted that paragraph because I believe that a letter from a chamber of commerce has infinitely more effect on my Liberal and Tory friends than letters from any other source that I can think of-even an ecclesiastical source-because that is their greatest god.
I say therefore that the disallowance should be effective right now, even though twelve days have passed since the freight increase went into effect. Even though a good many months have gone by since the release of controls, I say that the government-and this, I assure you,

is not coming from any communist source- should immediately reimpose price controls as they have been asked to do so many times by members in this part of the house and by people in many parts of the counrty.
I suggest also, as the chamber of commerce does, a complete investigation into the whole capital structure of the railways until we find out exactly what they are worth intrinsically and what they should charge as capital and fixed charges. With the overcapitalization as it is-and this is backed up by the authorities I have given-who, I ask, can look at a railway statement and determine, for example, whether their depreciation reserves are the proper ones, until we know what the capital figures of these companies actually are? Who can tell whether any of the percentages of their earnings indicate their proper earnings when no one knows exactly what the institutions are worth?
For that reason, and in the interests of and fairness to the country, I believe the government should accept the three recommendations I have mentioned.
May I make one more reference to the Edmonton chamber of commerce. They say that they feel the question of freight rates is "the single most important matter facing the Canadian economy at the present time." I will not say I fully agree with the importance they attach to it as the greatest single factor in the national life of Canada, but it is a great factor and quite in line with the statement made by the hon. member for Rosetown-Biggar (Mr. Coldwell), the leader of. this party, when he said that it would cause a strain on Canadian relationships if this freight increase went into effect.
The hon. member for Lethbridge (Mr. Blackmore) went further and said the strain would be so great that it was possible it would cause a great rift in our Canadian national unity. The chamber of commerce apparently is rather of the same view. I suggest therefore that the words spoken by hon. member for Rosetown-Biggar and the hon. member for Lethbridge were not idle words. They sprang from the thoughts and the information which we find among the people in the country, who distrust actions of this kind.
If, as I said before, it is necessary for Canada to subsidize railways to some extent, then they should be written down to their proper capitalization, and the extra debt that is to be serviced should be paid back by all the people of Canada, including the two central provinces. It would strengthen the bonds of Canadian unity if such action were taken.

Freight Rates


Mr. THOMAS REID (New Westminster):: Although I had something to say on the subject of freight rates after the Easter recess, in view of the fact that two want of confidence motions have since been brought before the house, and having regard to the speeches that have been made, I feel it incumbent upon me this afternoon to say something further.
I was a little amused at the remark of the hon. member for Swift Current (Mr. Bentley) when he talked about the common law marriage between Liberals and Conservatives.


Thomas John Bentley: It is legal out in British Columbia, I admit.


Thomas Reid: If it is a common law marriage, the offspring must be the members of that party to which the hon. gentleman belongs.


Stanley Howard Knowles: What has the hon. member been doing?


Thomas Reid: That is only by the way.


An hon. MEMBER:: Oh, oh!


Thomas Reid: If the hon. member keeps interrupting I will wait until he stops. I did not interrupt him.


Thomas John Bentley: Have fun.


Thomas Reid: If one cannot be a gentleman, he should at least act like one.


Mr. DEPUTY SPEAKER:: Order.


Thomas Reid: First of all, I want to make a comment on the want of confidence motion introduced by the leader of the C.C.F. It is like a great many more of the theories propounded by that group. One has only to read the motion to realize that what I am about to say is correct. He says it may be a want of confidence motion, that it may defeat the government, and that if it does, the people of Canada should decide. WT11 any member of parliament tell me if there is any one particular subject which the people of Canada can decide? One can just imagine a general election on the freight rates issue.


Mr. PROBE:: It would be just too bad for you if you had it.


Thomas Reid: It is an issue which would principally affect the people of British Columbia, who would speak about it, and perhaps the people of the prairies. But when you came to the provinces of Ontario and Quebec, which have over sixty per cent of the "population of Canada, I greatly doubt if freight rates would be an issue at all. How then could the people of Canada settle it? I cannot see the people in Ontario and Quebec voting for the develop-5849-2004
ment of British Columbia and the prairies if it meant the moving of the industries from those provinces out to the west. Therefore, in my opinion, what is suggested by the leader of the C.C.F. would not work at all. It is just a lot of theory. It would never work out in practice, because every member of parliament knows that no one can tell exactly what one issue elects or defeats a member. There are so many issues involved in an election that no person can say that this, that or the next thing either elected or defeated him. So I say there is nothing to the contention that the people of Canada would decide the issue. I submit that they would do no such thing.
I am frank to admit- that the general freight rates issue-that is, the charges for freight between various provinces and for various distances-is a matter which is somewhat complicated for the House of Commons to decide. Any reasonable-minded member will readily admit that. But I well remember what happened when I brought the plain issue of grain rates before the house. For five years, standing over there in the opposition, I tried) to get some redress with regard to grain rates-which was just one issue-from the prairie provinces to British Columbia. I well remember the treatment I received. I was told plainly on every occasion: "Why do you bring this subject into the house?" I was told that by the Conservative government then in office. I was told to take it to the board of transport commissioners. They said, "Do not bring it up here." I was not arguing the general freight rates structure at all. I was arguing one issue and one issue only namely grain rates. I well remember how the vote went when I was voted down. Even the members from British Columbia on the Conservative side actually stood up in their places and voted against me in the year 1935, the vote on that occasion being 45 to 64.
May I also point out this to hon. members. All the decreases which have taken place since 1920 have taken place under a Liberal administration. The one increase, the great 40 per cent increase, took place under a Conservative administration in 1920. I doubt if many members in the central provinces, including even the minister who mentions the mountain differential, is cognizant of the fact that there is no such thing as a mountain differential so far as the Canadian National Railways are concerned. The mountain differential was instituted after the building of the Canadian Pacific into British Columbia.
If one looks into the history of it, he will find that actually a Conservative administration was defeated in the year the railway
Freight Rates

began operations. Sir John A. Macdonald's administration was accused in the House of Commons of certain wrongdoing. An election was held and his administration was defeated. Then Sir Alexander Mackenzie came into office. The rates were set after the Canadian Pacific Railway reached the coast. That railway, by the way, chose the longest route to the Pacific coast. I am told that it was chosen on the instructions of Great Britain who at that time wanted the railway to be as far back from the United States border as it was possible to get it. So the C.P.R. chose what was then, and is now, called the Kicking Horse pass route, with a grade through the mountains of 2-5 per cent.
Realizing that the company had some difficulties in building that railway, the government of that day gave them 50,000,000 acres of land and also, I believe, $100 million in cash. The people of British Columbia, who were assured of equal treatment if they joined confederation, thought that the 50,000,000 acres of land and the $100 million would pay for any difficulties the railway might have in going to the coast through the mountains. But the C.P.R. started out in dictatorial manner and they were at that time the lords of creation because they were alone. Therefore the people in the province of British Columbia set out to have a competitor, and commenced the construction of a railway, called the Canadian Northern, from the coast to the prairies. That railway came through what is known as the Yellowhead pass. The grade on that railway is the lowest in the entire dominion, being 0-7 per cent. There is no grade on any other line, right from New Westminster and Vancouver to the prairies, that is as low as that of the Canadian National. I think it is not generally understood by many people, no matter how often we have told them, that there is no mountain differential in so far as grade is concerned. It exists only in the matter of rates.
But what happened? Just when we had the competitor railway built and ready to begin operations, the dominion government at one fell swoop took in the Canadian Northern Railway under the Railway Act. So the rates on the Canadian Northern became subject to the dominion Railway Act of that day, and the railway freight rates of those days were those of the C.P.R. From that day to this we have been paying the exorbitant rates charged by the C.P.R. Ever since then the C.P.R. have dominated, right through the piece.

I made a statement in this house in 1931, and I was greatly surprised to see that the statement was never mentioned in the press. When I introduced my motion in the house in 1931, I was interviewed by a high official of the C.P.R., who almost threatened me if 1 did not withdraw the motion. I made the charge in the House of Commons, but although I looked in the papers afterwards, I found no mention whatsoever of my having been intimidated by the C.P.R. official. From that day to this I have noticed that on almost every occasion W'hen I and other members have mentioned anything derogatory to or in criticism of the C.P.R., many of the leading papers have been silent on the subject.
I will go further than that. I ask hon. members to look back in the records of the press when a train wreck has occurred, either on the Canadian Pacific or the Canadian National. They will find that when the wreck is on the Canadian National, it is blazoned across the page in big letters, but w'hen a wreck takes place on the C.P.R., it is in small print, and one must look for it. I do not know why that is. I merely mention that to hon. members in order to support the contention I have made that, in so far as the railways in this country are concerned, the entire situation has been and is being dominated to quite an extent by the Canadian Pacific Railway.
When I fought the freight rates on grain at that time-and I am not going into that question this afternoon-I pointed out such instances as this. They were carrying grain, as I think they still do, 2,239 miles from the west to Montreal for 53 cents per hundred pounds. From Calgary to Vancouver, 642 miles, the cost was 41J cents per hundred pounds. There was no comparison at all. Bear in mind we are the only province in which grain has been designated in two -ways. If the grain is going abroad from the prairies it is carried at something like 21J cents per hundred pounds. If the grain is to be consumed within the province, at that time they were charging 41J cents, but after importuning the government for four or five years the railways reduced the rate to 30 cents per hundred pounds.
I well remember those days, when I produced the figures and papers in the house showing that we in British Columbia could buy in 1934 Canadian grain in China and bring it back to the Pacific coast for less than we could buy it on the prairies and haul it to British Columbia at the 41J cent rate. It was startling. All through the years we have been endeavouring to secure the removal of this differential, but without result.

Freight Rates
When the minister spoke on Tuesday, April 13, he mentioned that counsel for British Columbia and the other provinces had plainly stated that the recent application before the board was not for the removal of the differential. That is perfectly true; but if he had read the complete statement he would have seen that counsel said what British Columbia was complaining about was the 21 per cent increase on top of the present freight rates into that province; and that is the chief ground of our complaint. Anyone who has sat in the railway committee and listened to the financial statement of the Canadian National Railways being discussed; anyone who has heard, as we were told in the house the other day, that the deficit is expected to be well over $15,000,000, cannot help but be struck by the enormity of the problem. But except for a statement in respect to the capitalization of the C.N.R. I have not heard any member of that committee, no matter on which side of the house he sits, suggest to the railways how they can earn profits which will enable them to carry on, with the present high cost of materials and wages and the falling passenger traffic. It is a situation that has to be faced, and I am frank in saying that I for one have at present no permanent solution to offer at the moment. But I am going to offer one or two suggestions of which I trust the minister will take note.
With the surplus in the treasury we will have this year, I think the government might very well cut out the tax of 15 per cent on transportation. Perhaps that would not amount to a great deal, but I think it would mean between six and seven million dollars a year to the two railways. In my opinion there is no reason now for the transportation tax to continue to be imposed, because it was put into effect as a war measure and in my view is not required now.
In his speech the minister said there had been no appeals to the board of transport commissioners since 1927. That is perfectly true with respect to general freight rates, but there is a reason for that. British Columbia has spent huge sums of money and put forth every possible effort before the board to have the discrimination removed, all to no avail. As one who has appeared before the board of transport commissioners fighting the grain and freight rates question, I know one is immediately confronted with the statement that you are not introducing any new argument into the argument, and that therefore the judgments given in the past must stand. Realizing this, British Columbia has been slow to bring forward any further appeal to the board of
transport commissioners since 1927, not only because such an appeal entails great expense, but also because they are sure to be met with the argument, "Well, we have heard all that; the judgment has been given in 1927, and we cannot go back on it." I know that is what I was met with when I appeared before the board; that is what I was told. The board simply said, "We have heard all that evidence. Nothing new has been introduced; therefore we are standing by the judgment given in previous days."
I think it only fair to point out to hon. members that the railway into British Columbia was built at less cost than were many portions of railway in Quebec, the prairies and Ontario. It has been shown in evidence that construction costs were less, and pusher-mile expenditures are less. As a matter of fact I am told it sometimes takes three pusher engines to bring an ordinary freight into Fort William. The Canadian National can haul up to three times more, from Vancouver and New Westminster to Edmonton, than the Canadian Pacific, with the same class or type of locomotive; but while all this evidence was placed before the board-and I use the word "evidence" advisedly-it was of no avail.
I say to the minister that in view of the present situation; in view of the fact that there are areas and districts in Canada suffering an undue burden; in view of the fact also that we in British Columbia will have to pay more than people in the other provinces because our present rates are higher and the increase of 21 per cent therefore means a greater increase to us, we are asking that something be done once and for all to remove the gross injustice and the extra load we have been carrying as compared with the other provinces. I suggest to the minister that he designate at least three if not four areas in Canada, recognizing that there are long stretches with very little population where the cost to the railways must be higher because they do not pick up any freight, and that these areas be equalized so far as rates are concerned, with the country as a whole paying the difference.
After all it is a national affair, a national responsibility. As has been pointed out, we in British Columbia came into confederation with the understanding that with respect to railways and rates we would receive equal treatment with the other provinces. That has not been carried out.


John Ritchie MacNicol: I may have misunderstood the hon. member, but did he say that in this equalization the railways should pay the difference? I have heard it suggested that in
Freight Rates

those unpopulated stretches the country should pay the difference, and I am in favour of that.


Thomas Reid: No, I am not in favour of the railways paying it. I say the nation should pay it. If I said it should be paid by the railways I want to correct that statement.


John Ritchie MacNicol: That is what you did say.


Thomas Reid: I am very glad my hon. friend drew the matter to my attention. The country should pay the difference, because it is a national affair and not a provincial or local matter.
In conclusion let me ask the minister if, when he speaks again, he will give the assurance to the house that the request of the government that the board investigate and examine discrimination in freight rates be not only a request but a directive so to do.
It may surprise many members to know that in the Railway Act discrimination is allowed. If one looks through the- judgments of the board of transport commissioners he will find all the way through that they do allow discrimination. But when it comes to the matter of unjust discrimination, that of course is their responsibility. Anyone who makes an appeal to the board will find great difficulty in proving to the board that a discrimination is unjust.
What makes me somewhat perturbed with the minister's direction to the board is this, as it is found at page 48 of the judgment:
Mere mileage comparisons do not afford criteria of discrimination; but all facts material must be given weight.
In other words under the body of regulations which have developed under the Railway Act, mileage is not the rigid yardstick of discrimination. Discrimination, in the sense in which it is forbidden by the Railway Act, is a matter of fact to be determined by the board. It will be found by anyone who will take the trouble to read the judgments that, contrary to popular belief, discrimination is allowed by the board of transport commissioners; this is done under the Railway Act.
What we have claimed and what we maintain is that the discrimination against British Columbia is unjust, and that no evidence can be or has ever been produced to show that it costs more to haul a pound or a ton of freight to British Columbia than to haul it to any other part of Canada. As a matter of fact when counsel for the Canadian Pacific was asked what it cost to 'haul any article, he admitted in evidence that no expert could tell just how much it cost to haul an article over any given distance of the railway.


Mr. CASE:: Is the hon. member arguing against the increase in rates, or for equalization?


Thomas Reid: I am arguing at the present time that the increase of 21 per cent has placed a heavier load on the people of British Columbia than upon those of any other province. That is my argument today. I am asking and pleading with the minister that he give a directive to the board of transport commissioners-not merely a request to look into the matter of the different rates and of discrimination but to give them a directive to remove and to equalize rates, payable if need be from the treasury to the railways, and to make up any deficits incurred by them in that way.
I close with that request to the minister- to my mind a reasonable one. I could have taken more time to discuss the different rates, but I realize much has already been placed on the record, and realize also that the House of Commons is not always the best place in which to discuss the numerous differences in rates. When I discussed the matter during the years I was in opposition I did so with only one thought in mind, and that had to do with grain rates from the prairie provinces. British Columbia is the only province having a differential in grain going west. Grain going east carries only one rate, whereas on grain going west it is designated either as export or domestic. If it is domestic we pay fifty per cent more as freight than do the people abroad.


Stanley Howard Knowles: Mr. Speaker, I rise to speak mainly with respect to one aspect of the question before us. Therefore my remarks on the general situation will be brief; for, after all, the broad picture has been well covered throughout the course of the debate.
As the hon. member who has just taken his seat pointed out, what members from the west and from the maritime provinces object to is that the discrimination already in effect has been heightened and aggravated by the 21 per cent order. It has been pointed out from all sides of the house that this has an inflationary effect on the cost of living, and that it also increases the inequalities which already exist among the different sections of the country.
I must say I felt one of the most ridiculous statements made thus far in the debate was that made by the hon. member for Springfield (Mr. Sinnott) when on April 14, as reported at page 2964 of Hansard, he said:
I stand here as a dominion member, not acting for my own constituency; I am acting in as fair a manner as I can for the whole of Canada.

Freight Rates
Taken by itself, that sounds like a high principled statement. But when it is applied to the fact that we have this inequality as between different sections of Canada, for a member to stand in his place and say that he is condoning-


Mr. SINNOTT:: Read on farther.


Stanley Howard Knowles: If I had the time I would, but it would make it look worse. The hon. member knows that what he has done is simply to accept the decision of the government to condone the aggravation of discriminations and inequalities already existing.
I join with members from seven provinces of Canada, both east and west, in expressing the view that we are not seeking to stir up conflict between different sections of Canada. What we are asking is that inequalities which are the cause of potential conflict be removed. A few' days ago when the Minister of Trade and Commerce (Mr. Howe) was asked on the orders of the day a question about the implementing of the oats and barley provision in another act, he replied that the governments of two provinces had expressed their opposition to these provisions, and made the assumption that those governments therefore spoke for the people of those two provinces. I doubt that; but I suggest to the government that, if that principle is to be applied, then surely the time to apply it is now, when the premiers and the governments of seven provinces have expressed their views with respect to this matter. As others have done, I call the attention of the government to the fact that Liberal newspapers in various parts of Canada, strongly supporting the government, have criticized the government mercilessly for its action on this matter. I hope that even yet the government will change its position and pay heed to the requests of the premiers of the seven provinces for action which will lead to more unity in this country.
When I rose to my feet I indicated that in the main I wished to direct my remarks to only one phase of the matter. I refer to railway w'age rates. Let me say at the outset that I decry as strongly as I can the way in which the wage question has been mixed into this freight rates issue. Let me state clearly that I recognize, as everyone must, that the wages the railways can pay must have a relationship to the revenues of those railways. But that does not justify mixing up the present request of the employees for increased wages with this particular way of getting more revenue for the railways, namely by an over-all 21 per cent increase. As my colleague,
the hon. member for Swift Current (Mr. Bentley), has already pointed out, the tears that have been shed in this house with respect to the workers and their request for increased wages strike us as being crocodile tears indeed.


Mr. GARDINER:: Mr. Mosher did that.


Stanley Howard Knowles: -Not at all, but the Minister of Transport (Mr. Chevrier) certainly indulged in crocodile tears the other day. I submit that when some of us have called upon that same minister to do something about the pension rights of Canadian National employees he has found excuses for taking no action along that line.


Lionel Chevrier: The hon. gentleman
knows full well that the question of pensions for the employees of the Canadian National Railways is one which is governed by the administration of the railway and not by the minister. The hon. member should not make the statement which he has just made and which creates the inference that it is one for the minister to decide.


An hon. MEMBER:: He is full of that.


Stanley Howard Knowles: The minister recently
found it possible to deal with that matter on the floor of this house and to defend the action of the government and say that it was his view that he should not take any action to seek an increase in the pensions of Canadian National employees in view of the fact that his colleague, the Minister of Finance (Mr. Abbott), had taken that view with respect to superannuated civil servants.


Lionel Chevrier: The hon. member had better read the speech.


Stanley Howard Knowles: I certainly did read it; I read it again in preparation for these remarks. Similarly the Minister of Labour (Mr. Mitchell) has indicated solicitude on his part for the railroad workers, but I would remind the house of the struggle we have had through the years to try to get the Minister of Labour to take proper action in connection with the pension rights of Canadian Pacific employees.


Lionel Chevrier: I think the record will show who did the most for the railroad workers as far as parties go.


Stanley Howard Knowles: The record certainly
shows that in 1945 the Minister of Labour appointed an investigator to find out whether a royal commission should be appointed to look into this matter. When that investigator reported back in precise language that a royal commission should be appointed the
Freight Rates

Minister of Labour refused to carry out that recommendation. So I submit that the tears which have been shed in the house over the workers on these railways are indeed crocodile tears.
As to this whole question of the relationship, which I contend does not exist, between the present demands of the workers for increased wages and the demand of the companies for increased freight rates, I should like to quote from documents that I have before me at the present time. I have here a copy of a brief submitted on behalf of a long list of railway employee organizations to the conciliation board in support of their request for an increase of thirty-five cents an hour in the basic rates of pay. The document which I have in my hand was submitted by employee organizations mainly connected with the Canadian Pacific Railway. I also have a brief submitted by the Canadian brotherhood of railway employees whose members are employed by the Canadian National Railways.
I feel that these employees made out a strong case for these increases. They made a good case with respect to the employees in the so-called upper brackets by comparing their wages with the wages received by employees in other similar lines of endeavour, but they made an even stronger case by pointing out that there are thousands of employees on the railroads who are not in the upper brackets. In particular I would refer to the information to be found on pages 42 and 43 of this brief where reference is made to the large number of labourers and freight handlers getting as low as seventy-six cents a hour and, in some cases, only sixty-seven cents an hour.
Many of these employees have been in the service of their company for a long time, and at the same time they see advertisements by other plants for unskilled employment at rates of 87^ cents, 95 cents an hour and so on. The details are set out in the brief. The point I am making at this moment is that I support wholeheartedly the contention of the railway employees that an increase is coming to them and should be granted without delay. In my view they made an excellent case when they appeared before the conciliation board.


Lionel Chevrier: I wonder if we could have some order in this debate? The hon. gentleman is now discussing a matter which in my opinion, and with deference to you, sir, is outside the scope of this debate. He did start to discuss a matter which I think was in order, but he is now going into the railway wage rates and making attacks on the Canadian National Railways because of the wages they pay certain of their employees. I am not objecting to that 
if the hon. member wants to do it, but this is not the place to do it. This is a debate on a specific question, and I submit to you, sir, with deference that the hon. member should direct his remarks to the debate.


Stanley Howard Knowles: Mr. Speaker, I would point out that it was the minister himself "who brought into this debate the question of wage rates. I feel that I have just as much right to answer him as he had to bring up the question.


Lionel Chevrier: I am not going to allow the hon. gentleman to get away with a statement like that. Today he has been putting on Hansard several statements which are erroneous. Any remarks which I made did not deal with specific cases such as the hon. gentleman has referred to; they dealt with the general case. I do not think the hon. gentleman wants to say that I did otherwise, but if he does I shall take issue with him.


Stanley Howard Knowles: I should like to know the facts which I am putting on the record which the minister regards as being erroneous. I have quoted from a brief presented to the conciliation board by the railway employee organizations. However I had finished with that point when the minister interrupted and I was moving on to another point with which he may also take issue.


Lionel Chevrier: Let us get on with the debate if you do not mind.


Stanley Howard Knowles: Apparently what I am saying is hitting the minister.


Lionel Chevrier: It is drawing a red herring across the trail.


An hon. MEMBER:: Let us get on with the debate.


Stanley Howard Knowles: I think the Minister of Transport is the last one to talk about a red herring in this debate, especially after the performance in which he indulged the other day.


Lionel Chevrier: If you would listen to your own leader over the radio you would see what red herrings are being drawn across the trail.


Stanley Howard Knowles: May I turn to another phase of this question? I submit that this matter will be in order, although the Minister of Transport may not like it. The railway employee organizations took up fifteen pages of the brief to which I have referred in order to point out that their request for increased wages must not be regarded as being con-

Freight Rates
tingent upon increased freight rates. They made out that case along the lines I indicated a few moments ago. They admit that the companies have to have sufficient revenue to meet their costs, but they contend that such wage increases as they demand should not depend upon another question altogether, such as the economic structure of transportation costs in this country. May I quote a sentence or two from this brief in order to sum up the position that they take in connection with this matter? I quote from pages 57 and 58 as follows:
The employees do not think that compliance with their request should be contingent on the railways getting increased freight rates. Their position in this particular is the same as it was before the national war labour board in the Canadian Pacific et al wage case of 1946, which received the support of the board. Again we refer you to the board's "Reasons for decision," the references therein to the "enormous increases" in the company's earnings over the 19391945 period, its considerable increase in total assets and reserves, the improvement in the liquid position of the company, its reduction in funded indebtedness and fixed charges; the board's view that it was not required to estimate the future earnings of the companies involved in the case, and finally, ". . . we hold that the companies, respondents in this case, are able financially to pay."
Those sentences are taken from near the end of about fifteen pages in the brief presented by the employees' organization, in which they contend that their request for wage increases had no reference to the demand for freight rate increases and must not be made contingent upon them in any way. In this the companies appear to have agreed, for in the statement of the railways presented to the conciliation board with reference to the same matter, there are on pages 78 and 79 some four or five paragraphs, 209, 210, 211 and 212, which deal with this same matter, and in which the companies made it clear that, even if they were to get the freight rate increase which they were seeking, not one cent of it would be available for wage increases. Let me read a sentence or two from the statement of the railways to which I have referred. At page 79 they say:
The fact is here emphasized; that the current application was intended only to afford relief from added costs of operation arising out of wage and price increases which had taken place up to the time the application was made in October, 1946. This application-
That is the application for a freight rate increase.
-ycould not be based on speculation as to possible further increases in costs-
I ask hon. members to note this:
-and any relief which may be granted-
That is by way of a freight rate increase. -will not be available to meet such possible future costs, but only those which had already been imposed on the railways at the time of the application.
There, Mr. Speaker, you have it from both sides to the wage issue-the employees contending that their wage increases should not be contingent on any freight rate increase, and the companies saying that so far as they are concerned, even if they were to get the freight rate increase, which in part has now been granted to them, not one cent of it would be available to the employees for increased wages. In the light of that, I submit that this whole business of the wage demands of the employees, which as I have already pointed out are eminently justified, should not have been related to this freight rate question. I make it clear again that I am not denying for a moment that the companies must have sufficient revenues to meet their costs, including their wage costs; but, as other speakers have pointed out throughout this debate, to admit that the companies need increased revenue does not require that you condone this unequal and discriminatory way of giving them that increased revenue. Actually some of us are not convinced, and I think my colleague the hon. member for Winnipeg North (Mr. Stewart) made this point effectively the other night, that the Canadian Pacific Railway Company do need the increase for which they asked.
I note in the annual statement of the Canadian Pacific Railway Company for the year 1947 that their principal complaint to their shareholders is not that their net earnings, in absolute terms, were too low. Their net earnings for 1947 were $22,892,189, which was a higher figure than in a good many earlier years. Their only complaint is that their net earnings, in their view, bore too low a ratio to their gross earnings, that ratio being only 7-2 per cent.
In connection with this company's net earnings, may I point out that on the basis of 1947 earnings the company declared for payment total dividends amounting to $21,307,682. This information is found at page 7 of the Canadian Pacific Railway Company's annual report. Also from that report and likewise from sessional paper 125A, of April 12, 1948, information can be had as to where the stocks of the Canadian Pacific Railway Company are held. The preference stock is divided as follows: only -51 per cent is held in Canada, but 99-49 per cent is held outside Canada. Of the ordinary stock, 13-58 per cent is held in Canada and 86-42 per cent outside Canada.
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I may say in passing that during the war there was a considerable movement in the ordinary stock of the company away from the United Kingdom to the United States, with the result that at the end of the war the amount of the ordinary stock of the company held in Canada and in the United Kingdom had been considerably reduced and the amount held in the United States had been considerably increased. The result of this distribution of the stock as between Canada and other countries means that the $21,307,682 paid out in dividends from 1947 earnings went this way: $2,297,895 was paid within Canada, and against that figure has to be set the fact that $19,009,787 was paid to shareholders outside Canada.
We are not convinced, in the face of that, that the Canadian Pacific Railway Company really need the increased revenues which they seek in order to pay the just wage demands of their employees. If increased revenues are needed by the Canadian Pacific and the Canadian National to meet these wage demands, which I insist every member of this house should support, those revenues should be found in other ways, by making a charge on the consolidated revenue fund and by carrying out some of the suggestions that have been made by speakers on all sides of the house aiming at, not increasing the difficulties and inequalities in the freight rate structure, but removing them with the hope of achieving national unity and a much more balanced economy for all our people.


John Lambert Gibson: Mr. Speaker, the very vigour of this debate must have forcefully brought to the attention of the government the necessity for making a vigorous effort to try to heal this ancient wound which has caused so much unhappiness all across Canada. I am particularly pleased that the members of this house who come from the two great central provinces have spoken and acted in a generous manner. I think that should indicate to the government that, should legislation be brought into the house which would have the tendency of equalizing the present discriminations, it would have the support of hon. members from the two large central provinces.
I feel, too, that there is some justification for the feeling among hon. members from the maritimes and the western provinces that this 21 per cent increase all across the board, increasing as it does the discriminations already in existence, could possibly have been handled in a more equitable manner. However I have the feeling that the present situa-

tion will not last for very long, although I expect it will last after the vote tonight.
As to the necessity for and the justification of these freight rate increases, it would appear to me that in all fairness we should consider the prices of the two great products that we ship from British Columbia, lumber and fish. In 1939 the price of lumber was $20 a thousand and it is now $60. In 1939 salmon was worth $4 a case and it is now worth $12. It would seem to me therefore only reasonable and fair that the freight charges on these products should bear some relationship to the vastly increased values of these products, and I do not think the people of British Columbia in these particular industries would wish to have the workers in the railroad industry sharing the burden of low wages and being taken advantage of in this respect.
I was grateful that during the war the Panama canal route was still kept in effect by the board of transport commissioners, although actually there were no ships available to carry freight via water from the Atlantic coast to the Pacific coast. We have always enjoyed these advantages in British Columbia of having a competitive rate through the Panama canal.
In British Columbia we have been brought up since childhood to feel that we have been unjustly dealt with. I well remember hearing as a child of the exploits of the late Senator McGeer in presenting the case of our province to the board of transport commissioners. I have a feeling that probably we shall get somewhere on this equalization question; but, as regards the suggestion that the imposition of the increases be deferred for thirty days in order to allow the provincial premiers to come here and make representations, I submit that, while on the surface that seems plausible, it does not appear to me to be possible that results will be obtained1. The provincial premiers are not experts on freight rates, nor are they familiar with all the ramifications of the freight rate structure, and I do not think that coming here and spending two or three days presenting the case to the cabinet would justify the cabinet in setting aside the judicial decision of an expert board who have been considering the question for eighteen months.
The cabinet are able men; but, after all, freight rates are a most complicated question, and it would be too much to expect that the ' cabinet should set aside a decision of this kind made by so responsible a body. I am actually surprised to hear hon. gentlemen in this house talking, as we have heard recently, about human rights and fundamental freedoms, and nevertheless suggesting that the

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cabinet should set aside the findings of the board of transport commissioners in this matter.
The amendment of the C.C.F., proposing non-confidence in the government, was obviously conceived in great haste and I think it is being repented at leisure. I am sure it must have been a most difficult decision for the C.C.F. party to make. Here they are trying to serve two masters, as it were-


Mr. MacINNIS:: Aren't you doing the same thing?


John Lambert Gibson: -the
farmers on the prairies and the workers on the railways.


Angus MacInnis: Which group are you supporting?


John Lambert Gibson: I have
great interest in the welfare of both groups-


Angus MacInnis: So have we.


John Lambert Gibson: -but there are hon. gentlemen of the cloth on the other side-my hon. friends have a number of them -and these hon. gentlemen should have told them that one of the oldest precepts in human relationships is that a man cannot serve two masters. I do not know whether they consider in this case it is two servants instead of two masters. That is quite possible. It must have been a difficult decision for them to make among themselves, as to which one they would repudiate, because, after all, some of them come from rural ridings, while a great number of them come from urban centres.


Angus MacInnis: Would not the Liberal party, which my hon. friend supports, be in the same predicament?


Mr. CRUICKSHANK:: Let him make his speech.


John Lambert Gibson: The farmers of Saskatchewan, where they have a trial C.C.F. government, would be very much concerned by the attitude of my hon. friend.


Stanley Howard Knowles: What kind, of government do you feel Saskatchewan should have?


John Lambert Gibson: Saskatchewan may feel justified in taking a chance on an experiment, but I would not take that chance myself. Out there the people are used to the vagaries of the weather, and one bad government out there might not be very much worse than a bad hailstorm.


Mr. BRYCE:: You are sitting on the fence. You have not the courage to take either side.


William Ross Macdonald: I must remind hon. members that the question before the house at the moment is freight rates and not the governments of the provinces.


John Lambert Gibson: Thank you, Mr. Speaker. I can just imagine the C.C.F. sitting around the caucus room up there wondering what the decision should be, like Belshazzar when he saw the writing on the wall.


Angus MacInnis: How did he feel?


John Lambert Gibson: In this particular case there was no writing on the wall. Probably it was the long shadow of the pick handle, to use a phrase I often hear from my genial friend the hon. member for Skeena (Mr. Archibald). They must have wondered if they had not better be careful, lest they should have to go back to the outside life, being no longer members of parliament after another election.


Mrs. STRUM:: Speak for yourself.


John Lambert Gibson: I am sure $6,000 a year is much more difficult to earn in outside occupations out there where you have to use both your head and your hands. I do not expect the C.C.F. to be practical and to give heed to practical suggestions, but I think the Progressive Conservatives over there are sound, hard-headed businessmen and one can appeal to them. They are more interested in results than they are in any transitory political coup that might come from the subamendment they have moved. I am sure the Progressive Conservative subamendment has been motivated by a desire to do a service to the people of Canada, and on this assumption I would make a proposal to them. The government has promised to make a full investigation into these freight rates differentials in Canada. Do they not think that by some happy chance, about a year from now, probably before a general election, the board of transport commissioners might bring down a favourable finding in regard to these freight rates? I think it would be a wonderful time to do so.
I myself am not interested in the political factors.


An hon. MEMBER:: Just in the election.


Angus MacInnis: You will be all right whichever side wins.


John Lambert Gibson: I am
interested in an equalization of freight rates in Canada. I know my hon. friend is not interested in anything but the political angle, but I say to him, "Don't assume that every
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member of the House of Commons feels as you do." That would be a most unfortunate attitude to take.


Angus MacInnis: That is an assumption we should both bear in mind if we can.


John Lambert Gibson: If we could keep this government in power a year-I do not think my hon. friends want to defeat them tonight-[DOT]


An hon. MEMBER:: We will vote against
them.


John Lambert Gibson: I think it would be well if some of my hon. friends went to the hockey game tonight. They would not have to vote. In a year's time, we may have every reason to expect the board of transport commissioners to bring in a favourable decision on the appeal which the government is asking them to consider now.


Mr. R. R. KNIGHT (Saskatoon City):: Mr. Speaker, I am conscious that most of the things that can be said on freight rates in this house have already been said. It is my business,
then,	more or less to subscribe to those things that have been said by the members of my party. The last speaker had something to say about our support of labour and of farmers. He said, What would you do if you had to support both sides in this particular issue? As one who represents an area both rural and urban, I am one of those in the happy position of having to serve two masters, and I hope to serve them well. I see nothing incompatible, by the way, in so doing.
I want to say one or two things in the general argument. In the first place, I am not convinced that the railroads have made a telling argument that would convince people that they are for the moment in need of any extra money. When we are discussing wages, I might say that I think it would be quite possible for both these companies to pay adequate wages for at least two years without having any additional revenue.
I could give the house some of the point of view of the west, and of the press in the west, particularly that press which supports the government in power, as the press mostly does. I have a clipping or two here. I do not know whether or not I shall use them. I might use a heading or two. Here is one heading:
C.P.R. added $21,0-0-0,090 to its reserves, reduced funded debt.


George Alexander Cruickshank: Shame.


Robert Ross (Roy) Knight: The first paragraph reads:
A $21,000,060 increase in reserves and a $10,000,000 drop in funded debt are shown in the general balance sheet of the Canadian Pacific railway for the year ended December 31, 19-46.

And so forth. (Another paragraph reads in part:
Increases are shown in holdings of government bonds and in inventory of material and supplies.
And so it goes. Another paragraph reads:
Funded debt is shown as having been reduced from $93,6-69,0-0-0 in 1945 to $83,5-65,0-0-0 as at December 31 last.
That is at December 31, 1946. And so the story goes in general.
Then there is the Canadian National Railways. We know, of course, what is the matter with it. It is that business of its capital structure, an investigation into which is long overdue and, following investigation, something in the way of a remedy. I do not think the nationally owned road should be perpetually kept in the kitchen as a Cinderella to the richer sister, the Canadian. Pacific railway, where it can be constantly used as an argument wliy the C.P.R. shareholders should have more and fatter dividends.
I have already said that there has been some concern about the wage scale. I think my . colleague the h-on. member for Winnipeg North Centre (Mr. Knowles) has -adequately dealt with that. He has shown, -and quoted from a statement which shows it, that the railroads had n-o -intention of using any of the increase in rates which is now being sought for the purpose of increasing wages. If I were convinced, of course, that the wage scale would suffer through l-ack of revenue, I would be in favour of the railways having more money. But if I were in favour of the railroads h-aving more -money, I would favour their having it through equalization -of rates and the bringing up of freight rates in the places where they are low, rather than through the imposition of an incre-ase in freight rates where freight rates are at present high. The way to do this is not by a horizontal raise, such as has now been granted. Everyone knows that if discrimination existed with the rates as they were a couple of weeks ago, that discrimination has been increased by the increase across the bo-ard.
I think what this all adds up to is that it is one of the three great things which constitute -a method by which western wealth is transferred into central Canada coffers. One of them -is tariffs; another is profits upon western businesses which h-ave their central offices in central Canada, where that wealth is taxed and used for the benefit of those central provinces. This addition to the freight rates is the third thing.
I think no -one in this house has denied the fact of discrimination. I do not think I shall argue that point. Everybody knows it

Freight Rates
exists. I hope my friend the hon. member for Comox-Albeimi (Mr. Gibson) is correct when he says he hopes-and I do not know where he gets his information-that this thing will be levelled out.


John Lambert Gibson: A government source.


Robert Ross (Roy) Knight: May I suggest that that promise is one by which the government purchased the acquiescence of our rebellious friends on the other side and whipped them back into line.


Angus MacInnis: Where are these rebellious friends on the other side?


Robert Ross (Roy) Knight: Oh, they are not rebellious any more.


Mr. MICHAUD:: They never were.


Robert Ross (Roy) Knight: I am suggesting that the reason they are not rebellious any more is that they have been promised the very thing which the hon. member for Oomox-AIberni has just suggested. I hope that is true. If so, the hon. member for Rosetown-Biggar (Mr. Cold-well) will have done a considerable service to this country in bringing the matter before this country and before this house in a way that it will have to be voted on at the present time.
There is one thing that I am glad about in this discussion, and that is that the increased discrimination and the increased freight rates will bring extra attention to the cheaper haul through Churchill and the Hudson bay route. If there was a need before of the cheaper rates of the Hudson bay route and the shorter haul, there will be a greater need now. I draw that to the attention of the minister. It was with a great deal of satisfaction that I noticed the other day that the ocean rate to Churchill had been cut; that is to say, contract ocean freight rates from British ports to Churchill will now be the same as those applying on the Britain to Montreal route. That will be a source of tremendous satisfaction to the people in my district.
Here and now I should like to pay tribute to those men who, for years and years, have devoted their time, energy and, in some cases, their money, to the bringing about of that very end. Particular credit should perhaps go to the Hudson bay route association and to its secretary, a man who now unfortunately is somewhat broken in health, but who has worked hard and long to produce what has now come about. I hope to see trade extended through the Hudson bay route and the port of Churchill. I have reason to believe it
will be extended through the very imposition of these extra rates. This ill wind may blow some good in that direction.
Much has been said here about the freight rates in Ontario and Quebec being favourable, on account of road and water competition.
I .think this matter of competition by road is something that the railroads must ultimately face. They are facing it now but they are not solving it; they are giving way before it. So we have the discrimination of which we complain. I say that the way to solve that problem is not to have your road haulage in competition with your railroads but to have it supplemental to your rail transportation. I would point out to my Conservative friends on my right that, in the only place in the world I know of where a Conservative government still exists-outside of Ontario- and that is in my native Northern Ireland, in spite of the fact that a Conservative government is in power, there is a perfect example of socialization of the means of transportation. A few years ago their railroads were faced with bankruptcy. The rails were getting rusty on top for want of use. That government did not stick out its Tory chest and say, We refuse to have anything to do with nationalization; that is socialism. On the contrary, they got down to business and put their truckage, their road transportation, and their railroad system on an equal and combined basis. You can now interchange a ticket on the railroad for a ticket on the bus as easily as you can interchange an Ottawa streetcar ticket for a bus ticket. All transport in that country is handled by the government agency; and that is under a Tory government, which apparently is not as Tory as it sounds.
That is a problem which will have to be faced in this country, I think; because everyone who has any sense knows that where you have good roads, a large population and mobility for trucks, the railways cannot possibly compete, because the truck can pull up to the back door of a warehouse and go anywhere, which the train cannot do. The only way the railway has a chance of competing with road transport is over the long haul such as we have, for instance, in northern Ontario.
I might add a word or two about my own city to show how the increase in freight rates affects it and the district it serves. Our geographical position makes us a wholesaling city, from which goods are sent to all the towns contiguous to it. This freight rate increase is a considerable blow to us. Of course it will bring about an increase in the
Freight Rates

cost of living. Some people say that in its ultimate impact upon the consumer this 21 per cent will amount to perhaps 50 per cent after goods go through the hands of the various people who must handle them. Of course I do not mean an increase of 50 per cent in the cost of living, but 50 per cent in that cost to the extent that it is effected by freight rates.
It is a source of satisfaction to the western farmer that grain rates are not affected, but the other day in the house I made a discovery which may mean that things are not quite as good as they seem. The rumour is that the railways are holding that increases can be made in connection with back hauls and out-of-line hauls, while the rates for regular hauls remain the same. As I understood it, the whole grain freight rate structure on the prairies was to be left unchanged, and surely back hauls and out-of-line hauls are part of that structure. As such I believe they are outside the scope of this order and should remain untouched.
I blame the government for its ready and cheerful acceptance, and its immediate imposition, of this award by the board of transport commissioners. I blame the government for its refusal to intervene. When Premier Douglas and the premiers of the other provinces who oppose this increase applied to the dominion government in a proper and civil manner to have the heavy increase withheld until such time as they had an opportunity to present their case, they were justified in doing so, and I do not think the dominion government was justified in the refusal in which it persisted. I have a clipping here from the Saskatoon Star-Phocnix giving the comment of Premier Douglas on this refusal:
. There could be no possible harm in withholding the imposition of the new rates until the provinces had an opportunity to exercise their right of appeal.
I think that is a reasonable statement. The government is interested in the political repercussions. No one could tell me a few days ago that this freight rate question had not become a matter of major political importance. The minister is usually so astute I did not see how he could be so naive, when he made that categorical refusal of government intervention, as to think for a moment he could get away with it; because, while to some extent it is a statistical and financial problem, this business of freight rates, particularly when it comes to inequalities and injustices, is a human matter, a social matter, a matter which in itself is intrinsically political, and political it has turned out to be.

In that connection I might give another western opinion, this time from a newspaper which usually follows what I might describe, in the vernacular, as the government line. That is an expression I do not like, but I cannot think of a better one at the moment. I am quoting from an editorial which appeared in the Saskatoon Star-Phoenix of April 9:
The federal government has promptly implemented the unfortunate decision of the board of transport commissioners-


William Ross Macdonald: Order. Probably I should read a reference from Beau-chesne, third edition, on reading from newspapers or articles emanating from outside the house. I refer to citation 265:
It is not in order to read articles in newspapers, letters or communications emanating from persons outside the house and referring to, or commenting on, or denying anything said by a member or expressing any opinion reflecting on proceedings within the house.
I would ask hon. members to govern themselves accordingly in their remarks.


Robert Ross (Roy) Knight: With all deference, Mr. Speaker, I suggest that this comment has to do with the government, not with the house.


William Ross Macdonald: From the opening words I understood that it referred to the debate now taking place in this house.


Robert Ross (Roy) Knight: I shall not quote further from it, but will simply say on my own that I think the government committed a major political blunder. I take it that statement would be in order, whether or not hon. members agree.
Perhaps the government will do something. I have suggested previously that the government has now some reason for doing something. There was a tremendous rebellion within the government's own ranks. That rebellion was more vocal when no vote on the issue was expected, but I noticed that when the leader of the C.C.F. party brought the matter into the open so that there would have to be a vote, the rebellion rather died down. The hon. member for Comox-Alberni said a person could not serve two masters and, since I believe this matter is political and since the hon. member for Comox-Alberni talked politics himself for ten or fifteen minutes, I do not see why I should not be able to relate politics to this subject. It was suggested here that the government, that is to say the nation, might subsidize the freight haul across northern Ontario. In that connection I wish to refer to a statement made by the hon. member for Rosthern (Mr. Tucker)-or is he still the hon. member for Rosthern?-who is making speeches up and down Saskatchewan. The

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heading is: "Saskatchewan Liberal chieftain advocates nation defray costs of shipping goods over barren western Ontario." He says that is the Liberal policy in connection with freight rates. Am I permitted to read this item, Mr. Speaker?


Stanley Howard Knowles: He is a member of the house.


Robert Ross (Roy) Knight: The hon. member for Ros-thern is a member of the House of Commons, but here he is expounding Liberal policy, and I think it has a distinct bearing on what we are talking about:
Mr. Tucker contended it therefore followed that it was a national responsibility and not the responsibility of the west to defray the high costs of shipping across this barren territory.
Then listen to this:
Mr. Tucker declared absorption by the federal government of the costs of maintaining railway service across the barren western Ontario area would provide the railways with sufficient revenue to lower freight rates in the west to the level prevailing in the east . . .
That is the Liberal freight policy, says the hon. member for Rosthern. I should like to ask the minister if that is dominion Liberal freight policy, and if he intends to do anything about it. Talk about serving two masters:	the hon. member for Rosthern
appears to have the unfortunate facility of being in the wrong place at the right time. When matters of tremendous importance in the province were going to take place in the provincial legislature in Saskatchewan, he was offered a seat there, but he could not consider it, being needed in Ottawa.


William Ross Macdonald: I do not think the hon. member is now discussing the freight rates question; he is discussing the hon. member for Rosthern (Mr. Tucker).


Robert Ross (Roy) Knight: It is freight rates I am
coming to. I am saying what he would do about freight rates; what he said he would do about it.


William Ross Macdonald: I did not
interrupt the hon. member when he was referring	to what	the	hon. member	for
Rosthern had said about freight rates. But when he is discussing the hon. member for Rosthern, then I must call him out of order.


Robert Ross (Roy) Knight: The	hon. member	forRosthern	said out	in	Saskatchewan whathe would do about freight rates if he were here. Where is he? When matters vital to my province are happening here in Ottawa, the hon. member for Rosthern is not in Ottawa;	he is	out	electioneering	in
Saskatchewan.


William Ross Macdonald: Order. I must ask the hon. member for Saskatoon City not to discuss the hon. member for Rosthern.


Robert Ross (Roy) Knight: We will leave the hon.
member for Rosthern alone, and turn to more important matters.


James Garfield Gardiner: He will take care of them, anyway.


An hon. MEMBER:: Who is coming in now?


Robert Ross (Roy) Knight: I believe I have made my position clear in the matter of freight rates. This is an important question for the city of Saskatoon, not only to the businessmen who are operating in a wholesale capacity. It is also important to every man, woman and child in that particular part of the country. I sincerely hope the government will see fit to see to it that the railroads from now on are run in a more equitable and just manner.


Mr. RONALD MOORE (Churchill):: Mr. Speaker, the recommendation of the board of transport commissioners was received with some misgiving by those sections of the country in which freight rates are already considered to be too high. For a great many years the maritime provinces, the prairie provinces and British Columbia have felt that freight rates in those areas were out of line, when compared with those of the central provinces of Ontario and Quebec.
I do not at this time intend to cover any of the ground already covered respecting the difference in freight rates in the areas mentioned. What I should like to do is to go over a little bit of railroad history in Canada, and then try to indicate the policy which should be followed at this time.
For many years it has been a known fact that the capitalization of the Canadian . National Railways has been out of line, when compared with the actual assets of the company. For instance, the Grand Trank Pacific, which was one of the privately owned railroads which, with its branch lines was taken under the national system, cost a total of $197,139,391. The public subscribed nearly $128 million, or 65 per cent of the entire cost. Of the total capitalization, 88 per cent was in bonds and only 12 per cent in stock. This, of course, meant that there was a heavy load of fixed charges, amounting annually to more than $8,500,000, or $2,855 per mile. This is more than three times the fixed charges of the Canadian Pacific.
The Canadian Northern, another line taken over by the Canadian National, received large grants from the federal government and from provincial governments when it operated as
Freight Rates

a private concern. The accounts of the road show it received a total of $298 million. The Acworth commission, which dealt with the financial position of the Canadian Northern, stated that the maximum value of its property was only $370 million. In addition to investment bonds there was an outstanding funded debt of $83,000,000, while the outstanding liabilities were in excess of the total value of the property. The other privately owned roads which became part of the national system were in no better position financially.
In that connection I should like to quote from an article written by Sir Joseph Flavelle in 1932, when he dealt with this matter before the royal commission on transportation. These are the recommendations he made as reported at page 1599 of the commission's report:
(a)	^ That the cost of building the Intercolonial and Transcontinental railways should be written off at once.
(b)	That the advances made to the railways before taken over and the deficits which would be inevitable for some years, should be met by the issue to the government of common stock on which no interest would be charged or dividends paid until the company was in a position to earn profits after payment of interest on fixed charges assumed and on the subsequent capital expenditures that would be necessary.
Then again we find that Sir Henry Thornton, one time president of the Canadian National Railways, gave evidence before the royal commission on transportation, and is reported in this way at page 50 of the report of that commission:
To what is the condition of the C.N.R. system due. It seems to me it is due first to the inherited mistakes, if one may call them such, of previous proprietors; secondly, to capital expenditures necessitated to meet public demands to continue the development of the country to make up for deferred capital expenditures in years gone by and to create an efficient transportation machine; thirdly, the competition from subsidized water transport and the highways and fourthly the freight rate situation. All of these are of course augmented by the present state of depression through which we are passing and the problem is largely one as to how long the depression is going to last.
And listen to this:
I think I would be safe in saying as I intimated some little time ago, that the depression may be the reason which has provoked this investigation, but the investigation might just as well have been made years and years ago. The depression is a thing which simply aggravated an already existing condition. I may mention that because so many people confuse the depression -with conditions which really have fundamentally existed for a long time.
Those were the words of a former president of the Canadian National Railways. The commission's report of 1932 outlined the procedure

which should be taken more or less to correct the difficult railway situation in Canada at that time. I say the time is now ripe for the government to take action to deal with our complex railway problem.
Again we find that at page 30 of the report the commission recommended that the capitalization of the Canadian National railway system be drastically written down; and then they went on to say that they did not believe that in 1932 the time was opportune to write down its capitalization. I believe if those same people were approached today they would concede that the time is now ripe to deal with the capitalization of the Canadian National Railways.
Most of the bonds were held in Great Britain and other European countries in 1932. But today, because of war purchases, large amounts of those bonds have been repatriated. In fact, in the railway committee of two years ago w>e were told that only a very small portion of the bonds of the Canadian National Railways were held abroad. Because of the changed situation which has been brought about on account of the war, I think the time has now arrived when the government should take action and cut down the capitalization of the Canadian National Railways to a figure where it will be able to compete and provide transportation at cost.
I should like to say something about the 21 per cent increase in freight rates. I submit that the government should not have agreed to this increase going into effect. The better way to have dealt with the situation would have been to bear the losses of the railroads out of the consolidated revenue fund and hope that within one, two, three or four years the situation would so improve that it would not be necessary to increase rates.
The same problem came up some years ago. In 1918 the Canadian railroads applied to the government for increases in freight rates which were granted. About the same time the railroad employees asked for increases in wages. The increases in wages amounted to $77,000,000, while the increased freight rates received by the railroads amounted to $43,000,000. The railroads applied again for an increase in their freight rates and, after some deliberation, it was granted. Later on, in 1920, a further increase in freight rates was asked, and in this connection I should like to quote from the debate which took place in the House of Commons at that time because I think it indicates the position the government should have taken at this time. The position taken at that time by the government was

Freight Rates
summed up in parliament by the then minister of railways as follows:
Shall Canadian freight rates be increased generally for the particular purpose of enabling the Canadian National system to meet its operating expenses and fixed charges, or would it be better to go on with the present rates, giving dealers no additional excuse for increasing the cost of living, and trusting to increase in business, the economies it should be possible to effect by co-ordination, and the return of normal conditions, to gradually reduce these deficits until the day when the revenue will prove sufficient to pay for operation and, later, also to take care of fixed charges? Should this latter suggestion prevail, it would require to be thoroughly understood that the minister of railways must come down next year with a deficit, and the next year with a deficit, and so on for a few years until we shall have turned the corner. The railway companies applied to the commission for an increase in rates, and after a prolonged controversy an increase was granted, calculated to be sufficient to keep the Canadian Pacific railway at least in a healthy financial condition, with the hope that as a result the other great railway system may be benefited in a corresponding degree.
I submit that, because of the increase in the cost of living which is likely to occur on account of this substantial increase in freight rates, the government ought to meet the operating charges of the railroads out of the consolidated revenue fund without increasing the freight rates. It- has been denied that this increase in freight rates will have any effect upon the volume of traffic carried by the railroads, but I think there is great danger that this will happen. There is danger that competition from the Panama canal will considerably reduce the volume of traffic and the effect of this competition will be increased by these increased freight rates. Some reference was made to competition from the Panama canal before the royal commission which investigated transportation in 1932, because of the increased rates which were granted in 1918 and 1920. Professor W. T. Jackson, professor of transportation, University of Toronto, gave evidence before the commission and said at that time:
During the period from 1923 to 1928, the grain movement from Fort William to Port Arthur increased by six per cent, while that from Vancouver to Prince Rupert increased by 47 per cent in the same period. From 1921 to 1928 the movement from the Atlantic seaboard increased by 47 per cent, while that from the Pacific increased by 995 per cent in the seven-year period.
It will be seen that this represents a considerable loss of traffic to the railroads. I do not think it is beyond the bounds of possibility that the railroads will lose traffic because of the recent increase of 21 per cent. Other things
will have to be considered. Ocean shipping is more efficient today than it was twenty years ago. Ocean-going ships are faster and it is possible for them to make trips more quickly than it was twenty years ago. In view of all this, I think the government should take into consideration the possibility of maintaining freight rates as they were. If they have to pay additional losses out of the consolidated revenue fund it will be better to do that than greatly to increase the cost of living in this country by granting this increase in freight rates.
I believe the time has come when we must admit that we have a transportation problem in Canada. If the government is to take action on it, there is no time like the present. I submit that the sooner action is taken on this problem, the sooner we shall develop a national transportation system that will work to the benefit, not only of one or two sections of the country but of the country as a whole.


Angus MacInnis: Mr. Speaker, there was considerable that I intended to say on this question, but because of the lateness of the hour I shall try to finish before six o'clock. One of the outstanding features of this debate has been the way in which the leader of this group, the hon. member for Rosetown-Biggar (Mr. Coldwell), has changed in a few days from a statesman of a fairly high order to a real menace to society. When he moved the adjournment of the house on April 5 to discuss this matter of freight rates he was lauded by members on both sides of the house and, I think, by all political parties. For instance, the hon. member for New Westminster (Mr. Reid), speaking immediately after the hon. member for Rosetown-Biggar, had this to say, as reported on page 2625 of Hansard:
I listened with a great deal of attention to the remarks made by the hon. member for Rosetown-Biggar (Mr. Coldw'ell), and while I agree with everything he said, I would point out that, as a result of this decision, no province has been harder hit than British Columbia.
I have not been present during the whole of this debate, but I think British Columbia was just as hard hit on April 13 as it was on April 5, but nothing has been said by the hon. member for New Westminster. However I appreciate that a Liberal caucus was held in the meantime and rumour has it that there was some fairly pointed talk by the leader of the party. Then the senior member for Halifax
Freight Rates

(Mr. Isnor), representing the other end of the country, had this to say, as reported on page 2639 of Hansard:
I hope that the motion which was introduced today by the hon. member for Rosetown-Biggar (Mr. Coldwell) and the remarks of the various hon. members, who have presented their views from various angles, will have some effect on the board of transport commissioners. If not, I hope and I believe that it will have some effect on the government in making them realize that this action is not one which is well received in other than the two central provinces of Ontario and Quebec.
It would seem that the senior member for Halifax has changed his mind between April 5 and April 13. I turn over a few pages and I find that the hon. member for Fraser Valley (Mr. Cruickshank) had something fine to say about the hon. member for Rosetown-Biggar (Mr. Coldwell), as reported at page 2652 of Hansard:
I wish to compliment the hon. member for Rosetown-Biggar (Mr. Coldwell) on his speech this afternoon. I believe that he spoke on behalf of all of us, and in my opinion in all the years I have been in this house I never heard him make a better speech. I am glad to say that he kept partisan politics entirely out of it. I am sure that he spoke for every member from the maritimes and certainly for every member from British Columbia, irrespective of party.
If that was the situation as regards freight rates on April 5, and nothing has happened in the meantime to change the effect of the order of the transport commission on freight rates in British Columbia or the maritime provinces, what is it that has caused this great change of mind? The cause of this great change has been what the hon. member for Comox-Alberni (Mr. Gibson) has been trying to put over on this group.


Lionel Chevrier: You did not like his speech, did you?


Angus MacInnis: I liked it all right, if you could call it a speech, but that is a matter of opinion. He said that C.C.F. members were afraid they might have to go back to the use of the pick. I would tell him that the members in this group are taking exactly the same stand as they took on April 5, and the members who are afraid to go back to the use of the pick are the members opposite who have changed their tune in the meantime.
The hon. member for Comox-Alberni mentioned, quite fairly, I think, that the lumber and fish produced on the Pacific coast is now sold at a much higher price than previously and it should reasonably carry its fair share of increased freight rates. I want to draw attention to another important commodity which we produce in British Columbia and which is not in the favourable position of lumber or

fish; because of market conditions it cannot absorb increased freight rates. I refer to fruit. Grain shipments are exempted from the freight rate increases, and if these increases are to be continued in effect, I think something similar should be done for the fruit industry which, even before this freight rate increase, was facing a serious situation, and the new freight rate increase may mean the difference between carrying on or going out of business for the fruit growers. I have before me a copy of a telegram sent to the Prime Minister (Mr. Mackenzie Kingl and the Minister of Transport (Mr. Chevrier), dated April 10, 1948, signed by J. R. J. Stirling, president of the British Columbia Fruit Growers' Association. I want to put this telegram on the record, and I hope that the petition in it will be supported by all the members from British Columbia to whom the fruit industry is of such immense importance. The telegram reads:
Confronted with problem of marketing estimated tree fruit crops largest in the area's history, with rising production costs and curtailed offshore exports, fruit growers of British Columbia are deeply concerned detrimental effect 21 per cent freight increase and nonremoval long-standing discriminatory differentials. In light of prospective marketing outlook freight increase will take from this industry an additional million dollars in distributive transportation costs. Therefore this association urgently requests suspension new rates pending completion government's announced investigation.
Here you have an important industry which, even before this freight rate increase, was faced with a most difficult situation, and which, if something is not done to alter the new rates, will have to decide whether to carry on or go out of business altogether.
The railways in Canada are essential to the very life of this country, more so than any other form of transportation, and in order that the railways may operate efficiently I am not only agreed but firmly convinced that they must have adequate revenues. But I am also convinced that that revenue should be raised without discrimination between one section of the country and another. The Minister of Transport, speaking in the house a week ago, referred to the personnel of the transport department and said they were experienced and experts. I agree with that; but in view of the fact that it is accepted by everyone that there is discrimination and that the discrimination has existed for many, many years, I would say that the experts in the transport department are experts in discrimination.


Lionel Chevrier: That is a very unfair statement for an hon. member to make who pretends to be so fair in his statements in this house.

Dairy Industry Act


Angus MacInnis: That is an unfair statement?


Lionel Chevrier: That is what I said.


Angus MacInnis: I ask the minister, if his experts know so much about the freight rate structure, and know there has been discrimination, which, indeed, has never been denied, why has the discrimination not been removed?


Lionel Chevrier: If the hon. gentleman would only accept the policy of the government, which is to give an opportunity to the provinces to make application to have the discrimination or the inequalities disappear, then perhaps he will get an answer.


Angus MacInnis: That is a beautiful
answer-if I will wait for some time perhaps I may get an answer! Perhaps I won't. Blit even if I do, the answer may not be satisfactory. The discrimination may still continue, and that will simply prove my point, that they are experts in discrimination.


Lionel Chevrier: Which is still an unfair statement.


Angus MacInnis: It is not an unfair statement.


Lionel Chevrier: It is.
On motion of Mr. Bryce the debate was adjourned.
At six o'clock the house took recess.
After Recess
The house resumed at eight o'clock.



DAIRY INDUSTRY ACT


[Stage Direction]
Mr. JAMES SINCLAIR (Vancouver North) moved the second reading of Bill No. 4, to amend the Dairy Industry Act.
He said: Mr. Speaker, the bill of which I am moving second reading is a very short and simple one, providing only for the deletion of that clause in the Dairy Industry Act which prohibits the importation, manufacture and sale of oleomargarine or other butter substitutes in Canada.
This bill is identical with one which Senator Euler has before the senate and which he has twice previously introduced there. I think I should pay tribute to the valiant work he has already done in this matter.
My own connection with margarine is a simple one. In the last war I served for some
time with a squadron in Libya. In our food ration we got either New Zealand butter or British oleomargarine, and unless we saw the tins in which they came we did not know which we were eating-same taste, same colour, same texture.
Last September a group of irate housewives in the industrial portion of my riding complained to me about the shortage of butter. Butter at that time was controlled in price but very short in supply and they asked why there was no margarine to alleviate this shortage. I explained about the ban in the Dairy Industry Act, and how Senator Euler had tried in vain to have it repealed. They thereupon asked me to sponsor a similar bill in the House of Commons. I agreed, and I am now fulfilling that promise.
The origin of oleomargarine dates back to the 1860's. France at that time was afflicted as Canada is today-butter scarce and high in price. In the hope of correcting this condition, Napoleon III offered a prize to the scientist who could develop a cheap synthetic butter, which prize was won by Megez-Mouriez in 1869. He attempted to duplicate the milk secretory process of the cow, using beef fat as a base. In this he failed, but he developed instead a process for making animal fats as soluble, digestible and palatable as the fats in butter, and so developed not synthetic butter but a butter substitute which he named oleomargarine.
The production of this product began immediately in France and shortly afterwards in North America. Almost immediately the dairy industry of the entire continent marshalled their forces against the first real competitor they had ever had, but this is the most significant point about the entire battle which has raged since that time. They did not try to drive this competitor from the field in the honourable way that business has always used, by making their own product better and cheaper. They chose instead a cheap and shoddy way. They turned to legislative bodies for laws banning or hampering and hindering their competitor.
In America, however, the United States supreme court in 1886 ruled that such ban on the manufacture of a legitimate article of commerce was illegal, and so in the United States they had to confine themselves to restrictive legislation, to direct taxation by the federal government and nuisance taxes by the state governments.
Here in Canada, however, the dairy lobby was more successful, for in 1886 it secured a total ban on margarine. A bill was introduced by a private member, and it is interesting to recall that almost all legislation connected
Dairy Industry Act
[Stage Direction]
with margarine has been initiated by private members. It was a private member, Mr. Taylor of South Leeds, who introduced a bill in the House of Commons to regulate the manufacture and sale of oleomargarine in Canada. Once he got his bill into the house on second reading, however, he found the temper of members so hostile to oleomargarine that he joyfully amended his own bill, changing the word "regulate" into the phrase, "prohibit the importation, manufacture or sale of oleomargarine or butter substitutes in Canada." The bill carried, and that provision has been in effect in Canada since that time with a lapse of six years after the first war.
Of the greatest significance, however, is the reason given for this action at that time, a reason clearly outlined in the preamble of the bill and also in the subsequent debate in the House of Commons. It was charged that oleomargarine was an impure product which was fraudulently sold as butter. There were probably some pretty good grounds for that allegation at that time. Oleomargarine was an inferior product poorly produced by the packing houses out of inferior oleo fats. The whole packing industry at that time was disgraceful by modern standards and there was no government food inspection. Therefore parliament was probably right, and within its rights, in banning oleomargarine on the ground that it was an impure food fraudulently sold as butter.
However, great improvement was soon made in the manufacture of oleomargarine, and shortly after oleomargarine was accepted everywhere throughout the world, except in Canada, as a pure and wholesome food. Even Canada came round in 1917 when, because of a grave shortage of butter in the dominion, the government of the day authorized by order in council a temporary suspension of the ban in the Dairy Industry Act. This was clear recognition that margarine was then a pure, wholesome food.
During the next six years Canadians manufactured, sold and ate 52,000,000 pounds of oleomargarine without any ill effects. But the dairy forces were not content. Each year they marshalled their forces and brought increasing political pressure to bear upon parliament, and finally in 1923 the ban was reimposed.
To those members who are concerned only with the political implications of oleomargarine, the vote at that time, as recorded in Hansard, is quite interesting. Not a single member of the house who voted against oleomargarine on that occasion is still in this chamber; on the other hand, at least four of 
the members who spoke and voted for margarine are still gracing the chamber: the hon. member for Danforth (Mr. Harris), the hon. member for Yukon (Mr. Black), the hon. member for Broadview (Mr. Church) and the hon. member for Cariboo (Mr. Irvine). There were, of course, numerous absentees on that occasion, as no doubt there will be on this.
John Oliver Probe: May I ask the hon. gentleman a question? The Prime Minister (Mr. Mackenzie King) was in parliament at that time. What is his record with respect to the vote on that occasion?


Mr. SINCLAIR:: The Prime Minister is quite able to speak for himself. Actually he was paired at that time.


Some hon. MEMBERS:: Oh, oh.


John Ewen Sinclair: Hon. members may laugh. Pairs on that occasion did not declare how they would have voted; but the Prime Minister showed clearly how he felt, as any student of Hansard can find out, because in June, 1923, he moved a motion in the House of Commons unique in Canadian parliamentary history. He though leader of the government, moved that a private resolution, standing eleventh on the order paper, favouring oleomargarine be given precedence over all government business the next day, in order to bring it to a vote. He therefore clearly showed his interest in oleomargarine.
To get back to the constitutionality of the ban, great progress was made after the first war in the further improvement of margarine. Experiments had shown that while margarine was the food equivalent of butter, as far as energy and digestibility went, nevertheless children who were fed on butter did grow faster than children fed on oleomargarine. The discovery of vitamins explained the reason for this, and shortly afterwards the development of a process of artificially fortifying food with vitamins brought about the desired result.
Modern margarine is fortified with at least
15,000	units of vitamin A per pound, which is more than the average for good summer butter and greatly in excess of the vitamin content of winter butter. Today, therefore, we find that everyone recognizes that oleomargarine is a pure wholesome food, nutritionally the equivalent of butter. Do not take my word for it. The British and United States governments in official papers, and the British and American medical associations in official journals, so declare. Even better, so far as Canadians are concerned, is the authority of the Canadian Medical Association, who in

Dairy Industry Act
their official journal, the Canadian Medical Journal, in August, 1947, had an editorial eulogizing oleomargarine, and concluding with this sentence:
From the economic and nutritional aspects, good margarine is superior to butter.
However I will offer one other authority we should all respect, the government of Canada. That government has a Department of National Health and Welfare whose special duty it is to watch over the health of the Canadian people. They put out many good publications, one of the best being "Canadian Nutritional Notes," published especially for the benefit of dieticians in Canada, especially those in hospitals and schools.
In the December, 1947, issue of this splendid publication there appears an excellent article entitled "The Place of Fat in Nutrition." Let me read one paragraph from it.


Stanley Howard Knowles: Any reference to the minister.


John Ewen Sinclair: Let me read:
So far as is known at present good margarine is a complete nutritional substitute for butter in an ordinary diet. Margarine is made from a variety of vegetable fats and oils, and may have added animal fats. As a source of energy margarine and butter are equal for equal fat content. Margarine may be coloured by the same dye as is used for colouring butter. A good margarine contains 16-5 per cent skim milk for flavour and texture, plus minute amounts of glycerin derivative to prevent spattering in frying, and some lecithin to prevent burning and sticking to the pan.
On the back of this excellent booklet appears the familiar signature of Paul Martin, Minister of National Health and Welfare.


Stanley Howard Knowles: I wonder how he thrives.


John Ewen Sinclair: There may be some financial critics of the government, like the hou. member for Peterborough West (Mr. Fraser), who will denounce as a scandalous waste of public money the publishing of a bulletin extolling a food which Canadian dieticians cannot buy. I take a broader view. I think the Minister of National Health and Welfare, with his usual perspicacity, is merely anticipating the passage of this bill, and getting proper material into the hands of the public well in advance. If such is the case, I respectfully suggest to him that he start his missionary work much closer to home and give a copy of this excellent bulletin to his colleague, the Minister of Agriculture (Mr. Gardiner), who was reported in the press last month as having told the people of the west that he thought
the introduction of margarine would be detrimental to the health of the Canadian people.


James Garfield Gardiner: But not on the ground that it was not a good food.


John Ewen Sinclair: That was the statement in the report. Therefore I submit that this booklet proves beyond question that margarine today is a pure and wholesome food which can stand on its own merits, and therefore the grounds for the original ban have vanished.
The federal government, under the British North America Act, has the power, under customs, to ban or to put heavy duties on the importation of any foreign goods. But nowhere in our constitution is there given any right to the federal government to ban the manufacture and sale, within the country of a perfectly proper article of commerce. This I may say was the view of a great Liberal, W. S. Fielding, the great Haligonian, in the 1923 debate. If any authority has that right, then the provinces may have it as a property and civil right. Therefore I submit to the house as my first point that the present ban on margarine, as far as the ban on the manufacture and sale is concerned, is clearly unconstitutional.
My second argument is an economic argument. The present ban on the manufacture and sale of margarine establishes the butter industry as an ironclad monopoly in this country. The butter industry, of course, hotly deny that. They say that, far from being a monopoly, hundreds of creameries and dairies across the country are all busy producing butter, competing with each other and never getting together to fix prices or restrict production. That may be so. Most monopolies and cartels result when manufacturers who could flood the country with their production get together and restrict production and fix prices.
There is, however, no need for the butter industry to do that. The annual production of butter in Canada, as we well know today, is insufficient to meet domestic needs. More than that, the parliament of Canada, by its legislation, has removed from the field the only competitor which could take up the slack and compete in price. Therefore today we find that there is an automatic fixing of the price of butter in this country, which is set by the cost of production of the least efficient producer, the backwoods farmer on the marginal farm who makes his extra cream into dairy butter. As a consequence, the more efficient producers of the country enjoy a gratifying price. However, the real tragedy of this policy is that it results in abnormally high prices to the consumer, with no real benefit to the primary producer, because in winter when the price is high, his cost of production is high.
Dairy Industry Act

The speculators rvho buy surplus butter cheap in summer, store it and sell it at an exorbitant price in winter are the ones who are making money out of butter under the present system. The scandalous evidence of eleven and a half cents a pound profit revealed by the prices committee is shocking support of that contention. I think even more revealing was the callous comment of both the president of Canada Packers and the president of the National Dairy Council, to the effect that there was no point in their organizations taking less profits and reducing the price because butter is in such short supply that their competitors could get the high price anyway.


An hon. MEMBER:: Shameful.


John Ewen Sinclair: Yes, it is shameful. Therefore we have need today of price control on butter. If it were not for that price control, I am quite sure that butter would be dose to a dollar a pound.
As a matter of history and as a matter of interest, I looked back over Canadian and British history to see if ever before there had been such a ban on the production of goods within a country. I had to go a long way back. I had to go back to Britain at the turn of the seventeenth century, when the first cotton goods, calicos as they were known then, began to be imported from India. The wool and linen trades immediately raised their hands in holy horror; and, strangely enough, they similarly rushed to parliament in order to have their competitor banned. In 1701 a law was passed banning the importation of calicos. But that was not good enough. They went farther than that, and in 1721, the first year of the Walpole ministry, they banned the importation, manufacture, sale or even the use of cotton goods, in order to leave the field secure for the woollen and linen trades.
The University of Manchester series on cotton, which is in the library, has a most interesting account of the debates at that time. There was no Hansard then, but the arguments used by the proponents of wool and linen have a strangely familiar ring today. They said, of course, that the honest British workingman did not want to be clothed in cheap foreign cottons. They said he wanted to wear good British woollens and good Irish linens. The fact that he could not afford to buy them was immaterial. They said, next, that wool and linen were the cornerstone of British agriculture, and that the competition of these cheap cottons would ruin the British economy.

Their arguments were, of course, shown to be false, and mounting public opinion in the end forced, first of all, a relaxation of the ban in 1736, and in 1760 a complete repeal of that ban. Sixteen years later, Adam Smith, in a lecture to the University of Edinburgh, had this to say about this particular legislation. He called it "a mean and malignant expedient to dam the natural channel of free trade", and he said at that time that its failure was inevitable. I think Adam Smith would have used far stronger language than he did had he thought that 200 years later the parliament of Canada, which apparently has learned nothing from history, would still be resorting to this mean and malignant expedient.
The most striking argument is, of course, the social one. Quite bluntly, there are today in Canada many groups of people who cannot afford to buy butter at seventy-three cents a pound. I am thinking of old age pensioners, war pensioners, people on superannuation and large families with low incomes. But all those people need the soluble fats and vitamins which are found in both butter and margarine. There is another great group in the middle class who can afford to have some butter but not all the butter they need for a balanced diet. To these people the dairy-industry of Canada says, in effect: "If you cannot buy butter, you can do without. It is far better for this nation that you should want than that you should have margarine."
This ban is an imposition which is not borne by the whole consuming public in Canada. It is borne only by one group of it, thg poor and those in the low income groups. As such it should be regarded by anyone with any social conscience as morally reprehensible. It shows, for example, that we are less humane than that autocrat Napoleon III who at least tried to do. something to alleviate the effect of the butter shortage on his poor and his depressed.
A year ago our great sister dominion, South Africa, faced the same problem and embarked on a program of government assistance to margarine. There is an excellent account of this in "Farming in South Africa", an official publication of the department of agriculture of the Union of South Africa, which can be secured from the Department of Agriculture library. In the January issue, which I also commend to the reading of the Minister of Agriculture, there is an interesting article on why South Africa, under conditions similar to our own, with a butter shortage over the year and little domestic supply at the moment of edible oils, turned to margarine. This gov-

Dairy Industry Act
eminent report concludes with one paragraph which I think I should put on record. Speaking of margarine, it says:
Its manufacture has been and is still opposed by the dairy interests. These interests do not, appear to realize that the national well-being of a people must come before sectional gains. At present there is not enough butter to meet the purchasing power of the nation, let alone its nutritional needs. Even if butter production is expanded to supply the needs of those who can afford it there will always be a very large group of people whose wages will be so low, in relation to the price of butter, that they could not afford it at any price. The manufacture of margarine is intended to fill the present gap between the production of and the demand for butter, and to supply the nutritional needs of the poorly paid groups in order to improve their health and working capacity.
What a splendid stand for our sister dominion to have taken.
Within the last year another aspect has become apparent in the margarine situation, an international aspect brought about by two things, the Geneva trade agreements and the suggested entiy of Newfoundland into confederation. The Geneva trade agreements have been rightly heralded, by the democratic world at least, 'as a tremendous advance in international understanding and a breaking down of the barriers between nations to encourage world commerce and so stimulate world recovery; and none of the nations has so great a stake in this program as Canada, which is so dependent upon world markets. This great agreement was only reached, of course, through important concessions being made by each of the participating nations. One of those conditions is contained in article XI of the general agreement, which provides that there shall be no ban on the importation of any product of any of the signatory nations.
The Canadian experts who were at Geneva appeared before the senate committee last year and said that Canada had fought very hard against this condition because of our margarine situation, but that in the end we had given up and so were pledged to abide by that clause. Further evidence along that line was given in a statement by the leader of the government in the senate last year, which is found at page 34 of senate Hansard, where he said in part:
Under artiele XI of the general agreement we are bound to remove our ban on the import of oleomargarine. The product is not specifically mentioned, but we have bound ourselves to abstain from prohibitions of that nature.
Almost immediately following this declaration we were informed by a government press release, and I quote
. . . there is nothing in the Geneva agreement, nor is there apt to be anything in the Havana
modification, to prevent us putting duties and taxes on the margarine as high as may be felt proper to leave the dairy industry completely undisturbed.
If parliament should follow such a course; if we should agree in principle to the spirit of the agreements and then immediately turn around and by a cynical evasion impose tariffs which are in effect the ban which was just removed, then I say we as a nation are guilty of the most arrant hypocrisy. Further I say that if every other nation takes similar evasive methods to escape the concessions they made, then the Geneva trade agreements will not be worth the paper they are written on. They will be even more worthless, I would say, than our own signature if it is our intention to evade the spirit of the concessions by some technicality. If we intend to abide by these agreements, then I say the only sort of tariff we can in honour place on the importation of margarine is one no higher than that we imposed when margarine was last imported into this country.
The Newfoundland proposals have an equally shocking implication. This sister country, with climate and geography much like our own, had another problem in common with us. They found their butter production was insufficient to meet domestic needs; but they did not stick their heads in the sand like an ostrich. They embarked, after mature considerations, upon the manufacture of margarine, using mainly their own domestic oils; and margarine now sells for roughly half the price of butter there. When they inquired about the conditions under which they might enter confederation, naturally they were most anxious to preserve this right and insisted upon it. The Dominion of Canada, in its turn, agreed; with this provision, however, that margarine manufactured in Newfoundland could not cross the provincial boundaries. This amazing condition strikes at the very economic heart of the pact of confederation. Paragraph 121 of the British North America Act reads:
All articles of the growth, produce or manufacture of any one of the provinces shall, from and after the union, be admitted free into each of the other provinces.
The fathers of confederation intended Canada to be one economic unit, not nine Balkan states with customs houses lining every provincial boundary. This provision, therefore, strikes at the very heart of the economic foundation of confederation. It can be achieved only by an. amendment to section 121 of the British North America Act. This is an amazing thing. Apparently it is almost impossible to secure amendments to the British North
Dairy Industry Act

America Act for which the great bulk of the Canadian people long, such as an amendment which will permit contributory old age pensions, an amendment which will permit national health insurance, or an amendment which will permit national control of labour legislation; but apparently no difficulty is anticipated in securing an amendment to the British North America Act which, though shaking confederation, will please the dairy industry.
If such an amendment is obtained it will have to be one of two kinds. Either it will have specifically to mention margarine and the boundaries of Newfoundland, in which case we shall debase our national constitution by the mention of one trivial article of commerce which is singled out for discriminatory treatment, or it will have to be a general amendment permitting other provinces to impose bans. So shortly we may have Ontario banning British Columbia apples, British Columbia banning Alberta coal, Nova Scotia banning Prince Edward Island potatoes, thus breaking down the economic heart of confederation. Such however, is the power of the butter industry in this country.
Now getting away from the principles behind this ban, or rather the lack of principles behind it, let me turn now and look at the various groups involved. Who are against margarine? Just one group: the dairy interests of Canada; and for just one reason: they feel that the sale of margarine will affect their pocketbooks. One reason, a purely selfish one, is behind this ban. They, of course, expand this reason into a much bigger sphere. They say it is more than that. They say the sale of margarine would depress the sale and price of butter. They say butter is the cornerstone of our dairy industry, so that it will depress the dairy industry. Then they say the dairy industry is the cornerstone of our agriculture, so that it will depress agriculture; and agriculture is the cornerstone of Canadian industry, so the eventual result of the lifting of the ban on margarine will be a national depression.


Wilfrid Garfield Case: That is right.


John Ewen Sinclair: My hon. friend across the way is quite familiar with ballads and poetry. I say that is exactly the same type of logic which traced the loss of a great battle back to the loss of a horseshoe nail. The same argument, of course, was used by the proponents of the cotton law of the eighteenth century, except that then it was wool and linen which were the cornerstone of British industry. It was used again by the champions of the com laws in the nineteenth century,

though this time grain was the cornerstone. Both predicted national ruin unless those bans were maintained.
History shows how false were their assertions; and history today shows that the assertion of the butter industry that this must ruin Canada is equally false. The history of every other country in the world shows that the introduction of margarine has not debased the dairy industry or agriculture as a whole but has helped the dairy industry. Both countries with butter for export, like New Zealand, Holland or Denmark, and those which like Canada are in short supply, such as Newfoundland, the United Kingdom, the United States, Norway and South Africa, have found this to be so, for all today, with margarine, have healthy dairy industries.
The thing about this that interests me very much is the fact that for years we have witnessed crocodile tears on the part of the dairy industry about the money they lost on butter. They were always losing money on butter. If butter was such a money loser one would think the dairy industry would welcome a chance to get rid of this loss leader by the importation and manufacture of margarine, letting margarine take that loss and leaving the dairy industry free to go into the more lucrative field of the production of milk, icecream and cheese.
What is the truth of the matter? The truth is that the sale of oleomargarine in Canada would have very very little effect upon butter sales or butter prices. In the United States, for example, butter sells at about a dollar a pound and margarine at from thirty-five to forty-five cents a pound. The great sale of oleomargarine is to people who today are either not buying butter because they cannot afford it or not buying all the butter they would like.
More than that, the manufacture of oleomargarine is naturally complementary to butter making, since it uses the skim milk which is a by-product of butter. More than that, the dairy industry gains from the oleomargarine manufacture, because there is more oil cake which comes as a by-product of the increased production of vegetable oils which will be necessary. The records of Canada also show that, because between 1917 and 1923, when we had oleomargarine, butter production and consumption in Canada gained each year.
I turn then to their second defence, the argument of protection. I shall deal with that at the close of my speech.
The next argument which we hear so often repeated is that we could not have any oleo-

Dairy Industry Act
margarine anyway because of the international control of edible oils. It is true that edible oil production is controlled today by an international committee, which is expected to expire this year. However, South Africa embarked upon the manufacture of oleomargarine last year under exactly similar circumstances. Our domestic production of vegetable oils can be greatly increased. The hon. member for Winnipeg South (Mr. Mutch) has offered to develop this phase in his speech, and I hope too that the hon. member for Lisgar (Mr. Winkler) will tell the house of his own profitable experience last year in one of the prairie provinces in the growing of oil crops.
There are, too, animal fats-beef fats, hog fats-and the production on the coasts of fish, seal and whale oils to swell the supply. This entire argument can, however, be dismissed as pure sophistry, for if the dairy industry sincerely believed that the removal of the ban would bring no oleomargarine on the market, they would not bother fighting for the retention of this ban.
I turn now to those who are for margarine. First and foremost is, of course, the group corresponding to the dairy interests, those who for their own personal and perhaps selfish reasons would like to engage in the importation and manufacturing of oleomargarine and the primary producers who would sell them the vegetable, animal and fish oils for that manufacture. They say-and their stand is a personal one-that nevertheless they should have the same right to engage in their legitimate industry as has the dairy industry to engage in butter making.
There is a second group, however, a very large group to whom more attention should be paid, who are for oleomargarine. I refer to the very large group of consumers in Canada, those today who cannot find butter to buy, those today who cannot buy all the butter they need, those today who cannot afford to buy butter ait seventy-three cents a pound. Their interest, too, might be described as being personal or selfish; although I do not think the word "selfish" could be applied to mothers who are anxious because they cannot supply enough butter for their children.
These are the groups most affected by the present ban on oleomargarine. They are the ones who most want to have it removed. A Canadian women's magazine, Chatelaine, conducted a poll across Canada and found that 80 per cent of the housewives were for the sale of oleomargarine, although many said they would not use it themselves. Sixteen per cent were opposed. In that sixteen per cent were, of course, included wives of butter 5849-201
makers, and also those people who, through ignorance or stupidity, think the removal of the ban would force them to eat oleomargarine.
There is, however, another group in the country, a third group, a powerful group of national bodies and institutions who have no direct or selfish motives, but who feel on moral and social and economic grounds that the present ban should be removed.
First and foremost is the daily press, the greatest organ of public opinion in any free country. From Halifax to Victoria the daily newspapers in every city have thundered against this legislation. In editorials they have described it as evil, iniquitous legislation, a blot on our statute books, and have urged its removal. In all Canada I have seen not a single daily newspaper in its editorial columns champion the retention of the ban. Next to the daily newspapers are the national magazines of Canada: Maclean's, Chatelaine, National and New Liberty. These, too, have castigated this type of legislation.
Then come the great national bodies such as the Canadian Medical Association, the Canadian Hospitals Association, the Canadian Dietetic Association and the Canadian Welfare Association, comprising all the welfare agencies in Canada. This last named is the most informed on the plight of low-income families. In their fine brief to the Prime Minister (Mr. Mackenzie King) they have pointed out that, in a sample poll in the city of Hamilton, they have found that 55 per cent of the families with net incomes of $2,000 a year or less, had to cut their butter purchases because of high prices.
Across the country are hundreds of smaller public bodies such as city councils-and I have in mind the city of Ottawa-labour councils, women's councils and veterans organizations; yes, and to their credit, some farmers' institutions, which have added their voice. I know of two in British Columbia, namely the Howe Sound Farmers' Institute and the Okanagan Centre Institute.
This great volume of public opinion demand the repeal of this ban. Where are the great national public bodies who, without selfish interest, have advocated the retention of the present ban on oleomargarine? There is none; no, not one.
In conclusion, I wish to conclude by pointing out some of the political implications of oleomargarine. It is said, of course, that margarine is political dynamite, that no political party dare touch it for fear of incurring the hostility of the dairy interests. One rural member told me that, although he
Dairy Industry Act

had received twenty letters for oleomargarine to every one against, that one against felt more intensely than the other twenty combined. He has, of course, wha-t is called an open mind in the matter. These, however, are matters of political expediency, and great political parties should base their actions on high principles, not on vote-catching expedients.
Let me therefore turn to an examination of the principles of each of the major parties in the house in relation to this ban; and, if I do so unfairly, I shall welcome correction. Let me, first of all, take the Conservative party. One of the great historical principles and practices of that party has been the principle of protection, a perfectly honourable political philosophy which, at various times in our history, has won great support in this country. Its basis is the fact that infant industries in a young country do need a measure of aid so that they can compete with well-established industries in older countries, such aid being given by duties on the importation of products from foreign lands or by an outright ban. The purpose of such a policy is, however, not to stifle industry within the country. Its purpose was to encourage every type of industry within the country.
Thus while the Conservative party, believing in protection, might endorse the ban on the importation of foreign oleomargarine or might support a duty on foreign margarine, it would do so as a measure of encouragement to the manufacture of margarine and butter within the country. I never have understood the Conservative policy of protection to extend to stamping out competitive industry within the country. There is only one place where I have ever heard that practice called protection, and that was in Chicago twenty years ago. Al Capone and his gang used to supply that type of "protection" to businessmen; for a high fee they rub out any rival business in any area by simply eliminating that competition by intimidation and violence. And that is the type of protection which this legislation affords the butter industry.


Wilfrid Garfield Case: Leave A1 Capone out.


John Ewen Sinclair: I will tell the hon. member for Grey North, who is a Progressive Conservative that I am right in this view, as shown by Hansard of 1923, where the leaders of the Conservative party of that day the Right Hon. Arthur Meighen, the Hon. R. J. Manion, Who was later a leader, made splendid speeches in this strain and voted for margarine, as did the Conservative party by a 19-13 vote.

I turn next to the C.C.F. party. It is conceivable, to me at least, that in the planned and regimented state they hope one day to govern, their master planning board might order that only one of a variety of similar products should be produced, for economy of production. If such a choice were made, the product chosen would surely be that which, measuring up to the required standards, would be the cheapest and easiest to produce, so that there would be a saving in labour to the producer and a saving in money to the consumer. If that were the case, then certainly margarine would be the obvious choice over butter. The C.C.F. have always held themselves out to be the implacable foes of private monopoly. That should certainly include the butter monopoly. They have always shown real concern over the plight of the poor and those with low incomes, so I cannot see how they can condone such a monopoly which leaves butter short in supply, high in price to the consumer and permits great companies to make exorbitant profits.
I turn now to the Social Credit party. I must confess, as on previous occasions, that I have never been able quite to grasp their financial theories. But this I do know about them. No party in this house has been more vigorous in its championing of private enterprise, meaning by that free competition between business, each striving to produce the best and cheapest product. That being so, they can scarcely condone the stamping out of one industry in this country to provide an unrestricted field for another.
They believe in an economy of abundance as against an economy of scarcity. No one can deny that our present butter economy is one of scarcity. Butter is in short supply and high in price, a condition which can be cured only by the economy of an abundance of margarine.
I now turn to my own party, the Liberal party.


Stanley Howard Knowles: This is going to be good.


John Ewen Sinclair: If there is one party in this house which, as a matter of principle, should fight against this ban, it is the Liberal party. That is because of the reasons embedded in our very origin as a political force. One hundred and fifty years ago there were only two British political parties, the Tories and the Whigs. They differed only in one particular. The one party thought that power should be vested in the king, while the other thought that power should be vested in their own privileged hands.
On the scene began to appear the first reformers and radicals, men who were appalled

Dairy Industry Act
by the glaring economic inequalities, men who were fighting for social justice, slowly gathering to their ranks progressive thinkers from both the old parties. Their first triumph came in 1832 with the Reform Bill, which brought the voice of the middle class to the councils of the nation. With this accretion of strength they moved on to the great fight against the com laws led by John Bright and Richard Cobden, men who, in the Biblical phrase, were the glory of their time.
The com laws had been enacted as a supposed aid to agriculture, imposing an exorbitant tax on the importation of foreign grain. The British farmer could not supply the domestic needs and, as a consequence, he received an extremely high price for his grain, which resulted in raising the price of bread beyond the reach of the workingman. The great Tory and Whig landowners defended this policy by saying it had to be done in order to preserve the national economy, even though millions starved.
Bright led the battle against the corn laws with the great cry that the future British economy depended, not on restriction of trade but on the greatest freedom of trade, not on the starvation of the working people but on cheap food for the common people. He convinced the farmers themselves that they were not gaining by this policy, that the high prices they got were robbed from them by the great landowners and that only misery resulted.
Victory came with the repeal of the corn laws in 1846 and with that victory came a consolidation of Bright's followers into the Liberal party. That was the foundation of the Liberal party. If there are any in this house today who think the Liberal party should not support the fight against this ban, let them think what John Bright would say if he were a member of this house; John Bright, the father of the Liberal party, John Bright who, by his lifelong devotion to high principles and by his moral courage, swung millions into the ranks of the Liberal party, the John Bright who today after one hundred years is still the brightest and clearest star in all the Liberal firmament.
If he were here today he would stand up and denounce this ban with the same fiery denunciations which he used in his fight against the corn laws. The extraordinary thing about it all is that he could use the same speeches which he used against the corn laws, with which he swayed Britain, changing scarcely a word. Liberalism today needs more than high principles; it needs deeds and actions motivated by those principles. Here is an opportunity for such 5849-201J
action. Every Liberal who gets up and votes against this ban is, I contend, reaffirming the faith of his fathers.
If there are Liberals who will stand up here and speak and vote for the retention of this special privilege, they too are reaffirming the faith of their fathers, their very distant forefathers who were members of the long dead Whig party, the last political party which believed, not in freedom of trade but in restriction, not in the general good but in special privileges for their friends, not in the plight of the masses but in the special advantages sought by their own classes.
In summation, I submit that the present ban is unconstitutional in law, economically unsound, socially indefensible, morally reprehensible and in opposition to the political principles of every party in this house. It is a ban conceived in a mean and selfish spirit and, like most evil things, it has spawned an ugly brood which we see around us today-exorbitant profits being made on butter by speculators while the poor go without, a butter black market, butter sold at exorbitant prices or as a premium to force the sale of unwanted goods, bad butter sold as No. 1 butter. And there is a hint that two yet uglier progeny are still to come-the deliberate and cynical evasion in spirit of the Geneva agreements and the violation of the pact of confederation; all these things to be borne so that, in the words of a minister of the crown, "the dairy industry may be left undisturbed."
However, this Augean stable needs no Hercules to clean it. All that is necessary is the r otes of members of this free parliament to whose high principles and good judgment L now commend this bill.
Mr. EUGENE MARQUIS (Kamouraska) r Mr. Speaker, as a Liberal member I rise to put on the record a few remarks in opposition to this bill. First I should like to refer to a declaration made by the hon. member for Vancouver North (Mr. Sinclair) a few moments ago, that the ban on oleomargarine was put on to protect a selfish group in this nation. I wish to protest against such a statement about the farmers of this country. The farmers of this country do not put money in their own pockets. They put money in the pockets of the people of the cities and food in their mouths.
Since the origin of colonization and agriculture in the different countries of the world,
nature has provided for a specific production in each of them. The climatic and geographic
Dairy Industry Act

conditions, as well as the nature of the soil, have always had a direct influence on the kind of products to be grown.
Rice, tea, coffee and olives would not grow under our Canadian climate. Nobody would encourage the cultivation of bananas, oranges, grapefruits or nuts of any kind in the northern part of the American continent. Our people would not believe their eyes if they suddenly saw hippopotami, elephants, rhinoceroses, giant snakes and monkeys, lions and tigers or other animals of the African jungle, invading our nice St. Lawrence valley, and driving away our peaceful milch cows.
The first settlers of this land and their successors devoted their lives to organizing the daily industry in Canada. The first milch cows were imported here in 1606. This first experiment did not succeed, but in 1636 other herds of cattle were brought in, and this time cattle raising was definitely established.
At the beginning, herds were so small that [DOT]they supplied milk only for their owners. But further importations and breeding have been developed to such an extent that in 1946 there were nearly 4,000,000 milch cows in Canada, of which over 1,000,000 were in the province of Quebec.
In 1946 milch cows produced in Canada
16.937.028.000	pounds of milk, which have been used as follows: 325,591.000 pounds of butter;
148.060.000	pounds of cheese; 362,005,000 pounds of concentrated milk; 15,783,000 pounds of ice cream and 4,547,637,000 pounds consumed in its natural state as milk and cream.
Without taking into consideration what is consumed by the farmers, the cash income thus resulting from sales at home and abroad totalled, for the same year, 8285,604,000.
Our green and rich pasture growing meadows, valleys and prairies are naturally appropriate for the raising of milch cows which supply milk and meat to the people. Each year part of the livestock is slaughtered for the butcher trade and replaced by better grade cattle, thus improving the quality of cattle. This industry can be largely developed. The raising of cattle and the production of milk can be increased by at least one-third. If we consider that about 15,000,000 acres of new land can be tilled and that more than
10.000	old abandoned farms could be exploited, we may easily arrive at the conclusion that an increase of one-third is not an exaggeration. Is it not easy to believe that with the cultivation of old and new farms, the improvement of the soil and of the cattle, and with new scientific methods of farming we may

secure for this country such a surplus of livestock and milk products either for home consumplion or for export sales?
Having in mind the amount of money invested in livestock, in buildings and in equipment of all sorts for the maintenance of cattle, and for the production of milk, butter, cheese and evaporated or concentrated milk, we realize that the economy of Canada is intimately linked with the dairy industry and that any policy tending to facilitate the importation or fabrication of oleomargarine would seriously impair our economic structure.
Representing a farming constituency, I am aware of the sacrifices made by our people in modernizing their dairy industry, by improving the quality of their herds of cattle and establishing well equipped butter and cheese factories, many of them managed and operated by co-operatives. Any attempt to bring in an artificial product would surely disrupt the stability of the farming industry in our country, in our province and particularly in our region.
In this post-war period of reconstruction, I do not think artificial methods of production should supersede natural ones. During the war, artificial means were resorted to for supplying the needs of the armed forces and civilians in the devastated areas. Synthetic food has been manufactured to meet a deficiency of natural food. But this was done in extraordinary circumstances, for the supply of people in need, not for those who can have a sufficient production for their maintenance.
In our province, the nature of the soil, the climatic conditions, the farming organization and the necessity of complying with national and international demands, oblige our farmers to stick to the animal industry.
Let us suppose that a synthetic pill could be made to replace bread. What would happen to wheat? Would the wheat growers who contribute so much to our external trade discontinue or decrease their production? Would they grow cotton-seed, soya beans, corn and peanuts instead of wheat? Mr. Speaker, I now move the adjournment of the debate.
(Translation):
Mr. GEORGES H. HEON (Argenteuil): Mr. Speaker, before you call it nine o'clock, could I ask my hon. friend a question? Would the hon. member tell me the source of the figures and statistics he quoted?


Mr. MARQUIS:: They are from the Department of Agriculture and the Canada Year Book.

Vocational Training Co-ordination Act


Mr. HEON:: Would you repeat, please? (Text):
On motion of Mr. Marquis the debate was adjourned.


James Horace King: The hour for private bills having been exhausted the house will revert to the business before it at six o'clock.



VOCATIONAL TRAINING


[Stage Direction]
Hon. HUMPHREY MITCHELL (Minister of Labour) moved the second reading of Bill No. 202, to amend the Vocational Training Co-ordination Act, 1942.
Motion agreed to, bill read the second time, and the house went into committee thereon, Mr. Golding in the chair.
On section 1-Projects the minister may undertake.
Mr. McKAY:: The explanatory note says that the amendment will permit training for employment to be provided to unemployed persons in suitable cases. What is meant by "suitable cases"? Is age a factor, and, if so, what age would the minister consider the maximum at which training would not be considered wise?


Humphrey Mitchell: I could not catch my hon. friend's question very well on account of the noise in the chamber, but I think he spoke of age and suitability. The age is sixteen. The suitability is arrived at in each case by the provincial and dominion authorities in co-operation.


Wilfrid Garfield Case: While no objection can be taken to the desire to train and equip men to meet the problems of life, I should like to make sure that there is no coercion or direction or regimentation intended by any part of this bill but that the men will have the right to decide for themselves whether or not to pursue a certain course. If so, I think it is all to the good. I am constantly trying to fortify myself in the determination not to be a party to the acceptance of any socialist regimentation or planned economy. Will the minister say that there is nothing compulsory in the bill?


Humphrey Mitchell: It is voluntary.


Eric Bowness McKay: In the last part of the clause it is indicated apparently that persons not insured under the act will be eligible for training for employment. I think I am correct in that.


Humphrey Mitchell: That is a correct
statement.


Eric Bowness McKay: Where is the line drawn? How may persons qualify, and who determines the right of the individual to take the training course? A good many people come under the scheme, as we are aware.


Humphrey Mitchell: Over 3,000,000 workers in Canada come within the jurisdiction of unemployment insurance. I gave that figure last night. They must, however, have been gainfully employed, and selection is made by the provinces in co-operation with the dominion authorities.


Eric Bowness McKay: That is one of the qualifications. They must have been gainfully employed before they qualify.


Humphrey Mitchell: Yes.


Mr. BENIDICKSON:: Does this require provincial participation, as in the case of other forms of vocational training?


Humphrey Mitchell: Yes. It is all predicated on provincial participation on the basis of a fifty-fifty contribution by the dominion and the provinces, with the exception of the training of soldiers, which is carried 100 per cent by the dominion in training and apprenticeship training.


Mr. GREEN:: Would it be possible, with this amendment, to give training to veterans of the first war, by way of rehabilitation? As pointed out to the Minister of Veterans Affairs the other evening, there is no provision at the present time in the veterans legislation for the rehabilitation of veterans of the first w?ar. Many of these men are now about fifty, and I am informed by officials in Vancouver that they would benefit greatly by receiving training. Will the Vocational Training Co-ordination Act as amended be broad enough to cover these men?


Humphrey Mitchell: Yes, on a fifty-fifty basis with the provinces.


Howard Charles Green: Are the two dominion departments working together with regard to these men-the Department of Labour and the Department of Veterans Affairs? I suggest to both ministers that there is a great deal of work to be done there.


Humphrey Mitchell: Yes. We work closely with the provinces. The Department of Veterans Affairs and the Department of Labour co-operate. We have drawn upon our experience over a period of many years, in war training, in the training of mechanics for the army, the navy and the air force, and the
3164	COMMONS
Vocational Training Co-ordination Act
purpose has been to avoid duplication by using the experience of our department gained over the years.


Howard Charles Green: There would be no benefits payable to men taking training?


Humphrey Mitchell: The usual allowance is paid civilian trainees.


Howard Charles Green: The usual allowance is paid?


Humphrey Mitchell: Yes.


Mr. ROSS (St. Paul's) :: Suppose a particular field is overcrowded and unemployment ensues, is this intended to train men in some other art or skill?


Humphrey Mitchell: We try to train men for employment that is available. It is not much use training a person if you know beforehand that when he has completed the course there will be no employment opportunities for him.


Douglas Gooderham Ross: Let us take one trade by way of illustration. Suppose you had an overabundance of bricklayers. I am not suggesting for a moment that it is so; this is merely an illustration. Suppose, however, there is no possibility of men getting work in that trade; rather than have them idle, the purpose of the bill is to train these people for some other art or skill. Is that correct?


Humphrey Mitchell: That is correct.


Robert Ross (Roy) Knight: Last year there was drawn to my attention the case of a girl who had never worked in the sense of being employed away from home, though she did work at home where she helped. She made application for entrance into a course, and there was some doubt at that time whether she could be admitted in view of the fact that she had never been gainfully employed. Will the minister comment on that case in the light of the proposed legislation?


Humphrey Mitchell: It has been agreed that where girls work in their homes they should receive training. A girl may stay at home until she is twenty or twenty-five; I will not go any farther than that. I see my hon. friends smiling.


Wilfrid Garfield Case: The question we are considering is the fitting of unemployed persons for gainful employment. Suggestions have been made-I do not know how true they are

that people who are unemployed and are not specially equipped to earn their living have entered into courses of this kind; yet after they have only partly completed their course the fund, or whatever provision is made for such persons, is exhausted and they cannot complete the course. If an unemployed per-

son decided that he would like to go in for some particular vocation, and you are prepared to fit him for gainful employment, will the provisions of the act ensure such a person going through and not being cut off midway in his course?


Humphrey Mitchell: Provision is made for such persons to complete the course.


Wilfrid Garfield Case: Thank you.


[Stage Direction]
Section agreed to.
On the title.
Humphrey Mitchell: I wish to put certain figures on the record. If there is no objection I can put them on Hansard. One set deals with assistance under the money expended by the dominion and the provinces and the other deals with the number of schools and buildings in the different provinces. These are the figures:
Vocational Schools' Agreement Dominion Capital Allotments
Province Prince Edward Island
Nova Scotia	
New Brunswick	
Quebec	
Ontario	
Manitoba	
Saskatchewan	
Alberta	
British Columbia ...
Equipment $	20,500
126,075 324,750	108,250
2,354,550	784,850
2,273,625	757,875
492,000	164,000
643.650	214,550
525,150	175,050
446,550	148,850
Buildings $	61,500
378,225
$7,500,000	$2,500,000
Vocational Schools Assistance Agreement
Financial assistance given to provincial and municipal vocational schools.
Total 257.
Prince Edward Island	   l
Nova Scotia	 3
New Brunswick	 31
Quebec	 55,
Ontario	 42
Manitoba	  3
Saskatchewan	 so.
Alberta	 n
British Columbia	 61
Assistance for 107 new vocational school buildings as follows:
Prince Edward Island	 1
Nova Scotia	 3
New Brunswick	 8
Quebec	 28
Ontario	 11
Manitoba	 15
Saskatchewan	 29
Alberta	 6
British Columbia	 6
Estimated total payments for new vocational schools up to 1952, dominion $7,780,000, provincial $9,160,000, municipal $13,000,000.
Estimated total payments for capital equipment up to 1952, dominion $2,280,006, provincial $2,600,000, municipal $2,000,000.

Railway Grade Crossing Fund


William Moore Benidickson: Are those the figures for the past year?


John Oliver Probe: Can the minister indicate whether those figures are broken down on the sharing of administration costs with the provinces, or can he give an explanation as to what is done about sharing the cost of administration in respect of training?


Humphrey Mitchell: There is no administration cost in connection with buildings.


John Oliver Probe: I am talking about training. Who pays the administration cost of the training programs? Is that cost divided between the provinces and the dominion?


Humphrey Mitchell: We do not pay administration costs. They pay the costs.


John Oliver Probe: And they do not bill the dominion for a portion?


Humphrey Mitchell: No.


William Moore Benidickson: Have all the provinces indicated that they propose to participate in the extension of the vocational training program?


Humphrey Mitchell: Yes.


William Moore Benidickson: I have not been able to obtain a copy of the annual report of the Canadian vocational training section for 194647, but I notice from the report of 1945-46 that, in spite of allocation by the dominion of certain sums of money, several of the provinces have not participated by any means to the extent of the allotment made to them. Is there anything in the nature of an allotment in connection with this program?


Humphrey Mitchell: Yes. The plan naturally did not go into high gear under war conditions. The provinces have taken up their allotments since, in the last twelve months. Those figures will be on the record.


[Stage Direction]
Title agreed to.
Bill reported, read the third time and passed. UNEMPLOYMENT INSURANCE ACT

[Stage Direction]
Hon. HUMPHREY MITCHELL (Minister of Labour) moved the second reading of Bill No. 203, to amend the Unemployment Insurance Act, 1940.
Stanley Howard Knowles: May I say, Mr. Speaker, that we over here in this group are quite prepared to allow this bill to be given second reading now, if there is no debate on it. But we would
appreciate it if, as soon as we go into committee, the minister would be good enough to move that we rise and report progress. After all, we have had the bill for only a couple of hours, and it is a rather important one.


[Stage Direction]
Motion agreed to, bill read the second time, and the house went into committee thereon, Mr. Golding in the chair.
Humphrey Mitchell: I move that the committee now rise, report progress and ask leave to sit again.


Stanley Howard Knowles: Thank you.
Progress reported.



RAILWAY GRADE CROSSING FUND


[Stage Direction]
The house resumed from Monday, April 19, consideration of the motion of Mr. Chtev-rier for the second reading of Bill No. 201, to amend the Railway Act.
Motion agreted to, bill read the second time, and the house went into committee thereon, Mr. Golding in the chair.
On section 1-Appropriation for highway crossings.
Wilfrid Garfield Case: I have not a copy of the bill before me. I do not know where it is. Before I would be prepared to accept section 1, I want to ask the minister if this bill has anything to do with the debate that has 'been in progress for some time in the House of Commons.


Lionel Chevrier: It has not.


Wilfrid Garfield Case: That is fine. Thank you.


Thomas Langton Church: I understood that this Bill No. 201 was not to come up tonight, and I left my papers in my office. But I want to point this out to the minister regarding Bill No. 201, to amend the Railway Act. The minister proposes to spend half a million dollars this year. According to the return which he brought down in the house in answer to questions I asked away back last February- and as I say, I have not my papers here-a small amount was spent. These grade crossings are taking a great toll of life in this country at the present time. For the minister to propose such a small amount, only half a million dollars, for all the level crossings in this country is inadequate. It amounts to almost nothing. Ontario did not get anything.
I am sorry I have not the return here, because I was told that the bill was not coming up tonight. I am not objecting to its coming up. I want to say this. We have some of
Railway Grade Crossing Fund

the most dangerous crossings in Canada in our city of Toronto. There is one at Jones avenue in ward I. The railway commission went there and looked into that dangerous crossing, near Riverdale collegiate and some other schools. There was nearly a calamity there. What did they do with the money? After the city started the work and the railway commission had ordered it, they took it away out in the county of York; they built the crossing at Victoria avenue, away out in the county of York.
I want to point out to the minister that a small sum of money like that is inadequate; it will do almost nothing to alleviate the great dangers caused by these various crossings in Canada. A number of people have been killed at these crossings. There should be an amendment to the criminal code to provide a penalty for people who do not stop, look and listen before going over a crossing. There should be a fine.
What have we got? The province of Ontario contributes to railways a large sum of money from the taxes. I wish I had my papers here but I have not. However, a return was brought down, and it showed an amount that is not worth a snap of the fingers when it comes to saving life at these dangerous crossings.
In our city we are assessed one-third of the cost of the Toronto viaduct, although the city had no liability because the municipal roads were through there long before the railway came. But we were assessed something like a third of the cost of it. It was a $40,000,000 work and the city paid one-third of it. We got grade separation which cost the Toronto taxpayers several millions.
This is a very small sum of money, half a million dollars, to be voted for the thousands of grade crossings in this country. When you consider the toll of life at these level crossings, it is an appalling thing. Who orders these grade works? Application has to be made to the board of transport commissioners before an order can be made. Then you have a long inquiry, and all that kind of thing. I venture to say very little will be done about the matter this year.
I should like to hear from the minister as to to the program in view under this Bill No. 201, and how much of this half million dollars will be voted to the various provinces to cope with this great danger. We have several very dangerous crossings in our city but not a cent has been spent on them. Five or six mills on the dollar are paid by the taxpayers of Toronto for purely federal burdens, but we

get nothing at all in return; and this is only part of it. It is in Ontario that these railways make a great deal of their money, but we do not get anything back. I should like the minister to say how much has been spent since the start of the war on this grade separation work, by provinces. This amount used to be $200,000; now it is raised to $500,000, but that is nothing at all. We might as well strike out the vote altogether as attempt to solve this problem of grade crossings throughout Canada by the voting of a half million dollars.
In view of the heavy loss of life, it seems to me too bad that we cannot do something to remedy the situation. I should like the minister to tell us what is the policy of the government in connection with the removal of these death traps of grade crossings, and how many were covered in his survey. Then I think he should tell us where the money is to be spent. I believe the committee is entitled to hear something about it. What is the policy of the government; what has been spent, and where?


Lionel Chevrier: The hon. gentleman has asked how much will be voted to the various provinces out of the sums we are discussing this evening. That will depend upon the applications made by public bodies, municipalities and others in the various provinces. The board of transport commissioners does not approve projects by provinces as such, though it is a fact that over the years the provinces have received proportionate amounts from the grade crossing fund.
I should like to remind the hon. gentleman that this is not the only money voted for grade crossing elimination. Many votes have been directed from time to time toward the elimination of grade crossings. The hon. gentleman has asked how much has been spent since the beginning of the war. Unfortunately I have not that figure, but I have the figure as to expenditures for protection at highway crossings since the fund was established in 1909 to the end of January, 1947. During that period of time some $43,975,000 has been spent, of which $11,837,000 was voted out of the grade crossing fund, $15,507,000 was paid by the provinces and municipalities, and $16,431,000 by the railways. The expenditure by provinces was as follows:
Ontario	 $5,901,000
British Columbia	 774,000
Alberta	 393.000
Saskatchewan	 639,000
Manitoba	 346,000
Quebec	 2,737,000
New Brunswick	 300,000
Nova Scotia	 721.000
Prince Edward Island	 22,000

Railway Grade Crossing Fund


Stanley Howard Knowles: I should like to say a word in support of the contention of the hon. member for Broadview that the government should consider making a larger contribution to this fund in order that faster progress may be made in the elimination of grade crossings.
However, my purpose in rising at this moment is to ask the minister whether any provision has yet been made for the elimination of the grade crossings on Talbot avenue between Winnipeg and Transcona. The minister and I have had correspondence concerning this request, which I presented to the minister on behalf of the Elmwood home and school association of Winnipeg, which is particularly interested in the matter. I would point out that this is a busy thoroughfare, connecting as it does the city of Winnipeg with the rather large railway centre of Transcona; and the people in the area concerned are hoping that it will not be too long until this grade crossing is eliminated. In fact there are two grade crossings, one on the Molson cutoff and the other on the East Selkirk branch of the Canadian Pacific railway.
In the course of my correspondence with the minister he indicated that some estimate had been made as to the cost of doing this job, and in his letter of October 3, 1947, he said that in appropriate cases contributions could be made from this fund by the board of transport commissioners up to forty per cent of the actual cost of construction but not exceeding the amount of $100,000 for any one project.
As a supplementary question I should like to ask the minister whether those two provisions, the forty per cent regulation and the $100,000 limit, still stand. My main question is, of course, whether or not consideration is being given to the elimination of the grade crossings to which I have referred.


Lionel Chevrier: In reference to the first part of the hon. gentleman's question, the answer is yes; namely, that in any project brought to the attention of the board by way of application, the board cannot order to be paid out of the grade crossing fund more than forty per cent of the cost, and in any event the contribution shall not exceed $100,000 for any one project.


Stanley Howard Knowles: Is that in the act?


Lionel Chevrier: That is in the act. The board may afterward distribute or apportion the remainder of the cost between the applicant and the defendant. For instance, if the applicant is a rural municipality, or as in this case the city of Winnipeg, having regard to 5849-202
all the circumstances the board may apportion the remainder of the cost between the applicant and the railway company.
In the particular case to which the hon. gentleman refers I am not aware that an application has come forward to the board. Unless it does, the board cannot deal with it.
I do not remember in detail the letter the hon. gentleman mentions, though I recall having had correspondence with him. In that correspondence I presume I pointed out to him the sections of the Railway Act concerning an application, but if I did not perhaps I should have said to him that unless an application is made to the board there is no power to decide upon its merits.


Stanley Howard Knowles: May I ask the minister whether the board of its own motion, or the minister's department of its own motion, surveys the situation and lines up crossings such as these I have mentioned, which might come up for consideration? If so, can he tell me whether this one is on the list?


Lionel Chevrier: The department can
indicate to an applicant or to a member who is interested in a particular grade crossing separation that the member or applicant should make an application to the board, but unless the application comes squarely before the board the minister or his officials have no authority to determine that a grade crossing shall disappear.


Stanley Howard Knowles: Has the department no power to make a survey in this matter, and to tell us the result of such a survey?


Lionel Chevrier: There is no machinery in the department for that. Perhaps what the hon. member has in mind may be that some time ago the board of transport commissioners made a survey of projects which might be given consideration.


Stanley Howard Knowles: That is right.


Lionel Chevrier: That was made; but there are many projects of that kind, applications for which have been brought to the attention of the board. And when I say "many" I mean it in that sense; there are a substantial number of them. The board, of course, do that on request. I think at the time the request was made by the Department of Reconstruction and Supply, so that there would be on the shelf a list of projects of a public nature upon which certain sums of money might be expended when the need arose. But those are not the same in nature as applications made directly to the board, and would not warrant a payment out of the
316S
Railway Grade Crossing Fund

grade crossing fund, unless a specific application had been made in a particular case. So that to deal with my hon. friend's case I would say that if he is interested in it he should indicate to the city of Winnipeg that, through their solicitor, they should make an application to the board.


Stanley Howard Knowles: I understand the procedure the minister is outlining. Is the survey to which he has made reference public?


Lionel Chevrier: It is not.


Stanley Howard Knowles: That is too bad.


Mr. LENNARD:: Several sessions ago the hon. member for Calgary West suggested at some length that it should be made compulsory for vehicles to come to a stop at level crossings and that signs, instead of reading, "Look and listen" should read "Stop, look and listen", and that those signs should appear at. all level crossings in Canada. This evening the hon. member for Broadview suggested that that people who did not come to a full stop before crossing at a level crossing should pay fines. Would the minister say whether any progress has been made in this direction?


Lionel Chevrier: Yes, much thought has been given to that suggestion by the board of transport commissioners, but they have not seen fit to recommend an amendment to the Railway Act in the terms specified by the hon. member.


Wilfrid Garfield Case: I do not suppose it is the intention of the minister to attempt in any sense to deal with each individual case. What I am particularly interested in is the increase in the amount to be appropriated for the railway grade crossing fund to $500,000 in each year for nine years from April 1, 1948. In a few moments I shall ask my question based upon the statement I have made.
First of all, however, I should like to frame my questions so that the minister could answer at one time. I understand that the appropriation is not necessary for only government railroads; it has to do with all railway lines in Canada.


Lionel Chevrier: Yes.


Wilfrid Garfield Case: In the second place, I have no particular objection to the proposed subsection which gives a telegraph or telephone company power to expropriate land required in order to comply with an order of the board made under subsection 6. That is to say, the power of expropriation provides that the company may utilize certain lands for purposes of placing their wires underground. I am anticipating the time when the Bell Telephone Company, or other communications systems, would prob-
ably have their lines of communication underground. In the first instance, this may be more costly, but their costs of upkeep would be much less. So I would read into this section-and I wish the minister to clarify it-that the lands that a telegraph or telephone company may expropriate would be for this purpose.
We find in the explanation that subsection 6b enables the board, on application of the municipality or land owner, to permit drainage or the laying of pipes through, along, upon, across or under any telegraph or telephone lines. And it states that the amendment to subsection 7 is required by the new subsection 6b.
Perhaps the minister would clarify in my mind the matter of expropriation of land. He might be inclined to comment on the new subsection 6b, and then answer my final question: How does he arrive at the figure of $500,000 a year for each of nine years? Are representations made to him? Does he budget in anticipation, or how does he arrive at that figure?


Lionel Chevrier: To deal with the last question first, there has been paid into the railway grade crossing fund under the Railway Act the sum of $200,000 a year for three ten-year periods since 1909.


Wilfrid Garfield Case: By whom?


Lionel Chevrier: By parliament. Parliament voted $200,000 a year for three periods of ten years. That went on from 1909 until 1939, at which time, because of the war, payments were discontinued. Perhaps I should not say that payments were discontinued; the fact is that they expired in 1939 and parliament did not provide any further appropriation during the war years.
Last year, 1947, 'the provision was for $200,000 for a period of ten years. One of those payments has been made into the grade crossing fund. But because of the large number of applications now before the board, the board has recommended and the government has agreed with the recommendation, that there be an amendment which would provide that an additional sum of $500,000 be paid annually into the grade crossing fund. So that is why we are asking for the increased amount for nine years, instead of $200,000.


Wilfrid Garfield Case: It does not have anything to do with any particular railroad?


Lionel Chevrier: No, not the slightest.
I wonder if we might permit the other questions to stand until we reach that part of the bill. We have not yet disposed of the first section.

Railway Grade Crossing Fund


Thomas Langton Church: I call the attention of the minister to an important departure in the bill before us. In a return filed on February 4, the minister gave some information regarding grade separations throughout Canada. The amounts of money spent on grade separations in Canada is listed by provinces at page 857 of Hansard. In his reply to the question, the minister states:
The board of transport commissioners advise as follows:
Contributions were made from the railway grade crossing fund towards the cost of grade separations as follows:
Province of Ontario
Order No. 69945, dated December 18, 1947. Overhead bridge over Canadian Pacific railway at Pacific avenue, Fort William, Ont., $94,400.
Order No. 69950, dated December 18, 1947. Pedestrian subway under Canadian Pacific railway at McTavish street, Fort William, Ont., $29,600.
Province of Quebec
Order No. 69418, dated August 29, 1947. Subway under Quebec Central railway at Sharpe's Crossing, city of Thetford Mines, Quebec, $23,200.
Order 69419, dated August 29, 1947. Subway under Quebec Central railway at Johnson's Crossing (Mooney street), city of Thetford Mines, Quebec, $26,560.
Total amount, $173,760.
There was no contribution toward grade separation in the other provinces.
The next section deals with the consent of the municipality. The city of Toronto paid one-third of the cost to build a viaduct across the waterfront at a cost of some $15,000,000 to the city in order to eliminate level crossings. The city paid one-third and each of the two railways paid one-third. I asked the following question re grade crossing votes for 1947 to which the minister replied as follows:
1.	What sums of money have been spent on grade crossings in Toronto city during the year 1947, and where?
2.	Are any projects in that city proposed for the elimination of the level crossings at (a) Jones avenue; (b) Greenwood; (c) Woodbine avenue?
Mr. C'hevrier:	The board of transport commissioners for Canada advise as follows:
1.	No contributions were made from the railwav grade crossing fund towards crossing protection in the city of Toronto during the year 1947.	,
2.	Applications are before the board for grade
separations at (a) Jones avenue (b) Greenwood; (c) Woodbine avenue.	.
The railway grade crossing fund as provided for in section 262 of the Railway Act is not allocated to any specific city or place except as specifically directed under order of the board of transport commissioners from time to time.
That is all the money they spent on grade separation. I should like to point out one important thing. Suppose this space between 
the desks was a highway. The railway commission come along and pass an order under this new bill, No. 207. A new state of affairs is proposed for ten years, and I think it starts on a very good day, on April 1, 1948, April Fool's day. That is all it is. They propose to assess the municipality for removal of poles and services when a railway wants to change a right of way and the railways want to enter on or change a line. And along comes the railway commission and assesses them for pole removal. I contend that this is illegal under the Railway Act and under the British North America Act. The city streets often were there before the railway came. Only one city has contributed to this before; that is the city of Toronto which contributed $15,000,000 in connection with the waterfront viaduct matter.
The Canadian Pacific Railway Company were given a right of way along the Don river from Leaside right to the waterfront for $600 a year. That was many years ago, long before I was in the council. The Railway Act should be revised every ten years. Just now it is a dead law, as we found out the other day.
I raised this same matter in 1917, 1918 and 1919, the last year the Railway Act was consolidated. We were howled down, Sir Adam Beck and I, before the railway committee in 1917. We proposed that if a railroad came in. along, on, over or under a highway they would have to obtain the consent of the municipality before entering thereon. Railways had first to secure municipal consent. Those proposals of ours were inserted in the Railway Act away back in 1917, 1918 and 1919.
What are they doing now? If poles are removed the municipality will be assessed part of the cost. This vote of half-million dollars is only pin-money and more people will be killed if this bill goes through the house. I am surprised that the government, with such large sums of money to squander all over the seven seas, does not vote more money under this act.


Mr. GRAYDON:: The minister might well take into consideration a more general policy with respect to the grade crossing fund than has been evolved by the government. This looks to me like a continuation of the piecemeal legislation which was brought down year after year prior to 1939. There does not seem to be much improvement. There does not seem to be much imagination used in connection with the thing which concerns the public; that is, railway crossing accidents and safety measures generally.
This measure in essence attempts to bring the act up to date for several years, but I do not think that is good enough. I should like
Railway Grade Crossing Fund

the minister to take into consideration one or two facts. During the war years a return was made, I believe at the instance of the hon. member for Broadview who has just spoken, which showed that there were more people killed in Canada in highway accidents than had been killed during the war. That seemed to me to be a stunning and appalling situation.
Nowadays we have the condition where highways and railroads intercept and in many instances cause danger traps of the worst order and render the safe passage of either the vehicle or train open to question. At times even the provision of every safety measure known is not sufficient to overcome the difficulty that one finds where certain highways intercept railroad lines.
An application has been made in connection with a grade crossing separation at the south end of my constituency near Port Credit, where No. 10 highway and the Canadian National line from Toronto to Hamilton intercept. At that crossing not only do they have a bell and gates, but there is a watchman in attendance. But even with all that protection, the municipality of Port Credit feels, and I think rightly so, that there should be a grade separation. I have no doubt that when the province and the railway and the board of transport commissioners meet the matter will be given full consideration, and I hope that, after a review of the circumstances, something will be done.
I am sure that nearly every hon. member knows of danger traps in his own constituency which sooner or later will mean the loss of lives of innocent people travelling on the highway. We must remember that the Railway Act was passed many years ago. The conditions which governed in those days were quite different and distinct from the conditions which exist now with regard to highway travel. It is difficult for one to conceive that what existed at that time in the way of necessity for legislation could possibly be applicable in the same fashion today.
This is a paltry sum, $500,000 a year. It would not be enough to take care of one major gtade separation in each of the provinces in any one year. That gives one food for thought and should cause the government to consider whether there should not be some more effective means of dealing with this highway menace across the dominion. Nothing strikes the public imagination more than the fatalities that take place at these crossings which are so dangerous to life today, and some speedier method ought to be developed of eliminating at least some of the outstandingly dangerous crossings in the dominion.

I was interested in what the hon. member for Winnipeg North Centre said in connection with the grade separation which he considered essential in his own city of Winnipeg. That may be so. But in answer to what he had to say, I think we may say this much in favour of the board of transport commissioners, that it does not take very much in the way of a resolution from a municipal council or some other public body to be regarded by the board as an application for a grade separation. I have not found in my experience that it is difficult to get the machinery moving for an inspection at least of the grade separation in question, but that does not mean, of course, that in all cases speedy action will be taken by the board.
In conclusion, I would say that the board of its own motion or the government ought to make a survey of the situation at the earliest possible moment with a view to making a dead set against some of the death traps still abroad on our highways where they intersect Ihe railway right of way and which are haunting the motorists of Canada today. I do not think in this parliament we could spend our money to better advantage than in trying to save the lives of some of our best citizens who from time to time are removed from us in just this way. I commend to the minister that he take into early consideration more effective means of trying to eliminate some of the major causes of these fatalities, past, present and future, in the dominion.


Thomas John Bentley: I am not very familiar with this act or with the amendment and I am seeking information. I have had sufficient experience, however, to make me curious and to feel a sense of responsibility in what I am about to ask. First, does this $500,000 which is being appropriated for the fund each year for the next five years have to be all expended in any one year?


Lionel Chevrier: It has not to be expended in any one year. It depends on the number of applications and on the inspections.


Thomas John Bentley: Anything left over at the end of the year goes back into the fund and a new appropriation is sought.


Lionel Chevrier: That is right.


Thomas John Bentley: The village of Herbert, now the town of Herbert, some years ago had a grade crossing just east of the town, which was considered a good enough place at the time, but in view of developments it is felt that it should be moved further east or that

Railway Grade Crossing Fund
a new one should be built. Is it possible for the same place to apply again when new conditions arise?


Lionel Chevrier: Yes, the municipality can make a further application.


Thomas John Bentley: It must be the municipality? A small body of citizens affected would not be considered a proper source from which the application should come?


Lionel Chevrier: It need not be the municipality necessarily. Anyone interested may make application, but if they do, the application will be served on the municipality, which in the final analysis will have to pay a portion of the cost and which must be given an opportunity of saying whether they are willing or whether they object.


Thomas John Bentley: In that case 40 per cent of the cost is paid out of the fund and the other 60 per cent is apportioned by the board of transport commissioners?


Lionel Chevrier: The other 60 per cent may be paid by the municipality or by the railway, according to the decision of the board.


Douglas Gooderham Ross: I do not think we have received sufficient information from the minister as to whether this $500,000 is sufficient. I should like to know how much there is now in the grade crossing fund. I should also like to know how many fatalities and accidents there have been at grade crossings in each of the last three or four years. There is more than one class of persons interested in grade crossings. In addition to motor and other vehicular traffic, there are the passengers on the trains, and one class in particular which has not been considered at all is the railway employees. The anxiety of the engineer and fireman on a train approaching a dangerous crossing must be terrific. The train has to follow the rails and cannot avoid an accident by getting out of the way. I think that $500,000 for grade separation is just a drop in the bucket.
I also think a great deal more could be done in protecting the crossings. I do not think nearly enough warning is given. I know there are signs posted up along the highway, but people get used to them and do not bother about them. You sometimes see signs saying, "Slow down to twenty miles an hour". I do not know whether it is within the jurisdiction of the federal parliament, but I would ask the minister whether we have power to fix the rate of speed at a railway crossing. I do not know whether you can make them stop or not, but it would be a good thing to have something like that. It is tragic to see the loss of life at railway crossings week after week. There
is an exodus of motor traffic every week end from the city of Toronto into the country and you continually hear of people being killed at level crossings. I do not know how the minister values life, but it is said that a young person is worth $30,000 to the state, and at that rate it would not take many fatal accidents for the country to lose more than $500,000 in a year.
The minister should give us more facts. I should like to know what precautions are being taken to prevent these fatalities which are taking place week by week. What is being done to educate the public? It is not simply a matter of having grade separations, overhead bridges, and so on, because in a country the size of Canada it is impossible to eliminate all our grade crossings. A lot more could be done than is being done by the railways themselves, and a lot more done in the way of education of the public.
Take the Bell Telephone Company. On the. back of their trucks they have this sign, "This vehicle stops at all railroad crossings." I stop at all railroad crossings, but sometimes one is apt to forget. The other day I saw a letter in the paper, in the form of a warning to a man and his girl who had been driving in a motorcar. It was something to this effect: "You were one second away from eternity, but don't think it was only you for whom we were concerned. You ought to thank heaven you were not killed, because you were not watching; but don't think it was only you we were worrying about. We were worrying as much about ourselves as about you." I should like to have more information from the minister regarding the whole subject.


Lionel Chevrier: The amount in hand in the railway crossing fund, as of February 6, 1948, was $206,523. The speed at which motorcars may travel when approaching a level crossing is governed by the highway traffic act of the province in which the crossing is situated. Fatalities that have taken place-in 1947 or in any other year will be found in the annual report of the board I tabled some" weeks ago, and the number of devices for protection, such as wigwags and other mechanical contrivances, which are from time to time ordered by the board of transport commissioners, will also be found in the annual report of the board, which is an extensive, document.


Douglas Gooderham Ross: What I wish to know is whether the board of transport commissioners is getting results. What is it doing in co-operation with the provinces? Has it said to the provinces, You ought to do so and so; you ought to have your speed limit
Railway Grade Crossing Fund

reduced, and so on. Are the fatalities increasing or diminishing? That is the point. The minister says there is only 8200,000 or thereabouts in the fund at the present time. With all the work that has to be done across the country, that does not seem like anything at all.


Lionel Chevrier: The board, I am
informed, is in constant communication in these matters with the public authority having to do with traffic over provincial highways, be it the department of highways in the province or the. public body that acts in lieu of that, and the board has received excellent cooperation from these bodies in the provinces.


Douglas Gooderham Ross: One word further. I think the general public can look after themselves to a certain extent. They should be able to do so. The people for whom I am .speaking particularly are those men in charge of trains, and I think everything that can possibly be done to protect them should be done.


Lionel Chevrier: I may tell the hon gentleman that annually the government receives [DOT]representations from railway brotherhoods with reference to amendments to the act. I believe that last year the majority of the amendments brought in were at the suggestion of the brotherhoods. The first section of the bill, having to do with the $500,000, is one which has been approved by the brotherhoods over a period of time.


Howard Charles Green: The question I wish to ask the minister has to do also with railway trainmen. What power has the government or the board of transport commissioners to direct the installation of safety devices? As the minister knows, I showed him the other night a letter from a ladies' auxiliary to one of the lodges of the brotherhood of railroad trainmen, pointing out that there had been within the last seven months, in the Kamloops district in the interior of British Columbia, four slides, Two clay slides and two rock slides, in which five trainmen were killed and others injured. The auxiliary requested that directions be given for the installation of automatic blocks and also what is known as slide detector devices. That seems a reasonable suggestion, and I should like to know- what power there is to direct the installation of safety devices of this type.


Lionel Chevrier: The board of transport commissioner's has full powers under the act to direct the installation of safety devices upon application made by the public body affected. In the case my hon. friend refers to, he will

remember that the hon. member for Kamloops asked a question to which I replied. I indicated the other evening where he would find that reply.


Howard Charles Green: I have it before me now.


Lionel Chevrier: The board of transport commissioners is giving careful and active consideration to these accidents in the mountain region. With reference to the block system, so far as the Canadian National is concerned, I am able to say that at the moment it has that very question under consideration.


Howard Charles Green: In the area concerned?


Lionel Chevrier: Yes.


Howard Charles Green: The minister at page 2345 of Hansard said:
The board of transport commissioners have under study the question of safety devices commonly known as "slide detector fences," with a view to ascertaining their practicability and efficiency.
Has that study been completed, or is there some doubt as to whether these slide detector devices are efficient?


Lionel Chevrier: The study referred to in my answer has not yet been completed. One of the officers of the board of transport commissioners has been out there and has made a survey and reported to the board, but the board has not yet made a final decision.


Howard Charles Green: If these devices are found to be efficient, will directions be given for their installation?


Lionel Chevrier: I am not able to answer that question because I do not know a great deal about the mechanics of the device. I presume that if they were found to be effective, instructions would be given to install them, because, after all, it is a serious matter.


Howard Charles Green: Does the government exercise any power in connection with these safety devices?


Lionel Chevrier: No. It is a technical matter which is left entirely to the technical men under the board's jurisdiction.


Howard Charles Green: I would suggest that the minister bring to the attention of the board the fact that there is grave concern about these slides having taken place and about the lack of protective devices in the district.


Lionel Chevrier: I have already done so. I am doing so now. The officer who is at the table is the one who made the survey I referred to a moment ago.


Robert Ross (Roy) Knight: In line 15 of section 1, I find the expression "to aid actual construction

Railway Grade Crossing Fund
work for the protection", and so on. I should like to have a definition of "actual". I appeal to the minister's instinct for French, which he uses so eloquently along with English.


Lionel Chevrier: So does the hon.
gentleman.


Robert Ross (Roy) Knight: He will know what I am getting at when I refer to the word "actual". Would it be going too far to interpret this as work already initiated? I do not think it can be right as I understand it. This work is initiated by way of agreement between the railway company and the municipality concerned.


Lionel Chevrier: Not always.


Robert Ross (Roy) Knight: Would this be work already started? Am I going too far in that interpretation of the word "actual"?


Lionel Chevrier: Let me say that "actual construction work" means work and construction with reference to the elimination of crossings; not approaches or expropriation and so forth, but that work which actually has to do with the elimination of dangerous crossings. When my hon. friend asks how it is initiated, may I say to him that it is by application to the board. The board may decide that the railway will do a portion of the work, and that the municipality will do a portion; or, as my hon. friend had in mind a moment ago, that the railway will do all the work by agreement with the municipality, the municipality reimbursing the railway for its portion of the work.


Robert Ross (Roy) Knight: That is perfectly clear.


Stanley Howard Knowles: The words, "actual construction work" do not exclude cost of materials.


Lionel Chevrier: No. I would think the phrase would include the cost of materials.


Stanley Howard Knowles: That is good.


John Ritchie MacNicol: Has the board of transport commissioners any right or authority to bring to the attention of the municipality the fact that a certain railway crossing must be protected?


Lionel Chevrier: Yes.


John Ritchie MacNicol: Recently in western Ontario, as I think the minister remembers, I believe five people-a father and four children - were wiped out at a railway crossing in Norfolk county. If the municipality in which that crossing is located does not itself soon make application for the protection of the crossing, would the board have authority to call the attention of the municipality to that
accident and ascertain whether or not they were going to make any move?


Lionel Chevrier: Yes, it would.


Eric Bowness McKay: I may have missed the minister's reply to this question, because I believe somebody asked it. It is a question pertaining to the average government grant toward the construction of these under and over passes. Can the minister give the figure for, say the last ten years, that would indicate the average cost of construction; that is, the contribution which is made toward that average cost of construction?


Lionel Chevrier: I could not give anything other than I gave a moment ago, as to the amount of money which has been spent since the grade crossing fund has been in operation.


Eric Bowness McKay: You also said that the maximum would be 8100.000.


Lionel Chevrier: For any individual
project.


Eric Bowness McKay: I was trying to get at what the average cost has been.


Lionel Chevrier: Unfortunately I have not that information.


[Stage Direction]
Section agreed to.
On section 2-Consent of municipality.
Mr. LOCKHART:: I have been waiting to ask a question. The minister cautioned us not to deal with anything that was not in the particular section being dealt with. He tried to limit us in that way. I want to ask something about this matter. It is a well-known fact that on the waterfronts and on the approaches to the larger and smaller urban centres, for some reason or another these lands seem to have passed into the hands of the railways. The more valuable approaches seem to have passed out of the hands of the municipalities. In these days subdivisions are springing up outside reasonable-sized towns and smaller cities. No more lots are left in these municipalities, and people are going outside the city or town limits seeking a block of land on which they can erect a home. Perhaps that trend has been motivated by the fact that the Veterans Land Act courted that type of thing. It was necessary to get outside the towns and cities.
Railways have been built-and I have certain locations in mind-which consist of single-track lines cutting men's farms in the centre. On one side-perhaps on the far side-a subdivision will spring up. Why is it that in the latter part of this bill there is a definite limitation placed on the land
Railway Grade Crossing Fund

owner? It appears that he is limited before he can do anything to safeguard the school children and others who sometimes cross over the single-track lines-or double-track lines in certain places-that I have in mind. People may be coming to the owner and asking him to sell them two or three acres. It is down to a minimum of two acres now under the Veterans Land Act, where the land is under $500 an acre, and three acres where it is over that amount. That provision causes an increase in population in certain of these areas. Does the owner require to go to the municipality in order to develop something that is in the interest of the protection of the children, delivery men and other people who are travelling across the railway on roads that lead to the area?
Why is it that the land owner is mentioned here in connection with drainage only? I have one particular project in mind. It seems to me that if a land owner has some legitimate purpose in mind, he should be allowed to carry it out. I have in mind one instance where the municipality did not give him any encouragement, but the people kept coming and asking him for these three-acre plots of land. Hazards were being created at four or five spots in the way of level crossings. Yet the land owner is not mentioned here. I am wondering why.


Lionel Chevrier: This subsection 6b is designed to come to the assistance of the land owners.


Norman James Macdonald Lockhart: That is on drainage.


Lionel Chevrier: Yes; or a municipality. It has nothing to do with farm crossings. My hon. friend has in mind the question of a farm crossing, where the railway has to take over in a lump some land of the farmer.


Norman James Macdonald Lockhart: No; level crossings that result from new developments.


Lionel Chevrier: There is nothing in this bill that affects that in any way. Subsection 6b has to do with the right of a municipality or a land owner who desires drainage in the area or in the farm of the land owner.


Norman James Macdonald Lockhart: Perhaps I have not made myself clear. Does this bill not cover the protection of level crossings that may be going across any railway?


Lionel Chevrier: No, it does not. The first section has to do with the payment of a certain amount of money into the railway grade crossing fund for that purpose, but the other sections of the bill have nothing to do with the first section. They are further amendments to the act.


Norman James Macdonald Lockhart: To a certain extent they are contingent. I think just a moment ago an hon. member asked a question on a matter in which I am greatly interested. I have been told that the average cost of the elimination of level crossings, either by way of overhead or underneath passes about which the hon. member spoke, ran between $30,000 and $50,000. It would seem to me that the minister's officials could quite easily say whether that is a reasonable amount.


Lionel Chevrier: It is far more than that.


Norman James Macdonald Lockhart: I have been told that the very minimum is from $30,000 to $50,000. How can $500,000 adequately take care of this ever-increasing necessity for overhead or underneath traffic? That is the thing I am concerned about.


Lionel Chevrier: I do not know whether the hon. member was in the house when I answered a question this evening. I pointed out that the railway grade crossing fund was not the only one from which payments could be made for this purpose. Over the years about $7,500,000 has been paid into the railway grade crossing fund, whereas some $45,000,000 has been spent in the elimination of grade crossings, which would indicate that protection at these dangerous crossings has been obtained from elsewhere.


Norman James Macdonald Lockhart: I am sorry I was not here. That is what I wanted to know.


Lionel Chevrier: This is one source only.


[Stage Direction]
Section agreed to.
Bill reported, read the third time and passed.


[Stage Direction]
Right Hon. J. G. GARDINER (Minister of Agriculture) moved the second reading of Bill No. 204, to amend the Prairie Farm Assistance Act, 1939.
John Ritchie MacNicol: Is the minister going to make a statement?


James Garfield Gardiner: I made a very full statement last evening on the resolution. I could only repeat it now.


Eric Bowness McKay: I think it is generally recognized that this act has brought substantial benefits to the farmers of the western provinces. It has been in force since 1939, and in that period of time the

Prairie Farm Assistance Act
provinces of Alberta and Saskatchewan have been the recipients of payments under t'he scheme during at least eight years. In recent years the payments under the act have been considerable. According to a return tabled in this house on March 18 in reply to a question I asked, the total expenditures under prairie farm assistance were indicated as being some
816,840,000	for the year 1945-46, over $11,000,000 in 1946-47, and $14,908,000 in 1947-48, up to February 24 of this year.
As we know, most of the expenditures were made in Saskatchewan and Alberta, because of repeated crop failures there. Payments in Saskatchewan in 1945-46 were over $12,000,000. In 1946-47 they were over $9,000,000, and in 1947-48 again were over 812,000,000. In Alberta the amounts were somewhat less. In
1945-	46 they were slightly over $4,000,000; in
1946-	47 they were $1,839,000, and in 1947M8, slightly over $2,000,000.
It must be borne in mind that, while the greatest expenditures under the act were in Saskatchewan, the greatest deductions in order to service the fund to provide the awards also came from that province. There have been contributions to the fund, if I may call it that, by the federal government as well. This has been necessary on several occasions because deductions from wheat deliveries in western Canada, particularly in the provinces of Manitoba, Saskatchewan and Alberta, were inadequate in certain years to meet the payments required under the act. While there have been contributions by the federal government, I think it will be quite generally agreed that this has been a much better way of handling a serious drought situation than the relief which was paid some years back.
While the Prairie Farm Assistance Act has been of great benefit to the western farmers, nevertheless several objections have been expressed to its administration. I think the minister is reasonably familiar with some of those objections, because we in this corner of the house have stated them on many occasions. The most common objection I have heard in recent times is that the coverage under the act is inadequate. Many farmers who require assistance are left out of the scheme. Large numbers of farmers feel that payments should be made on the basis of the individual farm unit in areas where crop failure is prevalent on account of drought. Too many farmers, because they are so unfortunate as not to live in the declared area of crop failure, fail to receive awards under the act, despite the fact that in many cases they live just over the section or township line from a neighbour
who does receive the bonus. In some cases farmers have had complete crop failure, as occurred in my own district; but because they lived in a non-eligible district they received nothing under the act. On the other hand, farmers in eligible districts who had as much as fifteen bushels to the acre received a bonus. To me this seems grossly unfair. There would not seem to be much fairness about an act which operates in this fashion.
There is a further objection in connection with hail damage. The act should be broadened to include payment of the bonus on an individual farm basis. There is no possibility here of placing a premium on poor farming operations by including this type of damage on an individual farm basis.
Then there are many complaints that the present payments are inadequate. Farm operating costs have gone up substantially since the inception of this act. The payments were never large enough and now, with all costs soaring, they are miserably inadequate. In my opinion, the awards under the act in districts with crop failure or low yield should be at least $5 an acre, with a maximum payment of $1,000 per farm unit rather than the present maximum of $500.
Then, because of climatic differences which result in different frequencies of crop failure, I believe the provinces should be zoned. Northern areas are not so subject to drought as the southern areas, and this is particularly true in Saskatchewan. By zoning the provinces into certain risk areas, with lower deductions in low-risk districts and higher deductions in high-risk regions, the burden of crop failure assistance would be placed on a more equitable basis.
I think some consideration should be given to the grading of wheat. This may seem a far cry from prairie farm assistance, but I think it is closely related. I believe that consideration should be given to the grading of wheat on a protein content basis. If this were done the southern districts of the western provinces-and again I refer particularly to southern Saskatchewan-would receive higher grading for their wheat because of the larger protein content and naturally, of course, better prices. This would more than take care of higher deductions necessary in the higher risk area of southern Saskatchewan.
The bonus is woefully inadequate. If wheat yields are less than four bushels to the acre I think we must assume that it is virtually a crop failure. A payment up to a maximum of S500 per farm unit is certainly insufficient in a case of that kind to cover bare living expenses over the winter months; much less
Prairie Farm Assistance Act

to provide anything for the purchase of seed grain in the spring and fuel for spring operations. It has happened before, and it is now happening again that, because of this situation, many farmers are forced to go to the bank and borrow money to put in their crops. If the farmer again faces a crop failure the next year, it is quite conceivable that he will be placed in such a position of accumulative debt that he will be unable to carry on.
I appeal to the minister to consider payments on an individual basis, an increased bonus, and zoning which would place the operation of the act on a much sounder and more equitable basis.


Mr. VICTOR QUELCH (Acadiia):: Mr. Speaker, I find myself in agreement with much that was said by the last speaker. While it may be said that the amendments in the bill will improve the Prairie Farm Assistance Act, nevertheless they are of a very minor character. The bill falls far short of what is required in order to put the act on an equitable basis.
Since the passage of the Prairie Farm Assistance Act in 1939, many amendments have been made to it. And while, generally speaking, I think it may be said that these amendments have all been to the advantage of farmers, nevertheless many undesirable anomalies still remain in the act. The purpose of the Prairie Farm Assistance Act is to give assistance to farmers suffering crop failure due largely to climatic conditions. Yet we find, under the operation of the act, that many farmers suffering total crop failure are not able to get any assistance under the act, while at the same time many other farmers with fairly good crops are able to obtain the drought bonus.
I suggest that it should be a comparably simple matter at least to a very large degree to rectify that undesirable situation. For example, we have suggested time and again that the bonus should be paid on the individual farm unit basis. In the past the minister has invariably opposed that suggestion, on three main grounds. First of all, he has opposed it on the ground that it would encourage the cultivation of marginal lands. Secondly, he has suggested that it would be subsidizing in many cases poor farming; and, thirdly, he has suggested that where you have small units of land which fail to become eligible for the bonus the provinces might very well look after such areas.
Since the minister has in the past made it quite clear that the government will not accept the individual farm unit as a satisfactory basis, I should like to quote a resolution passed at the annual convention of the Alberta
Social Credit League last November, dealing with this question. I quote as follows:
_ Whereas the Prairie Farm Assistance Act provides that the bonus may be paid on a rectangular block of sections of land having an area of not less than nine sections, one side of which lies alongside the boundary of an eligible township; and
Whereas this deprives farmers of the benefits of the bonus, where their land lies adjacent to an eligible township, but in a block of less than nine sections; and
Whereas it deprives farmers of the bonus where their land may be adjacent to an eligible block but outside the rectangle:
Therefore be it resolved that the federal government be asked to amend section 7 (b) of the Prairie Farm Assistance Act so that any area of nine contiguous sections or more shall be eligible for the bonus regardless of whether the area is intersected by a township line, where the average yield is less than ten bushels.
I would say that if the government are not prepared to go even that far, then at least we should adopt the principle within the act that no block of sections of land shall be deprived of the benefits of the act purely on the ground that that block of land is separated from another block by a township line.
Let me explain what I mean. As the situation is at the present time the government will not pay a bonus on an area of less than nine sections of land in a rectangular block. The minister has given the excuse that it would encourage the cultivation of marginal land; and apparently there is some force in that argument. I will admit that there is something in his argument. But how can the minister justify refusing to pay the bonus on a block of land because it is too large, or on even part of a block of land because the total block is too large? For instance, let us consider a block of land six miles by six miles- a township. The bonus can be paid on the thirty-six sections of land. On the other hand, if you have a block of land six miles by seven miles, containing forty-two sections, the bonus can be paid only on part of that block. In that case the minister is not in a position to use the argument that it would be encouraging the cultivation of marginal land if it were paid on the whole of the block.
In those circumstances the minister must then fall back on the argument that, where you have a small piece of land outside a township, it should become the responsibility of the provincial government. I would say that if that principle were adopted there would be a tremendous amount of confusion. We would find a great deal of passing the buck, the province saying that a piece of land is the responsibility of the federal government, and

Prairie Farm Assistance Act
Ihe federal government saying that a piece of land is the responsibility of the provincial government.
Secondly, where would a provincial government get the money to pay that bonus? They are not in the fortunate position of being able to get whatever revenues are required, as is the federal government. I think the chief point to remember is that this is a federal act, and it is, therefore, a federal responsibility.
I say that because we must remember that the dry areas of the west were largely opened for settlement by the federal government at a time when the natural resources were under their control. In spite of the fact that they were warned time and again by engineers and surveyors back in the 1800's that certain lands were not suitable for settlement, they allowed farmers to come into those areas and settle. Ever since that time we have had many tragic eases where farmers have found it impossible to make a living because of drought.
For instance, I have in mind the constituency of Acadia, which I represent. I do not believe I am exaggerating when I say that 60 per cent of that constituency is in the semipermanent drought area, and that over < 0 per cent of the population of that district have moved out on account of drought.
There is another way in which the government could help the farmers that are under the Prairie Farm Assistance Act, and it is this. For instance, in the constituency of Acadia back in 1922 a survey was made in connection with what was known as the William Pearce stock watering project, under which a million and a half acres could have been irrigated. Ever since that time the government has encouraged the people to believe that irrigation would be carried out in that. area. Then today there is the Red Deer diversion project, the surveys of which have been completed. Agreement with the province has been reached and everything is ready to go ahead. All that is required is for the federal government to let the contracts and start work on the project. Over half a million acres could be irrigated.


James Garfield Gardiner: We are getting a long way from this bill, but I want to say that that statement is not correct.


Victor Quelch: What statement?


James Garfield Gardiner: That all we have to do is to let the contract. We have not yet the arrangements signed up with the provinces.


Victor Quelch: Agreement has been reached with the province of Alberta.


James Garfield Gardiner: That has nothing to do with this bill.


Victor Quelch: You said the statement was not correct, but at least agreement has been reached with the province of Alberta. They will be only too glad to sign an agreement with the federal government.


James Garfield Gardiner: Agreements have not been reached with the provinces and none of them has been signed. They have not been signed because of Manitoba. However I do not want to discuss that question tonight.


William Ross Macdonald: I understand that those agreements have nothing to do with the bill we are considering. I suggest that the hon. member discuss the principle of this bill.


Victor Quelch: I only mentioned that fact to show that-


James Garfield Gardiner: It is not a fact.


Victor Quelch: What is not a fact?


James Garfield Gardiner: The statement you made is not a fact.


Victor Quelch: You are trying to start the argument over again. I am quite prepared to go on with the argument if Mr. Speaker will allow me. I understand that the province has co-operated with the federal government in every way; but, as the minister himself says, the trouble is that an agreement cannot be reached with Manitoba.


James Garfield Gardiner: If we are to discuss this question let us discuss it some time when we can answer the questions. Those statements are not correct.
Mr. QUELCH- Then do not interrupt me any more on that score. The only reason I referred to irrigation was that we realized we have a serious drought problem in that. area. That drought problem will continue until such time as we have irrigation. The same thing applies to Saskatchewan. It would relieve the government of paying out a lot of money under the Prairie Farm Assistance Act. I am not suggesting for one minute that it would eliminate the need for the act, but at least it would reduce the amount of money that would have to be paid out.
I take it that the real reason for the failure of the government to be willing to pay the bonus on an individual basis is the increased cost to the federal government. I recall back in 1939 when this act was first introduced. At that time the Hon. Charles Dunning stated that if the act had been in operation during the 1920's he believed that it would have been
Prairie Farm Assistance Act

possible to build up a sufficient reserve to carry on during the poor years. I doubt personally whether that would have been so, but I think we can all agree that there is little chance of the act paying its way from now on. So long as the act remains in force, a certain amount of money will have to be paid out every year in addition to what is obtained under the one per cent levy; that is, unless irrigation is proceeded with.
I suggest that if the matter of cost is holding the government back from paying the bonus on an individual basis-and I think it will continue to hold the government back so long as we continue to operate under our present financial system-we should pay the bonus to all farmers who have a crop failure and stop paying it to those farmers who have a fairly good crop. At the present time section 7(a) of the act provides the means by which the bonus need not be paid to a certain number of farmers who have fairly good crops. It provides that, where you have a block of sections or a quarter of a township or more with an average yield of over fourteen bushels per acre, one side of which is alongside an ineligible township, then that block can be taken out of the township and the bonus not paid.
I should like to see that section eliminated from the act. I call it a vicious section. It results in turning one farmer against another and causing a lot of bad feeling within a township. Where you have a township with an average yield of around, say eight bushels per acre, and the bonus has to be paid on that basis, if in part of that township the yield is less than four bushels, those farmers whose yield is less than four bushels start to agitate that a block of nine sections in another part of the township be taken over if the yield is over fourteen bushels in order to raise the amount of bonus paid to them. I have just had a case of that kind which I drew to the attention of the minister.
There is another reason why I dislike that section. In this case it is because of the way in which the section is administered rather than the section itself. I had a case two years ago where a block of nine sections was taken out with an average yield of over fourteen bushels per acre. But in that block of nine sections there were only six sections which had a high yield. They had yields of over twenty bushels per acre. In order to be able to take the nine sections out, it became necessary to include three sections which had had nearly a total crop failure. But by adding those three sections to the six it still left the average yield over fourteen bushels. I protested at the action, 
and all the officials could say to me was, "Well, if you will recommend it, we will add another three instead of the three we are taking". If I had suggested that I would have immediately become very unpopular with the fanners in the three sections which I had suggested should be included with the six instead of the other three.
I would suggest that when section 7(a) of the act is brought into force it should be applied only to the land that has had a yield of over fourteen bushels per acre. Officials should not be allowed to include in the block any land on which there has been a total crop failure, as I know was done in one case, or any land with an average yield of less than eight bushels per acre. That is why I think section 7(a) should be repealed.
Where it is desired to stop the payment of the bonus, it should be done on an individual basis. Where a section of land has had a crop of over fourteen bushels to the acre the bonus should be stopped on that section. On the other hand, the bonus should be paid on every section of land that has had a crop failure, whether it is in a block of nine sections or not. It is only in that way that we can ensure that the farmer with a crop failure will get paid. It would ensure that whatever money was paid out would be paid to those with crop failures.
^ Mr. RONALD MOORE (Churchill): Mr. Speaker, I do not intend to speak at any length on this measure, but in the past two years I have received quite a number of representations from farmers in the southern part of my constituency complaining about the operation of the Prairie Farm Assistance Act. Hon. members are no doubt aware that the main purpose of this act is to serve the farming districts in the southern part of the prairie provinces. It was designed particularly to meet farming conditions on the prairies.
In that area the yield per acre is comparatively low and the areas in which failures take place are quite large. But as you go north a different situation develops. Better moisture conditions result in a higher yield and the areas in which failure takes place are much smaller. In the Swan river valley and in the Dauphin area we find that failures are comparatively small and occur in small areas; yet the farmers in those districts pay the same rates under P.F.A.A. as are paid in the southern districts. But the benefits they get from the act in the north are limited indeed. I have personally met a number of farmers who have had a crop failure and who have been unable to get benefits under the act, although they had

Prairie Farm Assistance Act
contributed for a period of years. The farmers in the two areas mentioned are anxious to have amendments brought in whereby any failure which takes place in those areas will be subject to benefits under the act. Those benefits should be paid on the individual crop basis. In some districts there may be only one farmer to suffer a farm crop failure in any one year and they would like to see the act amended to provide that the individual farmer would be entitled to benefits under the act.
A number of them have also expressed the feeling that, since failures in the north are comparatively rare, benefits should also be paid for damage by hail and frost. I am not going to state that this could be included as the act now stands, but it is something to which the Department of Agriculture ought to give consideration, since the amount of money which is collected in these areas is far in excess of the money paid out there.
I am inclined to agree with the suggestion that was made a short time ago, that a zoning system should be devised whereby payments could be made to cover a much smaller area than is now the case.
Mr. E. G. MeCULLOUGH (Assiniboia): Mr. Speaker, I have some extended remarks to make on this amendment to the Prairie Farm Assistance Act. I agree with the arguments put forward by previous speakers, and I am in complete agreement with the hon. member for Weyburn (Mr. McKay) when he said that under present conditions the act does not meet the needs for which it was set up. For that reason I feel that definite changes should be made in the act and its scope be enlarged to make it a comprehensive crop insurance scheme which would be available to those engaged in agriculture all across this country, instead of being confined to giving assistance to the western farmers.
This act was introduced in 1939 for two obvious reasons: first, because parliament and the government of the day saw the need for giving some sort of assistance, or I should say crop insurance, to the prairie provinces, where during many years, particularly in the 1930's, there had been a succession of crop failures through no fault on the part of the farmers but on account of weather and other conditions beyond their control.
I feel that the scope of this legislation does not meet the needs of our Canadian farmers. We have seen agricultural income fluctuate from year to year as much as 200 and 300 per cent, and while the act has been of
tremendous assistance to our prairie farmers it does not meet the needs of a crop insurance plan. I would draw to the attention of hon. members that from 1938 to 1940 one-half of our farm operators in the prairie provinces received less than $500 per unit; that is, their income including income in kind was less than $500. So it is clear that in the. prairie provinces there is a tremendous fluctuation in farm income, and that reflects itself in the standard of living of our people. The result is that in many sections we have what might be called depressed areas, and this fluctuation in farm income means a lower standard of living also for our merchants and businessmen and jeopardizes their business.
What we need is not just assistance to our prairie farmers but a federal over-all policy of crop insurance, comprehensive in scope and integrated with provincial schemes across the country so that our agriculturists will be assured of income in case of a crop loss. Such an over-all policy would have to have regard, first, to the man on the producer end, so that we would have produced in Canada a maximum of agricultural consumer goods. Secondly, it would have to establish a stable income for our agricultural workers comparable with that of workers in well-established urban industries. Thirdly, it should provide for a maximum production for export. The act in its present scope is so narrow that only in case of a disastrous drought do we get any assistance whatever, and that assistance does not in any way provide adequate help for our farmers in maintaining maximum production.
On motion of Mr. McCullough (Assiniboia) the debate was adjourned.



BUSINESS OF THE HOUSE

Howard Charles Green: What will be the business for tomorrow?


Lionel Chevrier: First, we shall resume the adjourned debate on the motion of the Minister of Finance for committee of supply, with the amendment of the leader of the C.C.F. and the subamendment of the leader of the opposition. I should like to remind the house that we have now spent six days on this debate and we hope, with the co-operation of hon. members, to conclude it tomorrow. Next, the second reading of Bill No. 204, to amend the Prairie Farm Assistance Act, which we have been discussing tonight; the second reading of Bill No. 203, to amend the Unemployment Insurance Act, and the second reading of Bill No. 198, to amend the Dominion Elections Act.
Business of the House


John Ritchie MacNicol: Will they be taken in that order?


Lionel Chevrier: Not necessarily, but I hope that will be the order. In any event, the
first item of business will be resuming the debate on the motion for committee of supply.


[Stage Direction]
At eleven o'clock the house adjourned, without question put, pursuant to standing order.
[Stage Direction]
Wednesday, April 21, 1948