1949-03-23

Mr. Jean Frangois Poulioi (Temiscouata):: Mr. Speaker, as chairman of the debates committee of the House of Commons I rise to say a word about a noncontentious matter, namely, the publication of Hansard of yesterday, with the full speech of the Minister of Finance and a lengthy appendix. Every hon. member has before him this morning the English text of Hansard in book form, including the speech of the Minister of Finance, with seven tabulations, an appendix, fifty-two other tabulations and eleven full pages of supplementary detailed tables.
It is my great pleasure to pay a special tribute to the king's printer and to the whole staff. Sometimes we have to complain about certain things, but at this time the whole personnel of the printing bureau deserves special praise. The work could not have been done anywhere else except in the printing department of the New York Times-and my remark applies to the whole of North America. I know of no other place where such a piece of work could have been done so well and so expeditiously.- I do not pay a tribute only to the higher-ups of the printing bureau-they deserve it; but I have in mind also the humble typesetter and proofreader. I know what it is to publish books, and this book, sir, is a credit to the members of the staff of the printing bureau. I hope that the minister will tell them it is the desire of the house to praise them and to encourage them to continue to do such fine work in the future.


Hon. Colin Gibson (Secretary of State):: thank the hon. member for Temiscouata (Mr. Pouliot) for bringing to the attention of the house the splendid work which is being done by the employees of the printing bureau. I shall be glad to inform them of his comments in that regard. I have often felt that hon. members do not realize that the members of the night staff of the printing bureau work month after month from ten o'clock until eight in the morning, at very high pressure and in difficult surroundings. The hon. member's word of tribute to these men will be appreciated.
Mr. M. J. Cold well (Roselown-Biggar): The
Hansard staff should be included as well for the remarkable job they do.


Mr. J. T. Richard (Otlawa Easi):: I want to join in the remarks made by the hon. member for Temiscouata. We should add the translators, who are also the unsung heroes in a historical document of this kind.



PRIVILEGE, MR. DIEFENBAKER-REFERENCE TO NOTICE OF MOTION OF MR. LACROIX   STATEMENT OF MR. SPEAKER

Mr. Speaker:: I should like to make a statement to the house following the remarks made by the hon. member for Lake Centre (Mr. Diefenbaker) who raised a question of privilege which will be found in the official report of the debates of the House of Commons of Tuesday, March 22, 1949, at page 1745. I call the attention of hon. members to the following paragraph:
My point of privilege is this, sir. Did you, in your position as Speaker, consent to the alteration of this resolution? Was it placed before the house, or was the alteration made at the request of the government?
The hon. member for Quebec-Montmorency (Mr. LaCroix) gave notice on Friday, March 18, that he would move the following resolution:
That, in the opinion of this house, the government should seek the co-operation of the provinces with the view of the adoption by parliament of a new constitution for Canada and Canadians which would be a statute of Canada repealing the British North America Acts, 1867 to 1946, resulting in the making of Canada a truly sovereign and independent nation, a separate republic outside of the British commonwealth of nations, free of economic or other commitments, whether in peace or in war.
This notice of motion appeared word for word on the order paper of Monday, March 21, but it was altered on the hon. member's instruction, and appears with material changes on the order paper of Tuesday, March 22. The hon. member for Lake Centre drew attention to the fact that the proposed resolution had been mutilated to read as follows:
That, in the opinion of this house, the government should seek the consent of the provinces with the view of the adoption by parliament of a new constitution for Canada and Canadians which would be a statute of Canada repealing the British North America Acts, 1867 to 1946, resulting in the making of Canada a truly sovereign and independent nation, a separate republic, free of economic or other commitments toward the British commonwealth of nations, whether in peace or in war.

House of Commons
The question has arisen whether or not the alteration was so material that it could not be made before the motion was taken up by the house. Mr. Speaker Lemieux decided on March 26, 1928, that a motion which differs materially from the terms of the notice can only be proposed with the consent of the house, or upon the renewal of the notice. I agree with that ruling.
The change was made at the request of the hon. member for Quebec-Montmorency, but crutside my knowledge. My own opinion is that the notice of motion should not have been placed on the order paper at all. Its proposal that this parliament, constituted under the British North America Act, take upon itself to adopt a new constitution resulting in making Canada a separate republic outside of the British commonwealth of nations comes in direct conflict with the oath taken by members of this house, which oath is as follows:
I do swear that I will be faithful and bear true allegiance to His Majesty King George VI.
May says, as quoted in citation 365 of Beauchesne's second edition, that:
When a notice, publicly given, is obviously irregular or unbecoming, the Speaker has interposed and the notice has not been received in that form. He has also directed that a notice of motion should not be printed as being obviously designed to give annoyance.
I have no doubt in saying the notice of motion should not appear on the order paper, and, using my authority as the custodian of our procedure, I have given the necessary instructions to strike it out of the order paper.



ARRANGEMENTS FOR DEBATE ON NORTH ATLANTIC TREATY

[Stage Direction]
On the orders of the day:
Mr. George A. Drew (Leader of Ihe Opposition):: Is the Prime Minister in a position to indicate on what day the debate is to open on the North Atlantic treaty?


Right Hon. L. S. St. Laurent (Prime Minister):: No, not this morning. I had hoped it might be possible to reach it this week, although now that does not appear to be probable. There is the emergency legislation which has to be dealt with if it is not to be allowed to expire by lapse of time. Just as soon as that is disposed of, I think we should provide an opportunity for an initial debate on the North Atlantic treaty in accordance with the terms of the motion which is on the order paper. I should like to have that matter discussed as soon as we have disposed of these emergency measures.


George Alexander Drew: The subject matter is of considerable importance, and hon. members will wish to arrange to be here. They all have 
their own arrangements which they are making from time to time. I think the time for the debate can best be arranged between the party whips by setting a definite date a few days in advance. I suggest therefore that the debate should not come on without due warning; hon. members should have an opportunity to make appropriate arrangements.


Louis Stephen St-Laurent: I shall bear in mind the observations of the hon. member, and try to arrange it so that there will be due notice to all members of the time at which the debate will begin.


Mr. Maclnnis:: Is it not a fact that members of the house are paid $6,000 a year to be here?



SITTING ON SATURDAY, MARCH 26

[Stage Direction]
On the orders of the day:
Mr. Solon E. Low (Peace River):: I should like to ask the Prime Minister whether it is the intention to have the house sit on Saturday if we finish the emergency legislation by Friday night.


Louis Stephen St-Laurent: No. The form of the motion indicated that it was only for the purpose of disposing of matters which had to be dealt with before the expiry date of the existing legislation that this departure from the standing orders was requested. If we are successful in disposing of that legislation by Friday night, there will be no reason for asking hon. members to sit on Saturday.


Mr. Knowles:: The order would lapse.


Louis Stephen St-Laurent: The order would lapse.



AUDIBILITY OF DEBATE


[Stage Direction]
On the orders of the day:
George Alexander Drew: I should like to raise a question that was raised earlier in the session, and the importance of which I think was emphasized again only yesterday when one of the members-I feel sure quite sincerely-indicated that he could not hear your voice, Mr. Speaker. Your voice, sir, carries particularly well through this chamber. It is a matter of concern to everyone here that members who speak cannot be heard-perhaps not because of their voices, but because when one speaks from under the galleries there is a deadening effect which muffles the voice to such an extent that it cannot be heard, although it may be a perfectly strong and resonant voice.
I suggest that serious consideration be given to a suggestion made earlier, that amplifying

devices be installed in this chamber, which unquestionably has acoustic dead spots. The legislature of Manitoba has had much success with small microphones which are put on each desk. They are relatively inexpensive, and they carry the voice of the speaker to every part of the chamber.
In raising this point again, may I remind you, Mr. Speaker, that, in addition to the microphones on the table in front of the Speaker of the House of Commons in London, there are microphones suspended by wires to carry voices throughout the house. The acoustic properties there are infinitely better than they are here. In fairness to the members, and in the interests of proper debate, I strongly urge that you consider the installation, even if only experimentally, of some system which will enable the voices of members to be heard in all parts of the house.
I feel sure that one of the companies which handles equipment of this kind would be glad to do it on an experimental basis.


Mr. Speaker:: I should like to say to the house that I have discussed the matter with the best firms in Canada who have to do with equipment of this kind. They agree with me that so far we have not reached a conclusion which would result in a method satisfactory to the house. It is with pleasure, however, that I say to hon. members that I hope that during the Easter recess certain experiments will be made in the house to see if we cannot succeed in providing a system which will give satisfaction.



PUBLIC ACCOUNTS


Hon. Douglas Abbott (Minister of Finance) moved:: That the public accounts of Canada for the fiscal year ended March 31, 1948, and the report of the auditor general, be referred to the public accounts committee.


[Stage Direction]
Motion agreed to.


[Stage Direction]
Bill No. 88 for the relief of Gordon Aylmer Thistle Shirres.-Mr. Winkler.
Bill No. 89 for the relief of Walter Jasper Blake.-Mr. Winkler.
Bill No. 90 for the relief of Margaret Murray McKinnon Trenholm.-Mr. Winkler.
Bill No. 91 for the relief of Walter Wilson McBroom.-Mr. Winkler.
Bill No. 92 for the relief of Mabel Florence Dunk Wright.-Mr. Winkler.
Bill No. 93 for the relief of Thomas Somerville.-Mr. MacLean.
Questions
Bill No. 94 for the relief of Joseph Wilfrid Leon Desrosiers.-Mr. Winkler.
Bill No. 95 for the relief of June Lucille Odell Woolnough.-Mr. Winkler.
Bill No. 96 for the relief of Christopher Edmond Cobham.-Mr. Winkler.
Bill No. 97 for the relief of Jack Zelinsky. -Mr. Emmerson.

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


Mr. Fraser:: 1.	Have any displaced persons with university degrees been employed by the National Research Council?
2.	If so, what are their (a) names; (b) date of arrival in Canada of each employee; (c) date that employment commenced in each case; (d) salary paid to each of these employees?


Mr. Mcllrailh:: 1.	No.
2.	Answered by No. 1.



* CANADIAN COMMERCIAL CORPORATION

Mr. Fulton:: What is the total of (a) all advances made to the Canadian Commercial Corporation since it was first set up; (b) all moneys advanced by the Canadian Commercial Corporation since it commenced operation?


Mr. Mcllrailh:: Mr. Speaker, it has been difficult to understand clearly what is meant by the second part of this question. I have taken the liberty of discussing it with the hon. member for Kamloops (Mr. Fulton), and I understand that by the word "advances" in paragraph (a) of the question he is referring to the amount of money on deposit with the corporation from the Minister of Finance. That amount is $3,500,000.
Part (b) of the question which asks for the total of all moneys advanced by the Canadian Commercial Corporation since it commenced operation, is, I take it, concerned with the revenues of the corporation. The gross operating revenues received with respect to purchases made on behalf of the Department of National Defence amounted to $1,170,264 as of December 31, 1948. With respect to purchases made on behalf of others, as of the same date the amount is $1,303,798, making a total of $2,473,972.


Mr. Speaker:: Answered.



PRAIRIE FARM ASSISTANCE


Mr. Campbell:: What farmers received Prairie Farm Assistance Act payments in township 45, ranges 27 and 28, west of the 3rd meridian, in the years 1946, 1947 and 1948?

Questions


Mr. Gardiner:: I would ask the hon. member, if he does not mind, to drop this question. We have taken great care to avoid publishing payments made to individuals under the Prairie Farm Assistance Act, the reason being that in the beginning strong pressure was brought to bear to permit of these payments being garnisheed. We have had requests from time to time to make public the names and amounts, and have always objected to doing so. We would have no objection to an hon. member getting the information, and I believe such information could be given as to individual cases, or even as to groups. We have always contended, however, that it would not be in the interests of individuals to have these lists of names published.


Alexander Maxwell (Max) Campbell: I received a complaint from one farmer in my area to the effect that his name had been left off the list to receive payments. My reason for asking the question was to determine the accuracy of his statement that his name had been left off.


James Garfield Gardiner: We will give the hon. member the information about that one individual.


Mr. Speaker:: Dropped.



MOUNTED POLICE


Mr. Black (Cumberland):: 1.	In what places In Canada has the Royal Canadian Mounted Police musical ride given performances in each of the fiscal years 1946-47, 1947-48, 1948-49?
2.	What was the cost of giving each of these performances?
3.	What were the receipts from each performance?


Mr. Garson:: 1.	In 1946-47, none; 1947-48, none; 1948-49, Toronto, Ontario.
2.	1946-47, 1947-48, 1948-49, nil.
3.	1946-47, 1947-48, 1948-49, nil.




Mr. Black (Cumberland):: 1.	In what places in Canada has the Royal Canadian Mounted Police military band given performances in each of the fiscal years 1946-47; 1947-48, 1948-49?
2.	What was the cost of giving each of these performances?
3.	What were the receipts from each performance? Mr. Garson:
1.	During 1946-47; Ottawa; Montreal; Shawbridge, P.Q.; Cornwall, Ont.; Hull, P.Q.
During 1947-48: Ottawa; Alfred, Ont.; Shawbridge, P.Q.; Aylmer, P.Q.; Montreal.
During 1948-49: Ottawa; Alfred, Ont.; Montreal and a recruiting drive at Edmonton, Red Deer, Calgary, High River, Macleod, Lethbridge and Medicine Hat in Alberta. At Maple Creek, Swift Current, Moose Jaw,

Regina, Weybum, Saskatoon, North Battle-ford, Prince Albert and Yorkton in Saskatchewan. At Dauphin, Wasagaming, Brandon, Portage la Prairie and Winnipeg in Manitoba.
2.	1946-47, nil; 1947-48, nil; 1948-49, nil, except for the recruiting drive, which cost $5,600.21.
3.	Nil.



CROWN COMPANIES


Mr. Merritt:: 1.	When did Northern Transportation Company become a crown company?
2.	As at date of acquisition and at December 31, 1948, what was (a) the value of the fixed assets of the company; (b) the amount of its reserve for depreciation; (c) the rate of depreciation permitted to the company, and by what authority was such rate paid or approved?
3.	What is the total of advances of public funds to this company directly or through its parent company Eldorado Mining and Refining Company since acquisition as a crown company to December 31, 1948?
4.	What is the total revenue of the company in each year since acquisition as a crown company attributable to (a) government contracts; (b) contracts with its parent company; (c) private contracts?
5.	Does the company carry on any business other than a transportation business, and if so, what other business?


Mr. Mcllrailh:: 1.	The shares of Eldorado Mining and Refining Limited were appropriated by His Majesty the King in the right of Canada as of January 28, 1944. As of that date, all of the outstanding shares of Northern Transportation Company, with the exception of directors' qualifying shares, were owned by Eldorado Northern Transportation Company Limited, and as of that date therefore came under the control of the government.
2.	The value of the fixed assets of the company and the amount of its reserve for depreciation as of January 1, 1944, and as of December 31, 1948, was as follows:
Jan. 1, 1944 Dec. 31, 1948 Fixed assets ...	$785,463 08 $3,823,216 01
Depreciation
Reserve	 360,688 85	1,403,073 08
$424,774 23	$2,420,142 93
The rates of depreciation used by the company vary according to the type of assets to be depreciated. Such rates are in conformity with income tax regulations with respect to depreciation.
3.	$1,859,015.07.
4.	Northern Transportation Company (1947) Limited is a carrier licensed by the board of transport commissioners, and operates under the jurisdiction of the board with respect to

rates and tariffs. As the company's tariffs are published, it does not carry freight under contract.
5.	No.



STARCH-PRODUCTION AND IMPORTS

Mr. Blackmore:: 1.	What is the total amount in tons of (a) starch; (b) flour, manufactured from potatoes in Canada in each of the years 1946, 1947, 1948?
2.	What is the total amount in tons of starch made from corn imported into Canada from dollar areas, during each of the years 1946, 1947, 1948?


Mr. Mcllrailh:: 1.	(a) and (b) cannot be shown separately. Production of potato starch and flour in Canada: 1946, 2,326 tons; 1947, 6,387 tons; 1948, not yet available.
2.	Information not available.



CANADIAN PACIFIC RAILWAY


Mr. Thaicher:: 1.	Has any request been made to the board of transport commissioners, to keep the C.P.R. station at Keeler, Saskatchewan, opened throughout the year?
2.	Has this action been agreed upon?
3.	If not, for what reasons?


Mr. Chevrier:: 1.	Yes.
2.	No.
3.	The earnings at this station do not warrant the appointment of a full-time agent at the present time.
ROYAL COMMISSION ON PRICES Mr. Maclnnis:
1.	Who are the members of the royal commission on prices for 1948?
~ 2. How much was paid to each for (a) salary; (b) traveling and living expenses; (c) what was the per diem rate of remuneration?
3.	How many persons were employed by the royal commission on prices for 1948?
4.	What are the names of such persons?
5.	How much was paid to each for (a) salary; (b) traveling and living expenses; (c) what was the per diem rate of remuneration?
6.	Has the commission finished its work? If so, when?
7.	Has the commission made a report?


Mr. Reid:: 1 and 2.
Professor C. A. Curtis	
Mrs. T. W. Sutherland	
Mr. H. C. Bois	
2 (b)
Professor C. A. Curtis..	$1,078.01
Mrs. T. W. Sutherland. 2,282.30 Mr. H. C. Bois	 524.68
2 (a)

3.	Thirteen persons.
23, 1949	1883
Questions
4 and 5.	5 (a)
A. G. S. Griffin	 (*)
Miss M. A. Mosley	 (t)
H. A. Dyde	$14,250.00
J. G. Dubroy	 1,210.00
Marcel Caron	 5,425.00
J. R. Wilson	 2,540.00
Mrs. Pearl Edey	 961.70
Mrs. Muriel Dowe	 961.70
Mrs. Louise Gratton	 749.30
Miss Jennie Johnstone	 684.40
Miss Monique Lafontaine	 938.10
Leo Lascelle	 938.10
Mrs. Mabel E. Unger	 926.30
(*) On loan to the royal commission on prices from the Department of External Affairs.
(t) On loan to the royal commission on prices from the Department of Secretary of State.
	5(b)	5 (c)
A. G. S. Griffin	$ 562.71	NilMiss M. A. Mosley..	Nil	NilH. A. Dyde 	2,263.86	$125.00J. G. Dubroy	Nil	10.00Marcel Caron 	1,226.40	70.00J. R. Wilson 	657.92	125.00Mrs. Pearl Edey....	Nil	5.90Mrs. Muriel Dowe....	Nil	5.90Mrs. Louise Gratton. .	Nil	5.90Miss Jennie Johnstone	Nil	5.90Miss Monique Lafontaine	Nil	5.90Leo Lascelle	Nil	5.90Mrs. Mabel E. Unger	Nil	5.906.	The last session of the commission was held December 16, 1948. Since that time the members have been occupied in writing the final report.7.	The report is in process of printing.



HOUSING


Mr. Irvine:: 1.	How many houses are being built for the federal government at the Fort St. John airport in British Columbia?
2.	Were tenders called for the contract to build these houses?
3.	If so, how many tenders were submitted and by whom?
4.	What was the amount of the contract as awarded?
5.	If tenders were not called, why were they not called?
6.	If tenders were not called, on what basis was the contract awarded?


Mr. Mcllrailh:: 1. 20.
2.	No.
3.	Answered by No. 2.
4.	$302,925 (including water service, sewers, roads and electric hook-up).

Questions
5.	It was apparent in the latter part of 1948 that every effort should be made to complete as many of these houses as possible before winter. Because of this and of the inaccessibility of the site it was considered expedient to negotiate for their construction with a firm in the general vicinity known to have had experience in construction in this territory and believed to be most capable of carrying out the work satisfactorily within a minimum of time.
6.	Contract awarded on a cost plus, a fixed fee basis. Estimated cost of work to be $288,500, fixed fee based on 5 per cent of estimated cost=$14,425.



PUBLIC WORKS


Mr. Miller:: 1.	What are the names of the employees or other persons who acted on behalf of the Department of Public Works in connection with the leasing of the Cadomin building. Main street, Winnipeg. Manitoba, in July and August, 1947?
2.	What are the terms of this lease?


Mr. Fournier (Hull):: 1.	W. F. Cherry, Ottawa.
2.	Premises, Cadomin building, 276-286 Main street, Winnipeg, Man.
Area, 25,518 square feet.
Rent, $40,046 per annum.
Term, ten years from February 1, 1948.
Lessor, United Realty Limited, C.P.R. building, Winnipeg, Man.
Lessor attends to large repairs, pays taxes, water rates, heating and provides toilet accommodation.
Crown attends to minor repairs, provides lighting, cleaning and janitor service.




Mr. Miller:: 1.	What are the names of the employees or other persons who acted on behalf of the Department of Public Works in connection with the purchase of a site for the proposed new post office in the city of Winnipeg, Manitoba?
2.	What properties have been purchased by the government for such post office?
3.	From whom were such purchases made and at what price or prices?


Mr. Fournier (Hull):: 1.	W. F. Cherry, Ottawa; H. R. Veals, Winnipeg; David Slater Limited, Winnipeg; F. E. Ernst, Winnipeg; Hugh Phillips, K.C., Winnipeg.
2.	Order in council P.C. 1024 dated March 11, 1948, authorized expropriation of the city block bounded by Graham avenue, Smith street, St. Mary's avenue and Garry street as the site for the proposed new post office building.

3. Three properties purchased as follows: Mrs. Rose Bendman, Winnipeg, $10,000; Carlton Realty Co., Limited, Winnipeg, $85,000; Hon. H. A. Mullins, Toronto, $8,500. Negotiations not completed on the remaining thirteen properties.



HOUSING


Mr. MacLean:: 1.	Is the federal government assisting In any program to study rural housing conditions in the maritime provinces, with a view to improving them?
2.	If so, what is the nature of the assistance?


Mr. Winters:: 1.	The Central Mortgage and Housing Corporation is assisting in a program for the study of rural housing conditions in the maritime provinces.
2.	Under the terms of part V of the National Housing Act the Central Mortgage and Housing Corporation has made a grant of $2,915 towards the expenses of the program of the maritime rural housing committee for 1949. This sum is 55 per cent of the budget of the maritime rural housing committee, the remaining 45 per cent being contributed by the provinces of New Brunswick, Nova Scotia and Prince Edward Island.
The program of the maritime rural housing committee is modeled on that of the prairie rural housing committee whose work has proved so useful. The committee is composed of representatives of the three maritime governments together with one representative from the federal Department of Agriculture, one representative of the farm women's institute in each of the three provinces and the maritime supervisor of Central Mortgage and Housing Corporation.
In addition to the grant made for the research being done by the committee the Central Mortgage and Housing Corporation also makes available the services of its regional secretary to act as secretary-treasurer of the maritime rural housing committee.



SOLDIER SETTLERS


Mr. Diefenbaker:: 1.	Are restrictions being imposed or payments being demanded in connection with the return of mineral rights on lands held by the soldier settlers?
2.	If so, what terms are being imposed and what is the justification or authority therefor?


Mr. Mutch:: No restrictions are imposed. The only lands affected are those where at the time of acquirement of surface rights by the soldier settlement board, the mines and mineral rights were also acquired. In cases where title to the land has already been transferred to a soldier settler or his heirs, the mineral rights are being transferred on payment of $25; where the settler has not yet

obtained title to the land, transfer of the mineral rights is subject to payment of his outstanding indebtedness to the director plus a nominal fee of $1. Mines and minerals are conveyed to the soldier settler or his heirs under authority in each case of an order in council pursuant to the Public Lands Grants Act.



TRADE WITH GERMANY, JAPAN AND ITALY

Mr. Thatcher:: 1.	What was the dollar value of Canadian exports during 1848 to (a) Germany; (b) Japan; (c) Italy?
2.	What steps, if any, have been taken by the government to re-establish trade with the above three countries?


Mr. Mcllraiih:: 1.	(a) Germany, $13,214,116;	(b) Japan,
$8,000,548; (c) Italy, $32,378,709.
2.	See statements below.
Germany
The Department of Trade and Commerce has had a trade official resident in Germany since February 1946. The present officer is located in Frankfurt, with a staff of four. The department recently sent in several of its officers to advise what further steps should be taken to strengthen our commercial representation.
The government, in October 1948, extended to Germany most-favoured-nation treatment in customs duties.
The department has sponsored many Canadian businessmen wishing to visit Germany and continues to make every effort to develop close liaison with the military authorities and German business firms in the interest of twoway trade.
Italy
The Department of Trade and Commerce reopened its trade office in September 1946. The present staff, consisting of a commercial secretary, assistant commercial secretary, and six clerks, are doing their utmost to promote two-way trade between Italy and Canada. The government extended to Italy in April 1948 most-favoured-nation treatment in order to assist trade, and reciprocal treatment has been accorded to Canada.
Japan
A commercial representative from the Department of Trade and Commerce was attached to the Canadian mission in Tokyo in June 1946, and he has endeavoured to develop a close liaison with the occupying military authorities and Japanese firms. The Department of Trade and Commerce continues to assist Canadian businessmen to enter Japan in the interest of trade promotion.
Questions



PUBLIC WORKS


Mr. Hodgson:: 1.	Who is senior supervising architect of the Department of Public Works?
2.	What is his salary?
3.	Was he appointed by order in council or through competitive examination by the civil service commission?
4.	Is he a returned soldier?


Mr. Fournier (Hull):: 1.	Andrew Kaye Mills.
2.	$5,700 per annum.
3.	By the civil service commission through competitive examination.
4.	No.



RAILWAY CONSTRUCTION IN ALBERTA

Mr. Dechene:: 1.	Have any steps been taken by the Canadian National Railways to undertake railway construction in Alberta in the current year?
2.	If so, what projects are contemplated?
3.	Do they comprise the closing of the gaps Heinsburg, Alberta to Frenchman's Butte, Saskatchewan, and Beaver Crossing in Alberta, to St. Walburg, Saskatchewan?


Mr. Chevrier:: 1.	The management of the Canadian National Railways advises that it has no intention to undertake new railway construction during the coming fiscal year. The management has made a review of the various branch line extensions and has come to the conclusion that with present-day wages, scarcity of steel and high cost of materials, none of the projects can be entertained economically.
2.	See answer to No. 1.
3.	See answer to No. 1.



PUBLIC BUILDINGS


Mr. McLure:: 1.	How many properties, in the area appropriated for the site of the new dominion building at Charlottetown, Prince Edward Island, have been appraised and paid for?
2.	What is the street number of said properties; who were the owners; what was appraisal price paid?
3.	How many properties remain to be appraised?


Mr. Fournier (Hull):: 1.	Twenty-one properties involved, all of which have been appraised but none paid for.
2.	No properties paid for as yet.
3.	None.



NEW GLASGOW-CAVENDISH, P.E.I., HIGHWAY

Mr. McLure:: 1. Has any arrangement or agreement been arrived at between the Prince Edward Island government and the national parks department regarding the

Questions
hard-surfacing of the Mayfield highway from New Glasgow to national parks beach at Cavendish?
2. If so, will this work be completed early this year 1949?


Mr. Maybank:: 1.	No.
2.	Answered by No. 1.



LOBSTER FISHING, P.E.I.-RUNNING OF LINES AND PLACE TRAPS

Mr. McLure:: 1.	Has the opening hour definitely been set for the lobster fishermen to run their lines and place traps for the open seasons of Prince Edward Island?
2.	If so, what hour has been set?


Mr. MacNaughl:: 1.	Yes.
2.	5 a.m. standard time.



RUSTICO BAY, P.E.I., DREDGING

Mr. McLure:: What action has been taken by the government or any department thereof to proceed with the dredging of Rustico bay during 1949?


Mr. Fournier (Hull):: Two dredging projects in Rustico bay, involving removal of 9,600 cubic yards, have been arranged for 1949 on the schedule for dredge D.P.W. No. 17.



NATIONAL PARKS


Winfield Chester Scott McLure: Who is responsible for repairs to the beach road from Cavendish leading down to national parks beach, Prince Edward Island?


Mr. Maybank:: The provincial government of Prince Edward Island for that section of the road outside national park boundary; the federal government for that section within the park.



FRED ROSE

Mr. Low:: 1.	Has Fred Rose, former communist member of this parliament, been given a position as "educator" in the library of St. Vincent de Paul penitentiary near Montreal?
2.	If so, what duties does his position involve, and how did he secure the position?


Mr. Garson:: 1.	No. This convict is employed in fitting and repairing covers for library books under the supervision of the penitentiary librarian and other custodial officers.
2.	Answered by No. 1.



COUNTY COURT JUDGES


Mr. Church:: 1. How many county court judges of the county court of York, Ontario, have been appointed during the past five years from outside places in the province of Ontario?

2.	What practice has been adopted by the government during this time in making these appointments?
3.	Were they all members of the bar at the time of their appointment, in actual practice or not, or in what other capacity were they when so appointed?
4.	Were not local men appointed in several other cities and towns in Ontario, such as Ottawa, Hamilton, London and other places?
5.	If so, in what other places?


Mr. Garson:: 1.	One (former resident of Toronto).
2.	The adopted practice is to appoint members of the legal profession who are in good standing at the bar and fully qualified to assume the judicial duties.
3.	All appointees are members of the bar.
4.	Local men have been appointed in Ottawa, Hamilton, Windsor, Brockville, Cornwall, Stratford, Picton and Guelph, but not in London, Walkerton, St. Thomas, Windsor (junior judge), Belleville, Woodstock, Welland, Sarnia, Simcoe and L'Orignal.
5.	Answered by No. 4.



QUESTIONS PASSED AS ORDERS FOR RETURNS


Mr. McKay:: What steps have been taken by the government to call a conference of dominion-provincial officials for the purpose of establishing a Borstal institution in the dominion as recommended by the royal commission of 1938, investigating the penal system?


Mr. Garson:: Return tabled.


INCOME AND TAXES PER CAPITA
Mr. Coldwell:: 1.	What was the population of Canada during each of the years 1926 to 1948 inclusive?
2.	What was the personal income per capita in Canada for each of the years 1926 to 1948 inclusive?
3.	What were the personal direct taxes per capita in Canada for each of the years 1926 to 1948 inclusive?
4.	What was the personal disposable income pel capita in Canada for each of the years 1926 to 1948 inclusive?
5.	What was the personal income per capita ia Canada for each of the years 1926 to 1948 inclusive based on the dollar fixed at the 1935 to 1939 level?
6.	What were the personal direct taxes per capita in Canada for each of the years 1926 to 1948 inclusive based on the dollar fixed at the 1935 to 1939 level?
7.	What was the personal disposable income pel capita in Canada for each of the years 1926 to 1948 inclusive based on the dollar fixed at the 1935 tc 1939 level?


George James McIlraith: With respect to parts 5, 6 and 7 of this question and parts 5 and 6 of the following question, the information is not available to complete the answers as requested. Information is available for the first four parts of each question, and I am

quite prepared to have the questions passed as orders for returns and to table the returns at this time.


Mr. Coldwell:: The hon. member explained the situation to me this morning, and I am quite prepared to accept his suggestion.


George James McIlraith: Return tabled.


PERSONAL CONSUMER EXPENDITURE, SAVINGS AND DISPOSABLE INCOME
Mr. Coldwell:: 1.	What was the total personal consumer expenditure in Canada tor each of the years 1926 to 1948 inclusive?
2.	What was the total amount of personal saving in Canada in each of the years 1926 to 1948 inclusive?
3.	What was the total amount of personal disposable income in Canada during each of the years 1926 to 1948 inclusive?
4.	What was the total personal consumer expenditure in Canada for each of the years 1926 to 1948 inclusive based on the dollar fixed at the 1935 to 1939 level?
5.	What was the total amount of personal saving in Canada in each of the years 1926 to 1948 inclusive based on the dollar fixed at the 1935 to 1939 level?
6.	What was the total amount of personal disposable income in Canada during each of the years 1926 to 1948 inclusive based on the dollar fixed at the 1935 to 1939 level?


George James McIlraith: Return tabled.



MOTIONS FOR PAPERS


Donald MacInnis: For a copy of all reports received by the Department of Transport, the Minister of Transport or any official of the department, since January 1, 1946, relating to the efficiency of radio equipment and the adequacy of radio watch keeping on ships operated from Pacific coast ports.


Donald MacInnis: I had a word with the Minister of Transport about this motion, and as I was not able to convince him that these documents should be produced, I would ask that the motion be dropped, without prejudice.


Mr. Speaker:: Motion dropped.



IMMIGRATION


Mr. Diefenbaker:: For a copy of all letters, telegrams and other documents received by the Department of Mines and Resources leading up to or connected with the issue of order in council P.C. 4233 dated September 13, 1948.



WARTIME HOUSING


Mr. Williams:: For a copy of vouchers and receipts in connection with the purchase, rental, maintenance and sale of cookstoves by Wartime Housing at Ajax. Ontario.
Motions for Papers



NATIONAL DEFENCE


Mr. Church:: For a copy of the requests of Major General Worthington to the Ontario government and the mayor of the city of Toronto, as to the fire and police protection in case of war.


Mr. Claxion:: I can answer this by saying that there is no such correspondence.


Thomas Langton Church: I should like to have the motion stand until I confer with the minister. The question has not been answered.


Brooke Claxton: The motion may carry as an order for return, or be dropped. There is no correspondence.


Thomas Langton Church: Toronto has always co-operated with this government in fire and police matters, on a standard plan. I raised this question last December of reviving the home guard-


Mr. Speaker:: As the minister is ready to answer, the motion should be either adopted or not adopted.


[Stage Direction]
Motion agreed to.

Mr. Hansell:: For a copy of all communications, letters, wires, correspondence and other documents exchanged between the government and any person or persons during the past seven years in respect to post office accommodation in the town of Nanton, Alberta.



VETERANS AFFAIRS


[Stage Direction]
On the orders of the day:
Mr. H. O. While (Middlesex East):: I should like to ask the Minister of Veterans Affairs if veterans status has been accorded to the civilian members of the R.A.F. transport command, and, if not, is it expected that such status will be accorded this year?


Hon. Milfon F. Gregg (Minister of Veterans Affairs):: It is not expected that such status will be accorded this session.



LABOUR CONDITIONS


[Stage Direction]
On the orders of the day:
Stanley Howard Knowles: I should like to ask a question of the Secretary of State. In view of the well-deserved tribute which was paid this morning to the staff of the printing bureau, and in which I heartily join, can the Secretary of State say what progress is being made to
1880

Inquiries of the Ministry bring the wages paid to employees at the printing bureau up to the levels prescribed in the act?


Colin William George Gibson: The
wages paid to printers are dependent upon the average wage paid in Toronto and Montreal. At intervals we ask the Department of Labour to secure this information and pass it on to the Secretary of State. The wages are then put in line with the wages being paid in those cities.


Stanley Howard Knowles: Is the Secretary of State aware of the fact that there is usually a lag of a year or two in bringing up the bureau's wages to those levels?


Colin William George Gibson: That is not correct. I may say that negotiations take place with the various trades in both Montreal and Toronto, and when agreement has been reached with the printers in those two areas the Department of Labour is in a position to give us the average wage that should be paid here.



NATIONAL DEFENCE


[Stage Direction]
On the orders of the day:
Mr. John O. Probe (Regina City):: I should like to direct a question to the Minister of National Defence. Will the minister please inform the house of the background of the reported disturbance aboard H.M.C.S. Crescent, indicating what seems to be dis-: atisfaction on the part of naval ratings? \ ,'ill the minister indicate the extent to which disciplinary action has been invoked, and whether it is the intention of the government to investigate conditions in the naval service with a view to their improvement?
Hon. Brooke Claxton (Minister of National
Defence): The reports I have received would indicate that this was a disturbance of a minor character and rather similar to that which occurred on board the H.M.C.S. Athabaskan. Disciplinary action was taken by the commanding officer on the spot, and since then the work of the vessel has proceeded without interruption. A full investigation will be held into the causes of these difficulties.


John Oliver Probe: As a supplementary question, I should like to ask the Minister of National Defence to indicate the type of disciplinary action that has been taken in relation to disturbances cn Canadian destroyers that have been referred to occasionally.


Brooke Claxton: I shall have to make further inquiries to ascertain what it was, but there was no serious action taken. I think some
! Mr. Knowles l
men were charged with the offence of slackness-which I understand is a minor offence, suitable for these incidents-and that the cases were disposed of.



ROYAL CANADIAN MOUNTED POLICE


[Stage Direction]
On the orders of the day:
Mr. G. R. Pearkes (Nanaimo):: Is the Minister of Justice able to give me a reply to the question I asked him on the 21st of March as to the R.C.M.P. guards at Esquimalt?


Stuart Sinclair Garson: I will look into the matter.



INQUIRY FOR RETURN


[Stage Direction]
On the orders of the day:
Mr. Patrick H. Ashby (Edmonton East):: should like to direct an inquiry to the Minister of Finance or the appropriate minister. On February 9 a number of questions asked by me were passed as orders for returns. I received an answer to the first two, but not to the others; I was informed that they would be answered elsewhere. I should like the minister to see that I am provided with correct answers to the questions that were not answered.


Douglas Charles Abbott: I will ask my colleague the Secretary of State to look into the matter and see what the situation is.



TRANS-CANADA AIR LINES FIFTEEN PER CENT INCREASE IN FARES- SUSPENSION OF TRAVEL TAX

John George Diefenbaker: To
clarify something that took place last night, I should like to ask the Minister of Trade and Commerce a question. Last evening in his budget speech the Minister of Finance announced the elimination of the fifteen per cent tax on air travel tickets. Almost at the same time an announcement came over the air that Trans-Canada Air Lines had increased the cost of its tickets to the extent of the reduction announced by the Minister of Finance. When did the directors of Trans-Canada Air Lines come to know that this reduction was to take place, or did they meet after the minister made his budget speech?


Right Hon. C. D. Howe (Minister of Trade and Commerce):: The decision to increase Trans-Canada Air Lines fares, by a scale which has been on file for some time with the

Board of Transport Commissioners for Canada, was made at least six weeks ago- certainly before there was any knowledge of the proposed budget action. I myself learned only last Monday about the budget action.


Mr. Fraser:: Who arranged the timing?



IMMIGRATION


[Stage Direction]
On the orders of the day:
Mr. N. J. M. Lockhart (Lincoln):: I should like to direct a question to the Minister of Mines and Resources and ask him to take it as notice. Based on information I have received, may I ask him if there are any immigration regulations in effect which would protect the interests of Canadian orchestras against an invasion of their rights by United States orchestras? I have received a telegram or two objecting to that.


Hon. J. A. MacKinnon (Minister of Mines and Resources):: From my knowledge of the regulations I think I can say these matters would be dealt with individually. If a person were coming in from another country for the purpose mentioned by the hon. member, that would be taken into account in dealing with the application.


Norman James Macdonald Lockhart: There used to be immigration restrictions.



FOREIGN EXCHANGE CONTROL ACT


Douglas Charles Abbott: the third reading of Bill No. 85, to amend the Foreign Exchange Control Act.


George Alexander Drew: Mr. Speaker, there has been no recorded vote on this bill at any stage, and it is my purpose to seek a recorded vote. Before doing so I wish to refer to two considerations which I think should be in the minds of hon. members in regard to this matter.
It has been pointed out already, and I think it should be emphasized, that every leading expert actively associated with the international exchange problem at the highest level has stated that if there is to be a return to normal trading among nations a solution must be found which will give some measure of freedom of movement to the exchanges of the world. As I mentioned yesterday, Mr. Paul Hoffman, who administers ECA and is also mainly concerned with the allocation of Marshall funds, has stated
Foreign Exchange Control that there must be a solution this year of the problem of convertibility. If that is so, there is every reason why parliament should not extend beyond one year legislation which gives extraordinary powers going far beyond the control of exchange itself.
That, Mr. Speaker, is something which has been overlooked or disregarded in any of the very limited explanations that have been given from the government side of the reasons fpr carrying forward this bill in its present form. This is not merely a bill to control exchange; it is a bill to control import and export as well. The argument originally presented was that the additional features were only for the purpose of supporting the effective operation of government action to control exchange, and were not intended as devices to deal with the export and import of goods, though that effect was clearly covered by the wording of the act. Later the Minister of Finance announced that he had been informed by his experts that under the provisions of the act he could control import and export, and since then this has been an important feature of the act itself.
If the optimistic viewpoint expressed by the Minister of Trade and Commerce and the Minister of Finance in regard to trade is in fact borne out, then there is every reason why a bill of this kind, which carries forward arbitrary controls over trading which can have no meaning once our exchange operates as a normal instrument of balancing accounts between countries, should not be approved by this house. If in fact the statements of the secretary of the treasury of the United States and Mr. Hoffman are based upon sound information-and I think we should assume they are-they look for a decision in this matter during the present year. Therefore the government should be under the compulsion of immediate action; and if this legislation is extended for only one year there will be more reason for the government to act immediately and initiate the appropriate action to return to actual convertibility between the pound and the dollar. Until there is a return to that convertibility, this country faces possible disaster, no matter what optimistic statements may be made in this house or elsewhere.
We have it within our power to give leadership in something which relatively is of more concern to Canada than to any other nation in the world. Surely we have the trained brains; surely we have men of sufficient mental vigour and confidence in themselves to give leadership in breaking the log jam which is backing up international trade between western nations whose ability to defend their freedom will depend very largely in the years that lie ahead upon their ability

Foreign Exchange Control to extend their trading strength and their, economic interdependence and co-operation. Therefore it is not only something that is in the interests of Canada; it is a challenge to Canada's maturity and capacity to deal with international problems.
For that reason, Mr. Speaker, I do not believe this bill should go forward in its present form, covering a two-year period. For that reason I believe it should not get third reading, and the government should take appropriate steps to reduce the life of the bill to one year.
In addition to the reasons I have given as to why that should be done in any event, reasons related to the statements made publicly by those best informed in the matter of international exchange, may I point out another reason why this house should refuse to extend the life of a bill of this kind, which in addition to controlling import and export has such a profound effect upon our whole economy. Our system of parliamentary control of expenditure is based upon an annual review of the action of the government. For hundreds of years that basic principle has been firmly imbedded in our parliamentary system. We should not disregard it when we have placed before us a bill which can affect the whole domestic and external economy of Canada in the years immediately ahead.
Out of the surplus collected in the form of taxes in 1948, more than $400 million had been lent for the purpose of dealing with the operations under this fund. That system again is contrary to our established methods of handling the public revenues. Other countries deal with similar exchange operations by setting up a fund for the purpose, to which money is voted in the ordinary way by parliament at the time the estimates are dealt with. That, I submit, is the way it should be done here. At the end of the year, in the usual way, there should be an opportunity to review the act itself as well as the results of the operation of the act. It is not enough to say, as has been said, that the accounting must come before this house every year. The bills that are dealt with by this house should be related to the accounting and should be amended from time to time to adjust them to the circumstances which that accounting discloses.
In this particular case we are told that our exchange is as strong as any other in the world, that our dollar is as sound a money unit as any other in the world. If that is so, why should we carry forward for two years, let alone for one year, emergency measures which in themselves suggest that that statement is not correct? The adoption of these additional measures covering the operation

of exchange indicates a belief in another method than the historic device of the normal balancing of trade. If our exchange is as strong as it is claimed, and as strong as it certainly has a right to be, with our enormous resources and raw materials, we should not give to this or any other government that arbitrary day-by-day power by order in council over the import and export trade of this country.
There are so many inconsistencies, Mr. Speaker, in the statements made in support of the procedure which is being followed that it is difficult to understand exactly what argument the government has put forward in favour of the contention that these measures should be extended for two years. The Minister of Finance has said that if we returned to something in the nature of a free dollar we would then have an addition to our cost of living of some seven or eight per cent. At the same time he says that our dollar is worth as much as the United States dollar, so I do not know how he arrives at that conclusion. Moreover, although he says he is greatly concerned about the addition to the cost of living of the seven or eight per cent which might result from having a free dollar, he has at the same time been placing a twenty-five per cent excise tax on many of the daily requirements of the people. If a matter of seven or eight per cent is of so much concern in the one case, it is difficult to understand why a twenty-five per cent increase on other necessities can be regarded as unimportant simply because it happens to be something that is imposed by the government itself. Yet that is the only reason one can find for the difference between the two situations.
Let me sum up in this way. If we believe that exchange is really what the word implies, and that exchange, given a realistic relationship to the actual value at the moment, of the unit of currency, does act as a measure which will balance international trade; if we believe that it is not necessary for the government to have these powers which go far beyond exchange; if we believe that bills covering matters of this kind should not give by order in council the arbitrary authority conferred here for a period of more than one year, then I submit that the members of this house should vote against the third reading of the bill which carries all these objectionable features into effect.
Let there be no doubt about one point. We have made it clear that we believe there must be some measure of reference to the international monetary fund during a period when the adjustments are made. By an amendment which was proposed and which was ruled out of order, we advocated the taking of steps-

within a year, or if possible within a shorter period, during which exchange control would still operate-to restore something in the nature of convertibility. Whether this bill is passed or not, but particularly if it passes, our position is that this government should without delay take the initiative in seeking a return to convertibility, which means so much to the future advancement of Canada.


Major James William Coldwell: Since we are going to vote for this measure, may I say a word? I agree with the leader of the opposition (Mr. Drew) that there is some incompatibility between the minister's statement about exchange and the incidence of excise tax. I agree that the excise tax has the effect which devaluation of the currency or inflation of prices might have. But I submit that to take the initiative in bringing about convertibility, as suggested by the leader of the opposition, is not in the best interests of this country.
A few years ago the United States did something of this kind. The effect was to impede the efforts that were being made for recovery, particularly in the United Kingdom. I believe convertibility is desirable, but in view of the circumstances I do not think the time has arrived when that can be safely undertaken. The bill upon which we are about to vote grants powers to the government for the period that will be required in order to bring about a measure of economic stability among some of the nations of the world.
We know, for example, that the customer upon whom we must rely for a great deal of our trade and commerce believes it will be 1952 before she is able to approach the required balance in her economy. If it is suggested that the government does not need the powers granted by this bill for two years, I think it is likely that no government would endeavour to carry on a policy of this kind if it was unnecessary to do so.


An hon. Member:: You do not know them.


Major James William Coldwell: I do not know, no; but I do
know that in a democracy governments must pay some attention to public opinion. If public opinion did not support a measure such as this because it was believed to be unnecessary, I do not think any government would dare to fly in the face of public opinion. That is the safeguard that we as a parliament have in passing upon this measure, and indeed upon many others.
If I were criticizing the government for the general policy that has recently been placed before this house I would say that the dropping of controls brought about an inflationary condition that has worked to the detriment of the great masses of the Cana-
Foreign Exchange Control dian people. I do not want to discuss the budget, but last night when it was proposed to remove the subsidy on flour and reduce the tax on chocolate bars, in which I concur, it seemed to me the effect of that might be to increase the price of bread, and, to paraphrase what Marie Antoinette said, if you cannot buy bread, you will be able to buy chocolate bars. I believe beneficial controls were dropped far too quickly, and the public regretted it.
To force Canada to take the initiative now in this regard would be a mistake. I agree with the leader of the opposition in the tribute he paid those who are advising the minister in these matters. If that tribute is sincere, then I have no doubt that the advice which the minister is getting, and upon which he bases the proposals he has made to this house, is advice which the whole House of Commons might well consider and approve. Consequently, Mr. Speaker, we should pass this bill, because it is in the interests of Canada, the Canadian economy and the customers upon whom we rely for our trade and commerce.


Mr. Speaker:: If the minister speaks now he will close the debate.


Douglas Charles Abbott: I have no intention of making any extended remarks. I set out my position in the statement which I made on the resolution stage of this measure. I then gave the reasons why the government considers it necessary that the Foreign Exchange Control Act be extended for a period of two years.
The government is just as much interested in the restoration of convertibility of currency as anybody in this country, but it is something which cannot be done alone. No single nation can do it. The leader of the C.C.F. party (Mr. Coldwell) is perfectly right when he says that world and trading conditions today are such that it is useless to expect or to count on a return to full convertibility of currencies for some little time yet.


Mr. Macdonnell (Muskoka-Onlario):: Why
not make a beginning?


Douglas Charles Abbott: We shall do our share. I also thank the hon. member for Rosetown-Biggar for the reference which he and the leader of the opposition have made to the advisers of the government on foreign exchange matters. My judgment is that the persons upon whom we rely for technical advice in these matters are among the most competent experts in that field to be found in the world today, and I have the most complete confidence in the advice which I receive from them in matters of this kind.

Foreign Exchange Control
I have just one other thing to say. In looking over Hansard of yesterday and the replies which I gave to some hon. members in connection with the change of residential status to the United States, I am afraid that, contrary to my usual practice, I was not quite as clear as I might have been. With the permission of the house I should like to place on Hansard, for the information of hon. members an official circular of the foreign exchange control board which outlines the full requirements with respect to change of residential status:
Foreign Exchange Control Board Ottawa
January 10, 1949 Change of Residential Status Definition of resident.
1.	Under the Foreign Exchange Control Act any person who was or is ordinarily resident in Canada on or after September 15, 1939, is deemed to be a "resident" for the purposes of transactions to which the act applies, unless the foreign exchange control board determines that he is a "nonresident". Application for change of residential status.
2.	A resident individual desiring that the board determine him to be a nonresident is required to apply to the board through his bank on form 107-application for change of status from resident to nonresident for foreign exchange control purposes. When application approved.
3.	The present policy administered by the board is, upon application, to designate as a nonresident an individual who is making a bona fide change of permanent residence from Canada to another country and has obtained any necessary permission from the country concerned to take up permanent residence there. Authority to transfer his funds and other assets from Canada is then granted as outlined below.
Transfer of assets to United States dollar area countries.
4.	(a) Where the total assets of an emigrant to a United States dollar area country do not exceed $5,000 he may transfer the total amount from Canada in the form of Canadian dollar bank drafts or cheques which he is free to negotiate in the United States at the rate of exchange prevailing there.
(b)	Where such an emigrant's total assets exceed $5,000, the transfer is permitted in the manner described in (a) up to 50 per cent of the total, with a minimum limit of $5,000 and a maximum limit of $12,500, during the first year after leaving Canada. Assets which are not authorized for transfer during this period continue to be regarded as those of a Canadian resident and the board may require that they be placed under the control of a resident agent or trustee. At the end of one year from his departure from Canada and at annual intervals thereafter, the owner may apply to the board for authority to make additional transfers from Canada from these resident assets. Subject to changes in policy in the meantime, such applications are normally approved for the same amount and in the same manner as on the original change of status application.
(c)	A United States citizen resident in Canada desiring to return to the United States to live is normally authorized to transfer all of his assets to the United States at the time of departure provided that the excess over the amount authorized for transfer in Canadian dollars under (b) above is invested in Canadian domestic securities having a term to
IMr. Abbott.]
maturity or earliest call date of not less than three years and the transfer of the excess if made in that form.
(d)	Assets authorized for transfer on approval of a change of status application may be retained in Canada and income from them may be transferred at the official rate of exchange. Any subsequent disposal of the assets in Canada is subject to the prevailing rules governing nonresident-owned assets, e.g., a nonresident may ordinarily sell securities in Canada only where the proceeds are being immediately reinvested in other similar Canadian securities.
(e)	In addition to assets which may be transferred in accordance with the preceding paragraphs, the export of normal household and personal effects is permitted.
To sterling area and special arrangement countries.
5.	An emigrant to a sterling area or special arrangement country is ordinarily authorized to transfer all of his assets to such a country at the time of his departure in the form of a Canadian dollar bank draft or cheque or in Canadian securities. These countries include the United Kingdom, the British commonwealth and empire, France, Belgium, Netherlands and Norway.
In-transit traveling expenses.
6.	At the time of departure an emigrant to whom change of status has been granted is authorized to obtain up to $150 (with a maximum of $400 per family) in foreign exchange at the official rate in Canada to meet in-transit expenses. In addition, he may buy his transportation in Canada with Canadian dollars.


Mr. Speaker:: Is the house ready for the
question?


Mr. Marquis:: I was paired with the hon. member for Charlevoix-Saguenay (Mr. Dorion). Had I voted I would have voted for the motion.
Bill read the third time and passed.



CANADIAN COMMERCIAL CORPORATION


Clarence Decatur Howe: that the house go into committee to consider the following resolution:
That it is expedient to present a bill to amend the Canadian Commercial Corporation Act to provide authority for advances to the corporation by way of loan out of the consolidated revenue fund and to extend the time of operation of the act.


Mr. Graydon:: Mr. Speaker, I think it would be advisable for the minister to make his statement at this stage of the proceedings. The whole matter would be clarified and the debate could be proceeded with on that basis.


Clarence Decatur Howe: Mr. Speaker, the bill to be based on this resolution has a threefold purpose: first, to extend the life of the Canadian Commercial Corporation; second, to authorize borrowings by the corporation; third, to provide that when its services are used by a department or agency of the government, the corporation may recover its proper out-ofpocket expenses and proportionate overhead from the department or agency concerned.
The corporation was established in 1946 to take over the functions of the Canadian export board-an agency established under wartime powers to facilitate the procurement in Canada by other countries of civilian type supplies. These supplies were financed in large part, though not entirely, from the proceeds of post-war loans and grants then being arranged. It was recognized at that time that not only would other governments and relief agencies need assistance in procurement in Canada, but that international allocations and controls exercised by other countries would make necessary some Canadian government organization that could act as procurement agent for certain Canadian import requirements. At that time, much of such Canadian procurement was being handled by Commodity Prices Stabilization Corporation, another wartime agency whose life was of limited duration but whose main purpose was connected with subsidies then being paid on imported goods. The Canadian Commercial Corporation
29087-1'20J

Canadian Commercial Corporation was not to be an agency for the payment of subsidies, but simply a piece of machinery that could be used to fill a need in carrying through foreign trade transactions that for one reason or another had to be handled through a government agency. Since it was established the corporation has made purchases in Canada for foreign governments and relief agencies to the total value of $272 million, a figure, incidentally, that is far in excess of the relative amount of credit or grants made by the people of Canada.
In the field of assisting in procurement of imports, the corporation's powers and organization have enabled it to be used with advantage on many occasions where the participation of a government buying or selling agency was essential. For example, in 1947, sisal being subject to world allocation, it was only through the auspices of the Canadian Commercial Corporation that Canadian cordage manufacturers were able to obtain their requirements of fibre from British East Africa. In another case the services of the corporation made it possible for the Department of Agriculture to obtain 5,000 tons of potash from the Russian zone of Germany. There is every reason to believe that the exigencies of foreign trade will continue to require the use of the corporation's facilities.
When the original act was passed and the corporation established in 1946, it was recognized that the need for the corporation's services in respect of foreign trade might well be required for some considerable time, but because the full useful life could not be forecast, the act was given a short term, it being understood that at the end of that term a review of the purposes and usefulness of the corporation would be made. Section 19 of the act provides that the act shall expire sixty days after the opening of the first session of parliament commencing in the year 1949. The legislation now before the house will permit the Canadian Commercial Corporation to continue to carry out its functions in the future.
In July 1947, the Canadian Commercial Corporation Act was amended in order to give the corporation the power to carry out for and on behalf and under the direction of the Minister of Trade and Commerce certain duties in connection with the acquisition of munitions and supplies required by the Department of National Defence, which duties had been previously transferred to the Minister of Trade and Commerce from the Minister of Reconstruction and Supply. This amendment was effective February 1, 1947, and since that time all purchasing for the Department of National Defence has been conducted by the corporation, acting in the 
name of the Minister of Trade and Commerce. This work has entailed the placing of more than 113,000 contracts, to the value of about $200 million.
One of the primary purposes of this corporate agency of government is to meet the needs of international trade. It has been, and continues to be, the policy of the government to provide for the procurement of the needs of the defence services by a civilian department rather than direct procurement by the services themselves. This purchasing function could be performed by a department of government rather than a corporate body, although the corporate form provides certain positive advantages, not only to the government but also to those who supply the requirements. However, a corporate form is almost essential in connection with certain foreign trade transactions, and it has obvious advantages to have but one buying agency rather than two separate organizations, one a branch of the Department of Trade and Commerce and the other a crown company. By establishing a single agency with corporate powers, real savings in costs of administration and in general efficiency were possible and were made.
In its work in the interest of national defence, the corporation has proven itself to be an efficient and economical procurement agency. It has in its service an experienced staff, many of whom were drawn from the wartime purchasing staff of the departments of munitions and supply and national defence.
The legislation also provides authority to the Minister of Finance to advance up to $10 million to the corporation by way of loan on such terms and conditions as the governor in council may determine. Occasions will arise where unforeseen developments affecting the supply of commodities essential to our civilian requirements or to our national security may require us to take immediate procurement action. This may involve the use of funds in excess of those made available to the corporation under the act. A case in point was the action taken by the corporation between October, 1948, and January, 1949, to relieve the threatened shortage of butter in Canada. The Canadian Commercial Corporation undertook the importation, handling, and financing of purchases of 15,680,000 pounds of butter from Australia, Denmark, and New Zealand, at a total cost at Canadian port, including ocean freight, of $11,348,741.80. The butter was quickly sold to packers and creameries on the basis of allocations recommended by the wartime prices and trade board at official ceiling prices. In this particular case the corporation was able to finance the transaction because payments were

promptly received from the Canadian purchasers. If there are transactions in the future of a similar nature for essential commodities, we cannot be sure that payments will be forthcoming with sufficient promptness to enable the corporation to finance them.
There is also always present the possibility that a sudden change in the international situation may confront us with the urgent necessity of procuring immediately supplies essential to our national security. We may, for example, be threatened with the loss of an important source of supply of a critical material. It seems prudent that the corporation be put in a position to deal with unforeseen emergencies of this kind should they arise.
Provision is also made in the proposed legislation under which it will be possible for the corporation to recover from departments and agencies of the government of Canada proportionate shares of the corporation's costs of operation. Such provision is calculated to place upon those departments and agencies proper financial responsibility with respect to services rendered to them by the corporation.
In this connection, the amounts up to $10 million provided for in section 8 were never regarded as a spending appropriation but were regarded as constituting a revolving fund, disbursements from which for the purposes of a particular department were to be recovered from that department out of its appropriation. Until May, 1948, the operating expenses were recovered on a prorated scale settled with the departments concerned and approved by the treasury office. In that way the corporation's funds were not depleted. On a question raised, however, the deputy minister of justice gave it as his opinion that, in the absence of special statutory provision, the corporation could not recover any of its operating expense from departments for which it acted as agent. Consequently the Department of Trade and Commerce had to get a supplementary appropriation to cover the corporation's operating expense incurred in transactions for the Department of National Defence. The view was expressed at that time by some hon. members that the costs of procurement should be borne by the appropriate departments rather than centralized in the Department of Trade and Commerce.
That, Mr. Speaker, outlines the purpose of the bill, and the provisions which will be contained in it.


James MacKerras Macdonnell: I should like to make a few observations on the resolution before it goes to the committee stage.
The minister has given us what I think is a clear picture of the scope of the work of the corporation. I should like to refer briefly
23, 1949
Canadian Commercial Corporation to a few aspects of it. I shall read from the resolution introduced in 1946 by the then minister of trade and commerce, to be found at page 1930 of Hansard of that year:
That it is expedient to present a bill to establish a corporation to be known as the Canadian Commercial Corporation empowered to assist in the development of trade between Canada and other nations and to assist persons in Canada to obtain goods and commodities from outside Canada and to dispose of goods and commodities that are available for export from Canada.
As the minister has pointed out, on the 5th of February, 1947, the authority was extended, and the extension was confirmed by chapter 51 of the statutes of that year. At that time, as the report of the corporation for 1947 shows, the function vested in the member for Port Arthur (Mr. Howe) as Minister of Reconstruction and Supply was transferred to the member for Port Arthur as Minister of Trade and Commerce. This was a measure to give the corporation power to act as purchasing agent for the Department of National Defence. I will read the pertinent section, which is to be found in chapter 51 of the statutes of 1947:
The corporation may, as directed by the minister, exercise and perform on behalf of the minister, the power, duty and function vested in the minister to buy or otherwise acquire and manufacture or otherwise produce munitions of war or supplies for, and to construct or carry out projects required by the Department of National Defence.
I do not think we should overlook the fact that there is this very wide power because of the simple word "produce". I think we will want to ask certain questions in committee to assure ourselves as to where the corporation is taking us. The minister will not be surprised if I say that we are always a little shy of the extension of powers of crown corporations. I shall not say any more on that point.
It seems perfectly clear from reading the report of the corporation for the year 1948- and of course that only brings us down to March, 1948, so that we are almost a year behind-that the business of the corporation was changing very substantially even at that time, and that its duties as purchasing agent for the Department of National Defence were becoming more important. It was doing more along that line while its other duties were diminishing to a very considerable extent.
I can quite understand the force of what the minister said about the disturbed conditions immediately after the war, particularly on the continent of Europe, and that a government agency could probably do things which a private agency could not do. The minister gave us two instances, sisal in 1947, and potash, I am not sure in what year; and I can quite understand that situations do

Canadian Commercial Corporation arise in which it would be important and useful to have a government agency operating. But we are now asked to provide more money for this corporation and in general to enable it to increase its operations.
It would seem to me that on the evidence of this second annual report for the year ended March 31, 1948, there is no reason to believe that the business of the corporation, other than that of acting as agent for the defence department, is on the increase. Rather the evidence is that it is on the decrease, and that seems to me to be quite proper; because I should have thought that as we got further away from the war, and as the abnormal situation became slightly more normal, people would be better able to look after their own business and would not have to rely so much on a government corporation. So we shall wish to ask a good many further questions on this point and others when we are in committee.
The report for 1948 states:
There has, however, been a substantial change in the activities of the corporation, resulting from the tapering off of foreign government purchasing operations in Canada, which, however, has been offset by an increase in purchasing activities on behalf of the Department of National Defence,
Another thing one observes, at which perhaps one is not surprised but a little disappointed, is that the report of 1947 expressed the hope that as time went on the corporation would be able to do with a smaller staff; but if my memory serves me correctly, actually between 1947 and 1948 the staff of the corporation was increased by a very small number-I think only two.
I do believe this house is entitled to have the fullest evidence given it as to the work of this corporation: first of all, that it needs more money. As I say, its operations are contracting on that side of its business other than acting as purchasing agent for the Department of National Defence, and so far as I can see, in that capacity it does not need any capital moneys at all, because it is merely acting as an agent and, as I understand it, the accounts are sent directly to the Department of National Defence. The corporation therefore needs no funds for that, except for its ordinary operating expenses.
As to the service of the corporation to the Department of National Defence, it seems to me the minister makes a prima facie case there. One can understand that people who are in the defence department may not be businessmen, and that it may be a sensible arrangement to have this plan continue. But we want a great deal of information from the minister as to the nature of the import and export business which it carries on now. This brings us back to our old question of control.
[Mr. Macdonnell (Muskoka-Ontario) .1

While I give the government credit for abandoning certain controls, nevertheless it seems to me that under a measure of this kind what goes out by one door comes in by another, and if the Canadian Commercial Corporation is going to play an important part in the import and export business, then it does in fact exercise in that way a considerable control over business.
As I have said, the report makes it clear that a great deal of the corporation's work for foreign countries, and for UNRRA, which it did immediately after the war, is coming to an end; and it is hoped that its activities in the import and export business will continue to decrease. In view of the fact that the latest information we have is almost a year old, I think the minister should give us figures which would bring us up to date and give us an indication of the course of business of the corporation in the last year. Otherwise we are rather in the dark.
It is getting close to one o'clock, and I suggest that when we come back at three the minister should be able to bring us up to date in that matter so we can get a better picture of the trend or tendency of the corporation's activities. My hope would be that in this past year, with a greater amount of normality returning to business, the tendency which is described in the 1948 report would be still further advanced; and I would certainly hope that the need for governments to enter into the import and export business would be lessened.
By the sheerest coincidence I met a man in this building last evening who told me he was in the export business, and by accident he mentioned the corporation. I am not able to give the details of this, and to that extent this portion of my remarks loses some effect; nevertheless this businessman-a bright, active fellow-did not seem to think the Canadian Commercial Corporation was helping him very much. In fact I think he would have been very much inclined to agree with the remark made by Winston Churchill in speaking about the socialists, that what the people wanted was to have the government get out of their way and let them carry on their own affairs. I do not wish to emphasize that or to be unduly critical of the corporation, because I think in certain ways it has performed a useful function; but just before resuming my seat I suggest to the minister that at three o'clock he should give us the fullest possible statement of last year's operations by the corporation. I should like him to indicate exactly the volume of the financial transactions it has carried out, as compared with the previous year. He should also indicate to what extent it has been acting for foreign governments, and in what particular

ways it has been able to serve the individual Canadian importer and exporter; because speaking for myself, and I think generally for members of the Progressive Conservative party, we do not want to take lightly the continuation and extension of commercial corporations.
The minister made the point that the corporation rather than a government department was needed in respect of various transactions which are to be carried out. That may well be; nevertheless we feel-and this has often been expressed in the house-that when things get into a government department that is a fine way of having them done without scrutiny, and a way of exercising almost without limit, powers which cannot be exercised if they have to be submitted to the scrutiny of this house. Indeed we shall have certain questions to ask on that very point-whether one of the incidental by-products, if I may put it in that way-I will not say one of the aims-may not be to enable the minister to wield a power which I do not think he entirely dislikes, and to do it in a way in which he could not do it directly as Minister of Trade and Commerce.
I noticed one thing in the report that interested me. Evidently the writer has a great respect for the minister, for this is what he says:
During the year the corporation, acting at the request and in the name of the Minister of Trade and Commerce . . .
And so on.


Clarence Decatur Howe: That was a different minister.


James MacKerras Macdonnell: Well, I am not so sure. This is the report for 1948. The minister will know better than I do how long he has been in this department. He will agree that it is very difficult to keep track of just what he is and what he is not. At any rate it is the officer we are talking about; and if the minister is right in saying he was not minister of trade and commerce at this time -though I think he is wrong-I should think he would exercise just as much control as any other minister, and therefore I think the point still stands. There is an old saying that a rose by any other name would smell as sweet. The minister, I am sure, enjoys power just as much when he exercises it through a crown corporation as he does when he exercises it direct. We like to see the minister exercise power directly rather than indirectly, because we feel we are better able to understand what he is doing and we can keep track of him better. There is then more chance for us to catch up with him some day, whereas when he is back of these commercial corporations no one knows what is happening.
23, 1949
Canadian Commercial Corporation
I do not intend to prolong this debate, but I suggest to the minister that it will expedite this matter if, after the luncheon recess, he can bring us up to date on the operations of the corporation. As always, we have an open mind, but there are a good many questions we want to have answered before this measure is passed.


Stanley Howard Knowles: At the outset, Mr. Speaker, I wish to say that in general I support the principle of the bill that is on the statute book as well as the principle of the amending bill to be based on this resolution.
I noted with interest the reference that the hon. member for Muskoka-Ontario (Mr. Macdonnell) made to a remark of Winston Churchill, to the effect that people would like the government to get out of the way and let them carry on their own business. That remark applies in a good many cases, particularly in relation to small businesses. I would also point out, however, to the member for Muskoka-Ontario that there are a good many things that are the people's business that the people will never get an opportunity to do except through their government.
My reason for rising to say a few words about this resolution is to call attention, calmly but firmly, to certain abuses that have occurred in connection with the activities of the Canadian Commercial Corporation. This does not detract from my support of the principle. I feel that full publicity should be given to something that was done about a year ago in connection with the affairs of this corporation. One of the purposes in calling attention to this abuse is to provide a basis for preventing a recurrence of it.
In my hand I hold copies of the five orders in council referred to in paragraph 9 of the most recent auditor general's report. I find that those orders in council refer to transactions of the Canadian Commercial Corporation. The transactions to which I refer-and I submit, Mr. Speaker, that it is in order to deal with them at this point-are transactions mentioned in the orders in council of March, 1948, which authorized payments in advance for certain supplies for the Department of National Defence which were to be purchased by the Canadian Commercial Corporation. These supplies were not to be delivered until after the end of the fiscal year. As some hon. members are aware, the Auditor General has called attention to this as a serious irregularity. He points out:
A constitutional reason for the lapsing and writing off of unused balances in appropriations at the year end is to ensure that the executive be ever in a state of dependency on parliament for funds.
1SS8

Canadian Commercial Corporation
He goes on to say that there were certain appropriations voted during the fiscal year ended March 31, 1948, which, according to the proper practice, should have lapsed if it was not possible to spend them in that fiscal year for the goods the department desired to purchase. The Auditor General notes that sums of money approximating $680,000 were spent on the authority of a series of orders in council passed in the month of March, 1948.


Clarence Decatur Howe: Who signed them?


Stanley Howard Knowles: The orders in council were passed by the governor in council on the recommendation of the Minister of Trade and Commerce (Mr. Howe). Did the minister forget them?


Mr. Isnor:: May I ask the hon. member a question?


Stanley Howard Knowles: Certainly.


Gordon Benjamin Isnor: Were these not payments made as progress payments in connection with contracts?


Edmund Davie Fulton: No.


Gordon Benjamin Isnor: The member for Winnipeg North Centre (Mr. Knowles) is capable of answering.


Stanley Howard Knowles: In one case it was a contract for changing certain snowmobiles, in other cases they were contracts for the purchase of new equipment. In all cases the Auditor General makes it clear that the government realized it was an irregular practice, and it was because of that irregularity the orders in council were passed in an attempt to regularize payments in the fiscal year ending March 31, 1948. These payments were for goods or services that would not be delivered until some time in the next fiscal year.
At one o'clock the house took recess.
The house resumed at three o'clock.


Stanley Howard Knowles: Just before the noon recess, Mr. Speaker, I had made reference to certain contracts entered into by the government at the instigation of the Canadian Commercial Corporation. I pointed out that in the case of a number of these contracts the Auditor General has given the government quite a severe reprimand. That reprimand is found in paragraph 9 of the auditor general's report appended to the Public Accounts for the year ended March 31, 1948.
As hon. members are aware, the Auditor General's criticism relates to the fact that certain money had been voted in that fiscal year, but the goods and services which the government sought to buy could not be


delivered before the end of that fiscal year. Accordingly the government recognized that it was irregular to pay for these goods and services which could not be delivered before March 31, 1948, out of that year's vote. I submit that the government recognized that irregularity in the fact that it found it necessary to pass five orders in council to authorize these payments, which came to a total of over $600,000.


Clarence Decatur Howe: May I clear up that point at this time. An order in council is passed for every purchase of the Canadian Commercial Corporation of over $5,000 in value.


Stanley Howard Knowles: The minister's quarrel is not with me. His quarrel is with the Auditor General, who points out that none of these five orders in council indicated any authority on which reliance was placed in order to give directions to pay the amounts. The Auditor General does not criticize the Canadian Commercial Corporation for the hundreds of orders in council which may be passed to authorize payments of over $5,000. That is not the reason for the Auditor General's criticism. The Auditor General criticizes these five orders in council because they authorized payment in March, 1948, before the end of the fiscal year, for goods or services not to be delivered until the next fiscal year. I have no doubt that when the Auditor General looked over these five orders in council-and I suggest to hon. members that they send for a copy of sessional paper 17 ID, brought down in response to a motion of the hon. member for Kamloops (Mr. Fulton), so that they can look these interesting documents over for themselves- he noted that each of the five orders in council attempted to give some basis for passing the order. The basis which is stipulated in each of the five is in these words:
That the proposed contract is in the public interest.
Mr. Speaker, those of us who have been here for a few years remember the many occasions during the war when we were denied information because it was not in the public interest. Now we have a new doctrine of executive power, namely, that when, in the view of the government, something is in the public interest they have the authority to pass an order in council giving effect to that decision whether or not there is any legislative authority for it.
I do not get excited, as do my hon. friends to the right, when the government exercises powers given to it by this parliament. In fact, time and again I have criticized the government for not fully exercising some of the powers voted to it by parliament; but I do take strong objection when the government

seeks to exercise power to pass an order in council for which there is no legislative authority.
The phrase which I have already mentioned runs through all five of these orders in council: P.C. 859 of March 2, 1948; P.C. 938 of March 6, 1948; P.C. 1051, of March 16, 1948; P.C. 1101 of March 16, 1948; and P.C. 1186 of March 23, 1948. I may say that all five of them were passed by the governor in council on the recommendation of the Minister of Trade and Commerce who, of course, is the present minister. I believe he assumed that position in the month of January, 1948.
It is possible that a case could be made for the desirability of changing our practice so that advance payments of this nature could be made; but that change has not been made, and the Auditor General has done a service to this parliament, and indeed a service to the government, in calling attention to this irregularity.
May I take just a moment to read a few quotations regarding the exercise of legislative power by the executive branch of the government? I have in my hand a well-known volume dealing with these matters, Law of the Constitution, by A. V. Dicey. On pages 50 and 51, and on a few additional pages, this matter is discussed. I find, for example, that in the year 1539, in the reign of Henry VIII, an act was passed giving the crown power to legislate by means of proclamation. Dicey says:
This enactment marks the highest point of legal authority ever reached by the crown, and, probably because of its inconsistency with the whole tenor of English law, was repealed in the reign of Edward the Sixth.
Dicey admits that some difficulties have arisen in modern times, and that probably the executive branch should have a little more authority than we give to it; but whether such is desirable or not, it is not the case. Executive legislative authority simply does not exist. Dicey says, for example:
For the repeal of 31 Henry VIII, rendered governmental legislation, with all its defects and merits, impossible, and left to proclamations only such weight as they might possess at common law.
I submit, Mr. Speaker, that the practice in our parliamentary way of doing things is very clear. The government can do by order in council such things as acts passed by this parliament give them power to do. When they exercise those powers they will get no criticism from me; but when they exercise, by order in council, powers not accorded to them in legislation I intend to raise my voice in protest.
Canadian Commercial Corporation
May I read another sentence or two from this work by Dicey, which is found on pages 326 and 327:
The minister or servant of the crown who thus takes part in giving expression to the royal will is legally responsible for the act in which he is concerned, and he cannot get rid of his liability by pleading that he acted in obedience to royal orders. Now supposing that the act done is illegal, the minister concerned in it becomes at once liable to criminal or civil proceedings in a court of law.
I myself will not endeavour to take the minister to court. Rather I am raising the case in this high court of parliament, and I suggest strongly to the government that they should not pass off too lightly the criticisms made by the Auditor General, but that they should be very careful as to the powers they exercise by order in council.
It is not so very long ago, Mr. Speaker, since we had another example of this, in which the same minister was involved. I refer to the Aeronautics Act, and to certain changes which were made in it in 1946. At that time this act had certain provisions in it. Some of us discovered that these provisions had been circumvented. When I asked the minister why, his reply was that it had been done by order in council. When we pressed the point that surely it was not possible to amend an act of this parliament by order in council, another answer was given; but in the end the whole intent of the act of parliament was circumvented by still another means. This was done by the same minister. I repeat, Mr. Speaker, from this group there is no objection to the government using the powers which are accorded to them by legislation, but I submit that they should stay within the legislation passed by this parliament. And while as I indicated at the beginning of my remarks I support the measure before the house and the idea behind the Canadian Commercial Corporation, I hope that those in charge of it will hew a little closer to the line.


Gordon Benjamin Isnor: Mr. Speaker, I rise, not to support the thought expressed by the hon. member for Winnipeg North Centre (Mr. Knowles) in regard to bringing the Minister of Trade and Commerce (Mr. Howe) into court in connection with what the hon. member has termed irregularities with respect to these amounts, but rather to express some of my views in the matter, and to answer from a common-sense point of view the observations made by the hon. member who has just taken his seat.


Stanley Howard Knowles: Answer the Auditor General at the same time.


Gordon Benjamin Isnor: And in doing so I feel I am
making a proper approach to dealing with a

Canadian Commercial Corporation matter of this kind. As I recall, the hon. member referred to four distinct transactions.


Stanley Howard Knowles: Five.


Gordon Benjamin Isnor: Yes, five distinct transactions, the hon. member says. Each of these is covered by the same principle, a principle which we in everyday business practice follow. It is a principle which I am sure the hon. member would follow if he contracted for the building of a house, in which event the contractor from time to time would approach him for progress payments. That would be along the same lines exactly, except in the present instance in some cases applications were made for payments because of the necessity of bringing from the United States into Canada certain parts for manufacturing purposes.


Mr. Nicholson:: Why did the Auditor General comment upon it, then?


Gordon Benjamin Isnor: I am not answering for the Auditor General. I am answering the criticism as it is advanced by the hon. member for Winnipeg North Centre. I point out to him that from a business standpoint the procedure followed is that which would be followed by the average businessman; and the C.C.C. has acted no differently from the average businessman in that respect. It will be noted I did not say C.C.F.; I said C.C.C. I say therefore that I do not see any great difference in the manner in which the Canadian Commercial Corporation has carried on its business from that which would be followed by a reliable business concern.
Let us deal with these cases. The first dealt with a well-known firm, RCA Victor Corporation, and had reference to a progress payment. They had a contract totaling $226,597. Before the end of March they pointed out that because they had completed a certain part of the work they were asking for a progress payment. The amount of $93,852.50 was advanced to them at that time, leaving a balance of $132,744.50.
The next case to which the hon. member referred, having to do with Canadian Arsenals, was much similar in detail. In August, 1947, they received a contract for about $800,000. They had completed prior to March 31, 1948, work to a value of $435,000, and with that in mind asked for a progress payment of that amount. It was paid; receipts were accepted and vouchers shown. Proper records were made of the transaction. There can be no criticism in any way so far as that case is concerned.
The next one was similar in detail, where the Department of National Defence required certain equipment, certain portions of which were manufactured in the United States. In

this instance an advance of $15,000 was made on a contract of $34,000. Other cases were similar in detail. Therefore I say there is no need for the hon. member for Winnipeg North Centre to become greatly concerned or excited when these transactions are carried on in a businesslike way, and proper records are kept.
The only fault I would find is that the facts were not set out by the Auditor General as they appeared in the return made later to us. I would not set myself up as an authority in the matter of auditing, when compared with Mr. Watson Sellar; but I do say that one must take into consideration the facts and figures supporting the case. The hon. member for Lake Centre (Mr. Diefenbaker) in his usual critical fashion at once pounced upon this, as did other hon. members inclined to study public accounts. I took notice of it, and received a return similar to that tabled for the hon. member for Kamloops (Mr. Fulton). This return covers almost all the cases in question. After having read it I recognized these as regular business transactions.


Stanley Howard Knowles: Would the hon. member permit a question?


Gordon Benjamin Isnor: I would be very pleased to do so.


Stanley Howard Knowles: Would it not have been possible for the government to put an item in the estimates of the succeeding year, thus meet the terms of the contracts in that way, and at the same time stay within the law?


Gordon Benjamin Isnor: Yes, and no. In the first place, the hon. member would be one of the first to criticize a government for placing in the estimates of 1949 an account which had already been paid in 1948-and would be justified in his criticism.


Stanley Howard Knowles: We see revotes every year in the estimates.


Gordon Benjamin Isnor: I beg the hon. member's pardon; revotes are for balances. This is for an unexpended amount.


Stanley Howard Knowles: Is that the way you run private business?


Gordon Benjamin Isnor: We set out every item of expenditure so that when the auditor comes along he will be able to go into our books, see the entries, and look at the vouchers and receipts; and he would see that we are not including in 1948 expenditures which rightly belong to 1949. This is the answer I would make to the hon. member.
I was about to make some comment with respect to the general functions and the principle behind this organization. Like the hon. member for Muskoka-Ontario (Mr. Macdon-nell), I recognize the generally good work

this organization is doing. I am pleased that it is operating under the Department of Trade and Commerce. I would also agree with the financial critic of the opposition when he says that there should be not only a report but a tie-up with the report of the Department of Trade and Commerce, so that we would be able to place these accounts before parliament, and in turn before the public accounts committee for careful scrutiny. In this way we would be able to make a careful study as to whether the expenditures have been made along proper lines.
Then there is one other feature of particular concern to the area from which I come. I would draw to the attention of the Minister of Trade and Commerce the fact that the operations of this organization seem to centre to a large extent around this industrial province of Ontario. Most of the purchases are made here because of the close contact the organization has with the buyers and sellers in these Ontario organizations. While the minister might say that these organizations have their local representatives in the various sections of the country, the fact is we believe that sections outside Ontario are not given the same opportunity. I would urge upon the minister, under whose jurisdiction this organization comes, that greater consideration be given to the different sections of the country, particularly the very fine province of Nova Scotia, and the maritime provinces in general. We believe that many of the contracts given to other sections of the country rightly belong to the maritime provinces. Not only could we supply the goods, but we could supply them in a more efficient manner. I have in mind particularly supplies to the armed forces-the army, navy and air force. For instance, who would think of buying butter in Ontario or Quebec to serve troops in Nova Scotia? But deliveries of butter are being made daily from areas outside the maritime provinces to serve the forces in Halifax. It is almost ridiculous. But that is what has happened recently. I pointed out at the time that I did not think it would work to the satisfaction of the department or of the organization which was doing the buying. Of course the results were what I expected they would be. They were unable to supply eggs and butter in sufficient quantities to meet the daily requirements. I think greater interest should be shown by this organization in the purchase of local requirements from local concerns, and I urge the Minister of Trade and Commerce (Mr. Howe) to consider this matter.
One other glaring example of lack of knowledge shown by certain officials was drawn to my attention only today. I do not
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23, 1949
Canadian Commercial Corporation suppose the average member of the house knows what a wharf fender is. A wharf fender is made up of some sixty to eighty small logs which are tied together and used to protect both the wharf and the ship coming into the wharf. Only recently a local concern which had been supplying these fenders for years were told that logs were going to be brought in from British Columbia for this purpose. We have every respect for the type of lumber and logs produced in British Columbia, but we feel there is no justification for bringing logs from British Columbia to Nova Scotia when we have quantities of that type of log available.
I am not saying this in harsh criticism because I am in accord with the work being carried out. However, I wanted to bring these matters to the attention of the minister and the organization because I believe this organization should be concerned, not with the economy of one or two particular provinces but with the economy of the country as a whole. I intend to support this resolution.


Ernest George Hansell: Mr. Speaker, I suppose that we in this group will have to support this measure because it simply provides for the extension of these powers for a short time. We have no particular criticism to make of the operations of this corporation. However, I would like to put on the record my personal views with regard to crown companies generally. I am inclined to think that these companies simply take responsibility out of the government's hands, thus giving the government a way of escape. However, I do not think the government can altogether escape responsibility for the operations of crown companies generally.
Personally I am a private enterpriser, and I am proud of that. Crown companies are usually costly. They do not necessarily have to show a favourable balance because, generally speaking, they can take the position that it does not matter very much if they are in the red, the taxpayer will be there to foot the bill. I think the minister will admit that this bill is designed to help private industry and I think because of its very nature that it does help private industry.
The difference between crown corporations and private industry is that private industry must be efficient; it must provide service because it is competitive and it must show a profit or it will go broke. But if it does go broke that is its own business; it cannot call upon the taxpayers to foot the bill. Crown companies do not have to do these things. Even though they do not do them, they can still remain in business.
We have some glaring examples in Canada of crown companies that are sapping a good

Canadian Commercial Corporation deal from the taxpayers in order to remain in business. They may be providing service, but they are providing that service at the expense of the taxpayer. Having stated these personal views, I am prepared to vote for the bill providing for a further extension of time for this corporation.


Mr. W. Ross Thatcher (Moose Jaw):: Mr. Speaker, I should like to make a very few comments on this resolution and in doing so I shall detain the house for only several minutes. My criticism of the resolution is the opposite to that of my hon. friends of the Conservative party. I contend that during the past two years sufficient use has not been made of this corporation. As was pointed out this morning, the Canadian Commercial Corporation was set up in 1946 for certain specific reasons. In a nutshell, the objects of the corporation as set out in section 4, chapter 40, of the 1946 statutes are to assist in the development of Canadian trade, first, by encouraging imports and, second, by encouraging exports. When introducing the resolution to the house the then Minister of Trade and Commerce said, as reported on page 472 of Hansard of April 2, 1946:
For some time it has been clear that there are many transactions in international trade which cannot be handled entirely by private enterprise-
The minister then went on to state that the corporation would be used for three specific purposes: First, to make purchases in Canada for foreign governments and UNNRA; second, to assist Canadian companies to obtain essential supplies from former enemy territories; third, to provide the machinery for making bulk purchases of such short supply commodities as sugar, oils, fats, et cetera.
Even in 1946, the Minister of Trade and Commerce estimated that there was some need in Canada for an organization which could carry out trading at a state level. I suggest that if there was that need in 1946, with world conditions as they are today and with bilateral trade agreements so much more prevalent, there is an even greater need for the corporation today.
In 1946 the C.C.F. supported the bill in principle and our reasons for doing so were set out clearly in Hansard at page 4324, where the hon. member for Vancouver East (Mr. Maclnnis) is reported as follows:
We support the bill, first, because in our opinion it is an attempt not only to expand our trade but also to bring about orderly marketing.
And again:
-this may well be the first step toward setting up export and import boards.
The bill passed parliament and the corporation was set up. This morning the Minister of Trade and Commerce (Mr. Howe) told

us some of the things which the corporation has done in the past several years, and he referred specifically to the handling of Australian butter. I think it has done some excellent work, but nevertheless the proportion of Canadian trade which the corporation has handled has been almost negligible. In view of recent trade developments our group is somewhat worried and disappointed over that fact.
Since the beginning of the session there has been a good deal of discussion about the deteriorating position of our trade with Great Britain. We are concerned especially with the way that markets in Great Britain for our primary products are evaporating. Our exports to Great Britain have been shrinking despite the fact that we have made very substantial loans to them, and despite the fact that the United States has made large ERP loans to Great Britain to finance purchases in Canada. We know that sooner or later ERP is going to end, and when it does we are concerned lest the whole bottom should fall out of our British market.
Recently, as has been pointed out several times in the house, Great Britain concluded a substantial barter deal with Poland, and the products which were obtained from Poland in that barter deal were livestock and farm products. Great Britain has concluded dozens of these barter deals in the last few months, and in almost every case the products which Great Britain is obtaining are products which she formerly obtained from Canada. In other words, our markets in Great Britain for primary products are apparently shrinking fairly rapidly. Sir Stafford Cripps warned us a few weeks ago as to what was happening. I should like to refer now, as I did about two weeks ago, to a Canadian Press dispatch from London concerning what Sir Stafford Cripps had to say about the question. The heading of the dispatch is:
Canada to lose exports unless it "buys British"
The article reads:
Britain will buy less food from Canada unless Canada buys more from Britain, Sir Stafford Cripps, Chancellor of the Exchequer, said Tuesday. He said the crux of the post-war Anglo-Canadian trading problem is expansion of British exports to Canada.
I know that the minister knows that. He knows that if we are to continue to have British markets we will have to find some way of increasing British imports into Canada. Time and again one minister after another has said that he does not believe in bilateral trade agreements. I myself think that bilateral trade agreements are a retrogressive step in most instances. If we had any choice in the matter I believe that most

Canadians would prefer to remain on a multilateral basis. Today, however, it is beginning to appear that we have not that choice. In Europe there are between 100 and 150 recently concluded bilateral deals, and if we want to trade with Great Britain it appears that we may be forced to trade in the way the British desire. I think we will be shortsighted if we do not keep that fact in mind.
I suggest that today it is not a question whether or not we like bilateral trade agreements. It is a question whether or not, in order to retain the British market, indeed in order to survive economically, we are prepared to adopt that kind of trading if forced to do so by the British. Rightly or wrongly, we of this group believe that in the immediate future there is going to be a good deal more of bilateral trading. Rightly or wrongly, we also believe that this parliament, whether it wants to or not, is going to have to adopt that kind of trading to at least a limited degree.
If we use bilateral trading, a company such as the Canadian Commercial Corporation might prove invaluable. We cannot see, for instance, why the corporation could not take our surpluses of apples in British Columbia and Nova Scotia, and on a state level try to make a barter deal with Great Britain for some product they have. We cannot see why this corporation could not take other agricultural products which may be in surplus supply, and make barter deals with them. In other words, we think the Canadian Commercial Corporation should be expanded, that its staff possibly should be increased, and that its powers should be made more comprehensive. If Canada is going to be forced into bilateral trading, we think that the corporation should be prepared to play some role in it. We support the bill, but we would like to see it extended.


George Randolph Pearkes: In July, 1947, an amendment was moved to the Canadian Commercial Corporation Act so that provision might be made for purchases to be carried out on behalf of the Department of National Defence through the corporation. At that time I stated that I could appreciate the advantages of having a central purchasing agency for the Department of National Defence. Then I went on to say that I could not understand the reason why the corporation should take over the construction of buildings for the Department of National Defence. At that time the Minister of National Defence said that they were in the housing business in a very large way, and that the Canadian Commercial Corporation was handling the building and construction of a large number of married quarters for
23, 1949
Canadian Commercial Corporation the personnel of the active army and the active navy. I want to stress that in doing so the corporation did not have the facilities to carry out a thorough inspection of the work which was being done, and that the effect was to set up a new department of public works when it would have been very much better if the construction of these houses had been carried out through the Department of Public Works, or by the service personnel themselves.
I have seen press reports that the corporation is to discontinue building houses for the active services. I do not know if that is true, but I hope that it is because for once the government will have taken my advice.


Clarence Decatur Howe: If I may interrupt, the Canadian Commercial Corporation has never built anything. It is a purchasing department. We took your advice before you gave it.


George Randolph Pearkes: No, not according to the Minister of National Defence. I do not say that these houses were actually built by the corporation, but the contracts were let through it.


Clarence Decatur Howe: Yes, but the planning and the supervision were carried out by the armed forces.


George Randolph Pearkes: I will quote what the Minister of National Defence said at that time. At page 4958 of Hansard of 1947 there is the following:
The Canadian Commercial Corporation was created, not only for the purposes of purchasing for the Department of National Defence, but for the other purposes that parliament or the government might provide for it.
Later at page 4960 he says:
This is a very large housing project involving the conversion or construction of some hundreds of dwelling units this year.
Then there is a reference by the minister on the same page to the fact that a great many men will be employed. He refers definitely to the Canadian Commercial Corporation, and then he says:
There would be presumably about that number in the Department of National Defence if we were not getting the Canadian Commercial Corporation to do that job.
I questioned the policy at that time. I know that I have not made a mistake in saying that it seemed to be the intention then that the contracts for these buildings should be let through the Canadian Commercial Corporation.


Clarence Decatur Howe: That is correct. The contracts were placed by the Canadian Commercial Corporation, but all supervision and planning are carried out by the services themselves. We simply act as purchasing agents for placing the contracts.

Canadian Commercial Corporation


George Randolph Pearkes: Has that policy been changed? Have they ceased to act as an agency for the letting of contracts?


Clarence Decatur Howe: No. The only change is that in the current year's program a good deal of the work in connection with housing has been turned over to the Central Mortgage and Housing Corporation. In the program of last year tenders were called by the Canadian Commercial Corporation and contracts were placed, but the planning and supervision were carried out entirely by the armed services.


George Randolph Pearkes: There is to be a change in that policy now, and the Minister of Reconstruction and Supply (Mr. Winters), through the Central Mortgage and Housing Corporation, will take over the work from the Canadian Commercial Corporation?


Clarence Decatur Howe: A certain amount of it.


George Randolph Pearkes: I am very pleased to hear that; it seems to me a step in the right direction. Will the act be amended to eliminate the powers now given to the corporation? I have not the words before me, but I think in the amendment of 1947 it said "to construct". Will that be removed?


Clarence Decatur Howe: We place the contracts for these projects; and when I say "we" I am talking of the Canadian Commercial Corporation. When we place contracts with Central Mortgage and Housing Corporation we have carried out our duty under the act. That may be our way of awarding the work. If we should decide to place such contracts with private contractors, that is also within the orbit of the corporation. The Canadian Commercial Corporation does not itself build; it has no building or supervisory staff. It simply places contracts for the services.
Perhaps I should clear up just one point, and in doing so close the debate. A good deal has been said about the five orders in council.


Mr. Speaker:: I understand the minister is closing the debate.


Clarence Decatur Howe: These five contracts have nothing to do with parliamentary appropriations. The Canadian Commercial Corporation works on the authority of a financial encumbrance. In other words, when a requisition comes to the corporation it is accompanied by a financial encumbrance, which states that a certain vote has been encumbered for a certain amount of money required to make this purchase.
The first order in council I have in my hand is P.C. 1186. The requisition came with the usual financial encumbrance, for the purchase of two helicopters. They are built in the United States; and the only way I know

to purchase anything from the United States aircraft industry is to follow the practice of that industry, which is to accompany the order with a down payment. That is done even by the United States government itself when buying from its own contractors, and it is done by the government of Canada if it is buying aircraft from Canadian contractors. It is a practice of the trade. If it is impossible to follow the practice it is impossible to purchase the aircraft.
What happened? The requirement in this case was that a twenty per cent down payment accompany the order for the two helicopters. That was made, in the amount of $33,979.80. It was a condition of the contract, the best contract that could be made. What is the government to do? I shall explain presently the technicality that has been advanced by the Auditor General. We have been buying aircraft for the last eight years, following this same practice exactly, but since purchasing has been under the authority of the War Measures Act the Auditor General has never called the matter to our attention. In this case the practice of the trade was followed; the order for these two helicopters was accompanied by the down payment required by the aircraft manufacturing plant. Then there was a further provision in the contract that when the planes were completed and ready for shipment to Canada a further amount was required, and that when the two helicopters were delivered to the forces the final payment was to be made.


Mr. MacNicol:: Two or one?


Clarence Decatur Howe: Two. The technical point raised by the Auditor General is that when the down payment was made, nothing had been delivered. That is true. The transaction took place in the United States; but the same practice has been and must be followed in placing an aircraft contract in Canada. The order is always accompanied by a down payment. I do not think anyone can see anything very vicious in that. If anyone can show how the Canadian Commercial Corporation could have carried out its duty to purchase these two helicopters for the services without making a down payment, then they may show where the corporation did not carry out its obligations; but I suggest that it followed the practice of the trade. It is a pure technicality that the contract happened to be with a United States manufacturer and therefore no delivery was made. If it had been with a Canadian manufacturer the point never would have arisen, because then the payment would have been in order.
The next order in council I have is P.C. 1101, covering the supply and installation of 54 rhombic antennae. These have a large

United States content, as set out in the order in council. These were not a standard product; the antennae were made to order. The contract provided that the order be accompanied by a down payment sufficient to cover the cost of the United States imports. The Canadian Commercial Corporation made the best deal it could, and the contract was passed accordingly. The transaction went through in the ordinary way.


Stanley Howard Knowles: These were purchased in Canada?


Clarence Decatur Howe: Yes, but with a large United States content. This order in council does not state that United States content, but I happen to know that the Canadian Marconi Company got this equipment from its American associate of the same name.
The next order in council is P.C. 1051 covering a quantity of teletype equipment consisting of fifteen items, as set out herein, with an expenditure of United States funds estimated at $22,750 as against a total price of $34,326. Here again the contract required an advance of $15,000. That was the best deal that could be made. The purchase was made in the ordinary way and the payment was made in accordance with the contract. As far as the Canadian Commercial Corporation was concerned, it could have refused to make the purchase; or it could have waited until next fiscal year to make the purchase or, alternatively, it must necessarily have carried out the terms required by the manufacturer.
The next one concerns a purchase from Canadian Arsenals Limited. Certain tooling up had to be completed and certain equipment purchased. It was getting towards the end of the year and the appropriation from the funds of Canadian Arsenals Limited, which is a government-owned company, was not sufficient to purchase the parts required for the tooling up. An advance payment was, therefore, requested from the Department of National Defence. There is nothing very serious about that, as I see it.
Then, there was the purchase of items of equipment from RCA Victor. The purchase price of this equipment was $226,597, of which $51,244 was an expenditure of United States dollars. In other words, the equipment was largely made in the United States. In this case, too, a down payment was required as one of the terms of the contract. This down payment was made.
The last one is the purchase of RCA Victor diversity communications equipment, a United States product. This purchase was made through the RCA Victor Company of Canada from its American affiliate. There was an expenditure in United States dollars of $51,224, and the usual down payment was
23, 1949
Canadian Commercial Corporation required. The down payment was made. These are all ordinary purchases. The only significant fact is that part of the purchase price fell in one fiscal year and the remainder in another fiscal year. If the purchases had been made two or three months later no question of procedure could have been involved. I suggest that no special concern need be felt about these ordinary transactions that occurred in the usual course of business.
Motion agreed to and the house went into committee, Mr. Golding in the chair.


Edmund Davie Fulton: The minister has been good enough to explain in some detail what was behind the transactions to which attention has been drawn by the Auditor General. However, as the one who obtained a copy of these orders in council to which reference has already been made by the member for Winnipeg North Centre (Mr. Knowles), I think it is quite fair to say that no one is suggesting there was anything underhanded or in any sense discreditable about what was done. Certainly the Auditor General did not say that. He did call attention, however, to the fact that this method of payment involved a departure from the normal method of financing government purchases. As I understand the normal method, it is that moneys can only be paid over to suppliers if, in fact, the goods or articles were supplied during the fiscal year in which the payment of money was authorized.
In this case, as a result of the orders in council, the money was paid over although the goods were not delivered in that fis-jal year. In fact, an answer to a question of mine which appeared in Votes and Proceeds *s, No. 27, indicates that some of this equipment has not yet been delivered. This equipment was purchased under the authority of order in council P.C. 938, which was the contract with Canadian Arsenals Limited. Twenty-two snowmobiles remain to be delivered, fifteen of which are to be delivered on March 31 of this year and the others on April 30 of this year. It is over a year since the payment was made under this order in council.
As the Auditor General points out:
A constitutional reason for the lapsing and writing off of unused balances in appropriations at the year end is to ensure that the executive be ever in a state of dependency on parliament for funds.
If that principle is not followed, then the executive need not come before parliament for authorization of expenditures. When that happens, the fundamental principle of responsible government has disappeared. I can see this as one objection to the proposal to increase the power of the Minister of Finance to make these advances from the consolidated revenue fund to the Canadian

Canadian Commercial Corporation Commercial Corporation. If contracts can be financed and deliveries obtained merely by descending on the consolidated revenue fund without the specific authority of this house, then certainly such operations could be continued, as long as there was money in the fund, without coming to parliament. This is one more stage in the progressive loss by this house of its control over the expenditures made by the executive.
Instead of the minister having to place an item in the estimates, in this case, of the Department of National Defence, and obtain approval of the expenditure, he was simply given $10 million which he could obtain from the consolidated revenue. He is now asking for another $2,500,000 which would make $12,500,000 that he could spend without the specific authority of parliament. I suggest that is a serious step for us to take. It is going to require considerably more justification by the minister before I personally would be prepared to accept this amendment.
If one examines the balance sheet appearing in the annual report of the Canadian Commercial Corporation for 1943, one will see that there had been advances under section 8 of the Canadian Commercial Corporation Act at that time of $2,500,000. In reply to a question, the parliamentary assistant to the Minister of Trade and Commerce today gave an answer from which it appears that up to the present moment the net advances made under section 8 of the act have been $3,500,000, so it varies slightly from time to time. If I am correct in my interpretation of how this works, it means there is a balance on hand still to be advanced of $6,500,000. If any portion of that were repaid, suppose $3 million of that were repaid, then a further $3 million could be advanced so long as there was not more than $10 million outstanding at any one time. Mr. Chairman, $10 million is a great deal of money, particularly when it comes out of the pockets of the taxpayers. I cannot see why the minister needs another $2,500,000.
Operations have been conducted for three years, and there is a sum outstanding of $3,500,000. If that is not the case, I hope the minister will correct me. He may tell us if there has ever been the whole $10 million outstanding and, if so, how long it has taken to repay it so that the corporation would be in a position to get more. For instance, the fact that he was able to finance this purchase of butter and repay it with only $3,500,000 outstanding at the moment is quite a strong argument to indicate that they do not need this $2,500,000 extra. And when one sees what has been happening-as was pointed out in the auditor general's report, the money was paid to contractors over a year ago for


goods which have not yet been delivered- I think it is going to take considerable justification for coming to us and asking for a further $2,500,000 of advances to be paid out for projects without the authority of parliament; that is to say, advances which may be made without the house knowing anything about it.


Clarence Decatur Howe: I think I can relieve my hon. friend's mind regarding two or three matters. The first is that no money under the control of the Canadian Commercial Corporation is involved in defence purchases. The moneys referred to in this order in council were not paid by the Canadian Commercial Corporation; they were not paid out of any fund of theirs. They were paid directly by the services. No money is involved in purchasing for the services other than the actual cost of purchasing, which I think ran last year about six-tenths of one per cent of the value of the purchases, the lowest cost of purchasing that I know of in all Canada. Therefore the question of capitalization is not wrapped up with defence purchasing. The capital was arranged for originally so that the Canadian Commercial Corporation would be able to purchase goods required for UNRRA or for governments abroad, pay for them, ship them and recover the funds later from UNRRA or from governments. It is still doing that business, and we have certain transactions-I mentioned sisal from India and potash from inside the iron curtain, and butter from Denmark. This financing required large sums of money. Money has to be paid when the purchase is made in the country of origin. Certain purchases can only be liquidated after the goods have been landed in Canada and resold to the Canadian trade. Around the end of the year we had drawn down from the Minister of Finance the full $10 million which we were authorized to draw, and it was only because of the fact that the shipments were fairly well spaced and goods were sold immediately on arrival that we were able to keep our funds sufficiently liquid to carry out the undertakings into which we had entered.
These undertakings are growing larger. We have had to finance a large purchase of tin. That transaction was entered into for reasons which were urgent. The reason that we are asking for more capital is that we have a full appreciation of the fact that in order to take care of situations which arise, temporary situations, we may require more than $10 million. We may require more than the $10 million capital that we have today. We drew the $10 million which we were entitled to draw from the treasury, and as we finished the transactions, we paid $6 million of it back a few

weeks ago. Of course the entire use of the funds, both capital funds and any authorized loans, is subject to treasury control.


Edmund Davie Fulton: Is it not a fact that most of the expenditures in the future will be on behalf of the Department of National Defence? I have particularly in mind stock piling. Between the time we last met and the time this session convened we have seen in the press numerous references to stock piling. My understanding is that these purchases of strategic metals are made on behalf of the Department of National Defence. If not, perhaps the minister will tell us on whose behalf they are made. One feature which strikes me as being significant is this. In the balance sheet of the corporation I cannot find any place where these purchases are carried as an asset. I do not recall any provision being made in last year's estimates, either in the minister's department or in the defence department, for funds to take care of these purchases. Surely the minister does not propose that the stock piling of strategic metals should be done out of the $10 million or $12,500,000 which he may have authority to obtain from the consolidated revenue fund. Will that not be done by items in the estimates and not in contracts of the Canadian Commercial Corporation?
Where are these stock piles? How are these stock piles reflected in the financial figures of the dominion? Where are they carried as an asset? Are they in the corporation balance sheet or in the department concerned?


Clarence Decatur Howe: Stock piling is a civilian operation, and the funds will be voted by parliament. The only stock pile we are carrying at the moment is a considerable quantity of tin, purchased on the strong recommendation of the defence department. At the moment that is being financed by the Canadian Commercial Corporation. When the further estimates for the year 1948-49 are placed before parliament, as they will be in a few days, there will be an item in these estimates to cover the cost of that stock pile, and the stock pile will then appear in the books of the government as an investment.


Edmund Davie Fulton: In the Department of Finance?


Clarence Decatur Howe: Yes. The funds of the Canadian Commercial Corporation are not for permanent investment or semi-permanent investment. They are to finance current transactions. The transactions which they are used to finance are transactions which will liquidate themselves in a matter of months.


Edmund Davie Fulton: In the estimates of what department will this provision for stock piling appear?
Canadian Commercial Corporation Mr. Howe: It will appear in the estimates of the Department of Trade and Commerce.


Stanley Howard Knowles: Just a brief word; I certainly do not intend to berate the government at length over the matter about which I spoke a moment ago; because I imagine that in view of the attention which has been called to this practice by the Auditor General, and by hon. members on the floor of parliament and in the press, it will not be repeated. I just want to say to the minister that we do not feel that his answers really explained away the abuse of power which the government has exercised in this case. The minister says that this is the practice of the trade. I remind the minister that he is a member of parliament and that it is important to follow parliamentary practices. The minister said that the government did this all through the war years under the authority of the War Measures Act. That was exactly the point that was offensive to some of us, namely, the powers which they properly exercised under the War Measures Act and which they still think they have the authority to exercise.
The minister said that it was only a technicality to which the Auditor General drew attention. That is right; it is only a technicality. I quite agree with him as to the common-sense approaches he sought to make to this whole matter, but I suggest that in parliamentary and governmental procedure technicalities are important, and I hope that the government will pay attention to the criticism which has been made in this respect.


Clarence Decatur Howe: I should like to say one word. I do not think my hon. friend understands yet what the technicality is. There was a vote for this equipment in the estimates of 1947-48 and also in the estimates of 1948-49. The goods were paid for partly out of the estimates of one year, and they were paid for partly out of the estimates of the next year. My hon. friend seems to think that somehow we evaded the provisions of the estimates; that we purchased without a proper provision being made in the estimates for the item. That is not so.


Stanley Howard Knowles: The Auditor General thinks so.


Clarence Decatur Howe: No; he does not say that at all.


Stanley Howard Knowles: He certainly does.


Clarence Decatur Howe: No.


Stanley Howard Knowles: He says that amounts were charged to the votes of 1947-48 for goods and services not delivered until the next year.


Clarence Decatur Howe: That is true enough.


Stanley Howard Knowles: I will wager that you won't do it again.

Canadian Commercial Corporation Mr. Howe: No! We do it every day. I did it just the other day. You cannot buy otherwise.


Stanley Howard Knowles: The minister is very nonchalant about this thing. He is a great businessman, a great organizer, but he does find parliament an awful nuisance, doesn't he?


Clarence Decatur Howe: No, no.


George Randolph Pearkes: Before the house moved into committee the minister did say this was a purchasing agency, not a construction agency.


Clarence Decatur Howe: Yes.


George Randolph Pearkes: There is some justification for misunderstanding in that respect, because the amendment assented to on July 17, 1947, makes reference to constructing and carrying out projects as required by the Department of National Defence. I understand that no construction work has been done by the C.C.C., and that any projects which have been carried out for the Department of National Defence have been through the letting of contracts to some outside firms.


Clarence Decatur Howe: That is right.


George Randolph Pearkes: I understand that policy is now to be discontinued, and that the Central Mortgage and Housing Corporation will carry out those duties. Would the minister consider amending that amendment, eliminating the words "construct and carry out projects"? That was the expression to which I objected in 1947. I think it is unsound, and that the present policy where you have a central department doing all construction work is the sound one. If I remember correctly, the explanation of that paragraph given a year ago when the bill was presented referred even to the possible construction of fortifications.
I believe that is wrong in principle, and if it could be removed from the text there would be no doubt in the minds of people as to the correct functions of this purchasing agency.


Wilbert Ross Thatcher: I have one suggestion which seems feasible to me. My understanding is that today this corporation does business only when some private company or foreign state approaches it. Why would it not be feasible to use the corporation when we have surplus primary products? For instance, I understand that today our apple-growers in British Columbia and Nova Scotia are facing disaster. Why could not this corporation try to arrange barter agreements with some other state, whereby it would take the produce received in return for the apples and sell it in Canada? There may be some reason why it cannot be done, but at the moment it is not clear to me. And if in the future other agricultural

products are in surplus supply it could perform a useful function at that time.


Clarence Decatur Howe: I would not want the hon. member to see disaster on all sides; I can assure him the apple crop of British Columbia has been largely sold, and at a good price.


Wilbert Ross Thatcher: How about Nova Scotia?


Clarence Decatur Howe: There is in Nova Scotia a surplus of a certain quality of apple not marketable in this country. Britain has said it does not want them-would not even take them as a gift. We offered to give Britain certain apples. What can you get in barter for something which people will not take as a gift?


Wilbert Ross Thatcher: If the corporation, on its own initiative, would try to search the world for markets, I should think we would get results. That is why we have a dominion corporation of this kind. I do not see why it should not try.


Clarence Decatur Howe: It is exactly for that purpose that the Department of Trade and Commerce has trade commissioners in every country of the world searching for markets.


Edmund Davie Fulton: With respect to stockpiling, if it is decided to obtain certain commodities for that purpose, do I understand that the $12,500,000 which will be available if this amendment passes would be used for that purpose, and that later provision would be made in the estimates to repay an equivalent amount? Or will a general item be inserted in the estimates to provide for an estimated amount to be spent for stockpiling in the coming year, and that amount drawn on from time to time as necessary?


Clarence Decatur Howe: We hope the latter procedure will be possible. As my hon. friend knows, conditions arise, such as threatened trouble in Malaya, which might easily have cut off our supply of tin, and which may make it necessary to take on commitments without the authority of parliament, in the belief that under the circumstances parliament would be sure to give approval when the time comes. But ordinarily we will anticipate the action and provide for it in advance, rather than ask Canadian Commercial Corporation to finance it.


Edmund Davie Fulton: Do I understand the minister to say that the only material stock pile thus far is that of tin?


Clarence Decatur Howe: Yes; I believe, though, that there are orders out for one or two other materials which may be provided for later.


Edmund Davie Fulton: The details will be included in the estimates?


Clarence Decatur Howe: Yes.


Mr. Gillis:: I had not intended saying anything in this debate, but I am not exactly satisfied with the answer just given by the minister to the hon. member for Moose Jaw in connection with the marketing of Nova Scotia apples. The hon. member for Winnipeg North Centre has said we are supporting the principle of the bill-and we are. But we are not supporting it merely as an agency to regulate, assist and help private enterprise when they get stuck. The basis of our support is that this is a government agency which steps in where private enterprise has fallen down, and that it will market the products of this country as a government agency, with any benefits or profits going to the government.
The apple industry of Nova Scotia is just another industry that has been siphoned off owing to the failure of private enterprise in the field of marketing. Only three or four months ago the hon. member for Rosetown-Biggar was in England. He stated in the house, and I believe accurately, that the people of Britain want Nova Scotia apples, but they cannot get them. I believe the chief reason for their not being able to get them is the difference in currency. We have depreciated the British pound to the point where they cannot afford to trade with us.
Unless some financial arrangement is made by the government for the marketing of Nova Scotia apples that industry will die out. Government policy is scrapping it. I have heard hon. members to my right make reference to the last by-election in the Annapolis valley. In my view the chief reason for the government's candidate having lost was the government's attitude toward scrapping the main industry of the valley. They are now paying for the uprooting of that industry by tearing up the trees and going into mixed farming.
If the government is to use the taxpayers' money for the maintenance of this commercial organization, I see no reason in the world why the government should not use it to support that industry. The hon. member for Rosetown-Biggar has said that our market is there, but that Britain cannot take our apples because of the difference in currency. That being so, I say it should be the responsibility of this agency to barter our apples for something from the old country which could be sold in Canada, thus getting around the currency difficulty.
I thought the minister spoke too quickly when he said our apples were not wanted in Britain. I am sure they are wanted. But until we get around the currency difficulty we will not market them; and the way to get
23, 1949	1909
Canadian Commercial Corporation around that difficulty is to barter Nova Scotia apples for something we can use in Canada.


Mr. Nowlan:: Mr. Chairman, I had not intended taking part in this debate, but since the minister raised the question of Nova Scotia apples and some facetious remarks were made, I believe one or two points should be cleared up in this connection. In so far as the remarks of the hon. member for Cape Breton South are concerned, I hope he is not suggesting that the failure of marketing in the Annapolis valley was due entirely to the failure of private enterprise. As a matter of fact, I think most hon. members know that the marketing was carried out by a board upon which were represented all branches of the industry. Although there have been difficulties in marketing, and very real difficulties, those were due to the exchange restrictions and not to the failure of private enterprise.
I notice the minister says that apples could not be given away, but I would ask his co-operation in clearing up any misunderstanding in this regard. I am surprised to know that the Canadian Commercial Corporation had any apples to give away. I think the minister will be ready to state that the corporation never at any time took over any apples. During the past year the marketing was carried on by the government agency. We did not ask the corporation to take it over, nor did the corporation take it over.
I would like to know when the corporation did offer apples to Great Britain and when the British refused them. I ask that in view of the fact that we were able to sell apples at a low price to Belgium, despite what the Minister of Agriculture said the other day, and at the same time Belgium was selling an inferior product to Great Britain at a higher price. I understand also that Great Britain imported apples of a poor quality from Italy, a former belligerent, a country with which I understand we have not yet arranged terms of peace. I rose simply to suggest that this misunderstanding should be cleared up.


Clarence Decatur Howe: The Canadian Commercial Corporation does not deal in apples. I was referring to the government who had conveyed an offer of apples which had been received from one of the co-operatives, not the Nova Scotia co-operative. That offer was conveyed to England but was turned down.


George Clyde Nowlan: It was the British Columbia co-operative, I presume.


Clarence Decatur Howe: We sent to the United Kingdom a good supply of Nova Scotia applesauce and dried apples which was delivered free on board ship. I think these two transactions indicate that there is not a great market for apples in England.

Canadian Commercial Corporation


Wilbert Ross Thatcher: Is it government policy that the corporation shall not take part in such transactions? If it is, will the minister not consider changing that policy so that the corporation can dispose of some of our surplus produce if necessary?


Clarence Decatur Howe: The corporation is not the agency for that purpose unless arrangements are made to use it as a selling agency.


Mr. Jaenicke:: The annual report of the Canadian Commercial Corporation states that the corporation acted as the agency for the government in placing contracts to a total value of $55,795,419 to the end of March, 1948. Would it be too much trouble for the minister to give us a breakdown up to date, including contracts that have been negotiated since that time? I would like to know the commodity involved in each contract.


Clarence Decatur Howe: I have not the list here but I suggest that it might be more convenient to discuss this when ihe bill is in committee.


Frank Eric Jaenicke: Could , not the list be placed on Hansard so that we could peruse it?


Clarence Decatur Howe: This table that I have includes national defence purchases as well as purchases for other governments. I could have a table prepared and distributed tomorrow.


Edmund Davie Fulton: Will the minister not acquiesce in the request made by the hon. member for Muskoka-Ontario (Mr. Macdonnell) that the balance sheet be carried out to December 31 between now and the time the bill is up for second reading? We could then make up our minds whether there is a real need for this extra $2,500,000.


Clarence Decatur Howe: The figures will all be available.


Wilbert Ross Thatcher: Does the corporation have representatives abroad or are the trade commissioners the only representatives of the government abroad?


Clarence Decatur Howe: The corporation does not have representatives abroad except in London and Washington.


Wilbert Ross Thatcher: Does the corporation do any advertising abroad?


Clarence Decatur Howe: No. The foreign trade service of the Department of Trade and Commerce is the agency that is used to obtain commercial intelligence in all parts of the world. Anything that the Canadian Commercial Corporation needs to know about foreign markets can be obtained from the foreign trade service.


Wilbert Ross Thatcher: What representatives or
agents has the corporation across Canada? Are efforts made to sell some of these products domestically?


Clarence Decatur Howe: No, the corporation is not a selling agency in that sense. In other words, it is not in the retail business. It is not a Loblaws. The corporation has offices in Halifax, Quebec, Montreal, Ottawa, Toronto, Winnipeg, Calgary, Edmonton, Vancouver, Victoria, Washington, D.C., and London, England.


Mr. Gibson (Comox-Alberni):: The minister said that one reason why timber control was being retained was that the British government were still making bulk purchases. Would it not be possible for the Canadian Commercial Corporation to undertake that work and act as purchasing agent for the British government? What policy would be followed if purchases were made in that way? Would there be an allocation as between the various producers, or would they be on a competitive basis?


Clarence Decatur Howe: As my hon. friend knows, throughout the war years, lumber was one commodity that was bought through the lumber controller. That was because the specifications were so important. Over-all arrangements were made and continue to be made through the timber controller's office.


Mr. Hatfield:: Was it the Canadian Commercial Corporation that traded British Columbia apples for Brazilian oranges?


Clarence Decatur Howe: No.


Wilbert Ross Thatcher: Is the corporation still trying to make deals with UNRRA or other relief organizations to dispose of some of the surplus horse meat in Saskatchewan?


Clarence Decatur Howe: The horse meat that Saskatchewan sold outside the country was sold by a government agency.


Mr. Case:: Is that horse meat to be consumed in Saskatchewan or is it just for export?
Resolution reported, read the second time and concurred in. Mr. Howe thereupon moved for leave to introduce Bill No. 122, to amend the Canadian Commercial Corporation Act.
Motion agreed to and bill read the first time.



NATIONAL PARKS ACT


James Angus MacKinnon: the second reading of Bill No. 81, to amend the National Parks Act.


[Stage Direction]
Motion agreed to, bill read the second time, and the house went into committee thereon, Mr. Golding in the chair.

On section 1-Short title.
Stanley Howard Knowles: Mr. Chairman, for the record, will the minister make a statement as to the purposes of the bill?


James Angus MacKinnon: Hon. members will recall that in 1929 the natural resources of the province of Alberta were transferred by the government of Canada to that province, and as appears in section 16 of the Alberta natural resources transfer agreement it was intended that that portion of Banff national park necessary for the proper development of the Spray lakes storage and power development project would be excluded from Banff national park. This is made clear by the debates in the house on the second reading of the bill approving the said agreement. Pursuant to the said agreement 630 square miles were excluded from the park in 1930.
The government of Alberta has now arrived at an agreement with the Calgary Power Company for a licence to develop the said project. It is proposed to dam the Spray river twenty-three miles above its mouth, and from the north end of the reservoir so created to divert the stored water through a system of canals, pipe lines and power houses down Goat creek valley and out through the pass opposite Canmore to the Bow river. The project will add 90,000 horsepower to the 110,000 horsepower now developed in the Bow river and its tributaries.
Strong representations have been made to me by the premier of Alberta as a result of which I am satisfied that the area excluded from Banff national park in 1930 is insufficient for the proper development of the project, and that it is necessary in the public interest that the further area of 21-2 square miles proposed to be withdrawn from Banff national park by section 2 of the present bill be excluded from the park in order that the proposed project may proceed. The said further area is all on the edge of Banff national park, and contains no features making essential its retention for park use. The natural flow into the Spray river from the watersheds emptying into it below the site of the proposed dam is usually adequate for scenic purposes.
In order to ensure an adequate flow of water for scenic and fire-fighting purposes, I have required the government of Alberta to enter into an agreement with me by exchange of letters between myself and the Hon. David A. Ure, the minister in charge of water resources and irrigation for the province. By this exchange of letters the province has agreed that it will not reduce, and that it will not permit any licensee from it, by works outside the boundaries of Banff national park, to reduce the flow of water in the Spray river
National Parks Act
at its junction with the Bow river in the said park to an amount less than 200 cubic feet per second during the months of June, July and August in each year hereafter; that it and any licensee from it will during the month of September in each year hereafter supply such amount of water as may reasonably be required by Banff Springs hotel for essential sewage and water supply, and that it and any licensee from it will provide additional water for fire fighting within the said park as required at the rate of 100 cubic feet per second. I consider that these provisions amply safeguard the scenic beauties of that portion of the Spray valley lying within Banff national park.
In order to protect fishing in the Spray river, the proposed licensee from the province of Alberta has agreed to provide 20,000 acre feet of storage more than was originally contemplated and to release the additional water into the Spray river below the dam at the rate of 100 cubic feet per second as and when required for the maintenance of a flow in the river sufficient to protect the fish therein.
Section 3 of the bill withdraws from Elk island national park, in the province of Alberta, a narrow strip of land on the north side of Alberta provincial highway No. 16 with a total area of 20-6 acres. The withdrawal of this area has been requested by the government of Alberta in order that the highway may be widened. I am satisfied that the withdrawal of this small area will in no way affect the park, and that such withdrawal is in the public interest.
Section 4 of the bill changes the name of New Brunswick national park. The new name, Fundy national park, has been suggested by the Hon. J. B. McNair, K.C., LL.D., premier of New Brunswick, and was selected as a result of an essay competition conducted throughout the New Brunswick schools.


[Stage Direction]
Section agreed to.
Sections 2 and 3 agreed to.
On section 4-Heading repealed.
Mr. Brooks:: I wish to ask the minister a question with reference to section 4. I notice that the name is being changed from New Brunswick national park. Is that because another national park is to be established in the province of New Brunswick and they do not wish to have confusion of names? Is this park to be called Fundy owing to the fact that possibly another park will be established in that province along the Saint John river? I may say that the site which was first selected for the national park was up the Saint John river, and it was the one which was most highly recommended. It occurred

National Parks Act
to me that possibly the department intends to develop another national park on the Saint John river. Can the minister give me any information on that?


James Angus MacKinnon: There is no intention at the moment to establish immediately another national park in the province of New Brunswick. The name Fundy was selected, as I said, after a competition among the schools of the province, and was recommended by the government of New Brunswick.


George Clyde Nowlan: As to the question which was raised by the member for Royal about the use of the name Fundy, will that include the national park which I understood was to be established in Nova Scotia? Certainly it is rather a surprise to me to know that the province of New Brunswick has a monopoly on the name Fundy. After all, there is as much of the bay of Fundy adjoining Nova Scotia as there is adjoining New Brunswick. I do not want to start an internecine feud between two of the three maritime provinces, but I want to register my protest now against the province of New Brunswick claiming any exclusive title, right or interest in the name Fundy.
Having made that preliminary statement, I now want to ask the minister a question. I noticed in a press report of something that had occurred in another place the fact that the federal government has taken steps to establish a national park near Blomidon. Certainly that is on the bay of Fundy. I had presumed that the amendment included that park, and I should like to know if it only applies to New Brunswick. I should like the minister to say what steps have been taken to set up a park in Nova Scotia at Blomidon, which should be included within the name Fundy and to which reference has been made by his department. I should like to know if the boundaries have been delimited.


James Angus MacKinnon: If I understand the hon. gentleman's question correctly, I would say in reply that this bill does not attempt to include the land in Nova Scotia referred to. There have been investigations by the parks branch officials of the department concerning the area of Blomidon, and at the moment I am not quite sure whether or not a decision has been reached.


The Deputy Chairman:: Shall the section carry?


Thomas Langton Church: On division.


[Stage Direction]
Section agreed to.
Schedule A agreed to.

Schedule B agreed to.
Title agreed to.
Bill reported, read the third time and passed.


Louis Stephen St-Laurent: Might I have the consent of the house to revert for a moment to motions, in order to inform hon. members that the royal assent has been given in the parliament at Westminster to the legislation providing for the union of Newfoundland with Canada.


Some hon. Members:: Hear, hear.


Louis Stephen St-Laurent: The applause with which this announcement has been greeted will not appear in Hansard, but I do wish to state that it is very satisfactory to find that, although there may have been diverging views as to the proper procedure, there is no divergence whatsoever as to the pleasure with which we receive the news that all the legal formalities have now been completed to make this union effective as from the expiration of March 31, 1949.


Some hon. Members:: Hear, hear.


Louis Stephen St-Laurent: May I add just a word to answer a question asked some time ago by the hon. member for Prince Edward-Lennox (Mr. Tustin). He asked whether the government was giving consideration to declaring March 31 a national holiday so that all Canada might join in celebrating the entry of Newfoundland into confederation. I replied that it would be premature to announce a celebration at that time, the bill then being still before the United Kingdom parliament.
Now I may say that owing to the very short time remaining before the end of March, and in view of weather conditions at this time of year, and other considerations, the government has decided that no holiday could conveniently be arranged for March 31 or April 1. However, it is planned to hold a simple ceremony here in Ottawa and in St. John's on April 1, and to broadcast these ceremonies over the Canadian Broadcasting Corporation system and the Newfoundland stations. A more detailed announcement of the program will be made later on. Should the provincial government of Newfoundland wish to hold a celebration there later in the season, which might perhaps coincide with the opening of their legislature after their provincial election, the Canadian government will be happy to co-operate.


Gordon Graydon: Does this mean there will not be a joint celebration in St. John's, Newfoundland, but rather separate celebrations in both the capital of Canada and the capital of Newfoundland.


Louis Stephen St-Laurent: It is planned to have a part of the celebration take place in St. John's and a part take place here on parliament hill, and to have them so arranged that they will be consecutive and form part of the same broadcast over the radio systems of Canada, as it is now, and of the new province of Newfoundland.


Gordon Graydon: The Prime Minister is not going down?


Louis Stephen St-Laurent: No, not at this time.



MAIL CONTRACTS


Hon. Ernest Bertrand (Postmaster General) moved: that the house go into committee to consider the following resolution:
That it is expedient to present a bill to amend the Mail Contracts Supplemental Payments Act to make supplemental payments authorized under the said act applicable to renewal contracts.


Gordon Graydon: I hope I may not be prevented from taking some part in the debate on this resolution, if I consider that necessary, by reason of the fact that I suggest to the minister now that he should make a full statement and explanation of the purposes of the resolution before Mr. Speaker leaves the chair.


Ernest Bertrand: For the last two years, Mr. Speaker, we have passed bills to authorize the Postmaster General to supplement the payments under rural mail delivery contracts to take care of increased costs. The provision was made effective for one year; then in June, 1948, there was an extension for another year. This year the officers of my department have come to the conclusion that it is not necessary to have further increases, but that it is better to get authority from parliament to merge the increases already given with the cost of the contracts when they came up for renewal. We do not intend to give further supplements, but when we renew contracts under which supplements have been paid we are asking permission from parliament to include those supplements in the prices of the contracts. When we have to ask for tenders the low tender, if the applicant has the facilities to fulfil the contract, will be the price of the contract; there will be no further supplements.
Mail Contracts
It was useful to have this legislation for the last two years, because costs were continually rising. When we asked for tenders the figures were so high that often we had to refuse to accept the lowest tender, and had to call for tenders all over again or ask those who had tendered to lower their prices. In other cases, concerning renewals, we gave supplements wherever we thought it was useful and just to do so.


Gordon Knapman Fraser: You only gave the supplement where it was asked for, did you not?


Ernest Bertrand: When there was a request for a supplemental payment we studied the matter and quite often granted the request because, with the cost of living increasing, it was usually found that the price was too low.
Now I want to give the house the pro rata of the different contracts in which we gave supplements as compared with the contracts in which we had to ask for tenders. There are about twelve thousand rural mail contracts in operation in Canada today. As of March 28, 1947, the Postmaster General was given authorization to pay supplements and war allowances to contractors. On June 30, 1948, we extended to March 31, 1949, the period during which these supplements might be granted. The present bill is asking for the incorporation of these supplements into the contract, just as if they appeared in the original contract. If this permission is not granted by parliament, whenever a contract expires we could not grant a supplement and the contractor would have to take the contract at the price that obtained a year ago or we would have to ask for tenders.
As of 30th September, 1948, the mail contracts with supplements in force represented 54 per cent of the total 11,933 contracts in force on that date. This meant that 6,485 contractors received the supplement. The original contract rates on these 6,485 contracts called for a total payment of $4,993,735 per annum. The supplementary payments, as of 30th September, 1948, in respect of those contracts amounted to $1,537,108, making total payments on these 6,485 contracts of $6,530,843. The increase in cost due to supplements, therefore, amounts to 30-78 per cent.
Certain contracts under which we could not grant supplements, because the contractor had disappeared, died or resigned his contract, had to be sent out for tenders. There were 1,143 such contracts. As of September, 1948, the payments to be made under the old contract rates amounted to $765,651. After tenders were called, the new contract rates

Mail Contracts
for those contracts amounted to $1,052,905 per annum. The per annum increase on these 1,143 contracts is, therefore, $287,254. The increased cost of the contracts which resulted from tendering amounts to 37-5 per cent as compared with 30-78 per cent for the contracts under which supplements were given.
During the coming year it is calculated there will be approximately 1,600 mail contracts that will expire. We have not the right to grant supplements to those contractors and we are not asking for it. We will have to call for tenders. If there is a supplement payable, the contract will include the supplement if this legislation is accepted by this house.


Thomas Langton Church: These
renewal contracts come under a public utility, the Post Office Department, and are no doubt very necessary. Rural mail deliveries are necessary. I wish to ask the minister a few questions, but I shall not take up more than two or three minutes. Would it not be well for the minister to follow a different method of financing these renewals? The Post Office Department has a surplus. In the city of Toronto, it is over $16 million and in the city of Montreal approximately $15 million. No doubt the mail order stores contribute to that to some extent.
This is a public utility with a large surplus. Would it not be better to return some of this money to the people? Would it not be well to follow the example of the present Minister of Finance (Mr. Abbott), who last night did something for the working class of the country in the announcement he made? There may be a difference in how it was done, but at least something was done. The minister has done fine work under the present contracts. There is a surplus and I think the minister should put it in the estimates. Whenever other public utilities such as the Bell Telephone Company, the City Gas Company or any of the others have a surplus the people are entitled to some reduction in rates. Since the Post Office Department has a surplus, I think the people are entitled to a reduction in postage rates. The benefit of the surplus has not been passed along.
There should be some other functions for the Post Office Department to perform. In England this department has many additional functions which are of benefit to the people. I appreciate what the minister has accomplished, but after all, the post office is a public utility. Service should be given to the people at cost and they are not getting it. If there is another way of financing it, it should be put in the tax rate so that the people would receive the benefit of improvement all along the line.


Ernest Bertrand: Mr. Speaker, for many years the Post Office Department has had a large surplus. I am sorry to say that this year the surplus is evaporating. We were very happy to do it, but this year we have been obliged to increase salaries-


Mr. Deputy Speaker:: I should point out
that we are not in committee, and I do not think the minister wishes to close the debate at this moment. I would suggest that the minister either close the debate or answer questions when we are in committee.


Gordon Graydon: In accordance with your ruling, Mr. Speaker, that the minister should not answer questions on second reading, since if he did he might close the debate, I want to take this opportunity of saying a word about the legislation now being considered. The question of the rural mail courier has been a vexing one during the years in which most of us have sat in this parliament. It has, of course, become an even more vexing one owing to the economic situation and the changes in Canada during the period of the war as well as to the increased cost of living.
I have no doubt that the Postmaster General has on his record hundreds of cases in which, had there not been some method of increasing the revenue to the rural mail courier for the carrying of mail to the rural residents of Canada, many of the bondsmen of those contractors would have found that they had a rural mail route on their hands. The minister, in his great wisdom or otherwise, decided that a supplementary sum should be paid to certain contractors when it was shown that those contractors could not proceed with the work under the present contract for which they had tendered and which had been accepted.
At this stage I want to refer to the conditions which made this legislation necessary. It was the failure of Postmasters General to face up to the problem of the rural mail courier. Since I came into the house in 1936 that problem has never been faced. I am wondering whether this bits-and-pieces legislation, which has been brought down from time to time, is not in a sense an attempt to cover up the mistakes of previous years. The mistakes to which I am referring are these. We have allowed to develop in the rural areas a condition which seems, strangely enough, to be overlooked by the government. It has been neglected all through these years, and we have allowed His Majesty's mail to be carried at a ridiculous price, particularly at a time when other people in the government service are well paid. That is the bedrock foundation of all the problems which make this legislation necessary.

Time after time we on this side of the house have asked the ministry, even if they did not want to change their policy, to go so far as to set up a committee to investigate the question how best to handle the rural mail-carrying situation in the country. But at no time, either in war or in peace, has this government seen fit to accept that proposal. What could possibly be in the minds of the government when they refuse to accept the suggestion? Are they afraid to have a committee set up? Are they afraid of the evidence which would be adduced by the rural mail couriers and by the people whom they are serving? Are they afraid of the evidence that would be brought out showing the disgraceful conditions under which the rural mail couriers have operated all during those years? I have never been quite able to see the government's point of view in dealing with rural mail couriers.
Last night the Minister of Finance (Mr. Abbott) used such words as "intelligence" and "prudence", which he applied to himself and no doubt to the government, because I am sure that he would not want to monopolize these words himself.


Douglas Charles Abbott: No, indeed.


Gordon Graydon: I am sure he would not. I am sure he had the Postmaster General in mind when he used those words.


Douglas Charles Abbott: He certainly did.


Gordon Graydon: If he did not he should have had.


Douglas Charles Abbott: Put him right at the top of the list.


Gordon Graydon: I do not think I would have done that. Nevertheless, he must be near the top because I am sure they are all in the same grab bag over there at the moment. In view of the fact that this government has chosen to interpret its actions as intelligent and prudent, the minister should not have taken such an adamant attitude to the setting up of a committee to deal with this question. Surely there can be no reason why the rural mail couriers problem should not have been investigated. If we take the government's word for it, in other lines of endeavour they are able to solve great problems in a masterly way.


Mr. Michaud:: Hear, hear.


Gordon Graydon: Just a minute; I did not think you were following me very closely. The government say that they have been able to handle some problems in a masterly way, but they have not been able to solve the problem of the rural mail couriers in Canada, and I think that is a pretty good indication of how they do handle problems in general.
Mail Contracts
This arrangement for supplementary contracts is a necessary thing. It is a necessary thing not because we like the idea of the principle and method involved. It is necessary because of the failure of the government to face up to the whole problem and solve it on a proper basis. I want to leave one suggestion with the minister. I have always felt that there was an injustice in connection with these supplemental payments. I could never understand why the rural mail courier, or someone in his behalf, should have had to make a complaint or to make a suggestion to the government, in the first instance, that he should have more money for his contract. There never seemed to be any justification for that. I could never understand why the government should single out the rural mail courier again and say to him, unless you ask for the money we will not bother giving it to you. I ask the government if there is any other single employee of theirs who has to come to them and ask for the pay that he is to get. Why single out the rural mail courier for that kind of treatment? That is what he has had to do.


Ernest Bertrand: Because he had a contract.


Gordon Graydon: The minister can explain it in that way if he likes, after I am through. The point is that every one of the mail couriers should have been told that a supplemental grant is available for them under certain conditions, having regard to the contractual position in which they find themselves. The government never did that; the government never notified a single rural mail courier in Canada that he was entitled to a supplementary grant on his contract. I have no doubt that in Canada there are hundreds of mail couriers who have received less than they should have because they have not known that they could get a supplemental grant from the government. The minister dare not deny that.


Ernest Bertrand: Yes, I do.


Gordon Graydon: I am sure that that situation has existed. I am hopeful that the minister will see that those who are entitled to this extra grant will be told that they are entitled to it and that the department will calculate what they are getting for the mileage and the conditions of the route, so that they will receive that to which they are entitled.
I have nothing more to add except to appeal again to the minister. I do not like to be hard on the minister. He has a genial disposition. It must be the fault of somebody else on the government benches because I cannot imagine the minister and his department not trying to do the best they can for

Mail Contracts
the rural mail couriers. I am going to ask the minister fairly and honestly this afternoon why we cannot set up a committee in this parliament to deal once and for all with this vexed problem of the rural mail courier. He is entitled to a square deal, and even though these supplementals do go a considerable distance to give him a better deal, he is entitled to the same kind of treatment as other servants of the government who are paid under the various contracts which they have entered into in the public service. It is not fair to single out the rural mail courier and treat him differently from other people in the service who are getting a much better deal.
I leave that suggestion with the minister in the hope that, in addition to the legislation which is now being brought down, he will consider the rural mail courier's position and bring in some legislation which will permanently solve the difficulty. When he does that he will be entitled to join that great throng to which the Minister of Finance referred last night as the intelligent and prudent part of the national community. Until the minister does that, I am afraid that we shall have to defer judgment on him.


Mr. Deputy Speaker:: Order. Before the hon. member for Red Deer (Mr. Shaw) speaks, may I refer to the interruption which I made a few moments ago when I stopped the Postmaster General replying to questions which are put to him? I think I was correct in suggesting that he should not answer questions at this time. However, I stated that he would have the right to reply. I was under the impression that we were on the second reading of the bill. Of course we are not on the second reading of the bill. The motion is that I do now leave the chair for the house to consider this resolution. There is no reply on that motion. I suggest that if there are questions to be asked the minister could answer them when we reach the committee stage.


Mr. F. D. Shaw (Red Deer):: Mr. Speaker, unfortunately it was difficult if not quite impossible for us at this end of the chamber to hear what the minister said when he spoke briefly a moment ago. It is my understanding that the resolution now before us will enable his department to continue the payment of supplemental bonuses to those mail couriers who have been receiving them during the past few years, and where renewals are necessary a continuation of such bonuses will be provided.
However, one point troubles me. I believe the minister said that about 1,600 contracts would expire in the coming year. Many of

those will be simple renewals, while in other cases it will be necessary to call for contracts. Is it the intention of his department to call for contracts, where such procedure is necessary, and then to pay the bonus on top of those contract rates?


Ernest Bertrand: I would not be allowed to do that. The right expires on March 31. We had the right to pay a supplement only when the contract had been in force for at least one year.


Frederick Davis Shaw: I just wished to be clear on the point. Were that not so we would be introducing a dangerous principle. I agree with the hon. member for Peel (Mr. Graydon) that concrete action should be taken soon to clear up once and for all the numerous conditions which do prevail and have prevailed for a long time with respect to rural mail couriers. It is one of the most unhappy activities in which one could engage. On the other hand, I do not know of any group of persons in the public service who have to contend with as many difficulties, unless one were to mention rural postmasters. However, I do not wish to go into that field at the present time.
We agree with the hon. member for Peel that a useful purpose could be served if a committee of the house were set up to enable hon. members to examine into the matter most carefully. I know last year there was considerable discussion of the suggestion made in some quarters that mail couriers should be appointed rather than placed in a position where they bid on contracts. However, before I would support that suggestion I would have to insist upon the clarification of certain conditions which at present surround the appointment of postmasters in many of our rural post offices. I am not at all happy about some of the conditions of which I am aware. Possibly before too long we will have an opportunity in the house to refer to some of those conditions.
Meantime may I repeat that, as in the past, we continue to support the payment of bonuses where they are necessary, and would also support the establishment of a committee so that we might consider this matter in greater detail.
Motion agreed to and the house went into committee, Mr. Golding in the chair.


Mr. Bentley:: As usual, when the minister was making his statement he did not take into his confidence those of us who are at this end of the chamber. It was difficult to hear what he said. There is a certain type of mail contractor in whom I am particularly interested, because I hear about his diffi-

culties. I refer to those people in the urban centres who carry the mail from the post office to the railway trains, and back again.
From year to year these people have found their operating costs increasing at a tremendous rate. When they have bid on contracts expecting those costs to be a certain amount, they have found that before many months the costs have increased to a point much greater than had been expected. I am not clear whether these people are included in the bill, the resolution of which we are now considering. Would the minister assure the committee of that?


Ernest Bertrand: Mr. Chairman, the purpose of this legislation is to get authority, upon the renewal of a contract in which there has been payment of a supplement, to include such supplement. We do not intend to give more supplements. It is understood that they were given in the last two years because of the rapid increase in the cost of living. Contractors who believed that their contract rates were no longer commensurate with the cost of the wox-k they were performing asked for this supplement. As a result of careful examination we gave the supplements wherever the officers of the department thought they might reasonably be given- and I might say that this applied to the vast majority of cases.
This law expires on March 31. Therefore in order to renew contracts now in existence we must renew with the added supplement; and in order to add the supplement we are asking for the passage of this legislation. The purpose of the legislation is to secure the privilege of including the supplement which was paid last year in the contract price for the coming year.


Thomas John Bentley: It will exclude any new contracts?


Ernest Bertrand: Yes; contracts cannot be for more than four years. If we were to renew a contract today it would be on a basis without the supplement, because it was to apply only for 1947 and 1948. Therefore we are asking permission to add the supplement to the original contract rates when renewals are made. I should suppose that those who are going to tender today would tender at rates which would seem profitable under present circumstances.


Alfred Johnson Brooks: As there are many rural mail routes in my constituency, I am interested in this resolution.
One condition which has been causing much dissatisfaction in recent months in rural areas has been the curtailment of daily mail deliveries. I believe the department regulation requires four boxes to the mile. Many of the
Mail Contracts
districts do not average this number, with the result that, instead of continuing the daily mail delivery which has been in operation for many years, the minister's department is cutting down the deliveries to three days a week.


Ernest Bertrand: Might I point out that that has nothing to do with this measure.


Alfred Johnson Brooks: I understand that. My question is this: When these supplementary payments have been made to rural mail couriers who we consider have not been paid enough, why would it not be possible to pay a supplementary sum in back areas so as to maintain in those districts daily mail deliveries where, in present circumstances, those deliveries are being reduced? I think it is most necessary that people in the country receive their mail each day. I should like to have the minister's reaction to that suggestion.


Ernest Bertrand: Any hon. member could get up and make an interesting speech about rural mail contracts, because each contract in the different sections of the country is different from the others. It is almost impossible to arrive at a unit price per mile. If we could do so, we would gladly adopt such a system. The matter has been studied for some time. These contracts have been in force ever since the Hon. Mr. Lemieux established rural mail deliveries back in 1908, I believe.
The officers of the department have done considerable thinking about this matter. I would have no objection to a committee studying this, but it has been studied before and I am sure that the members of such a committee would come to the conclusion that it is almost impossible to establish a unit price.
In certain places deliveries have been reduced from six a week to three a week, but this was done because of the small amount of mail that was being delivered. It is not efficient to spend money to deliver mail to points seven or eight miles from the railroad when there is only a little to deliver. The other day the hon. member for Mackenzie asked how many post offices had a yearly revenue of less than $25. It is hard to understand that a post office could have a revenue of less than $25 per year, but the fact is that there are thirty-four such post offices in one province. Surely when such a post office is located ten or fifteen miles from the railroad it is not wise to give deliveries six times a week, because there would be practically no mail to carry. The man would have to go to pick up the mail when there was practically no mail.
We are ready to give six deliveries a week wherever we can. For some time the Post Office Department has had considerable revenue owing to the increase in business and

Mail Contracts
the tax that was put on during the war. It is impossible to take off that tax at this time and it might be noted that for the coming year our huge surplus will completely disappear.


Mr. Cardiff:: I think the Postmaster General is one of the most genial ministers we have. I come from a county where the mail carriers have perhaps one of the hardest jobs to do in the country. We are in a snow belt and I can understand that it is impossible to set a mileage rate. On the other hand, I would not like to agree to these supplementary rates without knowing when they are going to stop. Suppose we give the minister another year or two, what will he do at the end of that time?


Ernest Bertrand: I am not asking for an extension. Last year we asked for an extension of one year but this year we took the stand that we could not ask for an extension. All we are asking is that wherever a supplementary payment has been made we be permitted to merge it with the original contract price, should the contract be renewed. There are rural mail contractors whose contracts will expire this year. If a mail carrier has done his duty properly and asks for a renewal for another four years, without this legislation we would be unable to renew the contract at the contract price plus supplementary payment.


Lewis Elston Cardiff: Why could you not let another contract? Why could you not call for tenders?


Ernest Bertrand: Perhaps we could do that, but the department has always felt that where a contractor has given good service, where he has purchased the necessary equipment such as an automobile and perhaps horses and sleigh for winter work, it is not fair at the end of his four years to call for tenders. Under the tender system we would have to accept the lowest tender and some other man might bid just a few dollars lower. It has been felt that it would be unjust to the man who has,given good service if he were forced to tender every time his contract expired.


Lewis Elston Cardiff: I am not opposing this, because I think these men deserve the supplementary payment; but I cannot figure where it is going to stop.


Ernest Bertrand: We are stopping this year; we cannot go any further except by asking for tenders.


George Alexander Drew: That is a frank admission of what the minister expects.
TMr. Bertrand (Laurier).]


Mr. Bradshaw:: Do I understand the minister to say that he will not pay any more supplementary payments?


Ernest Bertrand: Not after March 31.


Albert James Bradshaw: A new contract would not include supplementary payments?


Ernest Bertrand: A contract would be renewed if a contractor asked for its renewal at the old price plus supplementary payment which had been made this year. If a contractor does not wish to renew we will have to call for tenders.


Wilfrid Garfield Case: I have tried to follow the minister and I understand that he now intimates that no one can apply for a supplementary payment.


Ernest Bertrand: After March 31.


Wilfrid Garfield Case: Could anyone apply for a supplement between now and March 31?


Ernest Bertrand: The law is here.


Wilfrid Garfield Case: That gives a little different picture. If these men know in advance they may be anxious to have supplements to their contracts.


Ernest Bertrand: They have to be reasonable in their demands.


Wilfrid Garfield Case: I understand that if a contract is being renewed it will include the contract price plus the bonus.


Ernest Bertrand: That is all we are
asking for.


Wilfrid Garfield Case: There is no method by which you can make an adjustment later on if the costs of operation are lower?


Ernest Bertrand: We are coming back to normal times. I have been told quite often by members of the opposition that we are approaching normal times.


Wilfrid Garfield Case: The rural mail carriers are not satisfied even yet. They feel that their equipment should be considered, that certain amounts should be set up for depreciation, and so on. Personally my sympathies are with the rural mail carriers, and therefore I am not likely to oppose anything that sounds reasonable. Like the policeman on the beat, they turn out in all kinds of weather, and they bring a great deal of comfort to rural people by delivering their mail to them. With that clarification, knowing that they have from now until March 31 to apply for an increase supplemental to their contract, I will not oppose the measure.


Thomas Reid: There is an angle to the giving of a bonus that is not generally recognized

in the house. I rise to mention it, and then to make one suggestion. In so far as the rural mail carriers in my district are concerned, in the New Westminster constituency there are seven rural routes. There is nothing comparable in any other constituency because, of those seven routes, the smallest has not less than 480 boxes, and the largest route has 687 boxes. There is a reason why, in cases such as that in my constituency, it is advisable to grant a bonus, and I will explain it in a moment.
Bids are called on contracts to deliver mail over a mileage route, and at the time they bid on the contract there may be only 250 boxholders on the route. British Columbia is expanding rapidly in population, and especially the districts of Vancouver, New Westminster and the lower Fraser valley. These seven routes were put into operation two years ago, and they are now going to double the number and have fourteen routes. Where a man bids on 250 boxes, shall we say, and finds in two years' time that there are 600 in the same mileage, and that he has to stop almost every few feet to deliver mail, surely in that instance he is entitled to more money.
What I suggest to the minister is that the rules and regulations of his department should be examined and revised because some of the regulations in the postal department are inadequate. They go away back to the early days, and they have not been brought up to date. When we suggest to the officials that, instead of a man handling 687 persons on one route, the people on that route should be provided with door to door delivery, the officials say, "Oh, the regulations will not allow it because the main post office in the constituency is not one that has enough revenue to warrant door to door delivery going out from that post office." I suggest to the minister that he and his officials should take note of the conditions in certain parts of Canada where the rural mail system should be changed, and thus relieve the heavy work of the rural mail carriers. I suggest that in the congested areas door to door delivery should be established even though they have not the up-to-date and modern conditions of the cities. It is far too much to expect any man to pick up mail in the morning and serve 685 boxes in a day.


Frederick Davis Shaw: The minister stated a moment ago that in some instances the frequency of service to rural areas had been reduced. He gave as the reason for that the fact that the volume of mail had fallen off in many cases. That is undoubtedly true, but here is the situation which confronts us, in my part of the country anyway. In some instances the frequency of the delivery service has been
Mail Contracts
reduced from three days to two days a week, and there is an increase in the volume of mail delivered in every instance. That leads me to an intriguing question. What yardstick is used by the post office authorities in determining whether or not a tender is reasonable? I think that probably persons living in a district, knowing the conditions of the roads from season to season, are often in a better position to ascertain the problems and the costs involved than are persons who reside in the cities. As I say, I am very anxious to know just what yardstick is used in determining whether or not a tender is reasonable.
People become incensed when, after having had mail delivery to their boxes along the road three times a week for a period of many years, they find that the service has been reduced to once or twice a week, and are told that the reason for it is that all tenders were too high. I believe the minister owes us an explanation as to what standard is used when determining whether a bid is reasonable. I favour the principle of renewing contracts where the carriers are giving service. It takes quite a long time for these men to secure adequate equipment in order to give service in a highly efficient manner. It seems rather unfortunate, as the minister has stated, that in certain cases after a man has built up his equipment to a satisfactory state he has lost the contract simply because his tender happened to be $5 more than that of somebody else who probably was not familiar with the problems encountered. My first question, however, is the important one.


Mr. Ferguson:: I have had a great deal to do with the Post Office Department. It is not very often that it is humanly possible for a person to contact a member of the present government, but I want to say that I have taken many problems to the Postmaster General personally, and he has looked into them and remedied mistakes that have been going on for years, particularly as to rural deliveries. In the town of Barrie there was an old practice that no mail could be delivered to a house that did not have a sidewalk in front of it. I brought that to the attention of the Postmaster General and he could hardly believe it was a fact, but when it was established as a fact he agreed that it was a ridiculous practice. Immediately 170-odd people in the town of Barrie received mail delivery who had not been receiving it before because they had been denied it by a postmaster who apparently was not using his head, or was too much inclined to follow an old practice which should have been obsolete years ago.
I have known of rural mail carriers who have contended that they were not receiving enough money, but when I investigated I

Mail Contracts
found that these men simply believed that they would like to deliver mail, that it was an easy job, and they tendered so low that they took the business away from some other man who was doing a good job. I have also brought these situations to the attention of the Postmaster General and they have been remedied. In his department there are many old practices which through usage have become almost indispensable to the officials. I recommend to him that he inject a little of his fairness and farsightedness into the other members of his department. If he does that there will be very little to be desired from his particular department. I must say that.


Mr. Herridge:: I want to add a few brief words. I listened with a great deal of interest to the statement of the Postmaster General because I was interested in the figures on awards supplemental to contracts, and the figures given with regard to the cost of contracts issued during the same period. If I heard him correctly, it appeared to me that the officials who were responsible for making the final decision on the awards supplemental to contracts in force must have used very sound judgment. If I heard him correctly, supplemental awards were some five to six per cent less in cost than contracts given during the same period.


Ernest Bertrand: Seven per cent.


Herbert Wilfred Herridge: I think that indicates very sound judgment on the part of the officials concerned. I was interested in that aspect of it, because I remember when this legislation was up in the first instance hon. members to my right stressed very strongly that this was more or less a method of handing out political plums, and so on. The record as given by the minister indicates that this criticism has not proved to be correct.
At one time, Mr. Chairman, I thought this whole system of contracts was somewhat unsound, and had the idea that rural mail carriers should be under the civil service, or at least should be on a salary or wage basis. But the more I learn about the situation, the more I realize the difficulties with which the department has to deal, the more I appreciate the problems of climate, different road conditions, winter and summer conditions and all the rest of it, the more I believe that on the whole the rural mail system is handled very efficiently in this country.
Before resuming my seat I want to support the proposal put forward by the hon. member for Peel in regard to having this matter brought before a committee. It is not that such a committee would solve all the questions involved or that any great changes

would be made, but if this question were referred to a committee I believe hon. members would be much better informed as to the difficulties that must be faced in connection with rural mail delivery throughout Canada, and out of the discussion might come some recommendations, perhaps on a regional basis, which would do something toward standardizing the cost of rural mail delivery in this country.
Just before concluding I want to refer to the fact that some previous speaker mentioned that mail was delivered every two days on some routes in the maritimes. As a matter of fact at the present time the Post Office Department is calling for bids on a rural mail delivery in my constituency that takes place once every two weeks, and when the minister's estimates are up I am going to have more to say on that matter.


Edmund Davie Fulton: I want to bring a case to the attention of the committee and the minister because I cannot help feeling that it has not had adequate consideration. I have taken it up with the minister previously by correspondence, but it seems to me that it cannot have been brought to his attention by his officials, or he cannot have realized from the correspondence just what was happening. I shall be very brief, because I know it is not customary to bring forward individual cases at this stage; but this does involve some matters to which some other hon. members have referred.
This is the case of a route on which delivery was being increased from once a week to twice a week, as the result of extended negotiations with the department. The contractor who had the service on a once a week basis was a veteran who at considerable expense, and as a matter of fact only by means of loans, had built up his equipment to be able to carry out the once a week delivery. When it was increased to twice weekly, bids were called and his was not the lowest tender. There are certain features of the award of the new contract which I shall mention in a factual manner. When I asked who was the successful tenderer, I was given the name on February 9, in confidence. On February 10 the name of the successful tenderer was published in the local newspaper out at Williams Lake, British Columbia. It appears to me that someone somewhere in the department gave the information in such a way that it could be repeated in the press-and I have seen the article- while at the same time it was given to me only in confidence, as a member interested, because the contract had not then been executed.

Those facts, unfortunately, have aroused a great deal more feeling with respect to the awarding of this contract than otherwise would have been the case. The successful tenderer is not a veteran. The Williams Lake legion feels that the interests of veterans have been prejudiced. It is all very well to say that the contract must be awarded to the lowest tenderer, but in this respect I would point out two features to the Postmaster General. The first is that the previous holder of the contract was a veteran who had placed himself in a position to fulfil the contract by purchasing equipment by means of loans. He knew the conditions, knew what it would cost to perform a twice weekly service. The second point is that those in the area, members of the legion and other responsible citizens, tell me that the bid of the successful tenderer was for an amount considerably less than that for which he can actually perform the service. So not only does the veteran who formerly held the contract now find himself out of that work and with an unpaid loan on his hands, but it is very doubtful whether the present tenderer can perform the contract at the rate specified.
That raises the question whether he is to be allowed to apply for a bonus. I have no hesitation in saying that it would be quite improper to award a bonus in that case, when the contract has been given the present tenderer at a rate lower than the previous contract. I suggest that the Postmaster General should look into this case, because there are surrounding it features which to say the least are questionable. There is the leakage of information-


Ernest Bertrand: What is the name of the contract?


Edmund Davie Fulton: It is the Williams Lake-Horsefly mail route. I conclude by saying that the case should be reviewed and the opinion of those on the spot should be sought as to whether in fact the present contractor, the lowest tenderer, can carry out the contract at the amount of his bid. I believe the whole matter should be reviewed and possibly a chance given to re-submit tenders; and that the award should be made having in mind all the facts of the case and the cost of carrying out that contract. I hope the Postmaster General will look into this before anything is done.


Mr. Wright:: I want to bring just one other point to the attention of the minister. I believe the discussion has shown the great diversity of conditions throughout Canada as far as rural mail routes are concerned. In our area our position is the opposite to that of the hon. member for New Westminster. Ours are long routes with few people on them, and we find that from most post offices only
Mail Contracts
one rural route is being operated, and that on the basis of two deliveries a week. The man who has the contract must keep a car for summer deliveries and a team of horses for the winter. He can only use his car and his team twice a week, which means that his costs are very high. If on the other hand there were two or three routes operating from each of these post offices he could bid on two or three contracts; he would be able to perform them at a lower cost, and still make a reasonable living. I wish the minister would take that point into consideration, because in the area from which I come some of the routes are being closed simply because the men who have the contracts are not getting enough to cover their expenses. If such a contractor had two routes, which would give him four days' work a week, the routes could be maintained, and in my opinion that is the only way we are going to be able to continue these routes in some parts of Saskatchewan.


Mr. Miller:: A few moments ago the Postmaster General said that bonus applications would be received up to March 31 of this year. My recollection of these things from year to year is that there has been a deadline every year these matters have been before the house. What I want to know, Mr. Chairman, is this. How long, during the calendar year of 1948 and the calendar year of 1949, has it been open to contractors to apply for this bonus or payment supplementary to his contract?


Ernest Bertrand: It was permissible for the contractor to apply each year in which it was permissible to give the supplement. Last year permission to grant the supplement was renewed on June 30. In the previous year, by paragraph 3 of subsection 4, no supplementary payment could be authorized under the act later than sixty days after the commencement of the next session of parliament following the coming into force of that act. That was in 1947. In 1948 the power to grant supplementary payments was renewed until the 31st of March of this year. While the law was in force any contractor had the right to submit his request for supplementary payment.


Calvert Charlton Miller: Might I call the attention of the Postmaster General to the contractors in my own constituency of Portage la Prairie. Last year I sat here and heard speaker after speaker commend to the Postmaster General the couriers in his constituency, as being entitled to increases by reason of the snow. In no part of the country are there couriers who have more difficulties in winter than the couriers in the prairie provinces. I have no recollection, Mr. Chairman, of any occasion on which any of them have applied from my

Mail Contracts
area, with one exception, when bonuses or supplementary payments have been granted by the department.
I should like to know whether all these applications are considered in Ottawa or whether they are referred to the officers in the city of Winnipeg, for instance. If they are referred to Winnipeg, do you know whether the officials in Winnipeg make any inquiry outside the city of Winnipeg to ascertain whether a man is entitled to a bonus?


Ernest Bertrand: I wish to say a word or two in answer. There is no doubt that the argument advanced by the member for Portage la Prairie (Mr. Miller) is one which proves that we cannot apply the same rule in every part of the country. I understand that around Portage la Prairie the snow is very deep and the weather very cold. Distances are great. Rural mail carriers are working in every part of Canada, and the officer in charge of this branch of the service has many assistants. This officer usually compares what is being paid in that district in which the rural mail couriers are requesting a supplement. A contractor always makes a point of having to climb a hill when his fellow contractors have no hills to climb. The
department receives reports from the officers in this district, and in the case of Portage la Prairie that would be Winnipeg.
I do not know the names of all the inspectors because there are so many. Great care is taken to see that there is justification for refusal if the request is refused. The granting of supplements for fifty-four per cent of the contracts is, I believe, a good indication of that.
Resolution reported, read the second time and concurred in. Mr. Bertrand (Laurier) thereupon moved for leave to introduce Bill No. 123, to amend the Mail Contracts Supplemental Payments Act.
Motion agreed to and bill read the first time.



BUSINESS OF THE HOUSE

Alphonse Fournier: Tomorrow we will take up the resolution in the name of the Minister of Agriculture, and then consider second reading of the bill to amend the Canadian Commercial Corporation Act. Then we will consider the bill to amend the Mail Contracts Supplemental Payments Act.


[Stage Direction]
At six o'clock the house adjourned, without question put, pursuant to standing order.

[Stage Direction]
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